2023 (4) TMI 310 - HC - VAT and Sales Tax

Rejection of option for settling arrears of sales tax under the Amnesty Scheme - petitioners assail the order of the Lok Ayukta on merits and on the ground of jurisdictional infirmity - HELD THAT - Section 7 of the Lok Ayukta Act provides for matters which may be investigated by the Lok Ayukta and provides that, subject to the provisions of the Act, the Lok Ayukta may investigate any action which is taken by or with the general or specific approval of the persons specified therein, in any case where a complaint involving a ''grievance'' or an ''allegation'' is made in respect of such action. Going by the definition of 'maladministration', only unreasonable, unjust, oppressive or improperly discriminating action taken or purporting to have been taken in exercise of administrative functions would amount to maladministration. The power exercised by the Sales Tax Officer in rejecting the application of the complainants opting for the Amnesty Scheme-2020 is a quasi judicial function and a hierarchy of remedies is provided against the said order under Chapter-VII of the KGST Act apart from the remedy available before this Court under Article 226 of the Constitution in appropriate cases - It cannot assume any jurisdiction otherwise confirmed by the Lok Ayukta Act. This Court, in John Joseph 2011 (5) TMI 1141 - KERALA HIGH COURT , observed that, if the authority does not have the requisite jurisdiction to adjudicate the dispute brought before it, permitting such an examination would only create chaos in the administration. Ext. P1 complaint before the Lok Ayukta does not reveal any allegation or grievance in consequence of maladministration. Therefore, Ext. P1 complaint, is not maintainable before the Lok Ayukta and the Lok Ayukta has no jurisdiction to decide the correctness of the order rejecting the option for settling the arrears under the Amnesty Scheme-2020. Accordingly, Ext.P3 report of the Lok Ayukta is set aside. If orders passed by quasi-judicial functionaries exercising powers under a statute are for any reason untenable in law, resort must be had to the remedies under the statute and the complainants cannot bypass the procedure and approach the Lok Ayukta. This Court has not adjudicated the correctness or otherwise of the order of the assessing authority rejecting the application opting for Amnesty Scheme- 2020, but only the jurisdiction of the Lok Ayukta in entertaining Ext. P1 complaint - Petition allowed.

Summary

Issues involved:
The main issue in this case is whether the Lok Ayukta has the authority to review the decision of the assessing authority regarding the rejection of an option for settling arrears of sales tax under the Amnesty Scheme.

Details of the judgment:
The petitioners, representing the Revenue and Sales Tax authorities, challenged the report of the Kerala Lok Ayukta which set aside the assessing authority's rejection of the complainants' option for settling arrears under the Amnesty Scheme-2020. The complainants, directors of a company, had their option rejected by the Sales Tax Officer due to ongoing revenue recovery proceedings. The Lok Ayukta found the rejection discriminatory and illegal, declaring the complainants entitled to opt for the Amnesty Scheme. The petitioners contested the Lok Ayukta's jurisdiction, arguing that the Lok Ayukta cannot interfere in quasi-judicial decisions and that statutory remedies should have been pursued instead of approaching the Lok Ayukta.

The Lok Ayukta Act specifies that the Lok Ayukta may investigate actions involving grievances or allegations. The Act defines 'allegation' as affirmations of abuse of position, personal interest, corruption, favoritism, or lack of integrity by a public servant. 'Grievance' is defined as claims of injustice or undue hardship due to maladministration. Maladministration is described as unreasonable, unjust, oppressive, or discriminatory actions in administrative functions. The Sales Tax Officer's decision on the Amnesty Scheme option is considered a quasi-judicial function, with remedies available under the KGST Act and Article 226 of the Constitution. Previous court decisions emphasize that the Lok Ayukta is not an appellate authority over statutory forums and cannot override their orders. Acts of erroneous exercise of authority under a statute do not constitute maladministration under the Lok Ayukta Act. Therefore, the Lok Ayukta does not have jurisdiction to review the rejection of the Amnesty Scheme option, and the Lok Ayukta's report is set aside.

The court clarified that it did not assess the correctness of the assessing authority's decision but ruled on the Lok Ayukta's jurisdiction in this case. The writ petition was allowed, and the Lok Ayukta's report was overturned.