The future of the Indian Grand Prix was already under a cloud and now the Uttar Pradesh government have gone ahead and asked the Supreme Court for permission to withdraw its 2011 decision to grant entertainment tax exemption to race organiser Jaypee Sports International. With the race just a few days away, and having already been removed from the 2014 F1 calendar, this latest development will surely trouble the organisers. [caption id=“attachment_1186601” align=“alignleft” width=“380”]  This latest development will surely trouble the organisers. Getty Images[/caption] In October 2011, the Supreme Court had directed Jaypee Sports to “deposit in a ’no lien account’ the amount of entertainment tax without taking into consideration the exemption notification. It had also ordered that the entertainment tax due to the state would be deposited in this account within two weeks of the event. A Times of India report says that a writ petition was filed in the apex court challenging the state’s decision to exempt the race from entertainment tax. The report the quotes the state: “Jaypee Sports had held F1 race on two occasions from October 28 to October 30 in 2011 and from October 26 to October 28 in 2012, yet the shortfall amount of Rs 12.39 crore has not yet been deposited as per the apex court’s October 21, 2011 order.” Following this, a notice was issued to to Jaypee Sports on UP’s application accusing it of not declaring the income from the F1 race honestly. The withdrawal of exemption will cost Jaypee Rs 25 crore. However, they maintain that they are in the right — saying there had been no directions from the court on any matters related to F1. Their managing director also informed authorities that as per the 2011 SC order, the entertainment tax had been deposited in the ’no lien’ account. Click here to read the full Times of India report.
In October 2011, the Supreme Court had directed Jaypee Sports to “deposit in a ’no lien account’ the amount of entertainment tax without taking into consideration the exemption notification.
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