HCs to breathe easy as govt okays new tax tribunal

NEW DELHI: The Cabinet on Friday cleared the proposal to set up a National Tax Tribunal (NTT) with 25 benches that would dispose of long-pending disputes between the taxpayer and the government, thereby reducing the burden on the High Courts.
It will also ensure uniformity and certainty in the administration of tax laws, avoiding conflicting rulings on the same point. The tribunal will be chaired by either a retired judge of the Supreme Court or a retired chief justice of a High Court and will have a number of members. It has been left to the Central government to decide on the strength of the members.
A bench will consist of a judicial member and a technical member (direct taxes) for appeals against orders passed by the Income Tax Appellate Tribunal (ITAT) and a technical member (indirect taxes) for the appeals against orders passed by the Central Excise, Customs and Service Taxes Appellate Tribunal (CESTAT).
The expenditure for the 25 benches proposed is estimated at around Rs 7.88 crore. An appeal from the order passed by ITAT and CESTAT shall lie to the NTT only on the substantial question of law.
The proposed law also seeks for the constitution of a five-member special bench to resolve conflicting decisions of the question of law between different benches of the tribunal. The tribunal will also have powers to punish for its contempt.
The chairperson of the tribunal will hold office for five years or till he attains the age of 68 years. The age limit is 65 years for members. The chairperson and members will be selected by a selection committee comprising of the chief justice India or his nominee, chairperson of the NTT, secretary, law and justice (Department of Legal Affairs) and the revenue secretary.
The need to set up an NTT arose due to the large pendency before High Courts. The tribunal is expected to dispose off cases that would have otherwise lingered for five years or more.
The broad contours of the NTT, which will help realise thousands of crores of locked up revenue for the government and reduce transaction costs for tax payers locked in litigation, was announced by the finance minister Jaswant Singh in July this year. Tax arrears for corporate and personal income tax are estimated at around Rs 70,000 crore. A fifth as much would be arrears in indirect taxes.
The Cabinet also approved Prasar Bharati’s proposal to launch a 24-hour news channel which would replace the Doordarshan Metro channel. The channel, to be launched on November 3, would involve an annual recurring expenditure of Rs 54 crore and non-plan grants to the extent of Rs 20 crore for the current financial year. The budgetary support for subsequent years would be worked out in consultation with the Ministry of Finance after a review of the revenue generated by DD. Briefing reporters after the meeting, parliamentary affairs minister Sushma Swaraj said funding through direct budgetary support would, however, not really be open-ended. Prasar Bharati would, therefore, have to target 50% and 100% of the cost of the project as the revenue be to be generated for ‘04-05 and ‘05-06. Even the staff component for the channel would have to be worked out in consultation with the ministry of finance.
At present, DD telecasts news bulletins from the Delhi Kendra for three and half hours every day, while regional news units put out bulletins for a total of 12 and half hours. With DD already having other entertainment channels, it was felt that DD Metro’s terrestrial reach of 43% could be effectively tapped for a news and current affairs channel — giving it an edge over private satellite channels. As an added advantage the news channel would also have satellite reach as Metro is running in a dual mode.