PANAJI
The Bombay High Court at Goa has granted an interim stay on the operation of the Goa government’s notice to the JSW Group asking that they pay up around Rs 160 crore rural development cess, that the government says has been accrued between 2014 and 2018.
Earlier this month the Goa government had issued notices to JSW among other companies asking that the dues be paid up within 15 days failing which action to recover the monies and initiate prosecution would be undertaken.
The High Court had back in October dismissed the State government’s preliminary objections to the maintainability of the petition and held that the petition was maintainable before the Court.
In its petition, JSW has challenged the constitutional validity of the Goa Rural Improvement and Welfare Cess Act, 2000, and the Rules questioning the levy of cess on inter-State transportation of goods by rail from the Port in Goa to other States, such as Karnataka.
Appearing for JSW, Adv Mukul Rohatgi had argued that the manner in which the Goa authorities intend to apply the law to JSW, “it falls foul of the constitutional scheme as to distributing powers in the federal set up.”
Rohatgi submitted that JSW imports the coal to the port at Goa and then transports exclusively by train to other parts of the country.
“Unless the transportation is through the inland roads of the State, this statute will have no application. Much depends on the interpretation of the provisions, which are generic as to the nature of transportation,” he said.
“If the Goa government interprets the term ‘transport’ in the Act to include the railways as well, then the Act becomes constitutionally susceptible. Therefore, even a show cause notice, according to the petitioners, could not be sustained because the authority that issues lacks the power,” he argued.
The matter has now been kept for December 17 for further hearing.
