NE LAW & POLITICAL BUREAU
CHENNAI, APR 21
In a development that adds legal heat to Tamil Nadu’s election season, the Income Tax Department has informed the Madras High Court of “apparent inconsistencies” in the election affidavits of Udhayanidhi Stalin, particularly relating to investments, liabilities and financial disclosures between the 2021 and 2026 Assembly polls.
- Income Tax Department tells Madras High Court asset, loan data across 2021–2026 affidavits don’t tally
- Missing ₹7.36 crore investment, fresh spouse-linked entry and loan variations raise red flags
- Case follows scrutiny in Vijay affidavit matter; court seeks clarity, adjourns hearing
In a counter-affidavit filed before the court, the Department pointed to discrepancies that, it said, make it “difficult to arrive at any conclusive findings at this stage” without complete records.
Investments & Disclosures Under Lens
The Department flagged that an investment of ₹7.36 crore in Red Giant Movies, declared in the 2021 affidavit, does not feature in the 2026 filing.
At the same time, the latest affidavit records a ₹2.63 crore investment in the same company in the name of his spouse, which had not been disclosed earlier.
“These variations, along with other inconsistencies in financial records, make it difficult to arrive at any conclusive findings at this stage,” the Department stated in its affidavit.
Loan Figures Raise Further Questions
The scrutiny extends to liabilities as well. While the 2026 affidavit mentions loans of around ₹10 crore, the 2021 declaration recorded approximately ₹11.06 crore.
However, company financial statements indicate borrowings of nearly ₹17.69 crore, creating a gap that the Department says cannot be reconciled without detailed documentation.
“Without access to complete records, it is not possible to reconcile these figures accurately,” the affidavit noted.
Documentation Gaps & Filing Constraints
The Department also highlighted structural limitations in verification. The Income Tax returns were filed using the ITR-2 format, which does not require submission of a balance sheet.
This, coupled with the absence of certain audited financial statements, has restricted independent scrutiny.
Further, it observed that the politician’s spouse had not filed Income Tax returns for the relevant assessment year, limiting examination of related financial entries.
Petition, Court Proceedings & Wider Context
The court was hearing a petition filed by Chennai-based voter R. Kumaravel from the Chepauk–Thiruvallikeni constituency, seeking a detailed probe into alleged discrepancies.
The plea cites “material inconsistencies” between affidavits and corporate records, including disappearance of declared assets and unexplained liability variations.
Earlier, the High Court had issued notice to the Department on April 15. After the latest submission, the matter has been adjourned for four weeks.
Legal observers note that the case comes close on the heels of scrutiny in a similar affidavit-related issue involving Vijay, indicating heightened judicial attention on electoral disclosures.
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Legal & Political Implications
Election affidavits are sworn documents and form a critical pillar of electoral transparency under Indian law. Any discrepancies—intentional or otherwise—can attract legal scrutiny, including possible action under provisions relating to false declarations.
Experts point out that courts typically proceed cautiously in such matters, balancing due process with the need for accountability in public life.
