A gesture of goodwill extended to former cricketers in the form of a cash award backfired on the Board of Control for Cricket in India (BCCI) when the beneficiaries of this unexpected largesse got entangled with tax authorities.
The BCCI has disbursed close to Rs80 crore to about 120 former players from the revenue it earned from the IPL. The money paid per player varied from Rs35 lakh to Rs1.5 crore. Since it was a one-time ‘gratis’ payment, tax was not deducted at source.
In an attempt to avoid paying 30% tax on the windfall, some former players took up the matter with the government. While one group has written to the Central Board of Direct Taxes (CBDT) pleading that the payment be treated as an ‘award’ (that is exempted from tax), another group has demanded that the board pay the tax component separately.
The tax authorities and the BCCI aren’t the best of friends; the board is already engaged in a protracted battle with the CBDT over its income and exemption. Tax authorities haven’t missed this chance to needle the BCCI. The CBDT has written to the BCCI seeking details over the 'payment'.
Sources say a list of questions has been sent to the board asking it to explain the grounds on which the money was distributed. This missive is not something the BBCI bargained for.
The representations have apparently gone from players who are quite affluent. A Mumbai-based former player admitted to this paper that his senior has taken up the matter with the government.
A board official who is in the know of the matter said, “In the first place, the money was never their right. It was our gesture. Now they have created trouble for us by writing to the government to treat this as an award. Where on earth are 120 players given awards at one go?”
Players like Sunil Gavaskar, GR Viswanath, Kapil Dev and Mohinder Amarnath have benefited from the gesture.