2019 (12) TMI 1012 - HC - Central Excise

Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS) - cut-off date for settlement of case - quantification of demand - validity of circular issued by CBIC - Form of declaration under section 125 (1) - HELD THAT - In view of Rule 3 of the Scheme, 2019, which is floated under the provisions of Finance Act, 2019, and looking to the definition of amount in arrears as stated hereinabove, by no stretch of imagination it can be said that paragraph Nos.vii and viii of the Circular dated 25.09.2019 is said to be in violation of the Scheme, 2019. Even if the demand is quantified and no appeal is preferred or even if the appeal is preferred but the assessee is applying under the aforesaid Scheme, 2019, it will mean to be covered by Clause 3(b) - Moreover, looking to Rule 3 of this Scheme, 2019, cut-off date of 30.06.2019 is not made applicable in all the four eventualities. The cut-off date of 30.06.2019 is applicable only in the eventualities which are covered under Rules 3(a) and 3(c) - The cut-off date of 30.06.2019 is not applicable for the cases which are covered under Rules 3(b) 3(c). This cut-off date has been clarified in a Circular dated 25.09.2019 which is annexure P-1. The respondents are directed to follow scrupulously the Scheme, 2019 and the provisions of the relevant Act whenever any benefit is to be given for the Central Excise and for the Service Tax. As and when the individual case will come to the Court in detail, the provisions of the Scheme, 2019 and the relevant Act shall be matched with the facts of that individual case - petition dismissed.

Summary

Issues:
Interpretation of Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - Cut-off date for settlement of cases - Violation of Scheme by respondents - Applicability of Circular dated 25.09.2019 - Public Interest Litigation

Analysis:
The judgment pertains to the interpretation of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, specifically focusing on the cut-off date for settling cases. The petitioner argued that the Scheme, effective from 05.07.2019, specifies a cut-off date of 30.06.2019 for settling four types of cases as outlined in Rule 3. However, the petitioner contended that the respondents were settling cases with notices issued and demands quantified after 30.06.2019, which they believed to be in violation of the Scheme. The court analyzed Rule 3 in conjunction with Section 121(c) of The Finance Act, 2013, defining "amount in arrears" as recoverable duty under certain circumstances.

The petitioner further highlighted a Circular dated 25.09.2019, alleging that the respondents were settling cases beyond the Scheme's scope. The Circular's clauses VII and VIII were examined, emphasizing exclusions for cases under appeal or adjudication as of 30th June 2019. The court scrutinized these clauses and determined that they did not contravene the Scheme, as they provided for cases falling under the arrears category post-finality of appellate or adjudication orders.

Regarding the cut-off date, the court clarified that it applied only to specific eventualities outlined in Rules 3(a) and 3(c) of the Scheme. Notably, the cut-off date did not extend to cases falling under Rules 3(b) and 3(c), a clarification provided in the Circular dated 25.09.2019. The judgment emphasized that in public interest litigations, cases would be decided based on individual circumstances, ensuring adherence to the Scheme and relevant legal provisions.

Consequently, the court dismissed the writ petition, affirming that the Circular dated 25.09.2019 was not in violation of the Scheme or the relevant Act. The respondents were directed to adhere strictly to the Scheme and relevant legal provisions when granting benefits related to Central Excise and Service Tax. The judgment concluded by dismissing related applications due to the main writ petition's disposal, rendering them infructuous.