Grameen Kalyan’s Tk666cr tax dispute a ‘classic example of tax evasion’, HC says

The High Court has described Grameen Kalyan's attempt to prolong a settled tax dispute as a "classic example of tax evasion", saying the organisation had repeatedly tried to deprive the state of revenue legally due to it. 

In the full verdict dismissing two writ petitions challenging a Tk666 crore income tax demand for five assessment years from 2012-13 to 2016-17, the court said Grameen Kalyan, an organisation founded by Nobel laureate and former interim government chief adviser Muhammad Yunus, had taken contradictory positions on the same issue and shown "extreme defiance" towards court orders.

The court also noted that the organisation had paid similar taxes for the 2017-18 and 2018-19 assessment years before challenging the tax treatment in a separate case, which it later withdrew.

In its observations, the court said the petitioner had attempted to evade taxes by prolonging a matter that had already been settled. It added that the issue could have been approached differently, but the organisation had left no stone unturned in keeping the dispute pending.

The separate verdicts, spanning 32 and 15 pages, were published on the Supreme Court website. A High Court bench comprising Justice Md Mojibur Rahman Mia and Justice Rezaul Karim delivered the verdict on 10 September.

In its observations, the court said that under the relevant provisions of the Income Tax Ordinance, 1984, Grameen Kalyan was legally required to pay taxes when filing its returns. It could not treat withholding tax paid by Grameen Telecom as tax paid on its own behalf.

Grameen Kalyan's lawyer, Barrister Khwaja Tanvir Ahmed, told TBS that the organisation would file a civil petition for leave to appeal against the High Court decision as soon as possible, in accordance with the law.

How the case unfolded

On 4 August 2024, another High Court bench initially dismissed Grameen Kalyan's two writ petitions – filed in 2017 – but withdrew that decision on 29 August. The court said the second judge on the bench had previously represented the government as a deputy attorney general in the same cases, rendering the verdict defective.

The case records were subsequently sent to the chief justice, who referred the matter to a bench led by Justice Md Mojibur Rahman Mia. Following a fresh hearing, that bench delivered its verdict on 10 September.

Senior lawyers Fida M Kamal, Sardar Zinnat Ali and Abdullah Al Mamun represented Grameen Kalyan, while Deputy Attorney General Mohammad Abdus Samad Azad represented the state.