2024 (2) TMI 1543 - HC - VAT / Sales Tax

Kerala Amnesty Scheme 2020 Upheld: Authority Becomes Functus Officio After Order, No Further Modifications Permitted

S. VIJAYAN Versus COMMISSIONER OF STATE GOODS AND SERVICE TAXES DEPARTMENT, THE ASSISTANT COMMISSIONER (ASSESSMENT), THE DEPUTY TAHSILDAR (RR), THE VILLAGE OFFICER,

SC dismissed the writ petition challenging the Kerala Amnesty Scheme 2020. The court held that once an order is passed under the scheme, the authority ... Amnesty scheme - request for adjustment of an alleged amount due from the government against the tax arrears settled under the Kerala Amnesty Scheme 2020 - HELD THAT:- The Amnesty Scheme does not contemplate adjustment of any amount which may be due to an assessee. If any amount is due to the assessee, he may take the appropriate course of action to recover the said amount from the Government. When the provisions of the Amnesty Scheme do not contemplate adjustment of the amount and no such request was made before the 2nd respondent before the passing of the order dated 12.02.2021 under the Amnesty Scheme, the petitioner cannot seek a modification of the said order by requesting to adjust any amount allegedly due to him from the Government. Once an application under the Amnesty Scheme has been decided and an order has been passed, the authority becomes functus officio to modify the said order. If any amount was due to the petitioner, the petitioner could have taken recourse to appropriate remedy. The petitioner could not get a right to get the order passed under the Amnesty Scheme modified on the ground that some amount was due to the petitioner. Petition dismissed. ISSUES PRESENTED and CONSIDEREDThe core legal questions considered in this case were:1. Whether the petitioner could request an adjustment of an alleged amount due from the government against the tax arrears settled under the Kerala Amnesty Scheme 2020.2. Whether the authority under the Amnesty Scheme could modify an order once passed, based on a subsequent claim by the petitioner.ISSUE-WISE DETAILED ANALYSIS1. Adjustment of Alleged Amount Due Against Tax ArrearsRelevant Legal Framework and Precedents: The Kerala Amnesty Scheme 2020 was introduced via the Finance Bill 2020, allowing taxpayers to settle tax arrears by paying 40% of the demanded amount. The scheme did not specify provisions for adjusting any amounts allegedly due to an assessee from the government.Court's Interpretation and Reasoning: The Court interpreted the provisions of the Amnesty Scheme strictly, noting that the scheme did not contemplate any adjustment of amounts due to an assessee. The Court emphasized that any such claim should be pursued through appropriate legal channels separately and could not be integrated into the Amnesty Scheme process.Key Evidence and Findings: The petitioner had not raised the issue of the alleged amount due before the passing of the order under the Amnesty Scheme. The Court noted that the petitioner had submitted an application under the Amnesty Scheme and had not challenged the order dated 12.02.2021, which directed the payment of 40% of the arrears.Application of Law to Facts: The Court applied the provisions of the Amnesty Scheme to the facts, concluding that the petitioner's request for adjustment was not permissible under the scheme's terms. The Court found that the request for adjustment was made after the order was passed, and thus could not be entertained.Treatment of Competing Arguments: The petitioner relied on a previous judgment (M/s Steel Exchange India Ltd v. The Assistant Commissioner) where adjustments were allowed. However, the Court distinguished this case based on its facts and the explicit terms of the Amnesty Scheme, which did not provide for such adjustments.Conclusions: The Court concluded that the petitioner could not seek modification of the order under the Amnesty Scheme to adjust the alleged amount due from the government.2. Authority to Modify an Order Under the Amnesty SchemeRelevant Legal Framework and Precedents: The concept of functus officio was central to this issue, which implies that once an authority has fulfilled its function and passed an order, it cannot modify the order unless explicitly allowed by law.Court's Interpretation and Reasoning: The Court held that once the order under the Amnesty Scheme was passed, the authority became functus officio and lacked the power to modify the order based on subsequent claims by the petitioner.Key Evidence and Findings: The petitioner did not claim any amount due before the order was passed. The government representative confirmed that the amount of Rs.5 lakhs had been credited to the petitioner's account, negating any claim of an outstanding amount.Application of Law to Facts: The Court applied the functus officio doctrine, concluding that the authority under the Amnesty Scheme could not alter the order once passed, especially since the petitioner failed to raise the issue at the appropriate time.Treatment of Competing Arguments: The petitioner did not provide a compelling legal basis for the authority to modify the order post facto. The government's argument that the order could not be modified after being passed was upheld.Conclusions: The Court affirmed that the authority under the Amnesty Scheme could not modify the order once it was passed, and any claims of amounts due should be addressed through separate legal remedies.SIGNIFICANT HOLDINGSPreserve verbatim quotes of crucial legal reasoning: 'Once an application under the Amnesty Scheme has been decided and an order has been passed, the authority becomes functus officio to modify the said order.'Core principles established: The Court established that the provisions of the Amnesty Scheme must be strictly adhered to and do not allow for adjustments of amounts allegedly due to an assessee. Additionally, the functus officio doctrine prevents modification of orders once passed unless explicitly permitted by law.Final determinations on each issue: The Court dismissed the writ petition, finding no merit in the petitioner's claims for adjustment or modification of the order under the Amnesty Scheme. The petitioner was advised to pursue any claims of amounts due through appropriate legal channels outside the scope of the Amnesty Scheme.