HC quashes Black Money prosecution against Srinidhi Karti Chidambaram

CA Suraj R. Agrawal

Srinidhi Karti Chidambaram Vs. PCIT (Madras High Court)

Madras High Court quashes prosecution proceedings initiated under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 for non-disclosure/incomplete disclosure of foreign assets in the Return of Income.

Case Summary:-

Facts of the case:

• The petitioners (NC, SC and KC) are family members against whom notices for assessment were issued under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (BMA) for assessing undisclosed foreign income and assets for the assessment years (AY) 2015-16 and 2016-17.
• The revenue authorities further initiated prosecution proceedings under the BMA for non-disclosure/incomplete-disclosure of fixed assets (FA) in Return of Income (ROI) before completing the assessment under BMA.
• The foreign asset was jointly acquired by petitioners with tax paid money (disclosed income) and remittance for acquiring such foreign assets was routed through authorized dealers. Further, such foreign assets were shown in different schedules forming part of their individual ROI.
• The revenue authorities initiated criminal prosecution proceedings against each of the petitioners on the following grounds:
  • The petitioners did not disclose/ disclosed incomplete information in FA schedule (schedule for disclosing foreign assets) in the original ROI filed.
  • The ROIs were revised to make complete/correct disclosures in schedule FA post issuance of notices under BMA.

Issues for consideration