+
High Court says retrospective use of black money law unconstitutional
ECONOMY & POLICY

High Court says retrospective use of black money law unconstitutional

Rich Indians and large business families entangled in the stringent black money law are celebrating after the High Court ruled against its retrospective application.

For the first time, the court invoked Article 20 of the Constitution to nullify the retrospective use of the law, which was enacted in 2015 to target offshore bank accounts, properties, and companies of resident Indians.

Article 20 states that "no person shall be convicted of any offence except for violation of a law in force at the time of the commission of the act charged as an offence." In essence, one cannot be punished under a law that did not exist when the offence was committed. The Karnataka High Court quashed the criminal proceedings initiated by the income-tax department against individuals connected to overseas bank accounts and firms that were closed before the Black Money Act came into force. The court ruled that the prosecution against these petitioners did not meet constitutional standards under Article 20. This decision sets a precedent for numerous court cases, as many Indians had closed their bank accounts and companies before 2015 in anticipation of such a law.

However, under Section 72 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, overseas assets acquired years ago can also be scrutinised. The year the tax office receives the information is considered the year in which a foreign bank account was opened.

Referring to Section 72, Justice M. Nagaprasanna stated that it violates Article 20 of the Constitution. "The Special enactment is a statute. Article 20 comes under Chapter III of the Constitution of India, a fundamental right. The Constitution of India is not a statute. It is the fountainhead of all statutes including the special statute," the court ruled. (Source: ET)

Rich Indians and large business families entangled in the stringent black money law are celebrating after the High Court ruled against its retrospective application. For the first time, the court invoked Article 20 of the Constitution to nullify the retrospective use of the law, which was enacted in 2015 to target offshore bank accounts, properties, and companies of resident Indians. Article 20 states that no person shall be convicted of any offence except for violation of a law in force at the time of the commission of the act charged as an offence. In essence, one cannot be punished under a law that did not exist when the offence was committed. The Karnataka High Court quashed the criminal proceedings initiated by the income-tax department against individuals connected to overseas bank accounts and firms that were closed before the Black Money Act came into force. The court ruled that the prosecution against these petitioners did not meet constitutional standards under Article 20. This decision sets a precedent for numerous court cases, as many Indians had closed their bank accounts and companies before 2015 in anticipation of such a law. However, under Section 72 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, overseas assets acquired years ago can also be scrutinised. The year the tax office receives the information is considered the year in which a foreign bank account was opened. Referring to Section 72, Justice M. Nagaprasanna stated that it violates Article 20 of the Constitution. The Special enactment is a statute. Article 20 comes under Chapter III of the Constitution of India, a fundamental right. The Constitution of India is not a statute. It is the fountainhead of all statutes including the special statute, the court ruled. (Source: ET)

Related Stories

Gold Stories

Next Story
Infrastructure Transport

India To Build 100 New Airports Under UDAN Plan

The Civil Aviation Minister K Rammohan Naidu said that India will build 100 new airports over the next 10 years under the Centre's Regional Connectivity Scheme — Modified UDAN (UDAN) with an outlay of Rs 300 billion (Rs 300 bn). He inaugurated the country's third hub-and-spoke operation from Ahmedabad, intended to link passengers seamlessly to international destinations through domestic hubs. The minister indicated that the initiative forms part of a sustained expansion of air connectivity across the nation. Naidu recalled that there were 74 airports in 2014 and that the network has expanded..

Next Story
Infrastructure Urban

Auto PLI Draws Rs 454.77 Billion Investment Creates Over 67,000 Jobs

Union Minister for Heavy Industries and Steel HD Kumaraswamy said the production-linked incentive scheme for automobiles and auto components had attracted Rs 454.77 billion (Rs 454.77 bn) in investment and generated more than 67,000 jobs as of 30 June 2026. He told the Automotive Component Manufacturers Association of India that the next phase should focus on scale, deeper localisation, innovation and positioning India as a global hub for advanced and green mobility technologies. The minister urged industry to invest in cleaner technologies to help lead the global mobility transition. The gove..

Next Story
Infrastructure Energy

Coal India Production Falls in August as Supplies Rise

Coal India Limited's production declined five point seven per cent year-on-year in August 2026, while coal supplies rose five point five per cent during the month. The company produced 47.5 million tonnes (mn t) of coal in August, down from 50.4 mn t in the same month last year. Offtake rose to 60.6 mn t from 57.4 mn t a year earlier. Over the first five months of the current financial year, cumulative production during April–August was 267.5 mn t, down four point five per cent from 280.2 mn t a year earlier. Cumulative coal supplies rose six point seven per cent to 322.9 mn t in April–Aug..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code