Madras HC stays I-T proceedings against P Chidambaram and family

Justice Rajiv Shakder passed the interim order on petitions by Chidambaram, his wife Nalini and son Karti challenging the March 31, 2016, demand notice and consequential reassessment order dated 30 December last issued by the assistant commissioner of income tax, Chennai

Madras HC stays I-T proceedings against P Chidambaram and family

The Madras High Court on Monday stayed all proceedings against Congress leader and former Union Minister P Chidambaram and his family members on a case filed by Income Tax (I-T) department filed last year relating to income from a coffee estate owned by them for the 2008-09 financial year.

Justice Rajiv Shakder passed the interim order on petitions by Chidambaram, his wife Nalini and son Karti challenging the March 31, 2016, demand notice and consequential reassessment order dated 30 December last issued by the assistant commissioner of income tax, Chennai.


“Pending adjudication of the writ petitions, the further proceedings pursuant to the demand notice are stayed,” the judge gave the order and adjourned the hearing to March 16.

The matter is related to the petitioners' claim of exemption of entire income from the sale of coffee and pepper from their estate in Coorg in Karnataka in 2008-09 as agricultural income under section 10(1) of the Income Tax Act. The I-T department last year had issued the demand notice asking Rs six lakh from the petitioners after rechecking the income for the period.

The counsel for the senior Congress leader and his family alleged that the  I-T department’s action for the specified six years (2008-2009) was illegal and arbitrary. Counsel Vijay Narain added that it had been initiated only to defame the petitioner and his family.

Clarifying that the petitioners were only selling raw coffee seeds, Narain argued that the income from the sale would attract tax only if they were involved in curing coffee. He also said Chidambaram got the 200-acre estate from his grandfather in 1956.