The Bombay High Court on Thursday extended interim relief to Anil Ambani from coercive action based on a show cause notice issued to him by the Income Tax Department seeking to prosecute him under the Black Money Act (BMA).
A division bench of Justices SV Gangapurwala and SG Dige restrained the IT department till December 19 after the department sought time to file a reply.
Mr Ambani had filed a petition challenging the show cause notice issued to him by the IT department on August 8, 2022, for allegedly evading Rs 420 crore in taxes on undisclosed funds worth more than Rs 814 crore held in two Swiss bank accounts. It charged Ambani with "wilful" evasion, saying he "intentionally" did not disclose his foreign bank account details and financial interests to Indian tax authorities. Hence, IT claimed that Ambani was liable to be prosecuted under Sections 50 and 51 of the Black Money (undisclosed foreign income and assets) Imposition of Tax Act of 2015. The maximum punishment under the sections is 10 years imprisonment with a fine.
However, Mr Ambani claimed that the alleged transactions are of assessment years 2006-2007 and 2010-2011 whereas the BMA was enacted in 2015. Hence, BMA cannot have a retrospective effect.