Appendix 4
The National Tax Tribunal Act, 2005
(Act No. 49 of 2005)
(As amended up to date)
(Received the assent of the
President on 20-12-2005)
An
Act to provide for the adjudication by the National Tax Tribunal of disputes
with respect to levy, assessment, collection and enforcement of direct taxes
and also to provide for the adjudication by that Tribunal of disputes with
respect to the determination of the rates of duties of customs and central
excise on goods and the valuation of goods for the purposes of assessment of
such duties as well as in matters relating to levy of tax on service, in
pursuance of Article 323B of the Constitution and for matters connected
therewith or incidental thereto.
BE it enacted by Parliament
in the Fifty-sixth Year of the
Chapter I
Preliminary
1. Short title, extent and commencement:-
(1) This Act may be called the National Tax
Tribunal Act, 2005.
(2) It extends to the whole of
(3) It shall come into force on such date1[1] as the Central Government
may, by notification in the Official Gazette, appoint:
Provided that
different dates may be appointed for different provisions of this Act and any
reference in any such provision to the commencement of this Act shall be
construed as a reference to the coming into force of that provision.
In this Act, unless the
context otherwise requires,—
(a) "Bench" means a Bench of the
National Tax Tribunal;
(b) "Board of Direct Taxes" means the
Central Board of Direct Taxes constituted under the Central Boards of Revenue
Act, 1963 (54 of 1963);
(c) "Board of Excise and Customs"
means the Central Board of Excise and Customs constituted under the Central
Board of Revenue Act, 1963 (54 of 1963);
(d) "Central Excise Act" means the
Central Excise Act, 1944 (1 of 1944);
(e) "Central Excise Tariff Act" means
the Central Excise Tariff Act, 1985 (5 of 1986);
(f) "Chairperson" means the
Chairperson of the National Tax Tribunal;
(g) "Companies (Profits) Surtax Act"
means the Companies (Profits) Surtax Act, 1964 (7 of 1964);
(h) "Customs Act" means the Customs
Act, 1962 (52 of 1962);
(i) "Customs, Excise and Service Tax
Appellate Tribunal" means the Customs, Excise and Service Tax Appellate
Tribunal constituted under section 129 of the Customs Act, 1962 (52 of 1962);
(j) "Customs Tariff Act" means the
Customs Tariff Act, 1975 (51 of 1975);
(k) "Expenditure-tax Act" means the
Expenditure-tax Act, 1987 (35 of 1987);
(l) "Gift-tax Act" means the
Gift-tax Act, 1958 (18 of 1958);
(m) "Income-tax Act" means the
Income-tax Act, 1961 (43 of 1961);
(n) "Income-tax Appellate Tribunal"
means the Income-tax Appellate Tribunal constituted under section 252 of the
Income-tax Act, 1961 (43 of 1961);
(o) "Interest-tax Act" means the
Interest-tax Act, 1974 (45 of 1974);
(p) "Law officer" means the
Attorney-General for
(q) "Member" means a Member of the
National Tax Tribunal and includes the Chairperson;
(r) "National Tax Tribunal" means the
National Tax Tribunal established under section 3;
(s) "Notification" means a
notification published in the Official Gazette;
(t) "Prescribed" means prescribed by
rules made under this Act;
(u) "Supreme Court" means the Supreme
Court of India;
(v) "Wealth-tax Act" means the
Wealth-tax Act, 1957 (27 of 1957);
(w) Words and expressions used in this Act but
not defined herein and defined in the Central Excise Act, the Central Excise
Tariff Act, the Customs Act, the Customs Tariff Act (hereinafter referred to as
the indirect taxes) or the rules made there under or in Chapter V of the
Finance Act, 1994 (32 of 1994) shall have the meanings respectively, assigned
to them in the said Acts or the rules made there under;
(x) Words and expressions used in this Act but
not defined herein and defined in the Income-tax Act, the Wealth-tax Act, the
Gift-tax Act, the Expenditure-tax Act, the Interest-tax Act or the Companies
(Profits) Surtax Act (hereinafter referred to as the direct taxes) or the rules
made there under shall have the meanings, respectively, assigned to them in the
said Acts or the rules made there under.
Chapter II
Establishment of the National Tax Tribunal
3. Establishment of National Tax Tribunal:-
The Central Government
shall, by notification in the Official Gazette, establish with effect from such
date as may be specified therein2[2] , a Tax Tribunal to be known as the National Tax Tribunal
to exercise the jurisdiction, powers and authority conferred on such Tribunal
by or under this Act.
4. Composition of National Tax Tribunal:-
The National Tax Tribunal
shall consist of a Chairperson and such number of Members as the Central
Government deems fit, to be appointed by that Government, by notification in
the Official Gazette.
5. Constitution and jurisdiction of Benches:-
(1) The jurisdiction of the
National Tax Tribunal may be exercised by the Benches thereof to be constituted
by the Chairperson.
(2) The Benches of the National
Tax Tribunal shall ordinarily sit at any place in the National Capital
Territory of Delhi or such other places as the Central Government may, in
consultation with the Chairperson, notify:
Provided that the
Chairperson may for adequate reasons permit a Bench to hold its temporary
sitting for a period not exceeding fifteen days at a place other than its
ordinary place of seat.
(3) The Central Government
shall notify the areas in relation to which each Bench of the National Tax
Tribunal may exercise its jurisdiction.
(4) The Central Government
shall determine the number of Benches and each Bench shall consist of two
members.
(5) The Central Government may 3[3] [* * *] transfer a Member from headquarters of one Bench in
one State to the headquarters of another Bench in another State or to the
headquarters of any other Bench within a State:
4[4] [Provided that
no Member shall be transferred without the concurrence of the Chairperson.]
6. Qualifications for appointment of Chairperson and other
Members:-
(1) The Chairperson of the
National Tax Tribunal shall be a person who has been a Judge of the Supreme
Court or the Chief Justice of a High Court.
(2) A person shall not be
qualified for appointment as Member unless he—
(a) Is, or has been, or is eligible to be, a
Judge of a High Court; or
(b) Is, or has been, a Member of the Income-tax
Appellate Tribunal or of the Customs, Excise and Service Tax Appellate Tribunal
for at least 5[5] [five years].
7. Appointment of Chairperson and other Members:-
(1) Subject to the provisions
of sub-section (2), the Chairperson and every other Member shall be appointed
by the Central Government.
(2) The Chairperson and the
other Members shall be appointed by the Central Government on the
recommendations of a Selection Committee consisting of—
(a) The Chief Justice of
(b) The Secretary in the Ministry of Law and
Justice (Department of Legal Affairs);
(c) The Secretary in the Ministry of Finance
(Department of Revenue).
(3) No appointment of the
Chairperson or of any other Member shall be invalidated merely by reason of any
vacancy or any defect in the constitution of the Selection Committee.
8. Terms of office of Chairperson and other Members:-
The Chairperson and every
other Member shall hold office as such for a term of five years from the date
on which he enters upon his office but shall be eligible for re-appointment:
Provided that no
Chairperson or other Member shall hold office as such after he has attained,—
(a) In the case of Chairperson, the age of
sixty-eight years; and
(b) In the case of any other Member, the age of
sixty-five years.
9. Resignation of Chairperson and other Members:-
The Chairperson or any
other Member may, by notice in writing under his hand addressed to the Central
Government, resign his office.
(1) Subject to the provisions
of this Act, the salary and allowances and other terms and conditions of the
Chairperson shall be the same as applicable to a sitting Judge of the Supreme
Court, but no vacation shall be allowed:
Provided that if a
person who, immediately before the date of assuming the office as the
Chairperson was in receipt of or being eligible so to do, had elected to draw,
a pension in respect of any previous service or office held by such person
under the Government of the Union or of a State, his salary in respect of
service as Chairperson shall be reduced by the amount of that pension.
Explanation.—For the purposes of
this sub-section, "vacation" shall have the meaning assigned to it in
the Supreme Court Judges (Conditions of Service) Act, 1958 (41 of 1958).
(2) A Member shall draw salary of a High Court Judge and other
allowances and the terms and conditions of his service shall be the same as
applicable to a Secretary to the Government of India:
Provided that if a
person who, immediately before the date of assuming the office as Member was in
receipt of, or being eligible so to do, had elected to draw, a pension in
respect of any previous service held by such person in connection with the
affairs of the Union or of a State, his salary in respect of service as Member
shall be reduced to the extent of that pension.
(3) The salary and allowances
and other terms and conditions of service of Chairperson or a Member of the
Tribunal shall not be varied to his disadvantage after appointment.
11. Removal and Suspension of Chairperson and other Members:-
(1) The Central Government may,
in consultation with the Chief Justice of India, remove from office the
Chairperson or any Member who—
(a) Has been adjudged an insolvent; or
(b) Has been convicted of an offence which, in the
opinion of the Central Government, involves moral turpitude; or
(c) Has become physically or mentally incapable
of acting as such Chairperson or Member of the National Tax Tribunal; or
(d) Has acquired such financial or other
interest as is likely to affect prejudicially his functions as the Chairperson
or a Member of the National Tax Tribunal; or
(e) Has so abused his position as to render his
continuance in office prejudicial to the public interest.
(2) The Chairperson or any
other Member shall not be removed from his office except by an order made by
the Central Government on the ground of proved misbehaviour or incapacity after
an inquiry made by a Judge of the Supreme Court in which such Chairperson or
Member had been informed of the charges against him and given a reasonable
opportunity of being heard in respect of those charges.
(3) The Central Government may
suspend from office the Chairperson or any other Member in respect of whom a
reference of conducting an inquiry has been made to the Judge of the Supreme
Court under sub-section (2) until the Central Government has passed orders on
receipt of the report of the Judge of the Supreme Court on such reference.
(4) The Central Government may,
by rules, regulate the procedure for the investigation of misbehaviour or
incapacity of the Chairperson or a Member referred to in sub-section (2).
12. Officers and employees of National Tax Tribunal:-
(1) The Central Government
shall provide the National Tax Tribunal with such officers and employees as it
may deem fit.
(2) The salaries and allowances
and other conditions of service of officers and employees of the National Tax
Tribunal shall be such as may be prescribed.
(3) The officers and employees
of the National Tax Tribunal shall discharge their functions under the general
superintendence of the Chairperson.
(4) The officers and the other
employees shall be appointed on the recommendations of a Selection Committee
constituted by the Central Government.
13. Appearance before National Tax Tribunal:-
(1) A party to an appeal other
than Government may either appear in person or authorise one or more chartered
accountants or legal practitioners 6[6] [* * *] to present his or its case before the National Tax
Tribunal.
(2) The Government may authorise
one or more legal practitioners or any of its officers to present its case
before the National Tax Tribunal.
Explanation.—for the purposes of
this section,—
(a) "Chartered accountant" means a
chartered accountant as defined in clause (b) of sub-section (1) of section 2 of the Chartered Accountants
Act, 1949 (38 of 1949) and who has obtained a certificate of practice under
sub-section (1) of section 6 of that Act;
(b) "Legal practitioner" means an
advocate, a vakil or any attorney
of any High Court, and includes a pleader in practice.
14.
Member to act as Chairperson or to discharge his function certain circumstances:-
(1) In the event of any vacancy
in the office of the Chairperson by reason of his death, resignation or
otherwise, the Central Government may designate the senior-most Member to act
as the Chairperson until the day on which a Chairperson, appointed in
accordance with the provisions of this Act to fill such vacancy, enters upon
his office.
(2) When the Chairperson is
unable to discharge his functions owing to absence, illness or any other cause,
the Central Government may authorise the senior-most Member to discharge the
functions of the Chairperson until the date on which the Chairperson resumes
his duties.
(3) The senior-most member
designated to act under sub-section (1) or to discharge functions of the
Chairperson under sub-section (2), of the Chairperson shall continue to draw
salary and allowances of a Member.
Chapter III
Jurisdiction, powers and functions of National Tax Tribunal
15. Appeal to National Tax Tribunal:-
(1) An appeal shall lie to the
National Tax Tribunal from every order passed in appeal by the Income-tax Appellate
Tribunal and the Customs, Excise and Service Tax Appellate Tribunal, if the
National Tax Tribunal is satisfied that the case involves a substantial
question of law.
(2) The Chief Commissioner or
the Commissioner of Income-tax or the Chief Commissioner or Commissioner of
Customs and Central Excise, as the case may be, or an assessee aggrieved by any
order passed by the Income-tax Appellate Tribunal or any person aggrieved by
any order passed by the Customs, Excise and Service Tax Appellate Tribunal
(hereinafter referred to as aggrieved person), may file an appeal to the
National Tax Tribunal and such appeal under this sub-section shall—
(a) Be filed within one hundred and twenty days
from the date on which the order appealed against is received by the assessee
or the aggrieved person or the Chief Commissioner or Commissioner, as the case
may be;
(b) Being the form of a memorandum of appeal
precisely stating therein the substantial question of law involved; and
(c) Be accompanied by such fees as may be
prescribed:
Provided that separate
form of memorandum of appeal shall be filed for matters involving direct and
indirect taxes:
Provided further that
the National Tax Tribunal may entertain the appeal within sixty days after the expiry
of the said period of one hundred and twenty days, if it is satisfied that the
appellant was prevented by sufficient cause from preferring an appeal in time.
(3) Where an appeal is admitted
under sub-section (1), the National Tax Tribunal—
(a) Shall formulate the question of law for
hearing the appeal; and
(b) May also determine any relevant issue in
connection with the question so formulated—
(i) Which has not been so determined by the
Income-tax Appellate Tribunal or by the Customs, Excise and Service Tax
Appellate Tribunal; or
(ii) Which has been wrongly determined by the
Income-tax Appellate Tribunal or by the Customs, Excise and Service Tax
Appellate Tribunal, and shall decide the question of law so formulated and the
other relevant issue so determined and deliver such judgment thereon containing
the grounds on which such decision is founded and may award such cost as it
deems fit.
(4) Where in any appeal under
this section, the decision of the Income-tax Appellate Tribunal or the Customs,
Excise and Service Tax Appellate Tribunal involves the payment of any tax or
duties, the assessee or the aggrieved person, as the case may be, shall not be
allowed to prefer such appeal unless he deposits at least twenty-five per cent
of such tax or duty payable on the basis of the order appealed against:
Provided that where in
a particular case the National Tax Tribunal is of the opinion that the deposit
of tax or duty under this sub-section would cause undue hardship to such
person, it may dispense with such deposit subject to such conditions as it may
deem fit to impose so as to safeguard the interest of revenue.
16. Procedure and powers of National Tax Tribunal:-
(1) The National Tax Tribunal
shall not be bound by the procedure laid down by the Code of Civil Procedure,
1908 (5 of 1908) but shall be guided by the principles of natural justice.
(2) Subject to the other
provisions of this Act, the National Tax Tribunal shall have powers to regulate
its own procedure.
(3) The National Tax Tribunal
shall have, for the purposes of discharging its functions under this Act, the
same powers as are vested in a civil court under the Code of Civil Procedure,
1908 (5 of 1908) while trying a suit, in respect of the following matters,
namely:—
(a) Requiring the discovery and production of
books of account and other documents;
(b) Subject to the provisions of sections 123
and 124 of the Indian Evidence Act, 1872 (1 of 1872), requisitioning any public
record or document or a copy of such record or document, from any office;
(c) Dismissing an appeal for default to deciding
it, ex parte;
(d) Setting aside any order of dismissal of any
appeal for default to any order passed by it, ex parte;
(e) Rectifying any mistake or error apparent on
the face of record; and
(f) Any other matter which may be prescribed.
(4) All proceedings before the
National Tax Tribunal shall be deemed to be judicial proceedings within the
meaning of sections 193 and 228 and for the purposes of section 196 of the Indian
Penal Code (45 of 1860) and the National Tax Tribunal shall be deemed to be a
civil court for the purposes of section 195 and Chapter XXVI of the Code of
Criminal Procedure, 1973 (2 of 1974).
17. Finality of orders of National Tax Tribunal:-
Any order passed by the
National Tax Tribunal shall be final and shall be given effect to accordingly and civil court shall have or be entitled to
exercise any jurisdiction, power or authority with respect to any of the
matters falling within the jurisdiction of the National Tax Tribunal.
If the Members of a Bench
consisting of two members differ in opinion any point, they shall state the
point or points on which they differ, and make a reference to the Chairperson,
who shall hear the point or points himself or nominate any other Member for
such hearing and such point or points shall be decided according to the opinion
of the majority, who have hear the case including those who first heard it.
Where a judgment pronounced
on a question of law by a Bench subsequently comes up for hearing before any
Bench, and the letter Bench is of the opinion that the question of law requires
reconsideration, then the latter Bench shall make a reference to the
Chairperson to constitute a Special Bench consisting of five Members to hear
and decide such question of law.
Notwithstanding anything
contained in any other provisions of this Act or any other law for the time
being in force, no interim order (whether by way of injunction or stay or
otherwise) shall be made in relation to any appeal under this Act, unless—
(a) Copies of such appeal and all documents in
support of the plea for such interim order are furnished to the party against
whom the appeal is preferred; and
(b)
21. Power to punish for contempt:-
The National Tax Tribunal
shall have and exercise the same jurisdiction, powers and authority in respect
of contempt of itself as the High Court has and may exercise such power or
authority, for this purpose under the provisions of the Contempt of Courts Act,
1971 (70 of 1971), which shall have effect subject to the modification that—
(a) Any reference therein to a High Court shall
be construed as including a reference to the National Tax Tribunal;
(b) Any reference to any Advocate General in
section 15 of the said Act shall be construed as a reference to such law
officer as the Central Government may specify in this behalf:
Provided that such
matters shall be heard by a Special Bench consisting of five Members
constituted by the Chairperson.
22. Order of National Tax Tribunal:-
The National Tax Tribunal
may, after giving the parties to any proceedings before it, an opportunity of
being heard, pass such orders thereon as it thinks fit.
23. Transfer of pending cases from High Court:-
(1)
On and from such date as the
Central Government may, by notification, specify, all matters
and proceedings including appeals and references under the direct taxes and
indirect taxes pending before any High Court immediately before that date shall
stand transferred to the National Tax Tribunal.
(2)
Where any matter or proceeding
including appeals and references stand transferred from the High Court to the
National Tax Tribunal under sub-section (1),—
(a) The High Court shall, as soon as may be
after such transfer, forward the records pertaining to such matter or
proceeding to the National Tax Tribunal;
(b) The National Tax Tribunal shall, on receipt
of such records, proceed to deal with such matter or proceeding from the stage
at which it is transferred or from an earlier stage or de novo as it may deem fit;
(c) The Chairperson shall constitute a Bench
consisting of such number of Members as he deems fit for hearing cases
transferred under this section.
Any person including any
department of the Government aggrieved by any decision or order of the National
Tax Tribunal may file an appeal to the Supreme Court within sixty days from the
date of communication of the decision or order of the National Tax Tribunal to
him:
Provided
that the Supreme Court may, if it is satisfied that the appellant was prevented
by sufficient cause from filing the appeal within the said period, allow it to
be filed within such time as it may deem fit.
Chapter IV
Miscellaneous
25. Members, etc., to be public servants:-
The Chairperson, Members and
other officers and employees of the National Tax Tribunal shall be deemed to be
public servants within the meaning of section 21 of the Indian Penal Code (45
of 1860).
26. Protection of action taken in good faith:-
No suit, prosecution or
other legal proceedings shall lie against the National Tax Tribunal or its
Chairperson, Member, officer or other employee in the discharge of any function
for any loss or damage caused or likely to be caused by any act which is, in
good faith, done or intended to be done in the discharge of any function under
this Act.
27. Power to remove difficulties:-
(1) If any difficulty arises in
giving effect to the provisions of this Act, the Central Government may, by
order published in the Official Gazette, make such provisions, not inconsistent
with the provisions of this Act, as appear to it to be necessary or expedient
for removing the difficulty:
Provided that no such
order shall be made after the expiry of a period of two years from the
commencement of this Act.
(2) Every order made under this
section shall, as soon as may be, after it is made, be laid before each House
of Parliament.
(1) The Central Government may,
by notification, make rules to carry out the provisions of this Act.
(2) Without prejudice to the
generality of the foregoing power, such rules may provide for all or any of the
following matters, namely:—
(a) The procedure under sub-section (4) of section
11 for the investigation of charges of misbehaviour or incapacity against the
Chairperson or other Members;
(b) The salaries and allowances and the
conditions of service of officers and other employees of the National Tax
Tribunal under sub-section (2) section 12;
(c) The amount of fees payable under clause (c) of sub-section (2) of section 15;
(d) The other matters in respect of which the
National Tax Tribunal may exercise the powers of a civil court under clause (f) of sub-section (3) of section 16;
(e) Any other matter which may be prescribed or
in respect of which rules are required to be made by the Central Government.
29. Laying of rules before Parliament:-
Every rule made under this
Act by the Central Government shall be laid, as soon as may be after it is
made, before each House of Parliament, while it is in session for a total
period of thirty days which may be comprised in one session or in two or more
successive sessions and if, before the expiry of the session immediately
following the session or the successive sessions aforesaid, both Houses agree
in making any modification in the rule or both Houses agree that the rule
should not be made, the rule shall thereafter have effect only in such modified
form or be of no effect, as the case may be; so, however, that any such
modification or annulment shall be without prejudice to the validity of
anything previously done under that rule.
30. Consequential amendments:-
On and from such date as
the Central Government may by notification, specify, the enactments mentioned
in the Schedule shall stand amended in the manner specified therein.
(See section 30)
Amendment
of Certain Enactments
(Amendments made in the
Income-tax Act, 1961; Wealth-tax Act, 1957; Expenditure-tax Act, 1987;
Interest-tax Act, 1974; Finance (No. 2) Act, 1998; Customs Act, 1962; Central
Excise Act, 1944, not reproduced here)
[1]28th December, 2005: Notification No. SO 1826(E), dated
28-12-2005.
[2]The National Tax Tribunal has been established with
immediate effect: Notification No. SO 25(E), dated 6-1-2006.
[3]The words "in consultation with the
Chairperson" omitted by the National Tax Tribunal (Amendment) Act, 2007,
w.r.e.f. 29-1-2007.
[4]Inserted by the National Tax Tribunal (Amendment) Act,
2007, w.r.e.f. 29-1-2007.
[5]Substituted for "seven years" by the National
Tax Tribunal (Amendment) Act, 2007, w.r.e.f. 29-1-2007.
[6]The words "or any person duly authorized by him or it" omitted
by the National Tax Tribunal (Amendment) Act, 2007, w.r.e.f. 29-1-2007.