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2021 (1) TMI 267 - HC - Service TaxSabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - Determination of amount of pre-deposit before filing an appeal or Total amount as deposited earlier to be adjusted with Declaration of tax - whether in the facts and circumstances of the case could there be a dispute on the Service Tax deposited by the petitioner, and if there cannot be any dispute in this regard, would the petitioner upon reading the provisions of Sections 123(a)(i) and 124(2) of SVLDR Scheme, be entitled to Tax Relief thereunder which would absolve the petitioner from paying further amounts? - HELD THAT - The SVLDR Scheme contemplates Tax Relief as detailed in Section 124 Section 124(2) stipulates that the Tax Relief shall be calculated subject to the condition that any deposit during enquiry or investigation or audit shall be deducted when issuing the statement indicating the amount payable by a declarant and subject to the condition that if the amount so paid exceeds the amount payable by the declarant as indicated in the statement, the declarant shall not be entitled to any relief. If it is undisputed that the petitioner has deposited a sum of that the petitioner has paid ₹ 92,33,857/- after the audit and the petitioner is disputing the liability in a sum of R1,77,06,985/- in an appeal before the CESTAT In the light of the provisions of Section 124 of the SVLDRS Scheme, the petitioner would be entitled Tax Relief subject deduction of ₹ 92,33,857/-. However, the Tax relief is refused referring to the order-in-original which does not even refer to the deposit made by the petitioner after the Show Cause Notice dated 29.12.2014. The assertion on behalf of the first respondent that the petitioner has itself declared that a sum of ₹ 27,66,646/- in the appeal memorandum of appeal before the CESTAT cannot also be accepted in the view of the explanation offered by the learned counsel for the petitioner in Rejoinder and duty cast upon the first respondent Rule 6 of the SVLDRS Rules to verify the records. It is also undisputed that after SVLDRS-2 is issued, repeated representations have been made to bring out the aforesaid circumstances. The impugned Form No.SVLDRS-2 and Form No.SVLDRS-3 issued by the Designated Committee, SVLDRS are quashed and the first respondent is called upon to issue appropriate Discharge Certificate considering the undisputed deposit of duty in a sum of ₹ 2,52,46,749/- and the disputed claim of ₹ 1,77,06,985/- - Petition allowed.
Issues:
Challenge to SVLDR Scheme Statements and Discharge Certificate issuance. Analysis: The petitioner filed a writ petition seeking to quash SVLDR Scheme Statements issued by the Designated Committee and to direct issuance of a Discharge Certificate under the SVLDR Scheme. The petitioner was initially issued a Show Cause Notice for a tax demand, followed by an Order-in-original calling for payment. The petitioner filed an appeal before CESTAT and simultaneously filed a declaration under the SVLDR Scheme. The crux of the dispute lies in the discrepancy between the tax amount paid by the petitioner and the amount considered by the Designated Committee in the SVLDRS-2 and SVLDRS-3 forms. The petitioner argued that the Forms did not consider the actual tax deposit, as recorded in the Audit Report. The petitioner contended that the Committee should have verified records before issuing the Forms to ensure correct tax relief entitlement under the Scheme. During the proceedings, the respondent argued that the petitioner admitted to paying a specific tax amount in the appeal memorandum before CESTAT, which was considered in the SVLDRS Forms. The respondent contended that the petitioner cannot now dispute the amount paid based on previous documents. The petitioner, in response, highlighted the technical approach taken by the Committee and emphasized the need for proper verification of records to ensure accurate tax relief under the SVLDR Scheme. The core issue revolved around whether there was a genuine dispute regarding the service tax deposited by the petitioner and if the petitioner was entitled to Tax Relief under the SVLDR Scheme. The Court examined the remarks in the impugned Forms and concluded that the Order-in-original did not address the tax paid, only the liability amount. The Court noted the discrepancy between the tax amounts mentioned in various documents and upheld the petitioner's claim for Tax Relief based on the undisputed deposit of duty and the disputed liability amount. The Court emphasized the importance of correctly applying the provisions of the SVLDR Scheme to ensure declarants receive entitled relief without technical hindrances. Ultimately, the Court allowed the Writ Petition, quashed the SVLDRS-2 and SVLDRS-3 Forms, and directed the issuance of an appropriate Discharge Certificate considering the undisputed duty deposit and the disputed liability claim. The Court instructed the first respondent to expedite the issuance of the Discharge Certificate in accordance with the petitioner's entitlement under the SVLDR Scheme.
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