COMEDIAN Ken Dodd cheated the Inland Revenue ''for years and years''

as he deposited #700,000 in banks in Jersey and the Isle of Man, a court

was told yesterday.

When accountants tried to sort out his complex tax affairs he deceived

them as well, feeding them ''absolute garbage'', not once but many

times, said Mr Brian Leveson, prosecuting, at Liverpool Crown Court.

One of the ways he cheated was by getting paid two fees for one

performance: one cheque including VAT which which went on to his books,

and another fee in cash which did not, said Mr Leveson.

Dodd, 61, of Thomas Lane, Knotty Ash, Liverpool, faces 11 charges,

seven of being a common law cheat and four of false accounting.

The trial went ahead yesterday after Mr Justice Waterhouse said

medical tests had shown that despite suffering from a serious heart

condition, the comedian was fit enough to cope with the stress of the

case.

Mr Leveson said: ''When Mr Dodd was given a chance to come clean and

tell the truth he became devious and deceitful. For years and years he

has been reporting to the Revenue that his profits were far less than in

truth they have been.''

There were recent examples of the comedian receiving two payments for

performances -- one by cheque, the other cash, said Mr Leveson.

''He has put the cash in banks in Jersey and the Isle of Man earning

thousands of pounds in interest, none of which he has declared.

''In October 1986, Dodd entered a list of his accounts but did not

mention a single account in Jersey or the Isle of Man, although he had

had 20 such accounts and at that time had six in which he had

accumulated #700,000.

''He kept silent, not only to the Inland Revenue, but also to his own

accountants trying to put things right,'' said Mr Leveson.

''Unfortunately, it is this side of Mr Dodd that you must now judge.''

As the comedian listened intently, occasionally sipping from a glass

of water, Mr Leveson described a meeting between Dodd and accountants he

had recently appointed in May, 1984.

He told them of bank accounts he held in Liverpool and said he had no

other accounts in the UK or overseas, and never had.

''In reality his answer was totally untrue, because at that stage he

had over #1m in the Isle of Man and Jersey in bank accounts.''

''This lie was repeated again and again and again, as the accountants

tried to make sure they had missed nothing. One of the things you will

have to consider is why Mr Dodd should lie to his advisers,'' Mr Leveson

told the jury of five women and seven men.

Their report prepared for the Inland Revenue was eventually handed

over in January, 1986, followed eight months later by documents stating

that Dodd had made a full disclosure of his affairs.

''I must tell you that not one of them is worth the paper it is

written on,'' said Mr Leveson.

''Dodd fed the accountants absolute garbage. Not once did he lie but

many, many times.''

Mr Leveson then told of an ''absolute disaster'' for Dodd in December,

1986, when, accompanied by his solicitor and two accountants, he had a

two-hour meeting with tax inspector Mr Hope.

Asked if he had any items lodged with banks outside the United

Kingdom, including the Isle of Man and Channel Islands, Dodd said he had

not.

Then the inspector said he wanted Dodd to sign an authorisation to

contact the Isle of Man Bank Limited.

If the report was accurate, Dodd would have no money in the bank. Dodd

signed the authorities.

''After the meeting it was obvious to the accountants that Dodd was

very shocked. It had destroyed the facade he had created about his

affairs -- just as a house of cards collapses when the bottom card is

removed.''

The following day Dodd instructed another accountant to act for him,

and he revoked the authority addressed to the Isle of Man Bank.

Accountants Arthur Young then stepped in to complete a supplementary

report on Dodd's affairs.

The report ran to five chapters with eight appendices, said Mr

Leveson. It included a series of letters, one each from then Prime

Ministers Edward Heath and Harold Wilson and two from Mrs Thatcher,

praising the comedian.

The first from Mrs Thatcher, dated October 31, 1980, thanked Dodd for

a wonderful time at his show the previous Thursday and said: ''I hope

you enjoyed doing it as much we enjoyed seeing it.''

The trial continues.