Case Note & Summary
The Petitioner, Ashwini Builders and Developers Pvt. Ltd., a company registered under the Companies Act, 1956, filed a Writ Petition under Article 226 of the Constitution of India before the Bombay High Court. The Petitioner challenged a notice/statement dated 06/03/2020 issued by the Designated Committee in Form SVLDRS-3 under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, which rejected the Petitioner's declaration filed under the Scheme. The background of the dispute involves a Show Cause Notice dated 03-07/08/2015 issued by the Commissioner of Central Excise and Service Tax to the Petitioner for refund of service tax amounting to Rs. 49,96,083/-. An Order-in-Original was passed on 29/03/2017 against the Petitioner. The Petitioner filed a rectification application under Section 74 of the Finance Act, 1994 on 13/07/2018, which was rejected on 20/02/2019. Thereafter, on 08/04/2019, the Petitioner preferred an appeal before the Appellate Authority under Section 85 of the Finance Act, 1994. On 01/09/2019, the Central Government notified the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019. The Petitioner filed a declaration under the Scheme on 15/01/2020. The Designated Committee issued a notice in Form SVLDRS-3 on 06/03/2020, stating that the Petitioner was not eligible under the Scheme because the appeal was not pending as on the date of filing the declaration. The Petitioner argued that the appeal was pending and that the rectification application did not affect the pendency of the appeal. The Respondents contended that the appeal was not pending because the Petitioner had filed a rectification application which was rejected, and the appeal was filed after the rectification application was rejected. The Court analyzed the provisions of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, particularly Section 125 of the Finance Act, 2019, which defines eligibility. The Court held that the appeal filed by the Petitioner on 08/04/2019 was pending as on the date of filing the declaration on 15/01/2020, and the rectification application did not affect the pendency of the appeal. The Court quashed the notice in Form SVLDRS-3 and directed the Designated Committee to process the Petitioner's declaration in accordance with law. The Court also directed that the Petitioner be given an opportunity of hearing before any adverse order is passed.
Headnote
A) Service Tax - Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - Eligibility - Pending Appeal - The Petitioner had filed an appeal against the Order-in-Original dated 29/03/2017, which was pending as on the date of filing the declaration under the Scheme. The Designated Committee erroneously held that the Petitioner was not eligible under the Scheme on the ground that the appeal was not pending. The Court held that the appeal was pending and the Petitioner was eligible under Section 125 of the Finance Act, 2019. The notice in Form SVLDRS-3 was quashed and the declaration was directed to be processed in accordance with law. (Paras 2-10)
B) Service Tax - Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - Rectification Application - The Petitioner had filed a rectification application under Section 74 of the Finance Act, 1994, which was rejected. The Court noted that the rectification application was not an appeal and did not affect the pendency of the appeal. The Scheme does not require that the appeal be the only remedy; it is sufficient that an appeal is pending. (Paras 3-8)
Issue of Consideration
Whether the Designated Committee was justified in rejecting the Petitioner's declaration under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 on the ground that the Petitioner was not eligible under the Scheme, despite the Petitioner having a pending appeal against the Order-in-Original.
Final Decision
The Court allowed the Writ Petition, quashed the notice/statement dated 06/03/2020 in Form SVLDRS-3, and directed the Designated Committee to process the Petitioner's declaration in accordance with law, with an opportunity of hearing before any adverse order.
Law Points
- Sabka Vishwas (Legacy Dispute Resolution) Scheme
- 2019
- Section 125 of Finance Act
- SVLDRS-3 notice
- eligibility for scheme
- pending appeal
- rectification application
- show cause notice
- service tax
Case Details
2022 LawText (BOM) (02) 17
WRIT PETITION NO. 8793 OF 2021
R. D. Dhanuka, S. M. Modak
Mr. Nikhil Wadikar a/w Ms. Komal Bhoir i/by Mr. Nandu V. Pawar for the Petitioner; Mr. J. B. Mishra a/w Mr. D. B. Deshmukh for the Respondent Nos. 1 to 4
Ashwini Builders and Developers Pvt. Ltd.
Assistant Commissioner, Central Excise and Service Tax, Division I, Satara; Deputy Commissioner, Central GST, Kolhapur; Joint Commissioner, Central GST, Kolhapur; The Commissioner (Appeals-I), Central Tax, Pune
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Nature of Litigation
Writ Petition under Article 226 of the Constitution of India challenging a notice/statement in Form SVLDRS-3 issued by the Designated Committee under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, rejecting the Petitioner's declaration.
Remedy Sought
The Petitioner sought a writ of certiorari to quash the notice/statement dated 06/03/2020 in Form SVLDRS-3 and a direction to allow/accept the declaration filed under the Scheme.
Filing Reason
The Designated Committee rejected the Petitioner's declaration under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 on the ground that the Petitioner was not eligible under the Scheme as the appeal was not pending.
Previous Decisions
The Commissioner of Central Excise passed an Order-in-Original on 29/03/2017 against the Petitioner. The Petitioner's rectification application under Section 74 of the Finance Act, 1994 was rejected on 20/02/2019. The Petitioner filed an appeal under Section 85 of the Finance Act, 1994 on 08/04/2019, which was pending.
Issues
Whether the Petitioner's appeal under Section 85 of the Finance Act, 1994 was pending as on the date of filing the declaration under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019.
Whether the Designated Committee was justified in rejecting the Petitioner's declaration on the ground of ineligibility under the Scheme.
Submissions/Arguments
The Petitioner argued that the appeal filed on 08/04/2019 was pending as on the date of filing the declaration on 15/01/2020, and the rectification application did not affect the pendency of the appeal.
The Respondents argued that the appeal was not pending because the Petitioner had filed a rectification application which was rejected, and the appeal was filed after the rectification application was rejected.
Ratio Decidendi
The pendency of an appeal under Section 85 of the Finance Act, 1994 is sufficient to make a declarant eligible under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, and the filing of a rectification application under Section 74 does not affect the pendency of the appeal. The Designated Committee must consider the declaration on merits and cannot reject it on the ground that the appeal was not pending.
Judgment Excerpts
By this petition filed under Article 226 of the Constitution of India, the Petitioner has prayed for a writ of certiorari for quashing and setting aside the notice/statement dated 06/03/2020 issued by the Designated Committee in form SVLDRS-3...
The Commissioner of Central Excise and Service Tax issued a Show Cause Notice dated 03-07/08/2015 to the Petitioner for refunding the Service tax amounting to Rs. 49,96,083/-...
On 08/04/2019, the Petitioner preferred an appeal before the Appellate Authority under Section 85 of the Finance Act,1994.
The Petitioner filed a declaration under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 on 15/01/2020.
The Designated Committee issued a notice in Form SVLDRS-3 on 06/03/2020 stating that the Petitioner was not eligible under the Scheme.
Procedural History
The Commissioner of Central Excise and Service Tax issued a Show Cause Notice dated 03-07/08/2015 to the Petitioner. An Order-in-Original was passed on 29/03/2017 against the Petitioner. The Petitioner filed a rectification application under Section 74 of the Finance Act, 1994 on 13/07/2018, which was rejected on 20/02/2019. On 08/04/2019, the Petitioner filed an appeal under Section 85 of the Finance Act, 1994. On 01/09/2019, the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 was notified. The Petitioner filed a declaration under the Scheme on 15/01/2020. The Designated Committee issued a notice in Form SVLDRS-3 on 06/03/2020 rejecting the declaration. The Petitioner filed the present Writ Petition on 09/07/2021.
Acts & Sections
- Constitution of India: Article 226
- Finance Act, 1994: Section 74, Section 85
- Finance Act, 2019: Section 125
- Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019:
