Un-necessary litigation with gross negligence by revenue- a serious concern. Avoid un-necessary litigation to stop brain drain.

[C.A. DEV KUMAR KOTHARI]

Relevant link and references:

COMMISSIONER OF CENTRAL EXCISE. DELHI VERSUS M/S.MINIMAX INDUSTRIES 2012 -TMI - 210819 - SUPREME COURT OF INDIA

CIT vs. DSL DSoftware Ltd 2011 -TMI - 211006 - KARNATAKA HIGH COURT.

Awarding heavy costs is the only way to prevent Dept from indulging into un-necessary litigation http://www.taxmanagementindia.com/visitor/detail_article.asp?ArticleID=1612

The author has written several articles on the subject of un-necessary litigation by revenue. In many of cases where revenue indulge into litigation we find no merit to litigate on behalf of revenue. Recently we find that even before the Supreme Court, revenue carried un-necessary litigation just for litigation apparently without any sincerity and bonafide. Even the 

 The appeal of revenue  was dismissed for sole reason that final order of CESTAT  against which appeal is filed has not been filed , this shows  a case of  gross carelessness  causing  wastage of public money.

The chronological history of the case:

Supreme Court’s decision is dated 02 February 2012

The judgment of the High Court of Delhi was dated 17.01.2011.

Order against which  appeal was filed was  passed by CESTAT  on 10.01.2010

Order produced by  revenue before the Supreme Court was an interim order  passed by CESTAT (date not mentioned)  and the final order dated 10.01.2010 was not filed.

The issue involved was in relation to exemption under Notification No.1/93 dated 28.02.2003.

From the website of the Supreme Court we find the following details about the case:

Staus of : Appeal Civil    1545    Of   2012                DISPOSED

 

COMMISSIONER OF CENTRAL & EXCISE DELHI   .Vs.   M/S. MINIMAX INDUSTRIES

 

Pet. Adv. : MR. B. KRISHNA PRASAD   Res. Adv. : MR. VINAY GARG

 

Subject Category : INDIRECT TAXES MATTERS - INTERPRETATION OF EXEMPTION NOTIFICATIONS UNDER CENTRAL EXCISE ACT

 

Date of Disposal : 02/02/2012   Thus we find that there were advocates deputed from both parties to the case. However the copy of judgment is not found on the website of the Supreme court.     Other cases of the same tax payer: We find that the revenue ahs also challenged some other judgments in case of the same taxpayers.For example we find two cases and orders passed in them as follows:   Status of : Special Leave to Petition (Civil)...    14534    Of   2011   COMMISSIONER OF CENTRAL & EXCISE DELHI   .Vs.   M/S. MINIMAX INDUSTRIES   Pet. Adv. : MR. B. KRISHNA PRASAD   Subject Category : INDIRECT TAXES MATTERS - INTERPRETATION OF EXEMPTION NOTIFICATIONS UNDER CENTRAL EXCISE ACT   Last Listed on : 09/09/2011     ITEM NO.16                    COURT NO.11               SECTION III                  S U P R E M E       C O U R T   O F    I N D I A                               RECORD OF PROCEEDINGS   Petition(s) for Special Leave to Appeal (Civil)....../2011                                              CC 14534/2011   (From the judgement and order dated 17/01/2011 in         CEAC No.12/201 of The HIGH COURT OF DELHI AT N. DELHI)   COMMISSIONER OF CENTRAL & EXCISE DELHI                   Petitioner(s)                      VERSUS   M/S. MINIMAX INDUSTRIES                                  Respondent(s)   (With appln(s) for c/delay in filing SLP and office report)   Date: 09/09/2011    This Petition was called on for hearing today.   CORAM :           HON'BLE DR. JUSTICE MUKUNDAKAM SHARMA           HON'BLE MR. JUSTICE ANIL R. DAVE   For Petitioner(s)       Mr.   B. Bhattacharya, ASG                         Mr.   Krishna Kumar, Adv.                         Ms.   Monika Gosain, Adv.                         Mr.   B. Krishna Prasad, Adv.   For Respondent(s)                  UPON hearing counsel the Court made the following                                  O R D E R          Delay condoned.        Issue notice.        Tag with SLP(C) No. 3739 of 2011.                (NAVEEN KUMAR)                            (RENU DIWAN)        COURT MASTER                              COURT MASTER   And Status of : Special Leave Petition (Civil)    26078    Of   2011   COMMISSIONER OF CENTRAL & EXCISE DELHI   .Vs.   M/S. MINIMAX INDUSTRIES   Pet. Adv. : MR. B. KRISHNA PRASAD   Res. Adv. : MR. VINAY GARG   Subject Category : INDIRECT TAXES MATTERS - INTERPRETATION OF EXEMPTION NOTIFICATIONS UNDER CENTRAL EXCISE ACT   This Case is connected to : Special Leave Petition (Civil) 3739 OF 2011   Last Listed on : 02/02/2012 ITEM NO.16                    COURT NO.11               SECTION III                  S U P R E M E       C O U R T   O F    I N D I A                               RECORD OF PROCEEDINGS   Petition(s) for Special Leave to Appeal (Civil)....../2011                                              CC 14534/2011   (From the judgment and order dated 17/01/2011 in         CEAC No.12/201 of The HIGH COURT OF DELHI AT N. DELHI)   COMMISSIONER OF CENTRAL & EXCISE DELHI                   Petitioner(s)                      VERSUS   M/S. MINIMAX INDUSTRIES                                  Respondent(s)   (With appln(s) for c/delay in filing SLP and office report)   Date: 09/09/2011    This Petition was called on for hearing today.   CORAM :           HON'BLE DR. JUSTICE MUKUNDAKAM SHARMA           HON'BLE MR. JUSTICE ANIL R. DAVE   For Petitioner(s)       Mr.   B. Bhattacharya, ASG                         Mr.   Krishna Kumar, Adv.                         Ms.   Monika Gosain, Adv.                         Mr.   B. Krishna Prasad, Adv.   For Respondent(s)                  UPON hearing counsel the Court made the following                                  O R D E R          Delay condoned.        Issue notice.        Tag with SLP(C) No. 3739 of 2011.          (NAVEEN KUMAR)                            (RENU DIWAN)        COURT MASTER                              COURT MASTER

These pending matters also appear to on the same or similar issue. Therefore, we find that in case of same tax payer litigation on other similar matters are also pending before the Supreme Court. In such circumstances the revenue authorities and their counsels  must be considered as having regular work in form of cases before the Supreme Court also. Hence it cannot be a case of overlooking or inadvertent mistake.

Readers may also refer to article titled “Awarding heavy costs is the only way to prevent Dept from indulging into un-necessary litigation” in which reference was made to recent judgment reported as   CIT vs. DSL DSoftware Ltd 2011 -TMI - 211006 - KARNATAKA HIGH COURT.

Thanks for un-necessary litigation by revenue but with regrets:

Once again on behalf of professional friend’s  and associates author convey thanks to revenue officers and counsels of revenue to initiate and keep going litigation. This provide professionals lot of work.  However, author also express serious grievances and regret on such matter because this causes brain drain and erosion of capital in form of education, knowledge and expertise. If such litigation is not initiated and carried, then only appropriate credit and weight age will be given to science and technology. So long such un-necessary litigation goes on, there will be simple brain drain and also wastage of national resources.

Stop un-necessary litigation to stop brain drain:

A major part of litigation is due to wrong actions or inactions of government authorities. For example if assessment of tax liability under different tax laws be made properly, there will be reduction of appeal by at least 70%. In other cases also we find that there is more litigation by or against government authorities due to wrong action or omission to act. The government authorities must be made accountable for the loss to exchequer for indulging into un-necessary litigation and also forcing public to indulge into litigation due to wrong actions taken by government authorities. We find many times orders are passed knowingly that it will be reversed by higher authorities. Why such orders are passed? Is it to save jobs of appellate and revisionary authorities and courts?