ITC’s handshake with the Government – Firm?
Today many newspapers reported that that ITC had signed an agreement with the Government by which the Government need not refund the 350 Crores already deposited by ITC and the ordinance would be lapsed. The ITC case has been shrouded in mystery right from Day one and ended with the lapsing of the Ordinance. But there seems to be no end only ends (justified by all means). The CEGAT passed one of its longest orders running into over 150 pages in about 250 paragraphs. Reading the judgement was a formidable challenge to any student of excise. By the time you reach para 237, you have completely forgotten para 1!
What baffles a law student is, “What is the need for an agreement for a winning party with the losing party after the highest court of the land has given its verdict?” But if the losing party is the Government and they have the power to retrospectively amend the law, may be it is prudent business to enter into agreements. But why should the poor tax payer’s money be wasted in all this farce? Is 300 Crores such a large sum for the Government to enter into an agreement with the party whom it had accused of evasion? Was ITC coerced into signing the agreement? Was the ordinance meant to be a veiled threat- only to be lapsed? Then what happens to the sanctity attached to the office of the President of India? If the ordinance was a disaster, the lapsing was a calamity and this agreement is an affront to our sacred institutions. The nation does not lose much if ITC gains a few hundreds of Crores but when government is seen as any other businessman and when government appears to have no respect for judiciary, parliament or President, it shatters the confidence in the system. The ordinance on ITC brought down the price of ITC shares and the loss to investors on that one day must have been more than these 350 Crores for which the Government is said to have entered into an agreement with the ITC. It is a sacred principle of our Constitution that no tax should be collected except by authority of law. Government should collect taxes by law (even an ordinance) not by agreements – Not a penny more not a penny less.