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TMI Blog2022 (8) TMI 1052X X X X Extracts X X X X X X X X Extracts X X X X ..... in clauses (a) to (h) of sub-section (1) of Section 125. 'Tax dues' referred in section 124 is defined in section 123. It specifies various situations - The Circular dated 27th August, 2019 issued by Central Board of Indirect Taxes and Customs (CBITC) clarified for all cases pending in adjudication or appeal (at any forum), the relief is to the extent of 70 percent of duty involved if it is Rs.50 lakhs or less and 50 percent if it is more than 50 lakhs. The Respondent No.4 was completely unjustified in rejecting the Form SVLDRS-1 filed by Petitioner for the reason so stated in the impugned communication - petition disposed off. - WRIT PETITION (L) NO. 9579 OF 2020 - - - Dated:- 25-7-2022 - K. R. SHRIRAM A. S. DOCTOR, JJ. Mr. Shreyas Shrivastava a/w Mr. Saurabh R. Mashelkar for Petitioner. Mr. P.S. Jetly, Senior Advocate a/w Ms. Sangeeta Yadav for Respondents. JUDGMENT : (PER A.S. DOCTOR, J.) 1. Petitioner has impugned a communication dated 10th October, 2020 ( the impugned communication ) by which Respondent No. 4 has rejected Form SVLDRS-1 ( the said Form/Form SVLDRS-1 ) filed by Petitioner under the provisions of the Sabka Vishwas (Legacy Dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ans : I state that Service Tax payment for the period October 2016 to June 2017 is outstanding due to poor financial status of the company. The outstanding Service Tax amount on this account works out to be Rs. 60 Lakhs (approximately), out of which, the Company is paying Rs. 50 Lakhs under GAR-7 Challan today and hereby submit a copy of Bank Statement evidencing debit of Rs. 50 Lakhs from the Bank Account of the company bearing A/c No.371179588 maintained at Kotak Mahindra Bank at Branch Andheri Naka, Mumbai. We would submit the Service Tax payment challan to this effect tomorrow, as the same is yet to be provided by the Bank. Further, Company undertake to pay the balance Service Tax amount alongwith interest within a weeks time. Company would also file the ST-3 return for the above period within a week time. Company would also submit a reconciliation statement of outstanding Service Tax liability and interest within a week time. (Emphasis Supplied) Petitioner thereafter on the very same day under cover of its letter dated 13th March, 2018 submitted copies of the balance sheet, sales ledger, purchase ledger, client list and client contract copy. 4. On 28th March, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4,694,889 4,999,456 7,036,920 5,871,999 2,337,024 MRP Vegetable 16,520,202 27,256,316 28,167,791 28,241,407 32,853,815 10,934,206 People University - 17,299,834 8,373,301 120,074 - - Gross 18,123,399 13,658,830 17,981,030 43,567,624 78,167,274 30,831,190 ST Rate 12.36% 12.36% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20th March, 2019, Petitioner informed Respondent No. 2 that they had made an additional payment and also submitted other financial documents such as ST-3 returns, sales ledger, sales invoice, Form 26AS and audited financial statements in respect of the financial years 2014-15 to January, 2017. Petitioner, therefore, vide a letter dated 11th April, 2019 addressed to Respondent No. 2 submitted that it had discharged its service tax liability in full as per the letter dated 28th March, 2019 and assured Respondent No. 2 that they would pay penalty and interest in a few days. 8. In the year 2019 the Central Government enacted the Finance (No. 2) Act, 2019. Chapter V of the said Act introduced the SVLDRS scheme. The SVLDRS scheme was introduced with the objective of affording those tax payers who had pending issues in respect of any one or more of the indirect tax statutes (more particularly mentioned in Section 122 of the SVLDRS scheme) with an opportunity (and mechanism) to once and for all resolve the same. The object of the SVLDRS scheme was to provide amnesty to those in default and/or who had outstanding dues under the old regime of indirect tax before migrating to the new regi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le and being desirous of availing of the benefits of the SVLDRS scheme, on 15th January, 2020 filed Form SVLDRS-1 declaring therein an amount of Rs.1,30,37,261/- as service tax. However, on or about 10th October, 2020, Petitioner received the impugned communication from Respondent No. 4 rejecting Form SVLDRS-1 filed by Petitioner and recording therein that Petitioner was ineligible on the ground that Tax Dues Not Quantified as on 30.6.2019 . 11. Aggrieved by the impugned communication Petitioner made separate representations to Respondent No. 4 (on 17th February, 2020), and to Respondent No. 3 (on 4th March, 2020). On 1st June, 2020, Petitioner received a Show Cause Notice issued by Respondent No. 2 recording that Petitioner had charged and collected service tax from its customers (for the period of October, 2014 to June, 2017) but had not paid the same to the Government Exchequer. The amount of service tax mentioned in the said show cause notice was quantified at Rs.1,02,28,973/-. Petitioner thereafter once again made representations to the various Respondents, viz. Respondent No. 3 4 (on 19th October, 2020), to the Grievance Cell, Central Board of Indirect Taxation (on 22 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Not Quantified as on 30.6.2019 was entirely untenable and contrary to the provisions of the said scheme. Respondent No.4 therefore was bound to have accepted Form SVLDRS-1 submitted by Petitioner and after duly verifying same take the necessary further steps under the SVLDRS scheme by either issuing to Petitioner Form SVLDRS-2. He submitted that Respondent No. 4 in rejecting Petitioners Form SVLDRS-1 had acted contrary to the very object of the said scheme and in a totally arbitrary manner. He further submitted that Respondent No.4 was bound by the Circular dated 27th August, 2019 and thus could not have rejected Form SVLDRS-1 filed by Petitioner. He thus submitted that Petitioner was entitled to the reliefs prayed for in the present Writ Petition. 14. Per contra Mr. Jetly, learned Senior Counsel appearing on behalf of Respondents supported the impugned communication and submitted that the same had been correctly issued by Respondent No.4. He submitted that Petitioner was not eligible as per the provisions of Section 125 (e) 1 , as there was no final quantification and an enquiry/investigation was pending. In support of his contention he first invited our attention to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the exceptions set out in clauses (a) to (h) of sub-section (1) of Section 125. 'Tax dues' referred in section 124 is defined in section 123. It specifies various situations. Clause (c) of Section 123 is relevant to case in hand and it reads thus: 123 . For the purpose of the Scheme, tax dues means- xxxxx (c) where an inquiry or investigation or audit is pending against the declarant, the amount of duty payable under any of the indirect tax enactment which has been quantified on or before the 30th day of June, 2019 . What is quantified is defined in clause (r) of section 121. It reads thus: with its cognate expression, means a written communication of the amount of duty payable under the indirect tax enactment . 18. The Circular dated 27th August, 2019 issued by Central Board of Indirect Taxes and Customs (CBITC) clarified for all cases pending in adjudication or appeal (at any forum), the relief is to the extent of 70 percent of duty involved if it is Rs.50 lakhs or less and 50 percent if it is more than 50 lakhs. The same relief is available for cases under investigation and audit where the duty involved is quantified and communicate ..... X X X X Extracts X X X X X X X X Extracts X X X X
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