Officers must act reasonably and legally and not harass taxpayers Cost imposed on GST officer by High Court further increased by the Supreme Court. To put effective check on harassing attitude of officers , effective way can be suspension and debarring from government services.

[DEV KUMAR KOTHARI]

Officers must act reasonably and legally and not harass taxpayers

Cost imposed on GST officer by High Court further increased by the Supreme Court.

To put effective check on harassing attitude of officers , effective way can be suspension and debarring from government services.

2022 (1) TMI 954 - SC ORDER ASSISTANT COMMISSIONER (ST) & ORS. VERSUS M/S. SATYAM SHIVAM PAPERS PVT. LIMITED & ANR. Special Leave to Appeal (C) No(s). 21132/2021   Dated: - 12 January 2022

2021 (6) TMI 378 - TELANGANA HIGH COURT  M/S SATYAM SHIVAM PAPERS PVT. LTD. VERSUS ASST. COMMISSIONER ST AND 4 OTHERS Writ Petition No.9688 of 2020  Dated: - 02 June 2021

Other judgments considered on issue of e-way bill.

2006 (6) TMI 480 - ANDHRA PRADESH HIGH COURT  Other Citation: [2006] 147 STC 462 (AP) DELTA LUBRICANTS VERSUS DEPUTY COMMERCIAL TAX OFFICER, VIJAYAWADA  Writ Petition No. 354 of 2006  Dated: - 16 June 2006

2018 (11) TMI 1504 - ALLAHABAD HIGH COURT  M/S TIMEXO FASTENERS INDIA PRIVATE LTD. AND ANOTHER VERSUS STATE OF U.P. AND 3 OTHERS Writ Tax No. - 1471 of 2018  Dated: - 22 November 2018

Nature of case of Satyam Shivam Papers P. Ltd:

In this case due to Road Blockage/ bandh supplier could not deliver goods within validity period. There was no attempt to sell goods also. The officer seized goods and imposed penalty for alleged evasion of tax. Goods were detained and stored at a place of relative of officer. Explanation given by supplier was not considered and conclusion was drawn of tax avoidance.

Supplier had to approach High Court where he got relief  and demand of tax and  penalty was vacated. High Court also imposed costs of ₹ 10000/- to be payable to the supplier of goods.

Officer appealed against the judgment of High Court, pleading case of tax avoidance and valid  tax and penalty imposed by him and also challenged costs of ₹ 10000/- levied on him by High Court.

On consideration of facts and law the honorable Supreme Court confirmed judgment of High Court and further increased costs payable by erring officer.

Concluding portion from judgment is reproduced below with highlights added:

          Having heard learned counsel for the petitioners and having perused the material placed on record, we find no reason to consider interference in the well-considered and well-reasoned order dated 2nd June, 2021, as passed by the the High Court for the State of Telangana at Hyderabad in Writ Petition No. 9688 of 2020. Rather, we are clearly of the view that the error, if any, on the part of the High Court, had been of imposing only nominal costs of ₹ 10,000/- (Rupees Ten Thousand) on the respondent No. 2 of the writ petition, who is petitioner No.2 before us.

      The High Court has awarded costs to the writ petitioner in the sum of ₹ 10,000/- (Rupees Ten Thousand) in relation to tax and penalty of ₹ 69,000/- (Rupees Sixty-nine Thousand) that was sought to be imposed by the petitioner No.2. In the given circumstances, a further sum of ₹ 59,000/- (Rupees Fifty-nine Thousand) is imposed on the petitioners toward costs, which shall be payable to the writ petitioner within four weeks from today. This would be over and above the sum of ₹ 10,000/- (Rupees Ten Thousand) already awarded by the High Court.

Having regard to the circumstances, we also make it clear that the State would be entitled to recover the amount of costs, after making payment to the writ petitioner, directly from the person/s responsible for this entirely unnecessary litigation.

Unquote:

It is very common that tax officers make orders contrary to fact and law very carelessly and pass adverse remarks on tax payers holding him tax evader, his documents as bogus and levy allegations of fraud over revenue. This lead to harassment of tax payers and litigation. Penalties are imposed without considering facts, ground realities, complexities of law and bona fide of tax payers.

Generally every addition made by officer is considered a case of tax avoidance and demand of tax and penalty are raised without considering circumstances in which, if at all any mistake or lapse took place. Lot of pressure is exerted or recovery. This causes difficulties of tax payers. Many times officers adopt such practices to extort huge bribes.

This is not proper for government officers including tax officers who must be regarded as a facilitator and not an authority to harass public.

The judgment of the Supreme Court in this case is expected to make a change in careless  attitude of tax officers to be more reasonable and rational in their approach.

Quantum of costs:

It appears that honorable Supreme Court has restricted the amount of cost payable by the officer to the amount of wrongly raised demand by the officer. However, with all respect, author feels that this was a fit case to impose high cost to warn, in a real and meaning full manner erring officers. A sum of ₹ 69000/- is meagre sum for corrupt officers who can adopt this type of practices to extract huge sums as bribe by harassing taxpayers.

In fact  suspension of service of erring tax officers , harassing officers , corrupt officers can only be effective way to put a check on such practices in a meaningful manner.