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TMI Blog2022 (2) TMI 561X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of the said SVLDR Scheme on the basis of show cause notice? HELD THAT:- The conjoint reading of show cause notice dated 24th April, 2019 and the said Order-in Original dated 23rd December, 2019 indicates that the amount of service tax worked out by the petitioner in response to the said show cause notice was accepted as worked out at ₹ 39,47,420/-. Though the said assessment order was passed on 23rd December, 2019, the respondents did not pass any additional order demanding the additional amount being the differential amount arising out of the financial year 2014-15 to 2017-18 (upto June 2017) till SVLDR -3 form was issued by the respondent no.2 placing the declaration form submitted by the petitioner under litigation category i.e. on 4th March, 2020. The petitioner had already availed of the said scheme by filing SVLDR-1 on 31st December, 2019. In our view, the petitioner has rightly filed the declaration form i.e. SVLDR-1 by placing the said declaration under arrears category. There is no substance in the submission made by the learned counsel for the respondents that the show cause notice issued by the respondent no.2 having been pending in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cheme as one time measure for liquidation of past disputes of central excise and service tax as well as to ensure disclosure of unpaid taxes by a person eligible to make a declaration. The basic thrust of the scheme is to unload the baggage of pending litigations centering around service tax and excise duty. The focus is to unload this baggage of pre-GST regime and allow business to move ahead. The impugned order is contrary to the object, the purpose and the intent of the Central Government to frame the said scheme as one time measure for liquidation of past disputes of central excise and service tax as well as to ensure disclosure of unpaid taxes by a person eligible to make a declaration and the basic thrust of the scheme is to unload the baggage of pending litigations centering around service tax and excise duty and deserves to be quashed and set aside - the petitioner had rightly filed the said declaration form considering the tax dues as ₹ 39,47,420/- i.e. the amount of demand confirmed in the Order-in Original dated 23rd December, 2019 and had rightly computed an amount of ₹ 15,78,968/as estimated/determined amount payable i.e. by applying 40% under section 12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... riod. 6. The office of Deputy/Assistant Commissioner, Central GST Division-III, Kolhapur issued a Show Cause-cum-Demand Notice to the petitioner for the assessment year 2013-14 on the basis of the income tax return filed by the petitioner for the assessment year 2013-14. It was mentioned in the show cause notice that the petitioner had short- paid or not-paid Service Tax of ₹ 41,57,020/- on Max Differential ST-3 value of ₹ 3,36,32,851/-. It was alleged that the petitioner had contravened Section 68(1) of the Finance Act, 1994 read with Section 66/Section 66B read with Rule 6 of the Rules as applicable during the relevant period and Sections 77, 70(1) read with Rules 7(1), 7(2), 7(3) of the Rules made thereunder. 7. The petitioner was called upon to show cause as to why the Service Tax of ₹ 41,57,020/- inclusive of cesses which was not paid on taxable services provided by them during the period from April 2013 to March 2014, should not be demanded and recovered from them under the provisions of proviso to Section 73(1) of the Act. 8. On 15th November 2019, the petitioner had provided the details of amounts as reflected in the Service Tax returns as well as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15,78,968/-. The said application was filed under category Arrears and sub-category Appeal not filed or appeal having attained finality. The petitioner mentioned the details of the said Order-in-Original dated 23rd December 2019 in the said declaration form. 12. It is the case of the petitioner that the Designated Committee comprising of Joint Commissioner and the Deputy Commissioner issued an Estimate under Section 127 in Form SVLDRS-2 on 19th February 2020 showing the tax dues as ₹ 81,04,440/- and estimated amount payable as ₹ 40,52,220/-. It was mentioned in the said SVLDRS-2 that in case if the Declarant did not agree with the estimated amount payable, he shall appear for a personal hearing before the Designated Committee on 26th February 2020. 13. The petitioner submitted Form SVLDRS-2A in terms of Section 127 read with Rule 6 of the said Rules on 25th February 2020 and mentioned therein that Written submissions would be filed at the time of personal hearing for the reason for disagreement. The petitioner thereafter appeared for personal hearing on 26th February 2020 and submitted written submissions in addition to oral arguments advanced. 14. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... our attention to the Form SVLDRS-3 dated 4th March 2020 issued by the respondent no.2 determining tax dues @₹ 81,04,440/-, tax relief @ ₹ 40,52,220/and Estimated Amount Payable at ₹ 40,52,220/-. She submits that the petitioner admittedly did not file any appeal against the Order-in-Original dated 23rd December 2019 and accepted the said amount as arrears under Section 121(c) of the said Finance (No.2) Act, 2019 and more particularly under Chapter V i.e. the said SVLDR Scheme. She invited our attention to the definition of amount in arrears under Section 121 (c) of the said Scheme and submitted that the amount of duty which is recoverable as arrears of duty under the indirect tax enactment on account of no appeal having been filed by the Declarant against an order or an order in appeal before expiry of the period of time for filing appeal would fall under the definition of amount in arrears. 19. Learned counsel placed reliance on Section 123 which provides for Tax dues and more particularly Sections 123(b) and 123 (e). She submits that since the adjudicating authority had already determined the amount of tax dues in the Order-in-Original dated 23rd D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... very of interest and penalty on the non-payment of Service Tax without quantifying the Service Tax as the exact data was not available at that point of time. Exact data was subsequently made available on 30th June, 2016, through the Income Tax Department and accordingly reflected in the adjudication order vide Order-in Original dated 23rd December, 2019. 24. It is submitted by the learned counsel that the petitioner had submitted reply to the show cause notice along with data, on the basis of return of Income Tax Department, for the period 2013-14 to 2017-18 (upto June 2017) and on verification of the said data and information submitted to the Income Tax Department i.e. under form 26AS filed by the petitioner, the quantification of liability for further period i.e. 2014-15 to 2017-18 (upto June 2017) was done along with the re-quantification for the period 2013-14. He submits that the taxable value derived for the period 2014-15 till 2017-18 (upto June 2017) was arrived at ₹ 6,10,47,381/-. The service tax payable accordingly was computed at ₹ 83,46,041/-. The service tax of ₹ 43,98,621/- paid by the petitioner was deducted out of the said service tax payable at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and penalty) on the non-payment of service tax as per data available at that point of time. The quantification of the liability was not done in the show cause notice for want of exact data at the time of issuance of show cause notice. The said show cause notice was pending involving duty along with interest/late fee/penalty on or before 30th June, 2019 and thus the litigation was the most correct category for filing the declaration of the petitioner filed under the said SVLDRS. 29. Ms.Manasi Patil, learned counsel for the petitioner in her rejoinder argument submits that the respondent no.2 in the assessment order i.e. the Order-in Original dated 23rd December, 2019 has made reference to the show cause notice issued by the respondent no.2 and the reply to the said show cause notice submitted by the petitioner. She submits that the entire arguments advanced by the learned counsel for the respondent is contrary to the object and the purpose of the said SVLDR Scheme and the principles of law laid down by this Court in catena of decisions. In support of this submission, she also relied upon the judgment of this Court in case of Thought Blurb vs. Union of India Ors., 2020-TIOL-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the annual turnover for the financial year 2013-14 to the financial year 2017-18 (upto June 2017) in two tables. In table-1, the petitioner mentioned the differential service tax at ₹ 39,47,420/- after deducting the amount of service tax already paid during the financial year 2013-14 to 2017-18 (upto June 2017). It is thus clear that the petitioner had provided all the details for the entire financial year 2013-14 to financial year 2017-18 (upto June 2017). 34. A perusal of the order passed by the respondent no.2 on 23rd December, 2019 i.e. Order-in Original indicates that the respondent no.2 had adverted to the said show cause notice dated 24th April, 2019 issued by the respondent no.2 and also the reply submitted by the petitioner in response to the said show cause notice. In paragraph (10) of the said Order-in Original, the respondent no.2 held that the assessee failed to meet the statutory obligation of the payment of service tax (including cess, if any) for the period April 2013 to March 2014 for which the data was available with the department and when compared with 26AS, the assessee had deliberately suppressed the facts with an intention to evade service tax. It w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 23rd December, 2019, the respondents did not pass any additional order demanding the additional amount being the differential amount arising out of the financial year 2014-15 to 2017-18 (upto June 2017) till SVLDR -3 form was issued by the respondent no.2 placing the declaration form submitted by the petitioner under litigation category i.e. on 4th March, 2020. The petitioner had already availed of the said scheme by filing SVLDR-1 on 31st December, 2019. In our view, the petitioner has rightly filed the declaration form i.e. SVLDR-1 by placing the said declaration under arrears category. 39. There is no substance in the submission made by the learned counsel for the respondents that the show cause notice issued by the respondent no.2 having been pending in the circumstances set out in the earlier paragraphs of this order, the petitioner could not have classified its case under arrears category though the assessment order passed by the respondent no.2 on 23rd December, 2019 was passed after considering the show cause notice dated 24th April, 2019. 40. A perusal of section 121(c)(i) of the said scheme clearly indicates that the amount in arrears is defined and means th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... categories of cases in which the said form of declaration under section 125 of the said scheme could have been filed. It is thus clear that a separate declaration could be filed even in case of amount in arrears. 43. Learned counsel for the petitioner rightly invited our attention to the categories of application prescribed under the said scheme and the rules such as litigation , arrears , investigation , query or audit and voluntary disclosure . There is thus no substance in the submission made by the learned counsel for the respondents that since show cause notice was not decided though an assessment order determining the tax dues was already passed, the petitioner could have classified the declaration under the litigation category and not under arrears category. 44. In our view, the petitioner has rightly filed the said declaration form under the arrears category and was not required to file the said form under the litigation category in view of the tax dues already having been assessed and quantified before the date of the petitioner filing the said SVLDRS declaration form. A reply to the question no.1 of Frequently Asked Questions (FAQs) would clearly indi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this case. In this case, the facts are even better though the facts before this Court in case of Jyoti Plastic Works Pvt. Ltd. (supra). The respondent no.2 had already adverted to the show cause notice for the larger period and reply of petitioner and had determined tax dues which was the basis adopted by the petitioner rightly by filing the said SVLDRS-1 under the category arrears . 48. This Court in case of Morde Foods Pvt. Ltd. Anr. (supra) after considering the reply to the question nos.5 and 6 of Frequently Asked Questions and after adverting the judgment of this Court in case of Thought Blurb (supra) and Jyoti Plastic Works Pvt. Ltd. (supra) quashed and set aside the order passed by the authority and remanded back the matter to the authority to take a fresh decision in accordance with law. This Court in the said judgment held that while the declarant would not be eligible under the litigation category but once the order in appeal is passed (which presumably is post 30.06.2019), the declarant can file a declaration under the arrears category provided the appeal has attained finality or further appeal period is over or that the declarant gives an undertaking that he ..... X X X X Extracts X X X X X X X X Extracts X X X X
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