Information on Tax Evasion by News Agency, ANI Media Pvt Ltd: SC directs Centre to Reconsider Reward Granted [Read Order]

The Supreme Court directed the Centre to consider the reward granted to the appellant, Ketan Kantilal Modi, on giving Information on Tax Evasion by News Agency, ANI Media Pvt Ltd.

The case of the appellant which is accepted by the respondents, is that the appellant was entitled to a reward under “the Reward to informers and Government Servants Review of Policy-Procedure and Guidelines” issued by the Ministry of Finance (Department of Revenue), Central Board of Excise and Customs, New Delhi.

The appellant provided information to the authorities about the tax evasion of Rs. 2.59 crores by an assessee. The grievance of the appellant was that in terms of the Clause 4.1 of the said Policy, he was entitled to a reward upto 20% of the amount of duty evaded plus amount of fine and penalty imposed and recovered. His submission is that though he was entitled to the reward of Rs.51.87 lakhs, he was sanctioned only a sum of Rs.5.50 lakhs by way of reward.

The appellant filed a petition under Article 226 of the Constitution of India before the High Court. A Division Bench of the High Court held that the writ petition involved disputed questions of fact and therefore, appropriate remedy for the appellant was to file a civil suit.

Under Clause 4.1 of the Policy, the reward is up to 20% of the amount evaded plus the amount of fine and penalty levied. As per the policy, a committee comprising of three members is empowered to take a decision regarding the reward.

A Two-Judge Bench of the Supreme Court comprising of Justices Abhay S Oka and Sanjay Karol noted that “The minutes show complete non application of mind on the prayer made by the appellant. It is well settled that if the decision making authority does not record reasons for coming to a particular conclusion, the reasons cannot be supplied by filing affidavits.”

The Bench also noted that the order dated 20.09.2018 records the statement of ASG that the amount of reward has been enhanced to Rs.9.45 lacs. This also supports the reasons recorded by us that there is no application of mind by the Committee.

The Court directed the Committee constituted under the State Government Policy dated 20.06.2001 to reconsider the case of the appellant.

To Read the full text of the Order CLICK HERE

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