Sushmita Sen’s #MeToo payout is not taxable, ITAT

Sushmita Sen’s #MeToo payout is not taxable, ITAT

Mumbai: The Mumbai bench of the income-tax appellate tribunal (ITAT), has recently passed an order in favour of actress and model Sushmita Sen.

During the financial year 2003-04, she got Rs 95 lakh as a settlement compensation from Coca-Cola India, following her complaint of sexual Harassment by an employee of the company.

On November 14, the ITAT, in its order, held this sum was not ‘income’ that could be taxed but was in the nature of a ‘capital receipt’.

Further, the penalty of Rs 35 lakh which was imposed on her for concealing the amount of Rs 95 lakh to IT was ordered to be set aside.

Sushmita Sen had commercial contract aggregating to 1.5 crore with Coca-Cola India to endorse its product. However, the deal was terminated prematurely after Sushmita accused one of Coca Cola employees of sexual misconduct.

She then sued the multi-national over its failure to provide her a safe workplace.

As a result, instead of Rs 50 lakh as agreed in case of termination, she received Rs 1.45 crore from Coca Cola, of which she only offered Rs 50 lakh to the income-tax department, alleging that since the balance (Rs 95 lakh) was a compensation, it was not taxable.