SUMMIT REPORT, Gangtok 07 Mar:
The High Court of Sikkim has dismissed a Public Interest Litigation filed by Dr Doma T Bhutia challenging the constitutional validity of an amendment to the Income Tax Act 1961 which expanded the definition of the term “Sikkimese” under section 10 (26AAA) which deals with defining sections exempted from paying Income Tax.
The amendment, it may be recalled, was introduced in the 2023 Finance Act.
Dr Bhutia had argued that this expansion of the term violated Article 371F of the Constitution of India and weakened the historical identity of the indigenous Sikkimese people.
The case was heard by Chief Justice Biswanath Somadder and Justice Meenakshi Madan Rai, who ruled that the amendment followed the Supreme Court’s 2023 judgment in the Association of Old Settlers vs Union of India case.
The High Court found no Constitutional violation and based its decision on a government clarification from the Central Board of Direct Taxes (CBDT) on April 4, 2023, which stated that the revised definition of ‘Sikkimese’ applied only for income tax purposes and did not affect other constitutional protections.
Dr Bhutia had argued that the amendment exceeded the Supreme Court’s directive by unnecessarily broadening the definition of Sikkimese to include people whose ancestors lived in Sikkim before the merger, even if they themselves were not Sikkim Subjects.
She argued that the revision went against the Sikkim Subject Regulation Act of 1961 and violated Article 371F(k), which ensures the protection of Sikkim’s pre-merger laws. She also referred to the Sikkim Government Establishment Rules, 1974, which defined ‘Sikkimese Nationals’ and ‘Non-Sikkimese Nationals,’ ensuring that government jobs and privileges were reserved for those with the Sikkim Subject Certificate.
The PIL claimed that the amendment overlooked legal precedents, mixing pre-merger Sikkimese citizens with later settlers, which could upset the state’s demographic and economic balance.
The Union and State Governments, represented by Sangita Pradhan and Zangpo Sherpa, defended the amendment, saying it followed the Supreme Court’s order to extend tax exemptions to Indian citizens living in Sikkim before April 26, 1975.
During the proceedings, the Additional Advocate General of Sikkim referred to a clarification from the CBDT, which said the amendment’s definition of Sikkimese only applied to the Income Tax Act 1961 and didn’t affect the constitutional protections of indigenous Sikkimese under Article 371 F.
The High Court accepted the clarification and dismissed the PIL, stating that the amendments did not affect the rights and privileges of genuine indigenous Sikkimese.
