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2018 (9) TMI 228 - HC - Income TaxReopening of assessment - referral fees being paid by the assessee to doctors - Held that:- The assessee is a private hospital. It is paying fees to doctors for referring patients to it. Prima facie, it appears that, such a payment could not have been made in law. However, strictly on the provisions an AO need not address itself on the ethics of the payments made. There is public interest involved. Apparently, the transactions disclose that, a private hospital is paying doctors fees for referring patients to it and claiming such payments as expenditure. Whether such payments vitiate any code of ethics for doctors and a private hospital should also be considered. Without entering in the ethics of the payments, it would be appropriate to hear the State Government on the subject as it has promulgated the West Bengal Clinical Establishments (Registration, Regulation and Transparency) Act, 2017. The accounts disclosed in the writ petition also allow one to take a prima facie view that, payments made by the assessee to the doctors are in contravention of the provisions of the Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002. Learned Advocate General for the State is requested to take instructions as to whether the payments made by a hospital to doctors for referring patients to the hospital are permissible under the provisions of the Act of 2017 and under the Regulations of 2002, or not.
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