20 January, 2021

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Tax-Free Car Permit Abuse By MPs And Ministers Comes Before Supreme Court

In a Writ Application (SC/Writs/02/2015) field in the Supreme Court yesterday, by the Public Interest litigator Nagananda Kodituwakku petitioned to the Supreme Court that the ‘Tax-Free Permit Scheme’ introduced in good faith to grant tax-free permits to import vehicles free from fiscal levies, enabling MPs and the Cabinet of Ministers to use the vehicles to effectively discharge their office, has since been abused by them, exploiting the permits for unjust enrichment by selling the permits in the open market and defeating the very objective of issuance of such permits in the public interest.

Nagananda Kodituwakku

Nagananda Kodituwakku

In the Petition filed in Court lawyer states that according to the said Schedule ‘A’ of the Customs Law (see the document 1 below), statutory levy on over 2500cc Diesel Motor vehicles classified under the HS Code 87033359 is 300% of the CIF value, whereas the statutory levy on a very small motor car of less than 1000cc, classified under HS Code 87032169 is 135% of the CIF value.

Producing Customs declarations to support his case, Lawyer Kodituwakku demonstrates how this system is abuse for unjust enrichment by the MPs and Ministers whilst exploiting poor taxpayers. Producing evidence (Cusdec No 4797 of 09th Feb 2015) (see the document 3 below) the lawyer demonstrates how for a small car (used 650cc Suzuki Alto Petrol car) Customs charge a levy of Rs 1,485,039.00, whilst luxury vehicles imported under permits are granted tax waivers. For instance Cusdec No 21781 dated 12th May 2015 (see the doc 2 below) produced to customs for the clearance of a Mitsubishi Montero Jeep, of over 2500 cc, Customs waives a levy of Rs.8,188,846.00, a fair share of which is syphoned by the permit holder, by selling the permit in the car market, a patent improper act done purely for unjust enrichment, denying the rightful revenue to the government.

Lawyer Kodituwakku states that he made a formal complaint in this regard to the Corruption Commission urging it to investigate this blatant abuse that falls well within Section 70 of the Bribery Act (causing loss to the government and/or profiting from abusing office) on 11th December 2014 and despite the said plausible complaint was made, the Commission failed to initiate any investigation into it. Instead the Lawyer says that he was informed by the Corruption Commission in its communication dated 04th March 2015 as follows;

“…The Conditions in the tax-free permits were decided as policy of the government. Therefore any loss caused to the government due to the implementation of such government policy will not fall within the scope of Section 70 of the Bribery Act. Accordingly, please note that the Commission will not take further action on your complaint …”

Therefore, lawyer Nagananda Kodituwakku pursue for a Writ of Mandamus against the Corruption Commission, compelling it to initiate a formal investigation/inquiry into this blatant abuse of tax free permit scheme for improper purpose of unjust enrichment by MPs and the Cabinet of Ministers, causing tremendous loss of tax revenue to the government.

And in the Motion filed in Court he request the Chief Justice that his case be listed for support before a Bench, which does not include Justice Buwaneka Aluwihare, PC, Justice Sisira J de Abrew, Justice Priyantha Jayawardena, PC, (arbitrarily appointed to the Supreme Court by President Rajapaksa) reporting that he has no trust and confidence in them.

Schedule ‘A’ of the Customs Law;

P1

 

Document 2;

P2

Document 3;

P3

 

 

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  • 9
    0

    Public Interest litigator Nagananda Kodituwakku

    RE: Tax-Free Car Permit Abuse By MPs And Ministers Comes Before Supreme Court

    Question: Was the Permit owned by the MP, granted to him without any restrictions? Since They all form part of the Gang Of Robbers, they did what was in their best self interest. Clearly, the system is flawed, and the PMs used the flaw to their advantage.

    Now, Remember, these MPs were elected by the people ti represent a Party. Mahinda Rajapaksa gave Minister Portfolios to UNP Mps , and gave more money and perks.

    Isn’t that an abuser of the Voters trust, who expected to server the party?

    • 15
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      YES ! Investigate MR for BRIBING NOT just Tissa Attanayake but OTHERS as well. People elect reps with the thought the candidate is from a certain party and NOT for the candidate to cross over to another party. The People should approve that not a TOP Politician… Make it LAW that the person contesting an election CANNOT switch parties after being elected.. this is an abuse by the rep for his PERSONAL GAIN… not the voters interests..

      Investigate the Permit scheme its a BIG SCAM. The public officials are rewarded a permit which is sold to a car importer who gets a power of attorney and use the car for a limited time and then gets it transferred. This is HOODWINKING THE MASSES. Public officials are paid a salary and why would they be rewarded? IF so Shop owners PAY taxes to the govt, which helps in the best interests of the country but they do NOT get rewarded. SO are the workers who remit money to SL.. they have restrictions placed on their permits while Politicians and public officials do not have much hassle.. Unfair practices…

      IF law should be equal to everyone, so does the issue of permits.. LET EVERYONE pay the duty that the govt is supposed to get with no favoration…

  • 11
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    Thank you, fearless crusader Nagananda Kodituwakku for taking this before the courts. It will be very interesting how the learned judges (that exclude those three named, who were appointed by MaRa) will rule. The judgement could be shattering for not only those in the seats of the legislature who abused the system, but also many many others, such as academics, who sold their permits rather than use them to import a car for their own use.

    I hope that what comes out of this will be a mandated process of the permit holder being the only person who can own such a car, and that such cars be precluded from re-sale for a period of say, 3-5 years. Failure to do so should automatically trigger a demand on the permit holder, to pay the sum equal to the customs duty waiver plus a penalty of 300% of that amount.

    This will have the effect of properly siphoning correctly imposed sums of customs duty + penalties for improper use to the exchequer for the benefit of the country, rather than help to grow fat on the purse and person of the rogue permit holders.

    Looks like crookedness has become endemic in our fair land…. and it must be stopped now.

  • 10
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    Do away with this completely. NO tax free allowances: pay a monthly allowance to cover ALL expenses. That is the easiest and safest. Also, tax ALL who draw above the basic.

  • 11
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    Excellent. At last there is a professional who had challenged the system instead of challenging political parties

    I think late Denzil Fernando and Karu Jayasooriya were politicians who did not misuse the vehicle permit facility. One of my friends who closely knew Denzil Fdo mentioned 20 years ago that when retiring, DF had three duty free permits and never used them. (It was well known at the time that he refused to speak to a Corporation Chairman under his own Ministry for a vacancy to support the application of his own son who was an Engineer)

    Even the JVP initially did not use these permits to import LUXURY vehicles. Not certain whether they still adopt this practice.

    However unfortunately ACTIONS OF THESE HONEST POLITICIANS ARE NOT APPRECIATED BY THE PUBLIC during elections. Politicians with most money are considered most powerful by the voters and corrupt get highest number of votes. Further people tend to soft peddle corruption of the politicians form their preferred party.

    As such the voter is also largely responsible by not punishing the corrupt politicians.

    While it is commendable for Mr Nagananda to take up this matter in courts, I think the abandon duty of the voters and the civil society to consider the HONESTY OF THE POLITICIAN AS A KEY PARAMETER WHEN VOTING.

  • 5
    3

    vehicle permits are used and abused by all and sundry but it has its good points too as many state officials on their meagre salaries cannot otherwise afford a decent car

    How about the expat workers of Sri Lanka who toiled away from home soil in foriegn lands,are they also entitled for car permits?

  • 6
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    This is brilliant.

    If we had 10 lawyers like Nagasena from the 10,000+ lawyers in the country this place would be heaven!!!

    Wish you the very best.

    • 3
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      come on don’t insult the man , his name is Nagananda , not Nagasena !

  • 2
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    CJ Sripavan sain in his ceremonial address to the Nation that he will uphold the Rule of Law. The stand he takes in this case will surely show his intergrity.

  • 1
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    I think these MPs will try to get their arrest delayed by filing cases against the legality of those agencies investigating corruption charges against them.

  • 2
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    This is sheer abuse. The Court should intervine, because it exercice people’s Judicial Power when politicos are corrupt they should be dealt with appropriately.

  • 2
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    This looks like a billion rupee fraud.

  • 1
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    This looks like a billion rupee fraud

  • 2
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    Thanks for bringing this abuse of the system and bribing the individuals who are being appointed by the people to serve them. What they should realize is that they are not the ‘MASTERS’ but the ‘SERVANTS’ of the people. This has been going on for too long now, for decades I think
    I can still remember the days that people who worked overseas for more than five years were allowed a free permit (only one) for his personal use. There were not many then and no one wanted a permit as the public transport system was far superior to the present.
    Now then, I have been working overseas for more than 35 years and sent money to Sri Lanka for various reasons which can be amounted to almost 3-4 Billion Rupees. Still, I have to rent a vehicle when I visit my family and friends every year, while every Tom, Dick & Harry from nowhere are driving brand new super cars. I am happy for them, but only if they have earned those luxuries honestly and lawfully. This is one of the reasons the so called ‘diaspora Tamils and Sinhalese’, labelled by the ‘Jarapassa & his clan’, do not want to invest or comeback to retire at this juncture. So, Nagi, I wish you success in this, every avenue you take as a true friend who believe only in ‘Anichcha, Dukkha & Anathma’. May you and your family be well, happy and free from suffering!

  • 1
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    It is common knowledge that these corrupt politicos deceive people at will. They simply sell their permits with a power of attorney given to buyer to import a car on permit and a spot cash of over 7.5 million rupees.

  • 1
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    The Supreme Court should ensure that Rule of Law is privailed in this country.

  • 3
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    Thank you sir for doing this for all of us. What have the damned MP’s, Doctor’s and Engineer’s done more, than the rest of us for Sri Lanka that they get ONE TWO THREE duty free vehicles and the rest of us have to pay the full duty?

    Keep in mind the blardy Judiciary is benefiting from this trick too so it will be interesting to see how the ruling comes down.

  • 1
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    Mohan Peiris ruined the integrity of the Judiciary, hope that Justice Sripavan will maintain no cantacts with Executive and deal with the fraudster elements according to law.

  • 0
    0

    The court must order all public funds cheated by dishonest politicians.

  • 2
    0

    There should be a end to this high profile corruption. SIRISENA should stop this abuse immediately.

  • 2
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    What nonsense are you talking about after Sirisena was elected to Office Secretary Finance issued a new directive renewing this day light fraud.

  • 2
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    This practice forces even some relatively good people to engage in corruption by selling their permits.

  • 3
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    President Sirisena please stop this abuse.After all what they cheat is government revenue.

  • 2
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    President Srisena is given a mandate tp stop these abusea. Let’s see how he is going to deal with this scam.

  • 1
    0

    Unless finance minister personally authorise no tax waiver should be permitted even for a good reason.

  • 1
    0

    This is a million rupee fraud involving public funds. Stop this.

  • 3
    0

    This is plundering national assets by a select few allowed by Rajapaksha as a reward for pandering to him. Prosecute them all!

  • 3
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    Our country need people Like Mr. Kodituwakku and he is more suitable to be
    the Bribery Commissioner. I hope our President will consider him when
    appointing the next B.C.

  • 2
    0

    This is common knowledge. No one dared to bring these things out and file a case because of fear. Now anyone can do so because the fear culture disappered with MR.

    To whome should the credit of this go. I say 50% to Naganda and 50% to MR. Why for MR? Because he held parliamentary elections 2 years ahead and managed to snatch defeat from the jaws of victory in a case of self ‘bucketing’.

    P.S.: In campus parlance ‘bucketing’ means pouring of a bucket of water on somebody without any warning.

    That is what poor MR did to himself.

    • 0
      0

      Ban bucketing! A childish low-intelligence kick for the manda-buddhikas wherever they are.

      MR going with Sumaney is certainly a manda-buddhika act.

  • 1
    0

    An excellent move by Mr.Kodtuwakku. The nation must thank him.Bensen

  • 2
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    Most professionals have used duty concessionary permits not duty free more than 100%. Some sell it, others use it. Most MPs and Ministers sell it! On one hand 300% tax for Appuhamy’s and no tax for ministers is totally inappropriate!

    Even Asgiriya and other priests get bribed through this process. One of the in incentives to become an MP apart from the chances of bribery, power and pension is this.

    Sumathipala ‘ s 6 door limousines were classified as vans and Namal’s racing cars exempted?? How absurd is this?

    The best would be not to have such discrepancies but to have a reasonable tax for everyone to be able to afford a vehicle and stop using this tax as a income generating business for government.

    Ravi K also decided to increase tax on hybrids without considering savings in fuel imports to the country?? However if like the previous guys if there is a commission on each liter, more the merrier!!

  • 0
    0

    Not only MPs (government and opposition) there are others also who get cars under permits and they also sell them…such as Judges, Doctors, Other Government Servants. If I am not mistaken the previous government removed the restrictions on transferring the permits since all permit holders were doing this (not only politicians) so it became a black market. After the government removed the restriction the value of the permits drastically came-down…I think the young attorney’s intentions are good. But, I believe first the laws have to be amended. MS/RW couple will have to do this first.

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