The Hindu Business Line
Now, the taxman can
use your LinkedIn profile as evidence
Rahul
Wadke
Not
done GE’s liaison office was to act as a link with Indian customers. It was
found providing services to GE arms globally.
In trial case, online profiles used to prove
GE subsidiary owes taxes for its activities
Mumbai,
July 9:
For a professional, a good LinkedIn profile
is a passport to a better job. For the taxman, it’s just become a means to keep
tabs on the goings-on in your company.
In a recent case, Income Tax officials
succeeded in using LinkedIn profiles of people working for a GE group
subsidiary as evidence that their company was conducting activities that were
not permitted, and that it owed taxes.
In March 2007, the IT Dept conducted a survey
of the offices of General Electric International Operations Company Inc
(GEIOC).
The Department said it had noticed the GE
group was engaged in various sales activities in India, for which the business
heads were generally expats, who were on the payroll of GE International Inc.
Support staff were provided by GE India Industrial Pvt. Ltd. and also by third
parties.
Violation
of terms
The Department noted that according to the
application made to the RBI, the GEIOC liaison office was to act as a
communication channel between the head office and the customers in India.
However, as a result of survey, it says it found the company providing the
services of its employees to GE group entities worldwide.
The activities indicated that GEIOC was carrying
out business through a Permanent Establishment and that its income was taxable
in India. But it had never filed returns indicating this.
To prove its case, the IT Department had
sought details about the roles of certain employees working at the liaison
office.
When it was unable to get the information,
the Department submitted the LinkedIn profiles of the employees as evidence.
GE opposed this, saying the profiles were
hearsay evidence.
In its July 4 order, the tax tribunal pointed
out that LinkedIn profiles are not in the nature of hearsay (unconfirmed)
evidence because it is the employee who has provided all the relevant details.
These details are similar to an admission made by a person. No third party is
involved in creating a LinkedIn profile and therefore, it cannot be said to be
hearsay evidence, the order noted.
Matter
of appeal
The order also said that in the present case,
LinkedIn profiles submitted by the IT Department had a considerable bearing on
the subject matter of appeal and could therefore be admitted as evidence.
Building
digital profiles.
A cyber security expert employed with a major
financial institution said that all financial and security agencies have
started building digital profiles of their “persons of interest”.
Information such as name, age, PAN number,
credit card details are being collated using sophisticated algorithms. The IT
department is also moving in that direction.
(This
article was published on July 9, 2014)
Printable version | Aug 7, 2014 4:38:40 PM |
http://www.thehindubusinessline.com/news/now-the-taxman-can-use-your-linkedin-profile-as-evidence/article6193927.ece
© The Hindu Business Line
No comments:
Post a Comment