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TMI Blog2024 (4) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of services of Rs. 19,80,37,410/- shown in the Income Tax Returns vis-a-vis the value shown in the service tax returns for the period under dispute. On the basis of this enquiry, a Show Cause Notice dated 12th April 2019 was issued to the Petitioner proposing to demand and recover an amount of Rs. 2,44,77,423 (12.36% of 19,80,37,410), along with interest and penalty. 4. It is the case of the Petitioner that the allegation in the said Show Cause Notice that the turnover declared by the Petitioner in Form ST-3 is NIL is incorrect. It is the case of the Petitioner that, for the period from April 2013 to September 2013, returns were filed on 13th December 2013 declaring the turnover of services of Rs. 6,37,16,462/- and service tax of Rs. 78,75,354/- (including cess) was paid in respect of the same. It is also the case of the Petitioner that, subsequently, for the period from October 2013 to March 2014, returns were filed on 22nd April 2014 declaring the turnover of services of Rs. 7,42,00,743/- and service tax of Rs. 91,71,211/- (including cess) was paid in respect of the same. It is the case of the Petitioner that from the total proposed demand of Rs. 2,44,77,423/- shown in the Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble under the Sabka Vishwas Scheme to avail of the benefit under the Scheme. 11. It is the case of the Petitioner that Section 127(2) of the Sabka Vishwas Scheme requires the Designated Committee to issue Form SVLDRS 2 if there is a dispute regarding the amount payable under the Scheme. However, despite the Petitioner having disputed the amount payable in Form SVLDRS 1 itself, no such Form was issued to the Petitioner. 12. By a letter dated 19th June 2020, Respondent No. 5 issued a reminder to the Petitioner for making payment under the Sabka Vishwas Scheme as per Form SVLDRS 3. By an email dated 19th June 2020, the Petitioner requested Respondent No. 5 to consider the deposit made by it and, thereafter, issue Form SVLDRS 3. 13. Thereafter, by letters dated 24th June 2020 and 1st July 2020, the Petitioner once again requested Respondent No. 4 to consider the deposit made by it. Copies of the Challans were submitted to Respondent No. 4 and the calculation was also shown to him. 14. However, by a letter dated 8th December 2020, Respondent No. 6 directed the Petitioner to submit the relevant documents and file a reply to the Show Cause Notice dated 12th April 2019 which had been i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ments on record. 18. The main submission of Mr. Raichandani, on behalf of the Petitioners, was that if there is a dispute regarding the amount payable under the Scheme, the Designated Committee is mandated to grant personal hearing to the declarant. 19. Mr. Raichandani referred to the provisions of sub-sections (2) to (4) of Section 127 of the Sabka Vishwas Scheme. Mr. Raichandani also relied upon Rule 6 of the Sabka Vishwas (Legacy Dispute Resolution Scheme) Rules 2019 ("Sabka Vishwas Rules"). Mr. Raichandani submitted that Rule 6 dealt with clarification by the Designated Committee. As per sub-rule (3) of Rule 6 where the amount estimated to be payable by the declarant exceeded the amount declared by the declarant then the Designated Committee was required to issue a declaration in Form SVLDRS 2 giving an estimate of the amount payable by the declarant along with a notice of opportunity for personal hearing. He further submitted that sub-rule (4) of Rule 6 provides that, if the declarant wanted to indicate agreement or disagreement with the estimate referred to in sub-rule (3), or wanted to make written submissions or waive personal hearing or seek an adjournment, he should ele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Before dealing with the rival contention of the parties, it would be appropriate to set out the relevant provisions. Sub-sections (1) to (4) of Section 127 of the Sabka Vishwas Scheme are relevant and are set out hereunder. "127. (1) Where the amount estimated to be payable by the declarant, as estimated by the designated committee, equals the amount declared by the declarant, then, the designated committee shall issue in electronic Form, a statement, indicating the amount payable by the declarant, within a period of sixty days from the date of receipt of the said declaration. (2) Where the amount estimated to be payable by the declarant, as estimated by the designated committee, exceeds the amount declared by the declarant, then, the designated committee shall issue in electronic Form, an estimate of the amount payable by the declarant within thirty days of the date of receipt of the declaration. (3) After the issue of the estimate under sub-section (2), the designated committee shall give an opportunity of being heard to the declarant, if he so desires, before issuing the statement indicating the amount payable by the declarant: Provided that on sufficient cause bein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment, the committee shall decide the matter based on available records. (6) Within thirty days of the date of issue of Form SVLDRS-3, the designated committee may modify its order only to correct an arithmetical error or clerical error, which is apparent on the face of record, on such error being pointed out by the declarant or suo motu by issuing electronically a revised Form SVLDRS-3." 23. Sub-section (2) of Section 127 of the Sabka Vishwas Scheme clearly provides that where the amount estimated to be payable by the declarant, as estimated by the Designated Committee, exceeds the amount declared by the declarant, then the Designated Committee shall issue in electronic Form an estimate of the amount payable by the declarant within thirty days of the date of receipt of the declaration. Further sub-section (3) of Rule 127 provides that, after the issue of this estimate, the Designated Committee shall give an opportunity of hearing to the declarant, if he so desires, before issuing the statement indicating the amount payable by the declarant. 24. Further, sub-section (4) of Section 127 provides that, after hearing the declarant, a statement in electronic Form indicating the amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al hearing and of making written submissions by filing Form SVLDRS-2A. However, in the present case, without issuing Form SVLDRS 2, the Designated Committee has straight away issued Form SVLDRS 3, thereby depriving the Petitioner of an opportunity of a personal hearing. In our view, this action of the Designated Committee of straight away issuing Form SVLDRS 3, without issuing Form SVLDRS 2, is not only in violation of Section 127 of the Sabka Vishwas Scheme and Rule 6 of the Sabka Vishwas Rules but is also in total violation of the principles of natural justice. 28. For all these reasons, we are of the view that Form SVLDRS 3 is required to be quashed and the matter is required to be remanded back to the Designated Committee for taking a fresh decision in the matter, after giving an opportunity of hearing to the Petitioner. 29. For the aforesaid reasons, and in the light of the aforesaid discussions, we hereby pass the following orders: a. Form SVLDRS 3, dated 2nd December 2020, is hereby quashed and set aside. b. The matter is remanded back to the Designated Committee and it is directed to issue Form SVLDRS 2 to the Petitioner and, after giving an opportunity of personal h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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