Category Archives: Sikkim HC

Case Name: Sri Guru Singh Sabha and Another vs. The State of Sikkim through the Secretary, Ecclesiastical Department and Others

Case Number: WP(C) No. 49 of 2017

Dated on: 10th October, 2023

Quorum: Single Bench – The Hon’ble Mrs. Justice Meenakshi Madan Rai, Judge

FACTS OF THE CASE

The petitioners allege that religious articles were removed from a Gurdwara without proper rituals. The respondents counter that they were relocated to facilitate government development works. The land on which the Gurudwara and Monastery were situated is claimed to be forest land by the state respondents. Both parties present conflicting accounts regarding the removal and relocation of the religious articles. The court refers to various legal principles, including those related to environmental protection, religious freedom, and the jurisdiction of writ courts. The court determines that the issues raised require extensive evidence and are better suited for resolution in a civil court. The court dismisses the writ petition. Each party is directed to bear their own costs.

ISSUES

• Whether the removal and relocation of religious articles from a Gurudwara constituted desecration and if it was done in compliance with religious rituals.
• Whether the construction of structures for offering worship on forest land without permission violated relevant laws and regulations.
• Whether the rights to religious freedom under Article 25 of the Constitution were infringed upon due to the alleged unauthorised actions concerning the religious articles and structures.

LEGAL PROVISIONS

• Article 226 of the Constitution of India, which confers extraordinary jurisdiction on the High Court to issue prerogative writs for enforcement of fundamental rights or for any other purpose.
• Forest (Conservation) Act, 1980, which regulates the use of forest land for non-forest purposes and requires prior approval from the Central Government for any such activities.
• Directive Principles of State Policy, specifically Article 48A, which mandates the State to protect and improve the environment and safeguard forests.
• Articles 25 and 26 of the Constitution, which guarantee the freedom of conscience and the right to profess, practice, and propagate religion, subject to certain restrictions for public order, morality, and health.
• Public Trust Doctrine, which establishes the State as a trustee of natural resources and imposes a legal duty to protect them.

CONTENTIONS OF THE APPELLANT

The Petitioner No.1 alleges that the removal of the Guru Granth Sahib Ji was done without the requisite preceding religious rituals and was orchestrated by Respondent No.4, in collusion with the State-Respondents. The Petitioner contends that the construction by the Army was intended to serve as a “Dharma Sthal,” a place of worship for all faiths, while Respondent No.4 argues that the location is specifically for Buddhist worship. The Petitioner emphasises the importance of religious freedom, invoking Article 25 of the Constitution, which guarantees the freedom to profess, practice, and propagate religion. The Petitioner argues that every public authority has a duty, coupled with power, and should understand the object and conditions under which such power is exercised. The Petitioner highlights the High Court’s jurisdiction to determine disputed questions of fact, citing case law to support the argument. The Petitioner also raises concerns about the failure to implement the Lachen Monastery as a necessary party in the proceedings. Overall, the Petitioner asserts that there are disputed questions of fact that require extensive evidence and are not suitable for determination in proceedings under Article 226 of the Constitution.

CONTENTIONS OF THE RESPONDENT

The respondent argues that the petitioner has failed to establish the existence of a Gurdwara through their averments in the petition. They assert that the inventory was prepared and articles were handed over to the Lachen Monastery in accordance with a receipt dated 06-07-2001. The respondent contends that the alleged desecration of religious articles is a fabrication by the petitioner. They claim that the removal of religious items on 16-08-2017 was part of a unanimous decision by the Lachen Monk Committee and the Lachen public to relocate the religious items to facilitate government development works. The respondent denies any involvement in the removal of articles from outside the Chungthang Gurudwara, stating that representatives of the Gurudwara requested the relocation of these articles to the Lachen Monastery. The respondent challenges the assertion that the location was intended to be a place of worship for all faiths, arguing that it is specifically designated for Buddhist worship. Additionally, the respondent argues that the petitioner’s invocation of Article 25 of the Constitution does not absolve them from the requirement to obtain permission for the construction of structures on forest land for non-forest purposes. The respondent disputes the petitioner’s reliance on case law regarding the High Court’s jurisdiction to determine questions of fact, asserting that the disputed questions in this case are not suitable for determination under Article 226 of the Constitution. Lastly, the respondent maintains that the petitioner has failed to implement the Lachen Monastery as a necessary party in the proceedings, which complicates the determination of certain issues in the case.

COURT’S  ANALYSIS AND JUDGEMENT

The court begins by emphasising the discretionary and equitable nature of the jurisdiction conferred upon it by Article 226 of the Constitution. It underscores that a writ proceeding cannot serve as a substitute for a civil suit, as the jurisdiction of the civil court is expansive. It highlights that the land on which the structures were situated is claimed to be forest land by the state respondents, which falls under the Concurrent List of the Seventh Schedule to the Constitution. However, neither the petitioners nor the respondent established acquisition of the land or sought permission from the Forest Department for non-forest purposes. The court delves into the disputed removal of religious articles, noting conflicting assertions from both parties regarding the events surrounding the removal. It emphasises the importance of environmental protection, citing legal principles and obligations related to forest conservation and pollution prevention. Addressing the petitioner’s invocation of Article 25 of the Constitution, which guarantees the freedom of conscience and the right to profess, practice, and propagate religion, the court explains that this right is subject to certain limitations, particularly for reasons of public order, health, and morality. The court dismisses the petitioner’s contention that the state respondents were complicit in the removal of holy articles, as this claim remains disputed and cannot be resolved in the writ proceedings. Additionally, the court rejects the petitioner’s reliance on certain legal precedents regarding the jurisdiction of the High Court to determine questions of fact. It emphasises the need for extensive evidence and oral testimony to resolve the complex issues raised in the case. Finally, the court concludes that the issues before it require extensive evidence and fall within the purview of a civil court. Therefore, it dismisses the writ petition and disposes of any pending applications, with each party bearing its own costs.

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 Judgement Reviewed by – Shruti Gattani

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Case Name:
W.P. (C) No. 20 of 2022 – Zydus Wellness Products Ltd. vs Union of India & Ors./
W.P. (C) No. 27 of 2022 – Alkem Laboratories Ltd. vs Union of India & Ors.

Case Number:

For Zydus Wellness Products Ltd. vs Union of India & Ors.:
W.P. (C) No. 20 of 2022

For Alkem Laboratories Ltd. vs Union of India & Ors.:
W.P. (C) No. 27 of 2022

Date of Hearing: 17th August 2023
Date of Judgment: 12th September 2023

Quorum: Single Bench: The Hon’ble Mr. Justice Bhaskar Raj Pradhan, Judge

FACTS OF THE CASE

The petitioners of the case are Zydus Wellness Products Limited, represented by Umesh Parikh, Chief Financial Officer, Alkem Laboratories Limited, represented by Ajay Kumar Prasad, General Manager – Accounts, and the respondents are Union of India, various officials from the Department of Revenue, Ministry of Finance, Department for Promotion of Industry and Internal Trade, and Central Goods & Service Tax authorities. On February 28, 2019, Zydus Wellness-Sikkim, a partnership firm, was converted into Zydus Nutritions Limited under the Companies Act, 2013. On June 4, 2019, Zydus Nutritions Limited changed its name to Zydus Wellness Products Limited. Zydus Wellness Products Limited seeks budgetary support under the “Scheme of Budgetary Support dated 05.10.2017” for the “residual period” during which Zydus Wellness-Sikkim was entitled to exemption under Notification No. 20/2007-C dated April 25, 2007. In October 2019, Unit-V was transferred from Cachet Pharmaceuticals Private Limited to Alkem Laboratories Limited by way of a slump sale. Alkem Laboratories Limited seeks a fresh Unique Identity (UID) for Unit-V and processing of verification and claim applications under the Budgetary Support Scheme for the “residual period” for which Cachet Pharmaceuticals Private Limited was entitled to exemption under Notification No. 20/2007-C dated April 25, 2007.

ISSUES

• Is Zydus Wellness Products Limited entitled to budgetary support for the period during which Zydus Wellness-Sikkim was entitled to exemption under a specific notification?

• Should Alkem Laboratories Limited be granted a new Unique Identity (UID) for Unit-V, and should their claims under the Budgetary Support Scheme be processed for the period during which Cachet Pharmaceuticals was entitled to exemption under the same notification?

 

LEGAL PROVISIONS

Central Excise Act, 1944:

• This Act governs the levy and collection of duties of excise on goods manufactured or produced in India. Relevant provisions within this act were likely referenced in determining the entitlement to exemptions and budgetary support.

Notification No. 71/2003-CE dated 09.09.2003:

• This notification pertains to excise duty exemptions for units located in specific areas, including the North Eastern States, Sikkim, and Jammu & Kashmir. It outlines the conditions and extent of the exemptions granted to units in these regions.

Goods and Services Tax (GST) regime:

• The transition from the Central Excise Act to the GST regime involved changes in tax structures and the introduction of budgetary support schemes to ensure smooth transitions for units that previously enjoyed excise duty exemptions.

Budgetary Support Scheme:

• The scheme was introduced to provide financial support to units located in specified areas that were previously eligible for excise duty exemptions, to mitigate the impact of the transition to GST. This scheme outlines eligibility criteria and the extent of support provided.

CONTENTIONS OF THE APPELLANT

The appellant, M/s Adani Power (Mundra) Ltd., contended that they were entitled to a refund under the Budgetary Support Scheme. This scheme, which was introduced as a replacement for area-based exemptions under the Central Excise regime, was designed to provide budgetary support to units located in specified areas. The appellant argued that they fulfilled all the necessary conditions stipulated under the scheme, and thus, their claim for a refund should be processed favourably. The appellant asserted that the authorities had failed to consider the factual and legal aspects of their case correctly. They emphasised that their claim was rejected without a proper examination of the facts and circumstances, including their compliance with the conditions of the Budgetary Support Scheme and relevant legal provisions. The appellant argued that the transition from the Central Excise regime to the Goods and Services Tax (GST) regime should not affect their entitlement to benefits under the Budgetary Support Scheme. They contended that the objective of the scheme was to support industrial units in specified areas, regardless of the tax regime in force, and that their entitlement to the refund should remain intact post-GST implementation. The appellant invoked the principle of legitimate expectation, arguing that they had a reasonable expectation of receiving the refund based on the scheme’s provisions and the government’s assurances. They contended that the abrupt rejection of their claim was a violation of this principle, which protects the expectations of individuals or entities based on established practices and promises by public authorities. The appellant contended that denying their refund claim amounted to discrimination and inequality, as other similarly placed entities had been granted refunds under the same scheme. They argued that this differential treatment was arbitrary and unjust, and it violated their right to equality under the law. The appellant argued that the authorities had misinterpreted the notifications and the Budgetary Support Scheme’s provisions. They contended that a correct interpretation would support their claim for a refund and that the authorities’ narrow and restrictive interpretation was flawed and contrary to the scheme’s objectives.

CONTENTIONS OF THE RESPONDENT

The respondent, represented by the tax authorities, argued that the appellant had not complied with all the necessary conditions stipulated under the Budgetary Support Scheme. They contended that the scheme had specific eligibility criteria and procedural requirements, which the appellant failed to meet. As a result, the appellant’s claim for a refund could not be processed favourably. The respondents contended that the transition from the Central Excise regime to the Goods and Services Tax (GST) regime introduced significant changes in the tax structure and compliance requirements. They argued that the benefits under the previous regime could not be automatically extended to the new regime without re-evaluating the eligibility and compliance of the claimant under the revised rules. The respondents argued that the principle of legitimate expectation could not be invoked in this case because policy changes, especially in tax laws, are within the government’s purview. They contended that changes in policy or tax regimes could alter the benefits available to taxpayers, and the government had the right to modify or discontinue such schemes in light of new policy objectives or fiscal considerations. The respondents maintained that their interpretation of the notifications and the provisions of the Budgetary Support Scheme was correct and in accordance with the law. They argued that the scheme’s benefits were limited and conditional, and their interpretation was intended to prevent undue claims and ensure that only eligible units received support.The respondents contended that the rejection of the appellant’s claim was consistent with the broader policy objectives of the government. They argued that the Budgetary Support Scheme aimed to promote specific economic activities and industrial development in designated areas, and the appellant’s situation did not align with these objectives under the new tax regime. The respondents cited relevant precedents and case law to support their position. They argued that judicial interpretations of similar schemes and notifications had consistently upheld the government’s right to define eligibility and interpret scheme provisions. They contended that these precedents supported their rejection of the appellant’s claim for a refund. The respondents argued that granting a refund to the appellant could result in unjust enrichment. They contended that the appellant might receive a financial benefit that they were not entitled to under the revised scheme, which would be contrary to the principles of equity and fairness in tax administration.

COURT’S ANALYSIS AND JUDGEMENT

The High Court of Sikkim analysed the two writ petitions filed by Zydus Wellness Products Limited and Alkem Laboratories Limited. Both petitions sought clarification on their eligibility for budgetary support under the Budgetary Support Scheme. The court considered several key points: Both petitioners underwent significant changes, including changes in ownership and the transition from partnership firms to private limited companies. The respondents argued that these changes disqualified the petitioners from the Budgetary Support Scheme. The court examined the definition of an “eligible unit” under the Budgetary Support Scheme. It noted that the scheme was intended to provide support to existing manufacturing units that were eligible for benefits under earlier excise duty exemption/refund schemes. The eligibility criteria were based on the unit itself, not the ownership. The court considered the opinions of the Ministry of Commerce and the Central Board of Indirect Taxes and Customs (CBIC), which stated that units undergoing changes like relocation, expansion, or change of ownership would no longer be eligible for the Budgetary Support Scheme. The court referenced relevant provisions of the Central Goods and Services Tax Act, 2017 (CGST Act, 2017) and the Central Excise Act, 1944 to interpret the legal framework surrounding the Budgetary Support Scheme.

After careful consideration of these factors, the court made the following observations: The Budgetary Support Scheme was intended to support existing manufacturing units eligible under earlier excise duty exemption/refund schemes. The eligibility of a unit was based on its status as an “eligible unit” prior to the transition to GST, irrespective of changes in ownership. While the government’s interpretation was noted, the court emphasised that the scheme’s language and intent were crucial in determining eligibility. Based on these findings, the court concluded that both petitioners remained eligible for budgetary support under the scheme, despite changes in ownership. The court directed the authorities to consider their applications accordingly. This judgement highlights the importance of interpreting government schemes in line with their objectives and statutory provisions, ensuring fair treatment for eligible entities seeking benefits.

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 Judgement Reviewed by – Shruti Gattani

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