High Court dismisses Suriya’s plea to waive interest on income tax payments

The Madras High Court on Tuesday dismissed a writ petition filed by actor R.S. Suriya in 2018 to quash an order passed by the Principal Commissioner of Income Tax and consequently direct the official to waive the interest levied for delayed payment of taxes for the assessment years 2007-08 and 2008-09. The assessment orders were passed after a search conducted at his premises on October 19, 2010.

Justice S.M. Subramaniam held that the actor was not eligible for waiver of interest since he had not complied with all three conditions to be fulfilled for claiming such a waiver under Section 220 (2A) of the Income Tax Act of 1961. The judge concurred with the Principal Commissioner that the petitioner had neither cooperated in completing the assessment proceedings nor paid the taxes on time.

“The reasons furnished in the impugned (challenged) order for rejection of application for waiver of interest are candid and convincing,” the judge observed. The actor had told the court that he receives payments, including advances, in cash with reference to priority in dates.

Such advance payments received by him would be treated as income and brought to books for accounting and taxation only in the year when the project materialises as it was very common in the film industry for many projects to get either dropped or delayed due to varied reasons, including non-availability of call sheets. Sometimes, the petitioner would also not have any movies at all to act in.

Nevertheless, claiming that he had been facing harassment at the hands of the Income Tax Department, The actor stated that after the 2010 search operation, assessment orders were passed on December 30, 2011, for the years 2007-08 and 2008-09. The petitioner went on appeal and it was allowed partly by the Commissioner of Income Tax (Appeals) on March 27, 2013.

He appealed to the Income Tax Appellate Tribunal (ITAT), and the Assessing Officer too preferred an appeal before the tribunal. On August 23, 2013, the ITAT rejected both appeals and confirmed the order passed by the CIT (Appeals). Claiming that the department had contributed to the delay, the actor insisted on waiving the interest.

Disagreeing with him, the judge said, grant of waiver was up to the satisfaction of the Principal Commissioner. He pointed out that the officer had clearly stated how the actor had not cooperated in completing the assessment proceedings in 2011. The officer had also accused the actor of not having furnished full details regarding his income even after the search operation.