Verdict on tax tribunal law may delay cases

The Supreme Court’s move to strike down the National Tax Tribunal as “unconstitutional” will impact speedier disposal of appeals before High Courts, say tax experts.

This verdict is certainly a legal victory and in the bargain may turn out to be a loss for taxpayers, as huge number of tax cases are pending before High Courts, Aseem Chawla, Partner, MPC Legal, a law firm, told BusinessLine .

R Sekar, Partner, Deloitte, Haskins & Sells LLP, said the ruling may be appreciated for upholding Constitutional principles and judicial hierarchy. However, the verdict will go against the concept or intention of setting up of tribunals by the Government for speedy disposal of appeals, he said.

Now the Government will have to find a way of ensuring the speedier disposal of appeals, Sekar said, adding that the creation of NTT and constitution of NTT was a step in the right direction.

The Apex Court on Thursday held that NTT cannot decide on the matters involving substantial questions of law and also that Tribunals cannot take away the power of High Court.

Pallavi Bakhru, Director-Grant Thornton Advisory, said striking down the NTT does create a void of expectations in taxpayers’ minds who were looking forward to an alternative to the judicial process. Judicial delays notwithstanding, the points raised by the Supreme Court are well-noted, and the Central Government could, after careful analysis , propose an alternative institutional set up to cleanse up the pending litigation on central tax laws, she added. Chawla said tribunalisation of justice had always been a contentious matter. Now one needs to see that how judicial reforms in the tax sphere are carried out, he said.

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