sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
« News Headlines »
 Jindal Metal Co. Vs. Principal Commissioner Of Income Tax, Delhi-21
 Goods And Service Tax (Gst) Concept & Status As On 1st November, 2018
 Notification No. 91 /2018-Customs (N.T.) Central Board of Indirect Taxes and Customs
 Top 5 must-knows for education loan tax deduction
 Notification No.90/2018 - Customs (N.T.) Central Board Of Indirect Taxes And Customs
 The Central Goods And Services Tax (Amendment) Bill, 2018
 New Forms for making an application under section 197 and/or section 206C of the Income-tax Act, 1961
 I-T dept proposes online filing of tax exemption application
 How will income earned from professional services abroad be taxed in India?
  Income–tax (10th Amendment) Rules, 2018
 Received income tax notice under section 143(1)(a)? here’s how to deal with it

The differently-abled and an indifferent taxman
August, 26th 2006
The case of Kirti M. Kothari that came up before the Bombay High Court recently was different. On one side was `a disabled person suffering from polio, whereby his left arm was affected,' and on the other was the taxman, humanism-challenged. The plight of Kothari began more than two decades ago. You may remember that 1981 was declared as `The International Year for the Physically Handicapped Persons'. Taking a leaf from the declaration, "the Government of India introduced a policy under which the physically handicapped persons were permitted to import cars with appropriate modifications/designs which would be suitable for their use." Accordingly, such persons were not required to produce Customs Clearance Permit (CCP), and the Customs duty leviable was only 50 per cent of the ad-valorem value. Kothari imported a car with appropriate modification, having applied for exemption order in September 1982. As required by the Ministry of Finance, Kothari submitted a medical examination report and filed his tax report. To his dismay, he found that the taxman insisted on the CCP. "Many other persons situated similarly to the petitioner were also awaiting clearance for such import. Difficulties were raised by the respondents and, therefore, some of them filed a writ petition in the Delhi High Court," one learns. In December 1983, a Division Bench of the Delhi High Court "directed the Union of India to see that the policy for the benefit of disabled persons is implemented correctly, and not perverted by creating difficulties." Oddly, the Department appealed against this judgment, before the apex court. However, the appeal was dismissed in July 1985. Pursuant to the Delhi High Court's order, Kothari was issued an exemption order in September 1986, permitting him to import a Nissan/Sunny 1500 CC car. Later, on Kothari's request, the Department permitted him to purchase a "Mazda 323 Hatchback, 1300 cc Model BG 37 with automatic transmission, front seatbelt, multi-hand grip and necessary fitments for left-hand disability." This permission, granted by the Central Government, laid down three conditions, as follows: The car so imported shall not be sold without the permission of the Government. The car will remain in possession, control and use of the disabled person. CIF (cost, insurance and freight) value of the car not to exceed Rs 65,000. The exemption order specifically stated at the foot thereof that no import licence or CCP would be necessary for clearance of a vehicle. The importer was to produce evidence of Customs duty relief granted to him. Yet, the authorities insisted that Kothari produce the CCP for clearance of the vehicle. Challenging this, Kothari approached the Bombay High Court. In November 2003, the Assistant Commissioner of Customs filed a reply. "It is rather unfortunate that the reply makes some wrong statements," said Justices H. L. Gokhale and V. R. Kingaonkar of the Bombay High Court. For example, the reply said that Kothari had claimed to import without any payment of duty. "That is not so. He is required to pay 50 per cent of the duty and he is/was all through ready to pay it," observed the court. "The reply thereafter states that the petitioner has not made it clear as to how he is physically handicapped." This, despite Kothari having given the required medical certificates for the grant of the exemption order. One other ground in the Department's reply was that since the import was made in 1987, the Import Policy of July 9, 1988, would be applicable. "This is most surprising inasmuch as the policy which was not in existence on the date of the import is sought to be applied by the respondents," said the court. "It shows a completely bureaucratic attitude on their part and, therefore, the Delhi High Court was quite correct in directing that the policy for the benefit of the disabled persons should be implemented as it is and should not be perverted. In spite of such observations of the Delhi High Court, what we find is an attitude that is not a very helpful considering that the Government has framed the policy for the benefit of the disabled persons and yet the officers concerned are not implementing it." How sad! At the court, Kothari's counsel, K. R. Bulchandani, submitted copies of the car's registration certificate and other documents to prove that the vehicle has been with Kothari all throughout. The court said, "The laudable purpose of the Government policy was to give a helping hand to physically challenged persons. Normally, import of luxury items like cars/vehicles would not have been encouraged. Still, however, in the case of physically challenged persons, the exemption was provided, since such specially designed/modified versions of the car vehicles could not be easily made available in India, at the relevant time." Thus the difficulties of physically challenged persons in driving automobiles was sought to be removed under the Government policy. "It can be gathered that misuse of such exemption was also taken care of and remedied under the said policy. Obviously, the concerned Customs officer ought not to have insisted upon production of CCP by the petitioner," ruled the court. Asking Kothari to produce the CCP, which was not necessary at all, is "a classic example of how a benevolent provision made by the Government, aimed at bringing about social justice, particularly in relation to the physically challenged persons, is thwarted by the Government officials," said the court. "Instead of proper implementation of the beneficial policy, the concerned official/s tried to put spokes in its implementation. We are dismayed to see the approach of the Government official/s in denying benefits of the policy to the petitioner without any reason or rhyme and also in putting up serious contest to his claim in the court." A precedent of value for the physically challenged is Daya Ram Tripathi vs State of UP, where the Supreme Court came down heavily on the Government's directive to the UPPSC not to make reservations for the physically challenged in `Recruitment on the basis of Combined State Services Examination, 1978'. In Kothari's case the court ordered the Department to hand over the original bank guarantee to Kothari, duly cancelled within two weeks. "That will enable the petitioner to get back his Fixed Deposit Receipt and the share certificates from his bank," reads the benign judgment. The guarantee had been insisted on by the Department for the balance 50 per cent of the import duty, that is Rs 52,000, as a matter of abundant caution. Bulchandani informed the court that to keep the bank guarantee alive, Kothari had paid Rs 1,660 per year. "During a period of 18 years, by now, he has paid the bank a sum of Rs 29,880," noted the court. "He has lost the interest on this amount and if we award an appropriate interest on this sum, the amount will be quite large. The petitioner has been forced to suffer this litigation for no fault of his." Though the court was prepared to award a larger amount to Kothari, who was present in the court at the time of the case, he had conveyed through his counsel that a sum of Rs 50,000 should be all right, "towards the payment which was required to be made to the bank, the lost interest thereon and costs of the petition." A fair expectation, said the court. "It will be open to the respondents to recover the amount from the officer concerned of the Customs Department, by following proper procedure. The respondents will make the payment of Rs 50,000 to the petitioner by end of September 2006," concludes the verdict. Tailpiece "Do you know that he laughs in various ways?" "Depending on the amount?" D. Murali
Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Application Management Solutions Application Management System Application Management Software System Application Management Development Application Management Software Development

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions