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HC passes strictures for slow recovery, summons fresh ATR
PIL on Sales Tax Recovery
9/6/2012 12:04:00 AM
Early Times Report
JAMMU, Sept 5: The High Court today expressed displeasure over slow pace of recovery of Sales Tax/Vat from defaulters and took serious note of non-implementation of directions passed on June 15, 2012.
A Division Bench of State High Court comprising First Puisne Judge Justice Virender Singh and Justice Muzaffar Hussain Attar observed that a perusal of the fresh status report filed by the respondents State of J&K revealed that all is not well in the Commercial Taxes Dept, certain defaulters whose complete addresses are given in the chart, are shown to be not traceable, some persons have been shown to be migrants. No material is placed before the Court to show that serious and honest steps were taken in tracing out the whereabouts of the aforementioned persons who fall in the category of "not traceable" and "Migrants". The State authorities cannot be said to be helpless and hapless in tracing out the defaulters who have swindled the public exchequer of huge amount. Serious efforts and effective steps are required to be taken for effecting recovery of taxes.
The court further observed that it was submitted at the Bar that at earlier point of time, a number of persons after recovery of Sales Tax/ Tax under the VAT Act, did not deposit it with the Govt, the State formulated an amnesty scheme where under not only the penalty and interest was waived of, but the defaulters were asked to pay the taxes recovered by them from the consumers, in installments, thus causing huge loss to the Public Exchequer.
While expressing its displeasure, the court observed that the in-direct taxes under the relevant Acts are being paid by every section of the society. These types of taxes are being paid by the rich as also by the poor. Even that section of society which is under the category of "Below Poverty Line" and those persons who are surviving by taking one meal a day, also pay these indirect taxes.
Like other taxes, these taxes are being used for over all welfare of the people of the State. Because of the in-action and some where connivance of some of the officers of the Commercial Taxes Dept, this huge amount recovered as taxes is being illegally and unjustifiable retained by some dealers/ sellers which in turn results in unjust and illegal enrichment of such persons, the amount which is required to be spent on the welfare programs and for the benefit of common man find its way into coffers of few individuals.
The order said that it is shocking that most of the people who are charged with the onerous duty to enforce the tax laws are not discharging their duties honestly, resultantly making the tax laws literally redundant and useless. What appears from the record is that the directions issued by the Division Bench on June 15, 2012 still remain to be complied with.
Senior AAG Gagan Basotra appearing for the State submitted that three months time be granted to the respondent-state for complying with the directions issued by the Division Bench on June 15, 2012, however Division Bench declined the request of Senior Additional Advocate General and observed that there has been failure to enforce an implement the tax laws with all seriousness and in right earnest. Court further said that the statutory mechanism has not been exploited honestly and diligently so as to get the desired results. The Authorities are duty bound to enforce the laws with vibrating and pulsating enthusiasm.
The court after hearing Senior Advocate Sunil Sethi assisted by Advocate Deewakar Sharma for the Public Interest Litigation whereas Sr. AAG Gagan Basotra and AAG Seema Shekhar appearing for the State, directed the State respondents to comply with the directions issued by the Division Bench on June 15, 2012 by or before the September 25, 2012.
While parting with this significant order, Division Bench directed that the respondent-state will not at this stage form any amnesty scheme for recovering the taxes from the defaulters/ firms/ companies but will strictly follow the mandate of Tax Laws, the State will put in a proper mechanism to ensure the implementation of tax laws and recovery of taxes. Division Bench further directed the competent authority to consider initiation of disciplinary action against erring officers/ officials.
Division Bench looking into the Public interest involved summoned a fresh status report before the next date of hearing.
It is worth mentioning here that in an RTI expose, the Commercial Taxes Dept disclosed the list of defaulters of both the provinces of the State who were in arrears of Sales Tax/ VAT and amongst the defaulters include the MoS Home Nasir Aslam Wani, Arshi Taj d/o Taj Mohi-ud-Din, Imran Raza Ansari s/o Molvi Iftikhar Hussain Ansari, Power Grid Corporation, BSNL, JAKFED, JK Mineral, Forest Dept and so many other Govt departments and prominent hoteliers/ businessmen of the State. JNF
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