Separate benches for tax cases may help reduce pendency at courts


NEW DELHI: Separate benches at high courts to handle tax cases can help prune their pendency and bring about consistency in resolving litigation, the Economic Survey said.

“The Supreme Court’s recent experiment with constituting an exclusive bench for taxation produced impressive results, which may be replicated for other subject matters, and emulated by other high courts that do not have special rosters for daily hearings,” it said.

The Economic Survey highlighted that since the tax bench was set up in 2014, the apex court has been able to reverse the trend of burgeoning pendency of tax cases.

“It is noteworthy that during this period, the SC reduced its reliance on staying claims of the department (revenue), and focused on hearing and disposing cases,” the Survey said.

It said such benches ensure the Supreme Court speaks in one voice and there is continuity and consistency of legal jurisprudence.

“Further, they create efficiencies by allowing the judge to focus on the specialised branch of law placed before her. The model may be replicated for other commercial and economic areas of law as and when necessary at the Supreme Court, and should be replicated by every high court of the country,” the Survey said.

It said delays and pendency are caused due to the increase in overall workload of the judiciary. In the case of tax litigation, it stems from the government persisting with litigation despite high rates of failure at every stage of the appellate process, the Survey said.

It said tax departments in India have contested several disputes, with a low success rate of less than 30%. About 66% of the pending cases accounted for only 1.8% of value at stake.

The Survey said there were over 1.37 lakh direct tax cases under consideration at the level of Income Tax Appellate Tribunal, high courts and Supreme Court as of March 2017.

In indirect tax disputes, 83,338 cases with a value of `1.92 lakh crore at stake were pending in appellate tribunal CESTAT and 14,141 cases with `37,000 crore at stake were pending in high courts. In the Supreme Court, disputes were pending in 2,946 cases with `20,000 crore at stake. economictimes