New Delhi, July 7: The Supreme Court today said no one could claim immunity from prosecution under the voluntary disclosure of income scheme if a tax proceeding is pending against that person.

The ruling came in a case relating to seizure of over 37 kg of gold by income tax officials in Mumbai in 1974. The appellant, Gopaldas Udhavdas, had claimed immunity under the scheme after the proceedings started.

Under the scheme, announced by P. Chidambaram during his earlier tenure as finance minister of the United Front government, an offender can pay one-third of the wealth “disproportionate to known sources of income” as one-time tax and convert black money into white.

Former cricketer Mohammed Azharuddin and P.V. Prabhakar Rao, son of former Prime Minister P.V. Narasimha Rao, were among several people from different walks of life who reportedly disclosed their excess income under the scheme.

But a division bench of Justices Ruma Pal and S.H. Kapadia held that Gopaldas was not entitled to immunity under the scheme as a proceeding was already pending against him.

“Under the VDIS ordinance, a declarant was entitled to claim immunity from penalty, confiscation and prosecution under (the) Gold (Control) Act if, before making the declaration, the gold was not seized and no proceeding was pending in respect of that gold before any authority under the act,” the bench said.

“Since proceedings were pending at the time of filing of the declaration, the appellants were not entitled to immunity,” the judges added.

However, the court directed the authorities to return the gold seized as the appellant did not have prior knowledge about the “said gold hidden in ornamental top of the cupboard in the bedroom”.

But the question relating to voluntary disclosure has to be tested, whether the disclosure was made before or after confiscation and initiation of legal proceedings, the apex court added.