The Income Tax department on Wednesday told the Madras High Court that a decision taken by the Central Board of Direct Taxes (CBDT) to withdraw cases in which the expected tax recovery was less than ₹1 crore would not apply to a case pending against former Chief Minister Jayalalithaa’s close aide V.K. Sasikala since connected criminal proceedings were pending before an economic offences court here.
The case, pending in the High Court since 2008, has been listed for final hearing before the second Division Bench of Justices Vineet Kothari and R. Suresh Kumar. A standing counsel for the I-T department expressed reservations over withdrawing the case.
Accepting his submission, the judges simply adjourned further hearing on the tax case by two weeks.
The case relates to Sasikala’s income for the financial year 1994-95. Though her income for that year was initially assessed to be ₹28.86 lakh, it was later reassessed on the basis of an inquiry by Directorate of Vigilance and Anti Corruption (DVAC). The Income Tax Appellate Tribunal had ruled against the reassessment made on the basis of DVAC report and hence the department had approached the High Court in 2008.