- The Madras High Court upheld a Rs 1.5 crore penalty on actor Vijay by the Income Tax Department
- Penalty relates to alleged suppression of nearly Rs 5 crore income from 2015 film Puli remuneration
- Vijay challenged penalty citing delay in proceedings, but court found no procedural or legal flaw
In a setback for actor and Tamilaga Vettri Kazhagam (TVK) chief Vijay at a politically crucial juncture, the Madras High Court has upheld a Rs 1.5 crore penalty imposed on him by the Income Tax Department and dismissed his petition challenging the levy.
The penalty arises from a 2019 order of the Income Tax Department, which held that Vijay had suppressed income linked to his remuneration for the 2015 film Puli. Income tax searches conducted in 2015 revealed that out of a total remuneration of around Rs 15 crore, nearly Rs 5 crore was allegedly paid in cash and not voluntarily disclosed in his original returns. Based on these findings, the department imposed a penalty of Rs 1.5 crore for non-disclosure of income.
Challenging the order, Vijay had approached the Madras High Court, arguing that the Income Tax Department had initiated and concluded penalty proceedings after an inordinate delay, beyond the permissible statutory timeline. His counsel contended that the delay alone was sufficient to invalidate the penalty.
The Income Tax Department countered by stating that the delay was attributable to appellate proceedings arising out of the assessment and that the penalty was imposed strictly in accordance with the provisions of the Income Tax Act. It maintained that there was no procedural or legal infirmity in its action.
After hearing arguments from both sides, the High Court reserved its verdict on January 23 and subsequently dismissed Vijay's plea. The court held that the Income Tax Department's order imposing the penalty was valid and that there was no scope for judicial interference.
However, the court noted that Vijay is free to approach the Income Tax Appellate Tribunal with a fresh prayer if he chooses to pursue the matter further.
The ruling comes at a sensitive time as Vijay prepares for his political debut, projecting himself as a leader committed to clean governance and the eradication of corruption while stepping away from a lucrative acting career.
Actor Vijay or his party TVK is yet to issue a formal response to the High Court verdict. However, sources in the core TVK team told NDTV, "We will challenge this." Responding to questions on whether the ruling would dent Vijay's integrity, the source said, "No way. He had ultimately voluntarily disclosed the income and paid the tax."
The ruling DMK has refrained from formally responding. However, a source said, "This indictment by the High Court will speak volumes about his integrity. When it suits him, he will receive black money. What moral compass will he have to speak about corruption? He is a hypocrite of the first order."
