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TMI Blog2023 (6) TMI 1002X X X X Extracts X X X X X X X X Extracts X X X X ..... the aforesaid Scheme, 2019, amount paid as pre-deposit at any stage of the appellant proceedings or the amount paid towards the deposit during enquiry, investigation and audit, is required to be considered while calculating the amount of tax due. It can be said that the basic object of the Scheme, 2019 is to reduce litigation by allowing the eligible assessee to make the payment of the outstanding dues after availing the relief under the Scheme, 2019. The petitioners herein made bona fide attempt to make the payment as determined under the Scheme, 2019 and the petitioners are also ready to pay the amount in question in accordance with law along with interest for the period for which the petitioners were not permitted to make the payment by the respondents. Therefore, this is a fit case for invocation of powers under Article 226 of the Constitution of India. The present petition stands allowed partly. The respondent authorities are directed to accept the payment of Rs. 1,22,318/- as specified in SVLDRS-3 along with interest @ 9% per annum from 30.06.2020 till the date of payment and grant the benefit of the Scheme to the petitioner. - R/SPECIAL CIVIL APPLICATION NO. 182 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itioner no. 1 Company is engaged in the business of manufacture of excisable goods like SS Reactors, SS Vessels, SS Tanks etc. and also structures of iron and steel, which the petitioner Company has been clearing on payment of duties in compliance with the provisions of the Central Excise Act, 1944 (hereinafter referred to as Act of 1944 ). 5.2 It is the case of the petitioners that the petitioner no. 1 opted for CENVAT Credit scheme contained in the Cenvat Credit Rules, 2004 (hereinafter referred to as Rules of 2004 ) to avail of the credit of specified taxes, paid on input services and for utilization of such credit towards payments of specified taxes, leviable on the specified finished excisable goods. 5.3 It is stated that DGCEI authorities conducted inquiries against the petition no. 1 Company, which commenced from 01.12.2004. The panchnama was prepared at the factory of the petitioner no. 1 Company and statement of the petitioner no. 2 was recorded and, thereafter the search, inquiries and recording of the statements at the premises of various other entities like M/s. Nerka Chemicals Pvt. Ltd. etc. to whom the petitioner no. 1 has alleged to have sold and deli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hereafter. It is the case of the petitioners that the petitioners deposited Rs. 5,00,000/- as per the direction issued by the Appellate Tribunal and their evidence was also produced before the first Appellate Authority, however, the first Appellate Authority rejected the appeals filed by the petitioners on 25.03.2010. 5.7 It is stated that the petitioners, thereafter, again approached the Appellate Tribunal and the Appellate Tribunal, by an order dated 14.11.2018, partly allowed the appeal of the petitioner no. 1 giving an option of paying 25% of the penalty under Section 11AC of the Act of 1944 along with full duty and interest within 30 days from the date and the appeal filed by the petitioners came to be rejected. It is stated that the petitioners did not challenge the said order and the dues became tax arrears. 5.8 It is stated that thereafter, a scheme for resolving pending disputes with regard to the statues like Central excise Act, the Service Tax Laws etc. has been introduced on 05.07.2019, which was named as Sabka Vishvas (Legacy Dispute Resolution) Scheme, 2019 (hereinafter referred to as Scheme, 2019 ). It is stated that the petitioners were eligible to claim th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd requested the concerned respondent to issue fresh challans, however, there is no outcome of the said communication/ request. The petitioners, therefore, preferred present petition. 6. Learned advocate, Mr Dhaval Shah for the petitioner would mainly submit that the petitioners are entitled to get benefit of the Scheme, 2019. It is contended that the petitioners have made pre-deposit of Rs. 19,12,196/- during the investigation, which was appropriated and, thereafter, the petitioners further paid an amount of Rs. 5,00,000/- under the direction of the Appellate Tribunal by its order dated 11.11.2009. Learned advocate submits that against the total tax arrears of Rs. 22,18,148/-, the petitioners had already deposited Rs. 24,12,196/-, despite that, the respondent did not consider the amount paid by the petitioners as pre-deposit of Rs. 5,00,000/- and thereby asked the petitioners to pay Rs. 1,22,381/-. It is thus contended that by not calculating the amount of Rs. 5,00,000/-, which was paid by the petitioners under the order of the Appellate Tribunal, the respondent has committed an error and demand of Rs. 1,22,381/- from the petitioners is illegal. In support of the aforesaid cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity was Rs. 3,05,952/-. It is pointed out that the petitioners paid Rs. 5,00,000/- as adhoc deposit towards the penalty and, therefore, it could not be considered as pre- deposit against the duty amount. Thus, the respondents considered total payment of Rs. 19,12,196/- as pre-deposit amount towards the tax instead of Rs. 24,12,166/- as declared by the petitioners. It is further submitted that the petitioners were required to make further payment of Rs. 1,22,381/- towards the tax liability as per Scheme, 2019 and, therefore, the petitioners were intimated with regard to the same by sending a communication on 29.12.2019. It is further submitted that the petitioners were required to make the payment of Rs. 1,22,381/- within a period of 30 days from the date of issuance of the statement on 03.01.2020, however, the petitioners requested by letter dated 17.03.2020 that the Company is facing financial crunch and, therefore, time upto 30.05.2020 be granted for payment of the said amount. 9. Learned Standing Counsel, Mr. Utkarsh Sharma further submits that CPIN, which was generated, was valid upto 31.03.2020, however, the petitioners transferred the amount of Rs. 1,22,381/- on 30.06.2020 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e considered towards the amount of tax due as the said amount was deposited towards the penalty. 12. At this stage, this Court would like to refer to relevant provision of the Scheme, 2019. Clause 124 of the Scheme, 2019 reads as under, 124. (1) Subject to the conditions specified in sub-section (2), the relief available to a declarant under this Scheme shall be calculated as follows: (a) where the tax dues are relatable to a show cause notice or one or more appeals arising out of such notice which is pending as on the 30th day of June, 2019, and if the amount of duty is, (i) rupees fifty lakhs or less, then, seventy per cent. of the tax dues; (ii) more than rupees fifty lakhs, then, fifty per cent. of the tax dues; (b) where the tax dues are relatable to a show cause notice for late fee or penalty only, and the amount of duty in the said notice has been paid or is nil, then, the entire amount of late fee or penalty; (c) where the tax dues are relatable to an amount in arrears and, (i) the amount of duty is, rupees fifty lakhs or less, then, sixty per cent. of the tax dues; (ii) the amount of duty is more than rupees fifty lakhs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vestigation and audit, is required to be considered while calculating the amount of tax due. 16. Keeping in view the aforesaid provision, if the facts of the present case as discussed hereinabove, are examined, it can be said that in the present case, the petitioners have paid Rs. 19,12,196/- towards the tax dues and, thereafter before the Appellate Tribunal, learned advocate for the petitioners made voluntary statement that the petitioners are ready and willing to deposit Rs. 5,00,000/- towards the penalty and, therefore, the Appellate Tribunal directed to pay Rs. 5,00,000/- within stipulated time. Thus, an amount of Rs. 5,00,000/- deposited by the petitioners by way of penalty cannot be considered towards tax dues . Thus, the petitioners were required to make the payment of Rs. 1,22,181/-. Therefore, the decisions upon which reliance has been placed by learned advocate for the petitioners would not be applicable in the facts of the present case as the facts of the said cases were different. 17. It further transpires from the record that the petitioners filed declaration under SLDRS-1 on online portal as per Scheme, 2019. The respondent issued Form SLDRS-2 on 29.12.2019 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner could not generate the challan successfully for making the payment and after the advice of its Chartered Accountant, tried making payment through NEFT/RTGS out of abundance caution and to demonstrate the bona fide of the petitioner to make the payment as determined under the Scheme by respondent No. 2 Designated Committee. In view of the various decisions cited by the petitioner as reproduced here-in-above, the bona fide attempt made by the petitioner to make the payment cannot be doubted and therefore, the substantive benefit of the Scheme cannot be denied to the petitioner on the ground of procedural technicalities more particularly, in time of Covid-19 Pandemic. 10. The basic object of the Scheme is to reduce litigation by allowing the eligible assessee to make the payment of the outstanding dues after availing the relief under the Scheme. As per the provisions of the Scheme, respondent No. 2 has issued a statement as provided under section 127 of Chapter-V of the Finance Act (No. 02) 2019 determining the amount payable by the petitioner under the Scheme. Therefore, in the given facts and circumstances, the petitioner made bona fide attempt to make the payment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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