An Italian judge here postponed until April 1 a decision on whether the celebrity designers Domenico Dolce and Stefano Gabbana should be tried on criminal charges of tax evasion and fraud, according to New York Times.
Prosecutors say the designers, and other executives of their Italian fashion house, including a tax consultant, defrauded the Italian government and failed to pay taxes on more than $1 billion in revenue.
The investigation was prompted by the 2004 sale of the Dolce & Gabbana and D&G brands to Gado, a holding company based in Luxembourg, which prosecutors came to believe was merely a front to pay lower taxes.
Despite the Luxembourg address, prosecutors contend that the company did business in Italy, and should have been subject to Italian taxes. Prosecutors also say the brands were sold for a fraction of their actual value.
Mr. Dolce and Mr. Gabbana are often seen stepping out with their many celebrity clients, among them the singers Kylie Minogue and Madonna, and the Argentina soccer star Lionel Messi, and the case has put the designers in an uncomfortable position.
When news of the investigation was made public in 2009, the two denied the charges. Since then, they have declined to comment on the case.
Setting this case apart from most other investigations into tax dodging, the designers also stand accused of fraud. A conviction would bring a maximum sentence of five years, but other related charges could add two years.
Before adjourning the proceedings, Judge Simone Luerti heard deposition testimony from Luciano Patelli, the tax consultant to the designers, in a closed hearing. Mr. Patelli’s lawyer, Giuseppe Bana, and Massimo Dinoia, who represents the other defendants, declined to comment.