Digital Desk: The Bombay High Court on Monday barred the Income Tax Department from taking any coercive action against Reliance Group chairman Anil Ambani under the Black Money Act until November 17, after he claimed the proceedings against him were based on frivolous and false allegations and challenged the retroactivity of the notices issued to him.
On August 8, the I-T
department issued Anil Ambani a prosecution notice under the Black Money
(Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, for
the alleged evasion of 420 crores in taxes on transactions he conducted between
2006 and 2012.
Ambani filed an appeal
with the Supreme Court, challenging the notices.
While hearing Ambani's
petition, the division bench of justices S V Gangapurwala and R N Laddha was
informed by senior advocate Rafiq Dada that the notices issued to him by the
department under sections 50 and 51 of the Act in August were invalid. Dada
contended that because the enactment went into effect only in 2015, the
department could not have issued show-cause notices for transactions that
occurred much earlier. The bench was informed that the statements were being
applied retroactively and thus were null and void.
The bench was also
informed that the assessing officer had issued an order in March this year
under section 10 (3) of the Act, stating that Ambani had undisclosed foreign
income and assets based on transactions between 2006 and 2012, and thus owed Rs
420 crore in income tax. The bench was informed that the proceedings against
him were based on frivolous and false allegations, and therefore the order was
challenged before the commissioner of income tax (appeals).
The petition had also challenged the validity of various sections of the 2015 Act that allowed the Act to be applied retroactively to transactions completed before it went into effect.
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