Chennai : In a setback to actor-turned-politician and TVK chief Vijay, the Madras High Court on Friday dismissed his writ petition challenging an Income Tax Department order imposing a Rs 1.50 crore penalty for alleged non-disclosure of income in 2015–16. The case relates to additional income of Rs 15 crore that, according to the department, was not properly disclosed by the actor during the relevant financial year.
While dismissing the plea, the court granted Vijay liberty to approach the Income Tax Appellate Tribunal (ITAT) to challenge the notice and penalty order on grounds other than limitation. The case originated from income tax searches conducted at Vijay’s residence in September 2015. Subsequently, an assessment order was passed in December 2017, and penalty proceedings under Section 271AAB(1) were initiated in December 2018.
Penalty proceedings continued in relation to the Rs 15 crore surrendered during the search. In July 2019, the department issued a notice under Section 263 seeking revision of the assessment, contending that the penalty proceedings had not been properly initiated. However, the ITAT set aside this revision in May 2022, observing that no further action was warranted once penalty proceedings were already underway.
When the matter reached the High Court, the scope of examination was narrowed to whether the final penalty order had been passed within the limitation period under Section 275 of the Income Tax Act. At an interim stage, another bench had stayed recovery of the penalty after prima facie observing that the order appeared time-barred.
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