2020 (9) TMI 121 - HC - Service Tax

Rejection of benefit of Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - mistake of not mentioning the penalty - filing of details in the wrong column i.e. filing details in the column 9.1 instead of column 9.4 - HELD THAT - It is an admitted position of the parties that the petitioner does not come within the purview of the exceptions provided in sub clauses (a) to (h) of Section 125, meaning thereby that petitioners are otherwise eligible to make a declaration under Scheme 2019. The only issue before the Court would be whether the claim of the petitioner for the benefit under Scheme 2019 would stand rejected as because of the aforesaid mistake of not mentioning the penalty or a different view can also be taken in the matter - Admittedly the Finance Act, 1994 wherein, Scheme 2019 has been incorporated does not provide for any provision for re-submitting an application claiming the benefit under the scheme. In the instant case, the mistake made by the petitioner was that they had stated in clause 9.1 about the undisclosed dues instead of stating it in clause 9.4. By stating the required information in clause 9.1 instead of clause 9.4 it cannot be said that by making the mistake, the petitioner had claimed an undue benefit which they are otherwise are not entitled under the law - it is an agreed position of the parties that the petitioner may make an application to the appropriate respondent authorities to consider the claim of benefit under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 by allowing the petitioner to make necessary correction in the information provided as regards the earlier penalty imposed on them. It is further agreed that upon such application being made, the authorities would pass an appropriate order thereof as per their discretion. This writ petition stands disposed of by requiring the petitioner to submit an application before the respondent authorities for the correction to be made in the information provided in the Form SVLDRS-1 as regards the disclosure of the dues from them and upon such application being made, the respondent authorities would pass a reasoned speaking order thereon.

Summary

Issues:
Claim for benefit under Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 due to inadvertent mistake in Form SVLDRS-1.

Analysis:
The petitioner, an assessee under the Finance Act, 1994, provided taxable services from 2013-2017 but failed to file returns or pay service tax. The respondent authorities introduced the Sabka Vishwas Scheme, 2019, allowing voluntary disclosure of tax dues to avoid interest and penalties. The petitioner claimed eligibility under Section 124(1)(e) of the Scheme as they did not fall under the exceptions in Section 125(1)(a) to (h), making them eligible for the Scheme.

To benefit from the Scheme, claimants must submit Form SVLDRS-1, where the petitioner mistakenly stated the duty payable in the wrong clause. The authorities rejected their claim citing the mistake and the absence of a show cause notice. The crucial issue was whether this mistake rendered the petitioner ineligible for Scheme benefits, as the Finance Act did not allow resubmission of applications.

The Court deliberated on the nature of the mistake: deliberate to claim an undue benefit or inadvertent. The petitioner's error of stating dues in the wrong clause did not amount to claiming an undue advantage. Thus, the mistake was considered curable, allowing the petitioner to seek correction in the Form SVLDRS-1 to avail Scheme benefits.

Consequently, the parties agreed that the petitioner could apply for correction with the respondent authorities. The Court disposed of the writ petition, instructing the petitioner to submit the application within 15 days for correction. The authorities were directed to decide on the application within 2 months. Additionally, the petitioner retained the right to claim any other entitled benefits under the Scheme beyond Section 124(1)(e).

In conclusion, the judgment resolved the issue of the inadvertent mistake in the Form SVLDRS-1, permitting the petitioner to rectify the error and proceed with the claim under the Sabka Vishwas Scheme, 2019.