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. The penalty was imposed following income tax searches conducted at his residence in September 2015.
Vijay had approached the High Court in 2022 against the penalty order. Justice Senthilkumar Ramamoorthy, who had reserved orders on the plea last month, delivered the verdict on Friday.
The court held that the show cause notice issued by the tax authorities was within the time limit prescribed under Section 263 of the Income Tax Act and found no procedural infirmity in its issuance. In view of this, the court refrained from examining other aspects of the case, as per Live Law.
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. Vijay challenged the assessment before the Commissioner of Income Tax (Appeals), who partly ruled in his favour. The department later appealed before the ITAT, which also partly upheld its stand, including on certain expenses linked to Vijay’s fan association.
Parallelly, 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.
In its final ruling, however, the court held that the notice and proceedings were within the statutory timeframe, paving the way for the Income Tax Department to enforce the penalty.
– Ends
Published On:
Feb 6, 2026
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