2020 (7) TMI 765 - HC - Service Tax

Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - rectification of mistake done beyond prescribed time limit - applicability of time limitation - HELD THAT - A complete procedure and eligibility has been prescribed for availing the benefit of the scheme. However, as per section 128 within 30 days of issuance of statement, designated committee, suo motu, is empowered to correct an arithmetical and clerical error, which is apparent on the face of record. No doubt in the instant case while accepting the declarations submitted by the petitioner issued statements vide exhibits P8, P9 and P10 dated February 28, 2020. The rectification orders exhibits P12 to P14 dated June 2, 2020 are beyond 30 days. Though the petitioner was entitled to the benefit of the scheme as per originally issued SVLDRS-3 but, this court cannot remain oblivious that many assessees availed the benefits of scheme and owing to such fact, the designated committee could not notice the manual returns exhibits P1 to P3 were ever filed and by accepting declarations, SVLDRS-3 were issued. The petitioner had also attempted to pay tax as reflected in exhibit P8. But on noticing non-filing of the return by taking the aid of the provisions 128 or general law of the rectification, rectified SVLDRS-3 was issued. Even section 129 of the Scheme envisages that every discharge certificate issued under 126 with respect to the amount payable shall be conclusive but sub-section (2)(c) of section 129 opens with a non obstante clause that in a case of a voluntary disclosure where any material particular furnished in the declaration is subsequently found to be false, within a period of one year of issue of the discharge certificate, it shall be presumed as if the declaration was never made. Petition dismissed.

Summary

Issues:
1. Quashing of rectified statements in form SVLDRS 03
2. Acceptance of payment and issuance of discharge certificate
3. Timeliness of rectification by the designated committee

Analysis:
1. The petitioner sought to quash rectified statements in form SVLDRS 03 and direct the committee to accept payments and issue a discharge certificate. The petitioner, a private limited company, filed manual returns due to online access issues for certain periods. The Sabka Vishwas Scheme, 2019 was introduced for settling arrears under the Central excise and service tax regimes. The petitioner opted for the scheme and made declarations in form SVLDRS-1, leading to the issuance of statements estimating payable amounts in form SVLDRS-3. The petitioner objected to rectified statements beyond the prescribed timeline, claiming them as time-barred under the scheme.

2. The Revenue's counsel argued that the designated committee acted in good faith based on verified declarations, as the petitioner claimed manual filing of returns, contradicting the mandatory e-filing requirement. Allegations of wilful misdeclarations were made, affecting the petitioner's entitlement to scheme benefits. The committee rectified statements under section 128 of the Act, citing fraudulent actions vitiating proceedings. The petitioner's failure to produce evidence of manual filing and full tax payment led to the rectification, emphasizing the scheme's objectives and the need to prevent fraudulent claims.

3. The court analyzed relevant scheme provisions, emphasizing the committee's power to rectify errors within 30 days of statement issuance. While the petitioner was initially entitled to scheme benefits, the committee rectified statements upon discovering discrepancies in manual filing claims. The court upheld the committee's actions, considering the non-mandatory nature of the 30-day timeline for rectification. Section 129 highlighted the consequences of false declarations, reinforcing the committee's decision to rectify based on misstatements. Ultimately, the court dismissed the writ petition, supporting the committee's rectification actions and rejecting the petitioner's claims.

This detailed analysis of the judgment provides insights into the issues raised, the arguments presented by both parties, and the court's reasoning leading to the dismissal of the writ petition.