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| Monday, 29 March 2004 |
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The Supreme Court in ruling that the Inland Revenue (Special Provisions) Act. No. 10 of 2003 violated the Constitution has declared that the provisions contained in the Act as amended granted immunities and indemnities to persons who have contravened the laws and defrauded public revenue causing extensive loss to the State whilst being inconsistent with Article 12(1) of the Constitution which guarantees every person equal protection of the law. The Supreme Court was delivering its opinion on a reference made to it by the President on whether provisions of the Act exceeded the authority of the executive. Court also referred to the submissions made by the Additional Solicitor General that attempts over the past several decades to bring tax evaders to pay to the inland revenue had been futile and that even the previous amnesties offered to such tax evaders had not brought in the expected results. According to the Additional Solicitor General by an amnesty both the Government and community would be benefitted and would increase the future tax revenue of the Government. It was also pointed out that to achieve this objective it is necessary to offer sufficient incentive which are attractive to the defaulters . In the process according to the ASG the existing tax payers were also allowed to make a complete disclosure of their income and assets. Court however noted that in doing so a special class of persons have been created who would be entitled to benefits, denied to others who had complied with the law and paid their dues."An honest taxpayer who took pains to submit a tax return elaborating his income and expenditure is treated differently from the person who now submits a declaration in terms of Section 2 read with Sections 4(2) and (3) incorporating amounts which he decides that should be paid as taxes," the Court observed. It says that the immunity granted is not restricted to persons who have not made declarations or had evaded paying tax under the Inland Revenue Act. Section 2 and 3 of the said Act refers to the immunity granted under any law which is specified in the Schedule to the Act. Court also declared that Section 3 grants full immunity from liability to pay tax under any law specified in the schedule and the immunity would be enjoyed from liability from any investigation or prosecution for any offence under any law specified in the schedule to the Act. The Court said "the right to equality is statutorily enshrined in terms of Article 12 of the Constitution... This guarantee of equal protection of the law is an injunction issued by the Constitution to the Legislature against enacting discriminatory laws. What it attempts to prevent is discrimination between any two persons where they are similarly situated." |
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