Court notice issued in writ petition challenging Finance Act clause; respondents to file affidavits. No coercion, non-compliance won't dismiss.

The Court issued notice to the respondents in a writ petition challenging the Explanation to clause (ii) of Section 65(19) of the Finance Act, 1994. The respondents are directed to file counter affidavits within four weeks, with the petitioner allowed to file rejoinder affidavits if necessary. No coercive measures are to be taken during this period, and non-compliance with interim directions will not lead to automatic dismissal of the appeal. The case is scheduled for further proceedings on 11.12.2015.

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Issues: Challenge to the Explanation to clause (ii) of Section 65(19) of the Finance Act, 1994 as ultra vires the Constitution of India and beyond legislative competence of Parliament.

Analysis:
In this writ petition, the petitioner challenges the Explanation to clause (ii) of Section 65(19) of the Finance Act, 1994, arguing that it is ultra vires the Constitution of India and exceeds the legislative competence of Parliament. The petitioner asserts that Section 65(105)(zzzzn), similar to the impugned explanation, has been previously invalidated for the same reasons. Citing the case of Future Gaming solutions Pvt. Ltd. v. Union of India and Ors, where the Sikkim High Court held that activities related to games of chance fall under "betting and gambling," a subject within the exclusive jurisdiction of State Legislatures under Entry 62, List II of the Seventh Schedule to the Constitution of India. The petitioner contends that the impugned explanation, previously part of the business auxiliary service, should also be struck down on the same grounds as Section 65(105)(zzzzn) due to its lack of constitutional validity and parliamentary competence.

The Court has issued notice to the respondents, which has been accepted by their respective counsels. The respondents are directed to file their counter affidavits within four weeks, with the petitioner allowed to file rejoinder affidavits if necessary within four weeks thereafter. The case is set to be renotified on 11.12.2015. During this period, no coercive measures are to be taken, and non-compliance with interim directions from the Tribunal regarding pre-deposits will not automatically lead to the dismissal of the petitioner's appeal by the Tribunal. The Court has ordered for the necessary documents to be provided under the signature of the Court Master for further proceedings.

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