2024 (1) TMI 527 - HC - Service Tax

Sabka Vishwas Legacy Dispute Resolution Scheme 2019 - eligibility for CENVAT Credit or not - HELD THAT - The applicant under the Scheme would be entitled to waiver of 70% of the tax dues if the tax dues relate to a show cause notice or an appeal and the amount of duty is Rs. 50,00,000/- or less. In this case, the amount is undoubtedly below Rs. 50,00,000/-. Therefore, the petitioner has correctly computed the amount due and payable after also reckoning the sum of Rs. 50,000/- which was deposited by the petitioner pursuant to the order dated 01.08.2018 in W.P.No.19462 of 2016. Since the impugned order was issued by disregarding the above material facts and the provisions of the Scheme, the impugned order is unsustainable. The respondent is directed to issue a modified order in Form SVLDRS-3 specifying the sum payable by the petitioner as Rs. 95,988.40/- - impugned order set aside - petition allowed.

Summary

Issues involved:
The judgment involves a challenge to an order under the Sabka Vishwas Legacy Dispute Resolution Scheme 2019 regarding the computation of concession under the Scheme and the amount due for payment.

Issue 1: Computation of concession under the Scheme
The petitioner, engaged in furniture manufacturing and trading, availed Cenvat credit for input services. A show cause notice was issued demanding reversal of Cenvat credit. After multiple appeals and remands, the petitioner applied under the Scheme, indicating the category as "litigation" and subcategory as "SCN involving duty pending." The petitioner calculated the concession by taking the amount determined in the original order. The respondent, however, adopted the higher amount from the show cause notice for computation. The petitioner contended that the relief should be based on the amount in the original order, not the notice amount.

Issue 2: Applicability of Scheme provisions
The petitioner argued that as per Clause 124 of the Scheme, a declarant is entitled to a waiver of 70% of tax dues if the amount is below Rs. 50,00,000. The petitioner correctly computed the payable amount, including the sum deposited earlier. The respondent's order disregarded these material facts and provisions of the Scheme, leading to an unsustainable decision.

Judgment:
The High Court quashed the impugned order dated 29.02.2020 and directed the respondent to issue a modified order specifying the payable sum as Rs. 95,988.40. The petitioner's writ petition was allowed on these terms without any costs.