The Madras High Court has posted for hearing on Tuesday a writ petition filed by media baron Kalanithi Maran to quash an order passed by an Assistant Commissioner of Income Tax in New Delhi on November 3, 2014 declaring him as the principal officer of SpiceJet airlines. Such declaration would make him liable for prosecution due to the company’s failure to deposit Tax Deducted at Source (TDS) on time for different financial years.
When the case was heard by Justice M. Duraiswamy on Monday, Senior Counsel P.S. Raman, representing the petitioner, urged the court to grant an interim stay since a connected criminal case was coming up for hearing before the Delhi High Court on Wednesday. However, Central government standing counsel M. Sneha convinced the court to adjourn the matter by a day for the appearance of Additional Solicitor General G. Rajagopalan.
In his affidavit, Mr. Maran stated that he was only a non-executive chairman of the Board of Directors of the company and therefore not at all in charge or in control of its day-to-day affairs since it was managed professionally by the Managing Director and others. “Further, the company has its corporate office at Delhi from where it is managed and controlled. On the other hand, I am residing and carrying on business at Chennai,” he added.
He also claimed not to be receiving any sitting fee for participating in board meetings of the company or drawing any salary from it. “In these circumstances, I can never, be considered as the principal officer and especially so when the MD of the company Mr. Natrajhen has also been held as the principal officer of the very same company by the very same second respondent (Assistant Commissioner) by a separate order dated November 3, 2014,” he said.
‘Financial crisis’
Further, stating that the company had not been able to pay TDS on time due to severe financial crisis, he said that as one of the promoters of the company, he had infused over ₹245 crore from his personal funds and another ₹144 crore from his other company named Kal Airways. He also said that SpiceJet had already cleared most of the TDS dues by depositing substantial amount of money pursuant to the notices issued by the Income Tax department.
“I submit that the action is straightaway threatening me... with prosecution, without it being even preceded by penalty proceedings, whereas no such action is taken in hundreds of other cases, show clearly that I am being singled out for adverse action for collateral, oblique and malafide reasons,” Mr. Maran’s affidavit read.
