SC slams tax department, RBI governor for harassment of IRS officer

New Delhi: Supreme Court has slammed the income tax department and a former revenue secretary, who now is the governor of RBI, for systematically harassing an Army officer turned Indian Revenue Services bureaucrat for over a decade and imposed a cost of Rs 5 lakh on the authorities.

Pramod Bajaj was commissioned as an officer in the Army in 1980 but was released because of disability he suffered as Captain during an operation. He cracked the tough civil services examination and was appointed to Indian Revenue Services in 1990 and rose to became Commissioner of Income Tax in Jan 2012.

A bench of Justices Vikram Nath and Sandeep Mehta said, “Notwithstanding his promotion to post of Commissioner of Income Tax and imminent probability for further promotion, a trumped-up memorandum was issued to him, which was ultimately dropped. However, taking shelter behind this subterfuge, the petitioner was compulsorily retired.”

“The order of compulsory retirement was ultimately set aside by this Court in an earlier round of litigation vide the judgment dated March, 3, 2023, recording strong observations on the high-handed and mala fide manner in which the departmental action had been undertaken.”

Referring to the former revenue secretary, now RBI governor, as ‘the Officer’ without taking his name, the bench said, “Though considering the fact that ‘the Officer’ now holds a sensitive position, we refrain from making any observations on his role in the entire sequence of events leading to the present litigation.”

The bench imposed a cost of Rs 5 lakh on authorities payable to Bajaj. It also directed fresh selection of members of ITAT from among candidates that would include Bajaj.

Bajaj’s troubles with the I-T department began in 2014 when he applied for appointment to the post of Member (Accountant) of Income Tax Appellate Tribunal. The Search Cum Selection Committee (SCSC) headed by a sitting SC judge placed him at All India Rank One. But the department did not appoint him to the post, citing his litigation with his estranged wife.

On the directions of the Central Administrative Tribunal, the department’s objections were placed before SCSC, which rejected them and maintained his All India Rank One. Appeal against the CAT order was dismissed by Allahabad HC and then SC. Undeterred and adamant, the department initiated a vigilance inquiry against Bajaj and put him in the list of officers with suspected integrity.

This move too was set aside by the CAT. Appeal against this order was dismissed by the HC. Later the department initiated departmental proceedings and compulsorily retired him despite he being empanelled by ACC for the post of joint secretary.

The apex court in a hard hitting judgment on March 3, 2023 quashed the proceedings against Bajaj and set aside order of compulsory retirement.

Bajaj moved a contempt petition against the revenue secretary in 2024 and the court summoned him for deliberate defiance of SC orders. The revenue secretary tendered unconditional apology on Aug 4, 2024 and the court directed release of all consequential benefits to Bajaj.

He was not appointed as an ITAT member but was called for a fresh interview before SCSC headed by a sitting SC judge.


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