Madras HC Upholds Rs. 1.5 Cr Tax Penalty on TVK Chief Vijay

Why Madras High Court Dismissed TVK Chief Vijay’s Plea Against Rs. 1.5 Crore Income Tax Fine

On 6 February 2026, the Madras High Court dismissed a petition by actor and TVK leader Vijay, upholding a Rs. 1.5 crore income tax penalty. Justice Senthilkumar Ramamoorthy ruled that the fine, stemming from undisclosed income related to the 2015 film Puli, was legally valid and issued within statutory timelines. This legal setback arrives at a critical juncture for Vijay, occurring just months before the Tamil Nadu Assembly elections.

High Court Affirms Legality of 2015 Tax Search Penalties

The dispute started with a search-and-seizure operation in September 2015. Authorities searched Vijay’s properties at that time and found that the producers of the film Puli paid the actor Rs. 4.93 crore in cash. This amount was not in his original tax filings. Vijay later reported an extra Rs. 15 crore in income and paid the taxes. However, the Income Tax Department still issued a Rs. 1.5 crore penalty arguing that the disclosure was only made because of the raid.

As reported by The Hindu, "The assessment order also stated the actor would not have disclosed the additional income but for the search and seizure operation. Therefore, the department imposed a penalty under Sections 271(1)(c) and 271AAB(1) of the I-T Act."

Thalapathy Vijay’s lawyers challenged this penalty in court as they argued that the order was issued too late. They claimed it should have been finished by June 2019. The court disagreed with this argument by stating that the tax department followed the correct time limits.

How will the Income Tax Penalty Affect TVK’s Political Credibility?

The timing of this ruling is a major problem for Vijay, who is now the leader of the new party Tamilaga Vettri Kazhagam (TVK). His political platform promises ‘clean governance’ and an end to corruption but this court ruling shows a history of ‘concealed income.’ Rival parties like the DMK and AIADMK can now use this against him. They will likely question his honesty during the campaign.

Vijay can still appeal this decision to a higher tribunal. However, the ‘tax evader’ label is hard to fix during an election. Vijay says he is ‘sacrificing’ his acting career for the people. A penalty for hidden cash payments makes that message harder to believe. His party now needs to find a way to explain this to voters.