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2021 (3) TMI 293 - HC - Service TaxAmnesty scheme - Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - seeking to issue discharge certificate under SVLDRS - declaration under FORM SVLDRS-1 was rejected on the ground of ineligibility, with the remarks that Demand has neither been quantified nor has been communicated to the assessee and Submit SVLDRS-4 of main noticee - Whether the communication dated 18th June, 2019 issued to the Superintendent, Anti Evasion Group-1, Central Excise Service Tax, can be considered to be as an admission of duty liability so as to render the petitioner eligible under the SVLDRS? - HELD THAT - The quantification of the amount has to be before 30th June, 2019. Moreover, in terms of Section 121(r) of the Act, the word quantified has been defined to mean a written communication of the amount of duty payable under the indirect tax enactment. Further, Section 124(1)(d)(ii) provides that in respect of cases where the tax dues are linked to an enquiry, investigation or audit against the declarant, the relief shall be calculated on the amount quantified on or before the 30th day of June, 2019. Petitioner s case falls within the ambit of enquiry or investigation , as the Petitioner was issued summons dated 10.05.2019 by the Anti-Evasion Group 4, Central Excise Service Tax. In respect of such cases, by virtue of the aforesaid circulars, the Respondents have clarified that the benefit of SVLDRS can also be given to those cases where the duty involved is quantified before 30.06.2019 - Since quantification has co-relation and is interlinked with tax relief under the scheme, and the Petitioner has not made a voluntary disclosure, but has rather approached for settlement in respect of case under investigation, there are merit in the submission of the Revenue that unilateral quantification by the Petitioner by writing the letter/communication dated 18.06.2019 cannot render him eligible. It would only be an admission of service tax liability of that amount, and such admission in itself would not rendered the petitioner eligible under SVLDRS. The quantification in the instant case was understood to be done on the issuance of the SCN. There is not much difference between the amounts as mentioned in the communication dated 18.06.2019 and the SCN issued by the department subsequent to the completion of investigation. However, that in itself cannot be a measure to interpret the concept of quantification . The quantification of the amount in question, as defined under the relevant provisions, and further clarified under the circulars noted above, can only mean to be a duty liability which has been determined by the department. In the present case, since amount could not be said to have been quantified , the petitioner was not eligible, and therefore, the reasoning given by the respondent in rejecting the application does not call for any interference - petition dismissed.
Issues Involved:
1. Eligibility under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS). 2. Definition and scope of "quantification" under SVLDRS. 3. Validity of the rejection of the petitioner's declaration under SVLDRS. 4. Challenge to the Demand-cum-Show Cause Notice (SCN). Detailed Analysis: 1. Eligibility under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS): The petitioner sought relief under SVLDRS for settlement of service tax dues but was rejected on the grounds of ineligibility. The court examined the eligibility criteria under Section 125(1)(e) of the Finance Act, which excludes persons from making a declaration under the scheme if the amount of duty involved in an enquiry, investigation, or audit has not been quantified on or before June 30, 2019. 2. Definition and scope of "quantification" under SVLDRS: The court referenced previous judgments and circulars to define "quantified" as a written communication of the amount of duty payable. It emphasized that quantification must occur before June 30, 2019, and must be communicated by the department, not unilaterally by the taxpayer. The court cited the Chaque Jour HR Services Pvt. Ltd. v. UOI & Anr. case to reinforce that quantification is imperative for eligibility under SVLDRS. 3. Validity of the rejection of the petitioner's declaration under SVLDRS: The petitioner argued that the amount was quantified by their communication dated June 18, 2019. However, the court found that this unilateral declaration did not meet the requirements of SVLDRS, as quantification must be determined by the department. The court held that the rejection of the petitioner's declaration was justified because the amount was not quantified by the department before the relevant date. 4. Challenge to the Demand-cum-Show Cause Notice (SCN): The petitioner also sought to quash the SCN issued on March 20, 2020. The court noted that the SCN captured the petitioner's quantified service tax liability but emphasized that the SCN itself could not be considered as quantification before June 30, 2019. Since the petitioner's eligibility under SVLDRS was not established, the challenge to the SCN was deemed not maintainable. The petitioner was advised to pursue statutory remedies under the Act to contest the SCN. Conclusion: The court concluded that the petitioner's unilateral quantification did not render them eligible under SVLDRS. The quantification must be communicated by the department, and the petitioner's declaration was rightly rejected. Consequently, the petition was dismissed, and the challenge to the SCN was not entertained, leaving the petitioner to seek other statutory remedies.
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