By TIOL News Service

AHEMDABAD, AUG 31, 2018: A petition, in the nature of public interest, was filed by the two petitioners, one a practicing advocate and the other, a tax consultant.

The petitioners have challenged the constitutional validity of section 47 [Levy of Late Fee] of the CGST, 2017 as being ultra vires the constitution.

Principal contention of the petitioners is that the Government is trying to recover penalty in the guise of late fee charges; that as a result, the dealers are losing their valuable right of appeals as well as right to point out that there was sufficient cause preventing them from filing the return within the due date; that in all previous laws which have been repealed by the statutes enacted under the new GST regime, such charges were categorized as penal in nature.

The High Court was not impressed and observed that it is not inclined to entertain the petition which is categorised as a "Public Interest Litigation"; that it is not a case where PIL jurisdiction should be exercised.

The High Court further observed -

+ By the account of the counsel for the petitioners, there are not less than 1.30 crore dealers affected by the said provision. There is nothing to suggest that none of these affected persons can take up the cause and approach the Court of law as may be advised.

+ Majority, if not all, of them would be persons with proper means who can also avail proper legal advice. This is not a case where the petitioners are espousing the cause of a weaker section of the society who, on account of hardships and handicaps inherently faced by them, are unable to knock the door of justice.

+ In the present petition, the petitioners who are themselves active tax consultants and tax practitioners have challenged the vires of section 47 of  CGST Act. They are obviously indirectly concerned with the same.

+ As noted, they pointed out that there are millions of dealers who would be adversely affected by the provisions made therein. There is no reason why such an issue should be examined in a public interest petition when, as noted above, the group of persons whom the statute affects does not suffer from any handicap preventing them from taking up the litigation themselves and pursuing it.

The Petition was dismissed.

(See 2018-TIOL-2854-HC-AHM-GST)