HC serves notice on state govt

DIMAPUR, DEC 11 (NPN) | Publish Date: 12/11/2020 12:20:09 PM IST


In a significant development, Gauhati High Court, Kohima bench Friday admitted a Public Interest Litigation (PIL) filed by three organizations-- Against Corruption and Unabated Taxation (ACAUT) Nagaland, Public Action Committee (PAC) and Business Association of Nagaland (BAN) over rampant collection of taxes in Nagaland.

The State government represented by the chief secretary, chairperson of the Central Board of Indirect Taxes (Government of India), commissioner & secretary Municipal Affairs, commissioner of Nagaland, commissioner of Taxes, DMC administrator, KMC administrator and DGP Nagaland have been made respondents in the PIL.

A two-judge bench comprising of Justice S. Serto and Justice S. Hukato Swu in the order dated December 11, 2020 served notices on the above respondents made returnable within five weeks. The senior government advocate accepted the notice on behalf of all respondents except respondent No. 2 (Central Board of Indirect Taxes). The petitioners have been asked to take steps to serve notice to respondent No. 2 within three days.

The court has listed the matter for further hearing after the winter vacation.

In the PIL, the petitioners noted that they had been fighting for the cause of the people over the years in matters relating to illegal taxation and were well conversant with the trend of taxation in the State.

While highlighting in detail about how various government departments, Naga political groups etc. had been collecting tax, the petitioners stated that the PIL has been filed under Article 226 of the Constitution of praying for the Court’s intervention to pass necessary directives with regard to the existing illegal taxation plaguing the State of Nagaland and consequently pushing the public to bear the brunt with untold hardships and sufferings.

The petition also stated that a representation, dated November 25, 2020 was sent to the respondents (No. 1-8) praying for necessary action and steps. However, the petitioners expressed regret that till date no action had been taken for resolving the grievances highlighted in the representation.

The petitioners also submitted before the Court that they were not challenging the Goods & Services Tax or any other tax imposed legally in accordance with the provisions of the Constitution.

They, however, pointed out that the menace of illegal taxation prevailing in the State has been creating fear and resentment amongst businessmen and the public, paying the cost for the unlawful taxation imposed on the entrepreneurs and businessmen. This has violated the fundamental rights of the people to live with dignity, to live without fear and freedom to profess any profession and right to equality and equal protection of law guaranteed by the Constitution as well as by the Universal Declaration of Human Rights, they said.

In the PIL, the petitioners also compiled a brief fact finding report on the illegal taxation imposed on the entrepreneurs/business persons, truck drivers.

For instance, it pointed out that Manipur trucks carrying goods and essential items pay money to the organizations, associations, police, undergrounds and others starting from entering Nagaland gate-Dimapur- Kohima-Khuzama Police check gate. However, they said that the prices of essential items in Manipur were cheaper than Nagaland. 

They maintained that this was because taxation does not end after collection from the wholesale dealers/ truck drivers at various check gates, but the chain goes down to collection of money illegally from retailer shops, markets, wholesale dealer shops, street vendors and all other commercial outlets.

ACAUT as well as PAC have been at the forefront in exposing the rampant collection of illegal taxes multiple times for the same items besides the prevalence of market syndicates that manipulate sale and fixation of commodities at inflated rates. These have pushed up prices of commodities since traders pass on the burden on buyers. According to sources from ACAUT and PAC, the entire illegal collection racket has assumed menacing proportions with elements forming syndicates to facilitate collections so as not to depend solely on gate collections. 

Meanwhile, commissioner of Taxes, Kesonyu Yhome, in response to the November 25 representation by ACAUT, PAC and BAN, informed that the collection of entry tax/octroi had been subsumed under GST. In view of the above, Yhome said that entry tax/octroi were no longer levied separately by the department of Taxes.

In his letter dated December 5, Yhome also informed that the department had closed down all tax booths at check gates since August 3, 2017 and therefore no personnel of the department were manning static tax booths anywhere in the state.

However, PAC volunteers have time and again claimed they have confronted and confirmed that unauthorised tax collections were continuing at check gates.

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