TaxTMI 
TaxTMI 
TaxTMI 
2020 (11) TMI 78
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..... (4)Mr.M.Radhakrishnan, learned counsel for the petitioner has invited the attention of this Court to the materials placed and would submit that in terms of Section 7 of the Goods and Services Tax [Compensation to States] Act, 2017 [Central Act 15 of 2017], an obligation is cast upon the 1st respondent to provide for timely and speedy disbursal of compensation in pursuance of provisions of Section 18 of the Constitution [101st Amendment] Act, 2016. The learned counsel for the petitioner also drawn the attention of this Court to the Press Release in PR.No.635 dated 31.08.2020 issued by the Director of Information and Public Relations, Government of Tamil Nadu, Chennai and would submit that the Press Release contains a D.O. Letter dated 31.08.2020 of the Hon'ble Chief Minister of Tamil Nadu addressed to the Hon'ble Prime Minister of India, wherein the difficulties being faced by the State of Tamil Nadu, in the light of COVID-19 pandemic virus have been stated and a request has also been made for provision of a mechanism in and by which the Government of India raises required funds as loan and lends it to the Goods and Services Tax [in short ''GST''] Compensat....
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....e finally calculated for every financial year after the receipt of final revenue figures as audited by the Comptroller and Auditor General of India. Provided that in case any excess amount has been released as compensation to a State in any financial year during the transition period, as per the audited figures of revenue collected, the excess amount so released shall be adjusted against the compensation amount payable to such State in the subsequent financial year. (3) The total compensation payable for any financial year during the transition period to any State shall be calculated in the following manner, namely:-- (a) the projected revenue for any financial year during the transition period, which could have accrued to a State in the absence of the goods and services tax, shall be calculated as per section 6; (b) the actual revenue collected by a State in any financial year during the transition period shall be- (i) the actual revenue from State tax collected by the State, net of refunds given by the said State under Chapters XI and XX of the State Goods and Services Tax Act; (ii) the integrated goods and services tax apportioned to that State; and (iii) any c....
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....ring the transition period. (5) In case of any difference between the final compensation amount payable to a State calculated in accordance with the provisions of sub-section (3) upon receipt of the audited revenue figures from the Comptroller and Auditor-General of India, and the total provisional compensation amount released to a State in the said financial year in accordance with the provisions of sub-section (4), the same shall be adjusted against release of compensation to the State in the subsequent financial year. (6) Where no compensation is due to be released in any financial year, and in case any excess amount has been released to a State in the previous year, this amount shall be refunded by the State to the Central Government and such amount shall be credited to the Fund in such manner as may be prescribed.'' (8)The primordial submission made by the learned counsel for the petitioner is that in the light of Sub-section [1] of Section 7, the compensation payable under the Act to any State during the transition period, is mandatory and as such, the 1st respondent is under obligation to pay the compensation to the State of Tamil Nadu without any loss of tim....
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....th the particular rule. 18. It is well settled that the use of the word "may" in a statutory provision would not by itself show that the provision is directory in nature. In some cases, the legislature may use the word "may" as a matter of pure conventional courtesy and yet intend a mandatory force. In order, therefore, to interpret the legal import of the word "may", the court has to consider various factors, namely, the object and the scheme of the Act, the context and the background against which the words have been used, the purpose and the advantages sought to be achieved by the use of this word, and the like. It is equally well settled that where the word "may" involves a discretion coupled with an obligation or where it confers a positive benefit to a general class of subjects in a utility Act, or where the court advances a remedy and suppresses the mischief, or where giving the words directory significance would defeat the very object of the Act, the word "may" should be interpreted to convey a mandatory force. As a general rule, the word "may" is permissive and operative to confer discretion and especially so, where it is used in juxtaposition to the word "shall", which....
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....ct done in disregard of that provision causes serious prejudice to those for whose benefit it is enacted and at the same time who have no control over the performance of the duty, such provision should be treated as a directory one. Where, however, a provision of law prescribes that a certain act has to be done in a particular manner by a person in order to acquire a right and it is coupled with another provision which confers an immunity on another when such act is not done in that manner, the former has to be regarded as a mandatory one. A procedural rule ordinarily should not be construed as mandatory if the defect in the act done in pursuance of it can be cured by permitting appropriate rectification to be carried out at a subsequent stage unless by according such permission to rectify the error later on, another rule would be contravened. Whenever a statute prescribes that a particular act is to be done in a particular manner and also lays down that failure to comply with the said requirement leads to a specific consequence, it would be difficult to hold that the requirement is not mandatory and the specified consequence should not follow." (12)In the judgment reported in 20....
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....be construed.' ? that in each case you must look to the subject-matter, consider the importance of the provision and the relation of that provision to the general object intended to be secured by the Act, and upon a review of the case in that aspect decide whether the enactment is what is called imperative or only directory." (13)In the decision reported in 2016 [1] CTC 308 [Hyundai Motors Vs. Union of India], it has been held as follows:- ''59. Therefore, it is clear that if the condition imposed by the provision of law to do a certain thing within a time frame is upon an authority (such as the Designated Authority in this case) and the consequences of the failure of that authority to comply with the condition, is to fall upon someone else (such as the persons in the domestic market) who have no control over the authority which is to perform the duty, then the provision of law cannot be construed as mandatory, but only directory. .... 63. Another simple test to determine whether a time limit stipulated in a rule is directory or mandatory, is to see whether there is any indication in the Rule itself about the consequences of non compliance with the same. If a ....