In a show cause hearing yesterday, Attorney General (AG) Shera Lhundup verbally submitted before a full bench of the High Court that the Druk Nyamrup Tshogpa’s (DNT) case must be dismissed on two grounds.

Acting chief justice Sangay Khandu, who was presiding the show case hearing, asked the Office of the Attorney General to give reason why the Court should not admit the Constitutional case that DNT has filed.

The Attorney General submitted that considering the public importance of legal issues pertaining to fiscal incentives granted by both the present and the past government, the government had petitioned His Majesty for the Supreme Court’s opinion on the issue. He said that the petition was submitted before DNT filed the case.

The matter according to AG is effectively a sub-judice before the Supreme Court under the Civil and Criminal Procedure Code (CCPC).

AG stated that Article 21 (8) of the Constitution provides democratic means to resolve democratic issues and DNT’s petition had bypassed that democratic recourse provided by the Constitution.

The other ground to dismiss the case, according to the AG is that DNT has no locus standi to file a case against the government of the day. “Although DNT is a registered political party, it does not enjoy the legitimacy of being accountable and answerable to the people,” AG said. “Only the ruling government and the Opposition are vested with such Constitutional duties to the people.”

AG said that to sustain suit of a present nature, it is critical for the Court to consider whether there has been any injury caused by the fiscal incentives granted by both the past and present governments.

In an act of granting fiscal incentives, there is tax exemption effect and not a burden of tax imposition, he said adding that demonstrably, there is none who suffered injuries from the fiscal incentives granted so far. “Hence, there is no aggrieved person that the DNT could legitimately represent in the present suit.”

With an opportunity granted by the full bench prior to AG’s submission, DNT’s representative Phurba submitted that the court should admit the party’s petition in the interest of safeguarding the Constitution and smooth functioning of democratic process.

The party on August 18 filed the case with the High Court against the government for alleged violation of the Constitution by granting fiscal incentives without the parliament’s endorsement.

Party manager Phurba submitted that DNT registered and instituted the suit before the court in accordance with CCPC’s Section 31.2 and section 116. He also claimed that the party as a registered political party, which has more than 400 registered members and won 17 percent of votes in the 2013 primary round, has a strong legal standing and jurisdiction to initiate the case.

“As we submitted in our petition in writing, I would like to re-submit before the honorable justices that the government has violated Article 14.1 of the Constitution, which states, “Taxes, fees and other forms of levies shall not be imposed or altered except by law”, Phurba said. “However, the government had taken a unilateral decision and granted fiscal incentives to a handful of businessmen” without the Parliament’s endorsement.”

He said that the fiscal incentives granted by the government had benefited only a few businessmen, who were doing big businesses. “The government violated Article 7.15 of the Constitution, which states that all persons are equal before the law and are entitled to equal and effective protection of the law and shall not be discriminate against on the grounds of race, sex, language, religion, politics or other status.”

“That is why we submitted our petition before the court to issue a Constitutional writ on the illegal and unconstitutional implementation of the tax alteration. Such ruling can prevent future governments in amending the Constitution or laws to suit their interests,” Phurba said. “It is our sacred duty as a registered political party to protect the Constitution on behalf of the present and future generations.”

He also submitted that despite DNT’s repeated attempts through the media and other platforms to inform the government that it has erred in granting fiscal initiatives, the government paid no heed to take a correct measure, which forced DNT to take the issue with the court for writ.

The Attorney General submitted that if the court admits DNT’s petition, it only attempts “to open a floodgate for such baseless suits which the court must effectively contain in time.”

The government granted fiscal incentives worth Nu 1.104 billion since January 1, 2016 to May 7, 2017.

The next hearing is scheduled on October 25 during which the OAG will submit its response in writing, relying mainly on those grounds submitted by DNT and dismiss the case.

This is the second constitutional case filed before the High Court over tax issue.

Rinzin Wangchuk