Gujarat High Court Condoned Two-Day Amnesty Delay Caused by Technical Portal Failure

In a significant ruling aimed at balancing administrative fairness with tax compliance, the High Court of Gujarat has set aside the rejection of an amnesty application that was dismissed due to a mere two-day delay. The court affirmed that, where a taxpayer exhibits bona fide intent to settle dues, the government’s failure to provide a functional online portal should not result in the forfeiture of scheme benefits.

The Roadblock: Technical Portal Issues

The petitioner, M/S Kamnath Private Ltd., had sought relief under the Vera Samadhan Yojna (Amnesty Scheme) concerning tax assessments for the year 2015-16. While the company successfully paid the first five installments, a unilateral, automatic adjustment by the government’s online portal resulted in a minor shortfall of Rs. 34,102.

When the company attempted to pay this remaining amount, the online portal’s "E-payment" feature failed to reconcile with the Amnesty Scheme. Despite multiple attempts to navigate these technical impediments between August 29 and August 31, 2021, the petitioner was forced to remit the payment on September 2, 2021—two days past the deadline. The authorities responded by rejecting the amnesty application and freezing the company's bank account, prompting the writ petition before the High Court.

Examining the Judiciary’s Stance on Bona Fide Errors

The Division Bench, comprising Hon’ble Mr. Justice Bhargav D. Karia and Hon’ble Mr. Justice Pranav Trivedi, emphasized that technical glitches should not obstruct the primary object of an amnesty scheme, which is to facilitate the resolution of old disputes and enhance government revenue.

Relying on established precedents, including the Supreme Court’s decision in Dal Chandra Rastogi vs. CBDT , the court reasoned that the high-handed rejection of a taxpayer's attempt to settle dues is contrary to the spirit of equity. The bench made it clear that while officers may not have the statutory authority to condone such delays, the High Court’s extraordinary jurisdiction under Article 226 exists to remedy such manifest injustices.

Key Observations

The judgment features several critical observations regarding the purpose of amnesty schemes:

> "The object of the amnesty scheme is to bring about expeditious and effective resolution of old disputes and recoveries of old outstanding dues of the Government and reduction of administrative costs."

> "As held in the catena of decisions of this Court... the object and purpose of an Amnesty Scheme has to be seen from that angle which furthers the object of the Scheme, than which merely renders the Scheme illusory."

> "Though this Court is in agreement with the submission of learned counsel for the respondents that the power to condone the delay with regard to delay in payment is not vested with the Departmental Authorities, yet this Court under its inherent powers in extraordinary writ jurisdiction... can pass any order necessary to remedy the injustice."

Conclusion: Implications for Taxpayers

By quashing the rejection order and condoning the delay, the High Court has provided a vital safeguard for businesses facing technical failures on digital tax platforms.

Moving forward, this ruling serves as a strong signal to tax authorities that procedural compliance should not be weaponized in a way that defeats the substantive goals of government settlement schemes. For corporations and individual taxpayers alike, this decision reinforces the judiciary's role as a final arbiter of fairness, ensuring that digital limitations do not become insurmountable barriers to compliance.