29 years on, 76-yr-old man to get ₹19.44L for exposing tax evasion nexus

Although rewards are promised for informers, in Darshan Singh Parmar’s case, it was not kept. Instead he was kept waiting despite giving the sales tax department a tip-off that led to the recovery of ₹361 crore towards taxes, as claimed by him.

MUMBAI: A 76-year-old Chembur resident has been running from pillar to post to secure his due reward from the government for exposing a widespread tax evasion racket run by officers of public sector oil companies and fishermen cooperatives. Although rewards are promised for informers, in Darshan Singh Parmar’s case, it was not kept. Instead he was kept waiting despite giving the sales tax department a tip-off that led to the recovery of ₹361 crore towards taxes, as claimed by him.

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Parmar had exposed the racket in August 1996. On Tuesday, 29 years later, the Bombay high court had to step in to finally give him his due. The court first rapped the state for the inordinate delay in paying the due reward to the 76-year-old and frowned upon the authorities concerned for forcing the Chembur resident to make rounds of their offices. The court then ordered the state government to pay him ₹19.44 lakh within six weeks.

Taking note of the petitioner’s plea for a higher reward, the division bench of justice MS Sonak and justice Jitendra Jain directed the state sales tax commissioner and the finance secretary to determine in six months the precise amount payable to him, and pay the amount in two months thereafter.

Though sizable amounts of money were recovered as taxes pursuant to the information furnished by Parmar, and he was provided with details of the amounts recovered, he was kept under an impression that he would be paid the due reward once the recoveries become final after disposal of appeals, revisions, etc.

But, this did not happen and he kept making rounds of the departments. Frustrated by the indifference of the officials, in 2013, Parmar approached the high court, seeking orders to the sales tax department to pay him the due reward, claiming that his information had resulted in the recovery of ₹361 crore towards taxes.

The tax department, however, claimed that the tax demand was of ₹55.98 crore only, and the actual recovery was still pending. The department took the stand that the reward becomes due only after the revenue is permanently realised, implying that no reward would be paid during pendency of the appeals or recovery proceedings.

The court, however, disapproved the conduct of the state authorities after noticing that despite repeated orders, specific details had not been furnished to it. “If the government has formulated a reward scheme, it must be implemented fairly and transparently,” said the division bench of justice MS Sonak and justice Jitendra Jain, while disapproving the treatment meted out to Parmar.

“Informers who take risks and invest time must not be made to run from pillar to post to secure what may be due and payable. There must be no unreasonable delay in paying the determined reward amounts, and the practice of raising frivolous and belated objections only to avoid legitimate payments must also be eschewed,” the judges said.

The court further stated that the respondents (department officers) have consistently been uncooperative in providing the necessary details, solely to delay the payment indefinitely. “The officers of the respondents, of the rank of joint commissioner and with the approval of the commissioner of Sales Tax, Maharashtra, have decided that ₹19.44 lakh is presently payable to the petitioner as a reward. This amount should have been paid to the petitioner immediately. There is no basis for the respondents to now retract and refuse payment of even this amount, which has been determined by them” the bench said.