SC stays Orders of Allahabad and Kerala High Courts restraining Govt from Recovery of Tax due COVID-19 Ourbreak

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The Supreme Court has stayed the orders of the High Court of Allahabad and Kerala restraining the government from the recovery of Tax on the account of the outbreak of COVID-19.

The Special Leave Petition (SLP) was filed by the Ministry of Finance questioning the jurisdiction of the High courts of the Allahbad and Kerala on the order passed by it restraining the government from the recovery of tax.

The Solicitor General, Tushar Mehta in his plea in the Apex Court stated that it is not inside the purview of the High Courts to pass such a blanket order. It was further contended by the Solicitor general that the restraint on the government to recover the tax would put the government to prejudice, specifically in the view of the pending closure of the Financial Year on March 31, 2020.

It was further argued that any party who will be willing to pay the tax would not be allowed to do so. At the same time, the government is conscious about the spread of Coronavirus and the center is trying its best to figure out the mechanism to curb the outbreak of the virus.

It was also contended that the delay in the recovery of tax will have an adverse impact on the financial status of the nation and at the same time either the people will delay the payment of tax or the taxes will fall due on the people.

The Solicitor General also stated that the stay would adversely impact the revenue collection of the Government which will result in the loss of 2 Lakh Crores.

The three-bench of Supreme Court of India consisting of Justice A. M. Kanwilkar; Justice Vineet Saran and Justice Krishna Murari stayed the order of the High Courts of Allahabad and Kerala restraining the government from the recovery of tax in order to curb the outbreak of Coronavirus (COVID-19).