The Punjab and Haryana high court has slapped a fine of Rs 10,000 on a local official of the excise and taxation department for resorting to unlawful activities while collecting taxes.
According to sources, in a bid to achieve their periodical targets on time, some department officials adopted unlawful means to collect taxes, which the traders' association termed "tax terrorism".
The HC ruling on Wednesday held excise taxation officer (ETO) Navneet Singh guilty of coercion while recovering taxes from Sumit Agencies, which deals in tobacco products, and instructed him to refund the collected money within seven days.
Complainant's lawyer Aman Bansal said: "Without conducting requisite preliminary assessments, the excise and taxation department officials raided the agency and forcibly collected two cheques for Rs 3 lakhs each as tax against the will of the owners on February 2 this year. After getting no help from the local authorities, they moved the high court."
Bansal said the department sleuths threatened the owners by claiming their proximity with top police officials.
"On the first hearing in the case on March 17, the HC had directed the department to transfer Rs 3 lakh into the petitioner's account,"he said.
Hearing the petition, acting chief justice SJ Vazifdar and justice GS Sandhawalia observed that the procedure adopted by the department sleuths "smacks of arbitrariness and highhandedness of the authorities on the face of the record itself, which cannot be appreciated in any manner".
"It is hereby instructed to the respondents to refund a sum of Rs 3,10,000 within a period of one week from the receipt of a certified copy of this order and a sum of Rs 10,000 shall be recovered from the respondent by the state for his arbitrary action,"the order stated.