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2021 (10) TMI 935 - HC - Service TaxSVLDRS - Quantification of value of tax in relation to settlement of service tax arrears - Sabka Vishwas (Legacy Dispute Resolution Scheme), 2019 - according to the petitioner, this amount has been unilaterally quantified by the Central Excise Department - HELD THAT - The quantification of the demand under cover of its compilation of documents dated 12.08.2021 is not valid because, even according to the Department, a substantial portion of that demand was barred by limitation. That apart, the impugned order is clearly non-speaking and does not set out any alternate demand. This cannot be set right by way of counter or additional note - To quote the Hon'ble Supreme Court in the celebrated case of MOHINDER SINGH GILL ANR. VERSUS THE CHIIEF ELECTION COMMISSIONER, NEW DELHI ORS. 1977 (12) TMI 138 - SUPREME COURT , orders are not like old wine becoming better as they grow older. The petitioner, in my view, ought to have been granted opportunity to put forth its case and to understand why its application was proposed to be rejected. Moreover, the scheme itself provides, at Section 127 thereof that once there is a variation between the amount stated in the declaration and the estimate arrived at by the Department, Form-2 shall be issued accompanied by personal hearing notice. This has not been done in the present case. The respondent is directed to issue Form 3 afresh accepting the declaration of the petitioner, within a period of four weeks from date of uploading of this order on the official website of the Court - Petition allowed.
Issues:
1. Application under the Sabka Vishwas (Legacy Dispute Resolution Scheme), 2019 for service tax arrears settlement. 2. Rejection of the application without providing an opportunity to support the case. 3. Discrepancy in quantification of service tax liability between the petitioner and the Revenue. 4. Comparison with previous court judgments regarding rejection of declarations. 5. Failure to provide a personal hearing notice as required by the scheme. 6. Interpretation of terms 'tax due' and 'quantified' under the scheme. Analysis: 1. The petitioner filed an application under the Sabka Vishwas Scheme for service tax arrears from April 2012 to June 2017 amounting to ?14,35,147. The basis of the application was a communication from the Central Excise Department quantifying the liability. 2. The rejection of the application without giving the petitioner an opportunity to present its case was deemed improper. The rejection lacked reasoning or an alternate demand, violating the principles of natural justice. 3. There was a discrepancy in the quantification of the service tax liability. The Revenue's unilateral quantification was challenged as adhoc and not supported by any equal demand on the petitioner. The Revenue's higher quantification was not justified, especially since certain periods were beyond the limitation period for enforcement. 4. Previous court judgments were cited to distinguish cases where declarations were rejected due to incomplete disclosures. The present case showed that the petitioner had been more generous in its declaration than required. 5. Failure to provide a personal hearing notice, as mandated by the scheme in case of a variation between the petitioner's declaration and the Department's estimate, was highlighted as a procedural lapse. 6. The interpretation of terms 'tax due' and 'quantified' under the scheme was crucial. The communication from the Revenue dated 29.12.2017 was considered as satisfying the requirements of the scheme for quantification. 7. Consequently, the court quashed the rejection order and directed the Revenue to issue a fresh order accepting the petitioner's declaration within a specified timeframe. The writ petition was allowed, and no costs were imposed.
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