The Hindu : National : 2 Additional Solicitors-General soon for tax cases

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2 Additional Solicitors-General soon for tax cases

Special Correspondent

To present the state’s viewpoint more effectively

— PTI Photo/ Manvender V. Love

Tackling taxation: Union Finance Minister P. Chidambaram and Chief Justice of India Justice K.G. Balakrishnan release a souvenir at the Silver Jubilee function of Customs, Excise & Service Tax Appellate Tribunal in New Delhi on Saturday.

NEW DELHI: The government will soon appoint two Additional Solicitors-General to ensure that the state’s viewpoint in cases pertaining to direct and indirect taxes is presented effectively, Finance Minister P. Chidambaram said on Saturday.

“We are concerned about the quality of representation from the government side.” He sought to make out a case for better representation for the state while dealing with high-profile advocates hired by corporates. The appointment of good advocates to represent the government “will also improve the quality of judgments.”

The Minister was addressing a function held to mark the silver jubilee celebrations of the Central, Excise and Service Tax Appellate Tribunal (CESTAT). He urged the tribunal to gear up and increase domain knowledge to adjudicate disputes which were likely to arise after Goods and Services Tax (GST) was imposed from April 1 next.

Underscoring the need to increase domain knowledge, Mr. Chidambaram said the Ministry was still grappling with the issue of how oil companies priced their products before being taken out of refineries and also how these should be valued for levying tax.

Mr. Chidambaram later told newspersons that this issue was only an academic exercise and was intended to explain the complexities of taxation.

Fresh area of litigation

He noted that when GST was imposed in lieu of service tax and the value added tax being levied by the State governments, it would open a fresh area of litigation on indirect taxes and the CESTAT would have to deal with it.

As for customs duty, he said litigation on this count would be less, thanks to the harmonised system of classification of goods and reduced rates of taxation.

In fact, with revenue from customs duty declining the world over in the wake of declining tariff rates, corporates might not find it worthwhile to raise tax disputes. However, the duty would still remain important to the extent that it dealt with cross-border activities, Mr. Chidambaram said.

“Judges and tax advocates must refresh themselves on rapidly changing tax laws throughout the world.” Lack of domain knowledge affected the quality of litigation and adjudication.

Service tax disputes

More worrying in tax litigation was the increase in the number of disputes related to service tax, which was emerging as an important area of revenue. “It means that there is an arbitrage opportunity…We want the service tax to be administered in such a way that the disputes are very few and are adjudicated by the tribunal after devoting enough time,” he said.

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