2024 (7) TMI 1317 - HC - Service Tax

Interpretation of Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS) for service tax demand - Whether petitioner has actually paid the amount as indicated by petitioner in Form 1? - HELD THAT - If petitioner is given an opportunity to produce the challans/receipt of the payments made to enable respondent to verify whether the payment was actually made against the tax liability pertaining to the concerned Show Cause Notice, the matter could be put to rest. Once petitioner satisfies the consequence thereof will be to consider the same as payment under the SVLDRS. The Committee constituted under Section 126 of the SVLDRS will give hearing to petitioner within six weeks from today and the notice of hearing shall be communicated atleast five working days in advance - If petitioner is unable to satisfy the Committee that the payment made was against the tax liability pertaining to the impugned Show Cause Notice then respondent may take further steps based on the Impugned Order dated 25th February 2021. Petition disposed off.

Summary

Issues involved:
1. Interpretation of Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS) in relation to service tax demand.
2. Verification of payment made by the petitioner against the tax liability pertaining to the Show Cause Notice.
3. Granting of credit for the amount paid by the petitioner under SVLDRS.

Analysis:
1. The petitioner received a Show Cause Notice for service tax demand and contested it, stating that a major portion of the tax had already been remitted. The petitioner then opted for the SVLDRS and filed an application disclosing the tax dues and relief under the scheme. However, discrepancies arose when the respondent did not credit the amount claimed to have been paid by the petitioner, leading to further clarification requests and submissions of documentary evidence.

2. The core issue was whether the petitioner had actually paid the amount as indicated in the SVLDRS application. The respondent raised concerns about the lack of conclusive evidence regarding the payment against the specific tax liability mentioned in the Show Cause Notice. An affidavit highlighted the need for verification of the challans to determine the authenticity of the payments made by the petitioner.

3. The court directed the constitution of a committee under SVLDRS to conduct a hearing with the petitioner within a specified timeline. During the hearing, the petitioner was required to produce original challans to verify the payments made against the tax liability in question. If the petitioner could satisfactorily demonstrate the payment, the committee would issue Form 4 under SVLDRS, leading to the quashing of the Show Cause Notice and the Impugned Order. However, if the verification was unsuccessful, the respondent could proceed based on the existing order, while preserving the petitioner's right to challenge the Impugned Order at a later stage.

This detailed analysis of the judgment addresses the interpretation of the SVLDRS, the verification of payments, and the consequential actions based on the petitioner's ability to prove the payment made against the tax liability.