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2024 (6) TMI 1267 - HC - Service TaxIssues: 1. Interpretation of Section 129(2)(c) of the SVLDRS, 2019 regarding initiation of proceedings in case of voluntary disclosure under the scheme. Analysis: The High Court of Bombay, consisting of K.R. Shriram and Jitendra Jain, JJ., addressed the issue of whether proceedings can be initiated under Section 129(2)(c) of the Finance Act, 2019 without a finding that a material particular furnished in the declaration is false in cases of voluntary disclosure under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS, 2019). The court highlighted that the SVLDRS, 2019 aims to minimize litigation and not create fresh disputes. The petitioner had filed a voluntary disclosure application under the SVLDRS-1 for service tax matters, and upon processing, a discharge certificate was issued. However, the petitioner later received a communication requiring further documents, leading to the question of whether such actions were permissible post-issuance of the discharge certificate. The respondents argued that Section 129(2)(c) permits reopening of declarations in cases of voluntary disclosure, empowering officers to request additional information. However, the court emphasized that before initiating proceedings under the indirect tax enactment, there must be a finding that a material particular in the declaration was false. The court noted that the impugned communication lacked such a finding and was deemed a roving enquiry, contrary to the scheme's intent. The court held that without identifying a false material particular, the communication was invalid, and subsequently quashed it along with a follow-up communication. In conclusion, the court disposed of the petition, emphasizing the importance of adherence to the statutory provisions and the necessity of establishing the falsity of a material particular before initiating proceedings under the SVLDRS, 2019. The judgment reaffirmed the principle that the scheme aims to provide a resolution mechanism rather than perpetuate litigation, ensuring fairness and procedural compliance in dealing with voluntary disclosures.
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