1976 Charas

Forty-one years after its release, the late filmmaker Ramanand Sagar’s film “Charas” that featured Dharmendra and Hema Malini, has landed his kin into tax trouble. (photo provided)

MUMBAI—The late filmmaker Ramanand Sagar’s heirs have been asked to pay Rs. 6 lakh as penalty for the income earned from the Dharmendra-Hema Malini film “Charas” (1976). The filmmaker, who wrote RK Films’ breakthrough movie “Barsaat” in 1949 and spun several hits even as a filmmaker, including “Ankhen” (1968) and “Geet” (1970), is best known for his TV epic “Ramayana” in the 1980s.

Forty-one years after its release, Sagar’s film, one of the first movies to talk about drug menace, has landed his kin into tax trouble. The reason is an anomaly in disclosing the amount received as guaranteed money while selling the Mumbai distribution rights for the movie.

The Bombay High Court’s division bench of Justices S.C. Dharmadhikari and P.D. Naik upheld the penalty. The anomaly came up in the income-tax returns filed by Sagar’s company in the financial year 1976-1977, regarding money received by him as minimum guarantee amount for the distribution of the film in Mumbai territory from Prakash Pictures.

While Sagar divided the amount into two different heads, allegedly to avoid tax liability, Prakash Pictures showed the entire amount under one head – cost of acquiring the movie – in its income-tax return for the year.

The Income-Tax Department said Sagar received Rs 13.7 lakh from Prakash Pictures, but disclosed only Rs 3.9 lakh as he had previous losses to be adjusted against this income (interestingly for “Jalte Badan” in 1973 and “Lalkar” in 1972). The taxmen said that had Sagar disclosed the entire income at one go under the same head, he would have had to pay substantial money towards tax.

Sagar’s counsel argued that he did not disclose everything under one head at the same time as he wasn't sure if the movie will make enough money. The lawyer further said that the earlier tax return submitted by Sagar was admittedly inaccurate, but he had rectified it after receiving the first notice by the assessing officer. The court, however, declared that Sagar “should have been candid and honest” in declaring the received amount.

Besides spotlighting the antiquated taxation laws in the country then, which made almost every filmmaker do such “adjustments,” the news also triggers off the real picture of this film, which at that time was said to have done only reasonably well by some sources and have been a flop that was not revealed thanks to the unbeaten record of big hits for the Dharmendra-Hema team. Clearly, the film, one of the few to be shot overseas then, was not a flop at all.

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