SCNs involving duty evasion of Rs 2 lakhs to be scrutinized by CCs and Commissioners from Vigilance Angle - Preventive Vigilance
DIRECTORATE General of Vigilance of CBEC would hereafter shift to a more proactive, preventive approach to curb the menace of corruption and in this regard identified several areas. These steps were listed as a part of the Vigilance Action Plan and approved by the Finance Minister.
The DG, Vigilance, in a recent letter to the Chief Commissioners and Commissioners, had stressed the need for scrutiny of adjudication orders passed by various adjudicating authorities from a vigilance angle. In view of this, henceforth, the Committee of Chief Commissioners and Commissioners would also scrutinize the adjudication orders from vigilance angle and refer cases of recurring nature or involving substantial duty to the Zonal offices of the Directorate of Vigilance.
Also frivolous SCNs are being issued to harass the assessees. Hereafter all SCNs involving a duty evasion of Rs. 2 lakhs shall be scrutinized by the Chief Commissioners/Commissioners from a vigilance angle. Further, cases booked based on intelligence for clandestine removal/irregular availment of CENVAT credit etc should be invariably looked into by the Commissioners before a final decision is taken not to issue the SCNs. Any irregularities noticed during such scrutiny should be notified to the regional offices of vigilance directorate.
As per the Second Administrative Reforms Commission's fourth report, it was emphasised that proactive vigilance measures are primarily the responsibility of the Head of the Department, the DG adds.
Now what happens?
One reason cited for frivolous SCNs and unreasonable orders, is fear of Audit and vilgilance. Many officers who do not have the guts to be fair and right openly tell the assessees – “we don't have a strong case, but I am helpless – you will surely win in the Tribunal”
Now with the DG openly suggesting vigilance scrutiny of Show Cause Notices and adjudication orders, even the very few officers who occasionally indulged in the fantasy of passing a fair judicial order will shy away. After all who wants a vigilance inquiry for being fair to the law and assessee? A quasi judicial authority is always subject to judicial supervision in appeal and he should not be subject to vigilance inquiry.
In the celebrated ZB Nagarkar case, , the Supreme Court observed, “The entire system of administrative adjudication whereunder quasi-judicial powers are conferred on administrative authorities would fall into disrepute if officers performing such functions are inhibited in performing their functions without fear or favour because of the constant threat of disciplinary proceedings .”
However, in the Dulichand case, , the Supreme Court over ruled Nagarkar. This became an additional incentive for Departmental Officers to routinely confirm all demands, flouting the law and all higher judicial authorities including the Apex Court. There are Assistant Commissioners passing orders, “the learned tribunal erred ....”
With the Damocles' sword of vigilance hanging over their heads, now officers will vie with each other in passing orders favourable to Revenue, which will only be quashed in the higher forums. Only consultants will benefit.
And what about such adjudication orders passed in favour of the revenue which are grossly against the provisions of law and soon to be set aside by the higher forums? Will they also be probed from vigilance angle by the Committee of Chief Commissioners as it is nothing but harassment to the tax payers?