2016 (5) TMI 78 - HC - VAT and Sales Tax

Whether the rejection of the applications of the Petitioners by the Additional Commissioners acting as Designated Authority was without jurisdiction inasmuch as Clause 8 of the Amnesty Scheme envisages only the Commissioner VAT passing such orders - Held that - the Court is satisfied that the impugned orders rejecting Petitioners applications could not have been passed by an Additional Commissioner who has been declared as Designated Authority in exercise of the powers under Clause 8 of the Amnesty Scheme, which power only could have been exercised by the Commissioner, VAT and particularly in the absence of any order issued by the Commissioner under Section 68 (1) of the DVAT Act delegating such power to any other VAT officer. The Court also notes that under Clause 8(3) of the Amnesty Scheme, the SCN under Clause 8(1) would have to be issued within one year from the date of filing of the declarations by the applicants. Admittedly, that period of one year in all these cases has elapsed. Therefore, it is not possible for the Court to place the said applications before the Commissioner for a fresh decision. Therefore, the impugned orders issued by the Additional Commissioners rejecting the applications of each of the Petitioners in exercise of the power under Clause 8 of the Amnesty Scheme are hereby quashed. - Petition disposed of

Summary

Issues:
Validity of orders passed by "Designated Authority" under Delhi Tax Compliance Achievement Scheme, 2013 (Amnesty Scheme).

Analysis:
The judgment dealt with writ petitions questioning the validity of orders rejecting applications under the Delhi Tax Compliance Achievement Scheme, 2013 (Amnesty Scheme) by the "Designated Authority." The Amnesty Scheme allowed for tax, interest, penalty, or other dues payment under the DVAT Act before April 1, 2013, with specific conditions. The Designated Authority was defined as an officer not below the rank of Joint Commissioner. The petitioners had applied under the Amnesty Scheme for various years, and some received discharge certificates while others did not. The rejection of applications by the Designated Authority led to legal challenges.

The key issue revolved around whether the Additional Commissioners, acting as the Designated Authority, had the jurisdiction to reject the applications under Clause 8 of the Amnesty Scheme. The respondents argued that the Additional Commissioners were authorized under the DVAT Act to act on behalf of the Commissioner, VAT. However, the court noted that specific delegation of powers under Clause 8 to subordinate officers was essential. Without such delegation, the Designated Authority could not exercise the powers of the Commissioner under Clause 8.

The court referred to a previous judgment where it was established that powers designated to a specific authority must be explicitly delegated. In this case, the absence of a delegation order by the Commissioner meant that the Additional Commissioners could not validly reject the applications under Clause 8 of the Amnesty Scheme. The court emphasized the importance of proper delegation of powers under the law.

Consequently, the court quashed the impugned orders rejecting the applications, stating that they could only be passed by the Commissioner, VAT. As the one-year period for issuing show cause notices had lapsed, the court could not refer the applications back to the Commissioner for a fresh decision. Therefore, the impugned orders were deemed invalid, and all subsequent actions taken based on those orders were also declared invalid. The writ petitions were disposed of accordingly.