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It was alternatively sought a direction to the Law Commission of India to examine the legality of the TDS system and prepare a report within three months
The Supreme Court of India today refused to entertain a PIL seeking to declare the Tax Deducted at Source (TDS) system to be manifestly arbitrary, irrational and against Articles 14, 19 & 21 of the Constitution of India.
A CJI Sanjiv Khanna led bench said the petitioner Advocate Ashwini Upadhyay may approach High Court with his plea. "Sorry, we will not entertain. It is very badly drafted. You can approach the high Court..", the bench added.
The PIL alternatively sought a direction to NITI Ayog to consider the grounds and contentions raised in this petition and suggest necessary changes in Tax Deducted at Source (TDS) system.
"The regulatory and procedural framework surrounding TDS is excessively technical, often requiring specialized legal and financial expertise, which most assessees lack. The result is an unjust shifting of sovereign responsibilities from the Government to private citizens without adequate compensation, resources, or legal safeguards...", the PIL argued.
Court was further told that the TDS system disproportionately burdened assesses with significant administrative expenses i.e., salaries for employees, managing TDS compliance professional fees for chartered accountants & tax consultants.
"Illiterate or economically weaker assesses who lack the capacity to navigate technical framework, suffer undue hardship and harassment, undermining the constitutional guarantee of equality before the law under Article 14. This amounts to an indirect tax burden imposed on TDS assesses, which lacks explicit legislative sanction, making it unconstitutional and against public interest....", the petition further submitted.
Case Title: Ashwini Upadhyay vs. Union of India
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