The Madras High Court today set aside a 2014 Income Tax department order declaring Kalanithi Maran as the principal officer of the low-cost carrier SpiceJet and making him liable for the alleged tax dues of the company when it was owned by him.
Justice M Duraiswamy allowed a petition by Maran challenging the November 3, 2014 order of the I-T department related to various financial years when the company was under his ownership.
The I-T department had not produced any material to establish that Maran was responsible for the day-to-day affairs of the SpiceJet, the judge said in his order.
“The main criteria to treat a person as the Principal Officer is that he should have been involved in the management, administration and day-to-day affairs of his company,” he said.
Stating that unless the I-T department make out prima facie case against Maran of his liability and obligation as principal officer of the company under section 278 B of the I-T Act, he could not be prosecuted for the offences committed by the company, he added.
During the hearing of the petition earlier, counsel for Maran had submitted he was only the non-executive chairman and not involved in the company’s day-to-day affairs.
Maran had sold SpiceJet to Ajay Singh in 2015.