If a revenue department official who is in charge of filing a government appeal fails to do so within time and thus causes a loss to the exchequer, an enquiry should be made into the delay and the official responsible should be made to pay a hefty fine from his pocket. This is not an idea that escaped the mind of Arvind Kejriwal, but a rule of thumb followed by a bench of the Supreme Court in revenue matters. Several judges in the past decades had tried to wake up officials slumbering (or pretending to) behind the files, and had largely failed. But this experiment is worth following.
Some time ago, the government stated in Parliament that 5,806 cases involving Rs 2,707 crore in direct tax demands were locked in litigation before the apex court, and another 29,650 cases with a tax demand of Rs 36,340 crore were pending in high courts. It also revealed that 2,855 disputes over indirect taxes, involving Rs 8,130 crore, were pending in the Supreme Court and 14,626 cases amounting to Rs 11,459 crore were pending in various high courts. The money locked in numerous tribunals will take the total to astronomical levels. The judiciary blissfully lacks analytical data on the case flow and has not made any serious effort to gather it.
One reason why such amounts are tied up, apart from the snail's pace of civil litigation, is the delay in filing appeals. The normal time to file an appeal where the government loses a suit in tax, excise or customs is three months. But files have to move from the ministry concerned to the finance ministry, and then to the law ministry. The availability of officers, their transfers and conference with lawyers contribute to further delay. Hardly any tax appeal makes it to the court on time. Therefore, most appeals are accompanied by an application for "condonation of delay".
When the government makes such requests, the judges are in a dilemma. If they grant it, it will encourage lethargy in the leviathan, and mercy would beget more such prayers. If they dismiss the appeal for inordinate delay, sometimes counted in years, the loser would be the government and ultimately the taxpayer. Therefore, the judges tend to condone delay.
One method to combat bureaucratic indolence is to impose a fine on the government. But it hurts no one responsible for the delay. Officials of the three most corrupt government departments - income tax, sales tax and excise - just move one more file to pay the fine. The burden is on the public. In the past few weeks, one bench of the Supreme Court dealing with revenue matters has hit where it hurts, the babu's wallet. In one case involving transaction of defence land, the bench imposed a fine of Rs 30,000 on the official who caused a delay of more than a year in filing the appeal. An enquiry was ordered into the delay at each stage and an action-taken report was demanded. The penalty shall be recovered from the erring officer. The excuse that Rs 50,000 was not sanctioned in time for paying court fees was not found credible. A similar order was passed last month in an appeal moved by the Commissioner of Trade Tax against an order in favour of a Uttar Pradesh firm.
It is not easy to tackle the "steel frame", which is the only enduring thing while the ministers and judges fade away. Some time ago, the Supreme Court wrote in exasperation about the problem. In the case, State of Jharkhand vs Krishan Pradhan, it said: "It appears that cases are coming up before this court and probably before the high courts also, where appeals or writ petitions are filed after inordinate delay and an explanation is sought to be given in the application for condonation of delay in such cases filed by the government or the state authorities that the file was moved from one desk to another or the approval was sought from the higher authority which took considerable time."
The judges suspected that the party who won the suit in courts below was behind the deliberate delay. "We feel that the beneficiary of the judgment may be hand-in-glove with the officials in the department who deal with the files, and files are suppressed for a long period, and then the appeal is filed to get it dismissed on the ground of delay. Huge amounts of public money or property may be involved and the government will be the loser on the technical point of limitation in such cases. This racket has been going on for a long time. Now the time has come that this racket is ended and the officials responsible given severe punishment." The weapon has been identified, and it is for the judges themselves to ignite it.
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