The Madras High Court on Friday dismissed a writ petition filed by actor and Tamilaga Vettri Kazhagam (TVK) founder Joseph Vijay, challenging a ₹1.5 crore penalty imposed by the Income Tax Department for alleged non-disclosure of income [Chandrasekaran Joseph Vijay Vs DCIT].

Justice Senthilkummar Ramamoorthy passed the order.

A detailed copy of the order is awaited.

The penalty arose from income tax searches conducted at Vijay’s premises in 2015, during which the department claimed to have unearthed undisclosed income of about ₹16 crore.

According to the tax authorities, the amount related to Vijay’s remuneration for the 2015 Tamil film Puli, of which nearly ₹5 crore was allegedly paid in cash and not voluntarily disclosed in his returns.

The department thereafter initiated penalty proceedings under the Income Tax Act, culminating in an order dated June 30, 2022, imposing a penalty of ₹1.5 crore.

Before the High Court, Vijay did not dispute the department’s power to levy a penalty in appropriate cases. However, his counsel argued that the penalty order was barred by limitation. It was contended that the statutory deadline for imposing the penalty expired on June 30, 2019, and that the order passed three years later was legally unsustainable.

The Income Tax Department opposed the plea, maintaining that there was no procedural or statutory violation.

It submitted that the timelines had been correctly computed based on the nature of the assessment proceedings and subsequent actions arising out of the 2015 searches, and that the penalty was imposed strictly in accordance with law.

The High Court rejected Vijay’s challenge, accepted the department’s stand and upheld the validity of the penalty proceedings.