Monday, July 23, 2007

SC orders Surya Tobacco verdict review

The Supreme Court on Sunday ordered a review of its controversial verdict on Surya Tobacco Pvt. Ltd, ruling that the nearly 10-year old judgment flouted the set apex court precedents.
Justices Anup Raj Sharma, Bal Ram KC and Rajendra Kumar Bhandari ordered a review in response to a plea filed by Finance Ministry on behalf of the government in 1998. The review order came after a closed-door discussion of the justices.

Passed by the then Justices Hari Prasad Sharma and Harish Chandra Prasad Upadhyay on April 8, 1998, the verdict had nullified the government decision to collect Rs 135.982m excise duty from

the tobacco company as per appendix 3 (note 2) of the Finance Act 1993.

While nullifying, the court had then ruled that the "note" should not be taken as substantive law. When the verdict was passed, the present King Gyanendra, the then prince, was holding majority shares in the company.

The decision to collect excise duty was taken after the Office of the Auditor General found the tobacco company not producing cigarettes in proportion to the used raw materials. The verdict is considered one of the most controversial ones in Nepal's judicial history. Even the parliament had discussed the verdict.

The then Public Accounts Committee of parliament, in its decision on September 13, 1998 had concluded that the judgment "grossly" violated the Excise Duty Act, while ordering the Office of the Attorney General to file a plea for review. There was a strong demand for impeachment of the judges then on the ground of the verdict.

Both the judges who passed the verdict are retired now. Justice Sharma later became Chief Justice while Upadhyay is now dead.

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