Will take coercive action against revenue officials if appeal filing process not streamlined: SC

The Supreme Court on Friday took serious exception to the failure of finance department officials in finalising a proposal to streamline the process of filing appeals involving revenue and indirect taxation matters and warned it will not hesitate to initiate contempt against them and take coercive action.




A bench of Justices DY Chandrachud and M R Shah took note of repeated adjournments sought in an appeal against the order of the Customs Excise and Service Tax Appellate Tribunal filed with a delay of 536 days.

The top court sought the presence of Solicitor General to which it was told that he was arguing the matter in some other court.

The bench said, This is shocking. This court passed the order on February 15 on the proposal which was submitted by the Solicitor General Tushar Mehta and since then adjournment has been sought on one pretext or another. If something concrete does not come out by the next date of hearing, this court will not hesitate to initiate contempt against concerned officials and take coercive action .

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The bench told Additional Solicitor General Balbir Singh that it is for the benefit of the department that this proposal was sought to be prepared but instead officials do not seem to understand.

There were several appeals filed even with delays of over 10 years but we had condoned the delay depending on the case but this could not be a practice , it said.

On February 15, Mehta placed a note before the bench after deliberation with senior union government officials including the finance secretary and law secretary and the chairpersons of the Central Board of Direct Taxes and Central Board of Indirect Taxes and Customs.

In the note it was submitted that both Boards have issued instructions outlining the timelines for different levels for processing of a case for filing an Special Leave Petition to ensure that appeal is filed within the stipulated time frame of 90 days.

The proposal said that there should be a Committee in each Board (CBDT and CBIC) consisting of-Member (Judicial)-chairman, Director General of the Directorate in-charge for litigation management-convener, Commissioner (Judicial), Legal advisor for department of legal affairs, and Central Government Standing Counsel.

It said that the Committees of the both Boards should meet every week at a fixed time (say, every Tuesday at 5 pm) one after another and take the final decision on whether to file an SLP or not and only in exceptional cases of disagreement, matter could be processed on file between Department of Revenue and Department of Legal Affairs and even SG/ASG.

In the meetings the Finance Secretary had said that there are around 20-22 SLPs being filed between both the Boards every week and the Committee should be able to take quick decisions cutting down movement of files through various levels.

The Law Secretary had also pointed out that it is movement of files within various levels in the departments that consumes most of the time and had suggested that the cases should be monitored through software with alert mechanisms and time stamps so that delays are avoided.

The top court had taken the proposal on record and suggested the need to incorporate technological innovations in the process of monitoring litigation involving the revenue arm of the union government.

It had said that in order to facilitate further deliberations by the authorities of the Union government, it is posting the matter for further hearing on March 15, and sought a consolidated proposal also incorporating technological modalities to be placed before the Court on the next date of listing.

On February 10, the top court had said that the union government, in the Department of Revenue must find an answer to this state of affairs by ensuring that matters which are required to be litigated are litigated with all necessary dispatch and matters not worthy of being pursued are set to rest.