MUMBAI, July 24: A Bombay High Court division bench of Chief Justice M B Shah and Ranjana Desai today adjourned the hearing of the petition challenging the validity of the Voluntary Income Disclosure Scheme.The next hearing has been set for Monday. The Federation of All India Tax Practitioners Association, represented by advocate S E Dastur, argued against the rationale of the scheme.Dastur said the scheme was unfair toward the honest tax payers. Calling it ``arbitrary, discriminatory and violative of Article 14 of the Constitution'', he said the scheme encouraged tax evaders to pay tax at lower rates on their undisclosed income. An honest tax payer was put to such a disadvantage that his moral fibre broke down, he added. To this argument, the judge asked him if there was an alternative to the scheme.Additional Solicitor General of India Rafique Dada submitted that the government had evolved VDIS by balancing economic and ethical options on the basis of suggestions made in a meeting of the National Development Council attended by various chief ministers and members of Planning Commission. Quoting extensively from the Wanchoo Commission report, he said there were two options before the government - either to allow black money to remain unutilised or put into productive use. He said the scheme intended to mop up black money running into thousands of crore of rupees so that the amount could be canalised into priority sectors.
