Madras High Court Rejects Vijay’s Plea Against ₹1.5 Crore Income Tax Penalty

The Madras High Court has dismissed a petition filed by actor and Tamilaga Vettri Kazhagam (TVK) founder Joseph Vijay, challenging a ₹1.5 crore income tax penalty imposed on him by the Income Tax Department.

The order was passed by Justice Senthilkumar Ramamoorthy. A detailed judgment is yet to be released.

The penalty relates to income tax searches conducted at Vijay’s premises in 2015. During these searches, the department claimed to have found undisclosed income of around ₹16 crore. According to tax authorities, this income was linked to Vijay’s remuneration for the 2015 Tamil film Puli. It was alleged that nearly ₹5 crore was paid in cash and was not voluntarily disclosed in his income tax returns.

Following the search, the Income Tax Department initiated penalty proceedings under the Income Tax Act. This resulted in a penalty order dated June 30, 2022, imposing a fine of ₹1.5 crore on the actor.

Before the High Court, Vijay did not question the department’s authority to impose penalties in genuine cases. However, he argued that the penalty order was time-barred. His counsel submitted that the statutory limitation period expired on June 30, 2019, and therefore, the penalty imposed three years later was invalid in law.

The Income Tax Department opposed this argument, stating that the timelines were correctly calculated based on the nature of the assessment and related proceedings arising from the 2015 searches. It maintained that there was no legal or procedural lapse in imposing the penalty.

Accepting the department’s submissions, the High Court rejected Vijay’s plea and upheld the validity of the penalty proceedings.