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: Nargis' Challenge to Black Money Act Provisions Barred as , ₹60K Cost
In a sharply worded ruling, the has dismissed three writ petitions filed by the Nargis family challenging the constitutional validity of certain provisions of the , labeling the challenge as a “ to obviate prosecution.” The Bench of Justice Dinesh Mehta and Justice Rajneesh Kumar Gupta imposed a cost of ₹20,000 per petition (totaling ₹60,000) payable to the .
A Late-Breaking Challenge
The petitioners— Rajendra Prasad Nargis , Sudha Nargis , and Deepak Nargis —had challenged the proviso to and Clause (c) of of the Black Money Act, arguing that these provisions operated retrospectively and thereby violated . They claimed that properties acquired long before the 2015 Act came into force were nonetheless being assessed by the Assessing Officer for the Assessment Year 2019-2020, via an order dated .
Counsel for the petitioners revealed that they had recently received a prosecution notice on , prompting the current petitions. However, the court was also informed that the petitioners had previously filed multiple writ petitions: one set challenging the assessment order was withdrawn with liberty, while another set challenging penalty proceedings (W.P.(C) Nos. 3892/2022, 4291/2022, and 4292/2022) remained pending. Notably, those earlier petitions only challenged of the Act—not the provisions now in question.
The Government’s Objection
The respondents, represented by Senior Standing Counsel , countered that the petitions were an . They argued that the petitioners had failed to raise the plea at the earliest opportunity, when they first challenged penalty proceedings. The government contended that raising the of the proviso and (c) only now was a tactical move to avoid prosecution.
Court’s Reasoning: A Classic Case of Order II Rule 2
The Court was unimpressed by the petitioners' explanation. It observed that the challenge to the retrospective operation of the Black Money Act was “the first and most obvious question or ground that could have occurred to a litigant.” Having not raised it in earlier proceedings, the petitioners were barred by , which requires a party to claim all reliefs available at the first instance.
The Bench explicitly stated:
“We are not inclined to entertain the present writ petitions, because according to us, the challenge to Proviso to and Clause (c) of of the Act of 2015 is a to obviate prosecution or to somehow maintain the writ petition before this Court.”
No Findings on Merits
Crucially, the Court clarified that it had not recorded any finding on the validity or of the impugned provisions, nor any observation about the legality of the prosecution initiated against the petitioners. The dismissal is purely procedural, leaving the petitioners free to raise their pleas before the concerned authorities or take other legal recourse.
Implications
The judgment serves as a reminder that constitutional challenges to tax legislation cannot be filed in a piecemeal fashion to derail ongoing enforcement actions. By imposing costs, the Court signaled its displeasure at what it perceived as and a belated attempt to use litigation as a shield against prosecution. While the substantive question of remains open, this ruling reinforces the principle that procedural rules demand diligence from litigants.
[Note: The article is based solely on the court's order dated , and the accompanying information provided; no external commentary is included.]
