It’s not a great Friday for Thalapathy Vijay. The superstar-turned-politician has hit a legal speed bump, with the Madras High Court shutting the door on his attempt to escape a hefty income tax penalty.
Here’s what went down.
Actor Vijay, now also the chief of Tamilaga Vettri Kazhagam (TVK), faced a setback when the Madras High Court dismissed his writ petition on Friday. He had challenged an Income Tax Department order that slapped him with a Rs 1.50 crore penalty.
The penalty links back to 2015-16, when the tax department says Vijay did not properly disclose additional income of Rs 15 crore. According to officials, this income came to light during income tax searches at his residence in September 2015.
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Vijay took the matter to court in 2022, hoping to overturn the penalty. But this week, the High Court delivered its verdict, and it didn’t go in his favour.
Why the High Court said no
Justice Senthilkumar Ramamoorthy, who had reserved his order last month, ruled that the show cause notice issued by tax authorities was legally valid and issued on time.
The court focused only on one key question: was the penalty process started within the time limit set by law?
The answer, according to the court, was yes.
Since the notice fell within the permitted period under Section 263 of the Income Tax Act, the court said there was no procedural flaw. Because of this, the judge did not examine other arguments raised by Vijay.
In short: the case failed on timing, not on detailed merits.
Not the end of the road (yet)
While dismissing Vijay’s plea, the court did leave one door open. The actor-politician has been given liberty to approach the Income Tax Appellate Tribunal (ITAT).
This means he can still challenge the penalty but only on grounds other than delay or limitation.
So yes, the fight isn’t completely over, but it just got tougher.
How this case snowballed over the years
This legal saga has been unfolding for nearly a decade.
– September 2015: Income tax searches take place at Vijay’s residence.
– December 2017: An assessment order is passed.
– December 2018: Penalty proceedings under Section 271AAB(1) are initiated.
Vijay challenges the assessment before the Commissioner of Income Tax (Appeals) and gets partial relief.
The department appeals to the ITAT, which partly supports the tax authorities including on expenses linked to Vijay’s fan association.
Meanwhile penalty proceedings related to the Rs 15 crore surrendered during the search continued.
In July 2019, the department issued a notice under Section 263 claiming penalty proceedings were not properly started. However the ITAT scrapped this move in May 2022 saying no further action was needed once penalties were already in motion.