Understanding Retrospective Ordinances: Legal Rights and Government Power

Laws are typically prospective unless specifically declared to have a retroactive effect. This means that unless a legislative body explicitly states a law is applicable to past events, it will only apply to future actions. However, if a government decides to pass a law with a retrospective effect, it must undergo a rigorous legal scrutiny to ensure it does not violate fundamental rights.

Legislator's Perspective on Retrospective Laws

In a significant statement, Arun Jaitley, a prominent figure in Indian politics, argued that it is within the sovereign government's right to create and enforce laws with retrospective effects. This concept gained prominence during the discussion around retrospective tax laws aimed at eliminating specific legislative provisions.

Impact on Ordinances

Given that any law can be passed as an ordinance, it is logical to infer that an ordinance can also be crafted to have a retrospective effect. Any such ordinance would similarly need to withstand legal scrutiny, particularly when it challenges the principles of fundamental rights. It is essential for both the judiciary and other branches of government to maintain a balance while considering such laws.

Support for Retroactive Tax Law

Proponents of retrospective laws, such as those passed during Pranab Mukherji's tenure, argue that such measures are necessary to address the avoidance of taxes through loopholes. Telecom companies, for instance, have been known to exploit such loopholes to evade payment of additional levies, with the AGR (Adjustment for Revenue from Goods and Services Tax) dues continuing to be a contentious issue.

To safeguard against such practices, it is imperative that the government, judiciary, and legislative body come together to ensure that the due revenue of the government is actually collected in a timely manner. This can be facilitated by leveraging technology to streamline the payment process and introduce a 3-way transaction system.

Modernizing Payment Systems

Technological advancements offer the potential to revolutionize the way payments and taxes are handled. By implementing software that processes 3-way transactions, it would be possible for any payment made by a consumer to be automatically directed to both a business and the government after the appropriate tax or revenue shares have been allocated. This ensures that the government's revenues are effectively collected and utilized.

Given the prevalence of digital payments today, such a system could be seamlessly integrated into the existing infrastructure, reducing delays and increasing efficiency. This approach not only addresses past non-compliance but also sets a precedent for future actions, ensuring that taxes and levies are paid promptly and accurately.

Conclusion

While retrospective ordinances and laws carry significant weight, they must be carefully evaluated to prevent potential violations of constitutional rights. The government, legislature, and judiciary share responsibility in ensuring that public revenue is protected and effectively utilized. By leveraging technology and promoting transparency, it is possible to create a system that maintains the sanctity of the law while fostering fair and just revenue collection.