2021 (4) TMI 792 - HC - Service Tax

Admission of Liability of Service Tax - period spanning between 2010-2011 and 30.06.2017 - HELD THAT - Mr. Singh, with his counter-affidavit, has filed a copy of the petitioner s letter addressed to the respondents which is dated 26.09.2019, wherein, inter alia, the petitioner seems to have suggested that it will revert as to its pending tax liability after consulting with its Chartered Accountant. List the matter on 28.05.2021.

Summary

Issues: Liability admission for service tax, eligibility for Sabka Vishwas Scheme, communication evidence review

Liability admission for service tax:
The petitioner admitted liability for service tax for the period between 2010-2011 and 30.06.2017, amounting to ?92,56,543. This admission was reflected in the balance sheet accompanying the Income Tax Return (ITR) for the Assessment Year 2018-2019. The ITR was filed on 31.08.2018, and the balance sheet ended on 31.03.2018. The petitioner claimed that the respondents did not grant a personal hearing despite a purported intimation via email. The rejection order lacked clarity on the date of the email for the hearing, which was later found to be dated 25.02.2020, with a personal hearing scheduled for 28.02.2020.

Eligibility for Sabka Vishwas Scheme:
The respondents argued that due to the ongoing investigation and absence of a quantified liability, the petitioner was not eligible for benefits under the Sabka Vishwas (Legacy Dispute Resolution) Scheme 2019. Reference was made to Section 123(c) and 125(1)(e) of the Scheme. The petitioner, on the other hand, relied on Circular dated 27.08.2019, emphasizing Clauses 4(a) and 10(g) to support their claim that admission of liability before the cut-off date of 30.06.2019 made them eligible for Scheme benefits. The absence of the term "admission" in the Scheme itself, although present in the Circular, raised a point for further examination in the upcoming hearing.

Communication evidence review:
A letter dated 26.09.2019 from the petitioner indicated a pending tax liability, with plans to consult a Chartered Accountant before reverting on the matter. The court directed the respondents to provide the communication dated 26.03.2019 where the liability admission supposedly occurred and the show cause notice issued in September 2019. The case was listed for further proceedings on 28.05.2021 to delve into the contents of these communications for a more informed decision-making process.