YUVRAJ TUKOJI RAO PUAR Vs. UNION OF INDIA

JUDGEMENT

(1.) IN this petition preferred under article 226 of the Constitution of India the petitioner has prayed for declaration that section 95 (i) (c) of the Finance (No. 2) Act, 1998 (hereinafter referred to as "the Act"), is ultra vires, being defiant of article 14 of the Constitution and further to issue a writ of certiorari quashing the impugned order dated April 16, 2003. In addition there is a prayer to consider the declaration filed by the assessee under section 88 of the Act on the merits.

(2.) THE facts which are essential to be stated are that the late H. H. Krishnaji Rao Puar filed a petition under section 31 (2a) of the Wealth-tax Act, 1957 (in short "the Wealth-tax Act"), before the Commissioner, Wealth-tax, Bhopal, on November 27, 1995, with a prayer of waiver of interest under section 31 (2) for the assessment years 1961-62 and 1963-64 to 1990-91. The aforesaid petition faced rejection vide order dated January 24, 1997. The assessee, the late H. H. Krishnaji Rao Puar, filed an application under section 35 (l) (b) on September 27, 1997, before the Commissioner, Wealth-tax, seeking rectification of his earlier order on the ground while rejecting the said petition certain facts were not considered. While the matter was pending the assessee moved an application before the Chief Commissioner, Wealth-tax, Bhopal, on July 29, 1998, for issue of a direction to the Commissioner of Wealth-tax for disposal of the application which was pending before the said authority within a period of six months. As no order was passed the petitioner preferred a Writ Petition No. 1900 of 1998.

(3.) AS put forth in the petition during the pendency of the aforesaid petition the respondents enacted the Finance (No. 2) Act, 1998, which came into force and a scheme, namely, the Kar Vivad Samadhan Scheme, 1998, was framed. The objects of the scheme have been mentioned in the petition which basically provides a quick and voluntary settlement of tax dues outstanding as on March 31, 1998, both in respect of direct taxes as well as indirect taxes, it is urged in the petition that the scheme came into force on September 1, 1998, and the last date for availing of the benefit of the scheme was December 31, 1998. A reference has been made to the provision of section 95 of the Act which lays a postulate that the said scheme would be applicable in case, appeal, reference or writ petition is admitted and pending before any appellate authority, the High Court or the Supreme Court on the date of filing of declaration or application for review or revision is pending before the Commissioner on the date of filing of the declaration of the scheme. It is contended that the writ petition was filed on December 14, 1998, but the same was not put up before the court for consideration, for admission, however, it came up for admission on April 5, 1999, and the same was admitted. The said writ petition is pending for adjudication before this court. As pleaded, the petitioner disputed and denied the liability saddled on him by way of interest and accordingly the validity of the order passed by the authorities rejecting the prayer of the petitioner was assailed before this court in a writ petition preferred under article 226/227 of the Constitution of India and the matter was admitted. It is also the stand of the petitioner that penal action has been initiated against him without determining the bona fides of the petitioner. It is contended that these contentions have to be taken note of by the statutory authorities while exercising power under section 31 (2a) of the Wealth-tax Act. But the Commissioner, Wealth-tax, refused to exercise his jurisdiction by not considering the genuine hardship and other unavoidable circumstances faced by the petitioner. It is highlighted in the petition that as that matter is sub judice before this court, he offered to pay 50 per cent. interest under the provision of the scheme, but the respondents rejected the same and passed an order on April 14, 2003, not only denying the petitioner's right to take recourse to the provisions of the scheme but also acted against the interests of the Revenue. It is contended that the respondents ought to have considered and weighed that on the one hand the entire levy of interest is under challenge before this court by admission of the writ petition and, therefore, a hyper-technical view should not have been taken recourse to reject the application of the petitioner and levied interest. It is contended that the writ petition was filed on December 14, 1998, prior to the date of declaration but due to procedural impediment which was beyond the control of the petitioner, the writ petition could not be taken up immediately. It has been asseverated that the winter vacation ensued. The plea of prolonged illness of the assessee has been laid emphasis upon, which led to delay in admission of the writ petition. It is the stand of the petitioner that section 95 (i) (c) has to be purposively construed and in that backdrop the order dated April 16, 2003, deserves to be set aside. It is averred that if restrictive interpretation is given to the provision it would frustrate the object of the statute and thereby becomes arbitrary inviting the wrath of article 14 of the Constitution of India.