Valmiki Sa Menezes JUDGMENT
Valmiki Sa Menezes, J.
1. By this Writ Petition under Article 226 of the Constitution of India, the Petitioner seeks issuance of a writ of Mandamus to direct the Respondent-Union of India to extend the date of availing deductions by assessees under section 80-IBA of the Income Tax Act, 1961 ('the Act) from 31.03.2022 to 31.03.2023, by taking necessary executive legislative steps as may be required. The Petitioner further seeks issuance of a writ of Mandamus to direct the Respondent to extend the time period for completion of construction projects from five years to seven year under section 90-IBA(2) (b) of the Act.
2. It is the Petitioner's case is that the provisions of section 80-IBA of the Act were enacted vide Finance Act, 2016, to provide a tax holiday to the Real Estate Developers, who the petitioner claims to be representing, and such tax holiday was granted to Real Estate Developers-assessees for constructing affordable housing projects that fulfill the conditions contained in the said provisions of law. It is the Petitioner's case that the said provision was amended from time to time and mandates that, to avail tax holiday, developers are requested to complete the construction of a housing project within five years from receipt of building approvals and, such project should have been approved on or before 31.03.2022.
3. It is further the Petitioner's case that the provision of section 80-IAC of the Act was also enacted under the Finance Act, 2016 providing incentives to start-up companies for availing deductions provided they were set-up on or after 01.10.2019 and had commenced operations. It is the Petitioner's case that under clause 22 of the Finance Bill, 2022, for the purposes of section 80-IAC, the date of incorporation for start-up companies was extended from 31.03.2022 to 31.03.2023 for availing deductions under those provisions of the Act. Similarly, the Petitioner claims that under clause 26 of the Finance Bill, 2022, the last date for availing deductions by manufacturing and production companies under section 115-BAB of the Act was extended from 31.03.2023 to 31.03.2024, subject to the concerned company being set up on or after 01.10.2019 and having commenced its business operations.
4. The Petitioner claims that the Union of India has failed to grant similar extensions in timelines as were granted in the above cases, in the timelines incorporated under section 80-IBA, as they stood in the previous year, beyond 31.03.2022; thus depriving the members of the Petitioner, parity with similarly situated classes of persons covered by the provisions of section 80-IAC of the Act, 1961. In other words, the Petitioner's members claim parity with persons given the benefit of the provisions of section 80-IAC of the Act, and claim that non-extension of the timelines of eligibility beyond 31.03.2022, operates as a discrimination against them.
It is further the Petitioner's case that recognizing the impact that the Covid-19 Pandemic had on the real estate industry as a whole, the Ministry of Home Affairs (MHA), Government of India had issued Office Memorandum dated 13.05.2020 to all the Real Estate Regulatory Authorities of the states, advising them to extend registration of Real Estate Projects on the ground of force majeure, in terms of the Real Estate (Regulation and Development) Act, 2016 ('RERA') and following this advisory, the Maharashtra Real Estate Regulatory Authorities ('MahaRERA) had issued a similar advisory to extend registration of such projects, which were unable to be completed due to force majeure conditions. It is the Petitioner's claim that the Respondent, being aware of the impact of the Covid-19 Pandemic on the Real Estate Industry, has acted in a discriminatory manner by refusing to extend the timelines contained in the provisions of section 80-IBA of the Act, and has consequently infringed the fundamental rights of members of the Petitioner, more particularly, rights enshrined in Article 14 of the Constitution of India. Hence, issuance of a writ of Mandamus in the nature claimed in the petition is sought by the Petitioner.
5. We have heard learned counsel for the respective parties. We have given due consideration to the arguments advanced.
6. The Petitioner's claim to be discriminated against, on the basis that its members are similarly situated to persons covered under the provisions of section 80-IAC of the Act. In order to prove the element of discrimination, the Petitioner would be required to plead specific facts to demonstrate that its members as a class and those covered by the provisions of section 80-IAC of the Act are similarly situated. Apart from this factor, the Petitioner would be required to make out a case for the issuance of a writ of Mandamus in exercise of powers vested in this Court under Article 226 of the Constitution of India for directing the Respondent, or for that matter, the legislature to legislate and extend the timelines in the provisions of section 80-IBA(2)(b) of the Act, 1961 as claimed in the petition.
7. In V.S. Rice and Oil Mills and others v. State of A.P. etc. MANU/SC/0044/1964 : AIR 1964 SC 1781, the Hon'ble Supreme Court has held..
"This Court has repeatedly pointed out that when a citizen wants to challenge the validity of any statute on the ground that it contravenes Art. 14, specific, clear and unambiguous allegations must be made in that behalf and it must be shown that the impugned statute is based on discrimination and that such discrimination is not referable to any classification which is rational and which has nexus with the object intended to be achieved by the said statute. Judged from that point of view, there is absolutely no material on the record of any of the appeals forming the present group on which a plea under Art. 14 can even be raised. Therefore, we do not think it is necessary to pursue this point any further."
8. In State of Orissa And Others vs. Balaram Sahu & Ors. MANU/SC/0895/2002 : (2003) 1 SCC 250, the Hon'ble Supreme Court has held..
"To claim a relief on the basis of equality, it is for the claimants to substantiate a clear-cut basis of equivalence and a resultant hostile discrimination before becoming eligible to claim rights on a par with the other group vis-à-vis an alleged discrimination."
9. In State of U.P. & Anr. vs. Kamla Palace MANU/SC/0789/1999 : (2000) 1 SCC 557, whilst dealing with a somewhat similar situation, the Supreme Court has considered the various facts that legislature would address itself to, while enacting taxing legislation. Hence, it further analyzed how Courts apply the test of Article 14 in the matter of giving incentives in a taxing statute and how classification of persons, objects and transactions are considered by the legislature. It has been held that..
"Article 14 does not prohibit reasonable classification of persons, objects and transactions by the legislature for the purpose of attaining specific ends. To satisfy the test of permissible classification, it must not be "arbitrary", artificial or evasive" but must be based on some real and substantial distinction bearing a just and reasonable relation to the object sought to be achieved by the legislature. (See Special Courts Bill, 1978, Re, MANU/SC/0039/1978 : (1979) 1 SCC 380, seven-Judge Bench; R.K. Garg v. Union of India, five-Judge Bench.) It was further held in R.K. Garg case, MANU/SC/0074/1981 : 1981) 4 SCC 675: 1981 SCC (Tax) 30, that laws relating to economic activities or those in the filed of taxation enjoy a greater latitude than laws touching civil rights such as freedom of speech, religion etc. Such a legislation my not be struck down merely on account of crudities and inequities inasmuch as such legislations are designated to take care of complex situations and complex problems which do not admit of solutions through any doctrinaire approach or straitjacket formulae. Their Lordships quoted with approval the observations made by Frankfurter, J. In Morey v. Doud; MANU/USSC/0152/1957 : (1957) 354 US 457-
"In the utilities, tax and economic regulations cases, there are good reasons for judicial self-restraint if not judicial deference to legislative judgment. The legislature after all has the affirmative responsibility. The Courts have only the power to destroy, not to reconstruct. When these are added to the complexity of economic regulation, the uncertainly, the liability to error, the bewildering conflict of the experts, and the number of times the Judges have been overruled by events self-limitation can be seen to be the path to judicial wisdom and institutional prestige and stability."
12. The legislature gaining wisdom from historical facts, existing situations, matters of common knowledge and practical problems and guided by considerations of policy must be given a free hand to devise classes-whom to tax or not to tax, whom to exempt or not to exempt and whom to give incentives and lay down the rates of taxation, benefits or concessions. In the field of taxation if the test of Article 14 is satisfied by generality of provisions the courts would not substitute judicial wisdom for the legislative wisdom."
10. In Supreme Court Employees' Welfare vs. Union of India MANU/SC/0582/1989 : (1989) 4 SCC 187 the Hon'ble Supreme Court has considered the powers of the courts to issue a writ of Mandamus to direct a legislature to enact a particular law. Whilst construing the constitutional scheme and powers vested in courts to issue a writ of Mandamus, it has been held as under:-
"What the appellant really wants is a mandate from the court to the competent authority to delete the concerned entry from Schedule A and include the same in Schedule B. We shall not go into the question whether the Government of Himachal Pradesh on its own authority was competent to make the alteration in question or not. We shall assume for our present purpose that it had such a power. The power to impose a tax is undoubtedly a legislative power. That power can be exercised by the legislature directly or subject to certain conditions, the legislature may delegate that power to some other authority. But the exercise of that power, whether by the legislature or by its delegate is an exercise of a legislative power. The fact that the power was delegated to the executive does not convert that power into an executive or administrative power. No court can issue a mandate to a legislature to enact a particular law. Similarly no court can direct a subordinate legislative body to enact or not to enact a law which it may be competent to enact.
There can be no doubt that no court can direct a legislature to enact a particular law. Similarly, when an executive authority exercises a legislative power by way of subordinate legislation pursuant to the delegated authority of a legislature, such executive authority cannot be asked to enact a law which he has been empowered to do under the delegated legislative authority.
11. Applying the ratio of the judgments cited above, we find the present petition is grossly lacking in sufficient pleadings as would be required from making out a case of discrimination as claimed by the Petitioner. The petition lacks all material particulars required to be stated in the pleadings, to draw some parity or similarity between members of the Petitioner and persons stated to be covered by the provisions of section 80-IAC of the Act.
12. Further applying the ratio laid down by the Hon'ble Supreme Court in Supreme Court Employees Welfare (supra), this Court would not exercise its jurisdiction under Article 226 of the Constitution of India, to issue a writ of Mandamus to the Respondent and much less to the legislature, directing the legislation in the nature sought by the Petitioner in the reliefs claimed in the petition.
13. On these grounds, we are of the opinion that no writ of Mandamus would lie to direct the legislature and accordingly, we dismiss the petition.
14. The Petition is dismissed. No costs.
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