Presumption in favor of constitutionality of an enactment and the wide scope of Article 246A influenced the court's decision to dismiss the application for interim relief.

JUDGMENT

Manmohan, J. -

Crl.M.A.16841/2020 (exemption)

Allowed, subject to all just exceptions.

Consequently, present application stands disposed of.

Crl.M.A.16840/2020

1. The petition has been heard by way of video conferencing.

2. Present writ petition has been filed challenging the constitutional validity of certain provisions of the Central Goods and Services Tax, Act, 2017.

3. This Court in a similar matter in Dhruv Krishan Maggu vs. Union of India & Ors., W.P.(C) 5454/2020 has refused to pass any interim order holding that it is not inclined to interfere with the investigation at this stage and that too in writ proceedings. The relevant observations made by this Court in Dhruv Krishan Maggu vs. Union of India & Ors. (supra) are reproduced hereinbelow:-

(i) There is always a presumption in favour of constitutionality of an enactment or any part thereof and the burden to show that there has been a clear transgression of constitutional principles is upon the person who impugns such an enactment. Further, laws are not to be declared unconstitutional on the fanciful theory that power would be exercised in an unrealistic fashion or in a vacuum or on the ground that there is a remote possibility of abuse of power.

(ii) The Goods and Service Tax is a unique tax, inasmuch as the power as well as field of legislation are to be found in a single Article, i.e., Article 246A. The scope of Article 246A is significantly wide as it grants the power to make all laws 'with respect to' goods and service tax.

(iii) This Court is of the prima facie opinion that the pith and substance of the CGST Act is on a topic, upon which the Parliament has power to legislate as the power to arrest and prosecute are ancillary and/or incidental to the power to levy and collect goods and services tax.

(iv) Even if it is assumed that power to make offence in relation to evasion of goods and service tax is not to be found under Article 246A, then, the same can be traced to Entry 1 of List III. The term 'criminal law' used in the aforesaid entry is significantly wide and includes all criminal laws except the exclusions.

(v) This Court, at the interim stage, cannot ignore the view is taken by the Gujarat High Court with regard to application of Chapter XII Cr.P.C. to the CGST Act.

(vi) In view of the Supreme Court judgment in Directorate of Enforcement vs. Deepak Mahajan (supra) and the aforesaid Gujarat High Court judgment, the arguments that prejudice is caused to the petitioners as they are not able to avail protection under Article 20(3) of the Constitution and/or the provisions of Cr. P.C. do not apply even when CGST Act is silent, are untenable in law.

(vii) Reliance on "no coercive orders" by counsel for the petitioners are untenable as the Supreme Court in Union of India vs. Sapna Jain & Ors., SLP (Crl.) 4322-4324/2019 dated 29th May, 2019 has 'spoken its mind'.

(viii)This Court prima facie finds force in the submissions of the learned ASG that the Central Tax Officers are empowered to conduct intelligence-based enforcement action against taxpayers assigned to State Tax Administration under Section 6 of the CGST Act.

(ix) What emerges at the prima facie stage is that it is the case of the respondents that a tax collection mechanism has been converted into a disbursement mechanism as if it were a subsidy scheme.

(x) In view of the serious allegations, this Court is not inclined to interfere with the investigation at this stage and that too in writ proceedings. At the same time, innocent persons cannot be arrested or harassed. Consequently, the applications for interim protection are dismissed with liberty to the parties to avail the statutory remedies.

4. However, Mr. Vijay Aggarwal, learned counsel for petitioner states that the order passed by this Court in Dhruv Krishan Maggu vs. Union of India & Ors. (supra) is per incuriam as it is contrary to the Division Bench judgment of this Court in Rajbhushan Omprakash Dixit vs. Union of India & Anr., 2018 1 JCC 506.

5. He fur