Big blow to Vijay: Madras High Court dismisses plea against ₹1.5 cr tax penalty

The Madras High Court on Friday dismissed a plea filed by actor-turned-politician Vijay, upholding a ₹1.5 crore penalty imposed by the Income Tax Department over alleged undisclosed income of ₹15 crore for the 2015–16 financial year.

The verdict was delivered by Justice Senthilkumar Ramamoorthy, who had reserved orders on the matter on January 23, 2026. With this ruling, the court declined to interfere with the penalty proceedings initiated against the actor.

Why did the court reject Vijay’s plea?

The High Court observed that the show cause notice issued by the Income Tax Department was well within the time limit prescribed under Section 263 of the Income Tax Act. The judge noted that there was no legal flaw or procedural lapse in the issuance of the notice.

As the limitation issue was found to be validly complied with, the court said there was no need to examine other arguments raised by Vijay in this petition.

Can Vijay challenge the penalty further?

While dismissing the plea, the court granted Vijay the liberty to approach the Income Tax Appellate Tribunal (ITAT) to challenge the notice and penalty order on other grounds — except on the issue of limitation, which has now been settled by the High Court.

Background of the case?

The case stems from income tax searches conducted at Vijay’s residence in September 2015. Following the searches, an assessment order was passed in December 2017. Penalty proceedings under Section 271AAB(1) were initiated in December 2018 in connection with ₹15 crore that Vijay had reportedly surrendered during the search.