Gandhinagar: On the petition filed by Adani Power Limited (APL), which has challenged three sections of the Finance Act, 2011, the Gujarat High Court on Tuesday issued notice to the central government. Agencies
The bench, comprising Chief Justice S.J. Mukhopadhaya and Justice J.B. Pardiwala, issued the notice after APL challenged constitutional validity of sections 18, 20, and 76 of the Finance Act, which have been amended.
The amendments in section 18 make developers of the Mundra Port Special Economic Zone (SEZ) and APL liable for payment of minimum alternative tax (MAT) relevant to assessment years commencing on or after April 1, 2012.
The amendment to section 20 would mean that SEZ developers shall be liable for payment of dividend distribution tax (DDT).
Section 76 seeks to amend the second schedule to the SEZ Act, which applies to the unit and not to the developer.
APL stated in the petition that while planning the investment in the Mundra SEZ in Kutch district, the company took into account the benefits available to it as SEZ developer under the SEZ Act. The total projected investment in Mundra SEZ is Rs.74,000 crore. The total investment made till date is Rs.23,586 crore, APL has claimed.
It claimed in the petition: 'The total investment already made and the projected investment is based on the fact that the profits derived by the petitioner companies from SEZ shall not be taxed. The sudden change by seeking to impose MAT and DDT on SEZ developers in the current financial year is arbitrary and irrational even though the petitioners have achieved the object and purpose of the SEZ.'
The company submitted in the petition that the provisions imposed unreasonable restrictions on the petitioner's fundamental rights to carry on trade, business and commerce and, therefore, the need to challenge the amendments.
Gandhinagar: On the petition filed by Adani Power Limited (APL), which has challenged three sections of the Finance Act, 2011, the Gujarat High Court on Tuesday issued notice to the central government.