Madras High Court directs GST Department to Take Action against Officials causing Revenue loss to State
The Madras High Court directed the GST department to take action against the officials causing revenue loss to the state.
The petitioner, GE Govindraj, sought quashing of the 2012 notice of the Assistant Commissioner in Arisipalayam Assessment Circle, Salem district. The notice has sought recovery of sales tax arrears for 2000-01 and 2001-02. Petitioner’s counsel Shri S. Rajasekhar said that he had purchased the property from the second respondent through a sale deed with the building in the range of 3017 3⁄4 sq ft.
The second respondent, in fact, purchased the subject property through sale deed. Counsel for the petitioner reiterated that the petitioner was a bona fide buyer and had purchased the subject property in the year 2006 itself.
The impugned notice was issued after a gap of about 11 years for due sales tax arrears and six years after the purchase of the subject property by the petitioner. Shri P. Nanmaran, on behalf of the Respondent, submitted that since the year 2006, several letters were sent to the second Respondent/Defaulter and no proper response was received from the second Respondent/Defaulter. Finally, the respondent has initiated action under the Revenue Recovery Act and issued notice, directing the petitioner to pay the sales tax arrears within a period of seven days, failing which the subject property shall be transferred to Tamil Nadu general sale. shall be attached under the provisions.
Tax Act, 1959. A single judge division bench of Justice SMS Subramaniam ruled that if misconduct or otherwise is proved, further action is to be initiated for recovery of loss of state revenue from those officers. The court directed the department to issue suitable orders to all subordinate officers to identify cases where no action is taken or is late in respect of collection of tax or arrears of tax..
The court issued directions to the Secretary, Commercial Taxes and Registration and Commissioner, Commercial Tax to initiate appropriate action against all those who are responsible and liable for such omission, negligence or dereliction of duty. The judge said that the authority had initiated action for recovery of the arrears after a lapse of 10 years, which was against the TNGST rules.
The High Court, being the custodian of the Constitution, is bound to ensure that constitutional principles are safeguarded for the welfare of the citizen in general and the failure of the authorities in this regard is suitably dealt with. “Both the authorities shall coordinate with the Vigilance and Anti-Corruption Department by conducting frequent surprise raids to control the evil menace of corrupt activities of seeking and accepting or receiving free bribes from the business community across the state,” the court said. .
