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TMI Blog2025 (1) TMI 1263X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner would be entitled to the benefit of the SVLDRS which has a basic feature of reducing the disputes and create an atmosphere of trust between the assessee and the respondent-department. However, in the facts of the case it appears that, the designated committee, contrary to the provision of the SVLDRS and with total non-application of mind has issued Form SVLDRS-2 and without taking into consideration reply of the petitioner 29.11.2019 has issued Form SVLDRS-3 in a mechanical manner. The petitioner has been vigilant to challenge such SVLDRS-3 immediately by preferring this petition and this Court has directed the petitioner to deposit 60% of the tax arrears amounting to Rs. 31,32,551.60 which petitioner has already deposited. Therefore, in the facts of the case, when there was no appeal pending filed by the petitioner, the amount of demand raised in the Order-in-original would become the tax dues being the amount in arrears as per clause (e) of section 123 of SVLDRS and accordingly, the petitioner is entitled to get the benefit of the provision of section 124 of the SVLDRS by paying 60% of the amount in arrears as tax dues which the petitioner has already deposited. Con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax arrears." 6. Pursuant to the aforesaid order, the petitioner has deposited the amount of Rs. 31,36,551.60 as per the Form SVLDRS-1 on 21.01.2020 and has placed the challan on record. 7. Brief facts of the case are as under: 7.1 The petitioner, who is engaged in providing Taxable Service under category of 'Construction Service in respect of Commercial Industrial Building and Civil Structures' was subject to proceedings under the provisions of Finance Act, 1994. A show-cause notice dated 18.12.2018 was issued by the respondent-Assessing Officer to show cause as to why the amount of service tax and interest of Rs. 12,23,19,106/- alleged to have been not paid under 'Construction Service in respect of Commercial and Industrial Building and Civil Structure' during the period from April 2014 to June 2017 should not be demanded and recovered from the petitioner along with interest and penalty under sections 78, 77 (1) (a) and 77 (2) of the Finance Act,1994. 7.2 After considering the reply filed by the petitioner, the Assessing Officer vide Order-in-original dated 31.03.2019 held that the service tax amounting to Rs. 43,03,591/-and Rs. 9,23,995/- is recoverable from the petitioner al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Form SVLDRS 2, the petitioner filed reply dated 29.11.2019 contending inter alia that the petitioner is not liable to pay the amount stated in Form SVLDRS-2 as the case of the petitioner falls in the arrears and the tax dues would be covered by clause (e) of section 123 of the SVLDRS and not clause (a) which is pressed into service by the Designated Committee. However, the Designated Committee comprising of the respondent Nos. 1 and 2 herein, issued the Form SVLDRS-3 dated 04.12.2019 as per the provisions of section 127(iv) of SVLDRS dated 04.12.2019 determining the amount of payable at Rs. 1,55,32,324/- considering the tax dues of Rs. 2,58,87,206/- by granting relief of Rs. 1,03,54,882/-. 7.10 On receipt of the aforesaid Form SVLDRS-3 the petitioner has affirmed this petition on 01.01.2020 challenging From SVLDRS-3 which, according to the petitioner, is contrary to the provisions of the SVLDRS. 7.11 This Court, vide order dated 08.01.2020, as extracted here-in-above directed the petitioner to pay the undisputed amount of Rs. 31,36,551.60 which is deposited by the petitioner on 20.01.2020. 8. Learned advocate Mr. D.K. Trivedi for the petitioner submitted that the provision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of India reported in 2023 (70) GSTL 439 (Jharkhand) more particularly, paras 5 and 11 thereof which reads as under: "5. Learned counsel further pointed out to the supplementary counter affidavit filed by the respondents, in particular para-9 and 10 which are quoted hereunder :- "9. That the respondents states and submits that Section 125 of the Finance (No. 2) Act, 2019 (SVLDRS, 2019) prescribed eligibility to make a declaration under the scheme, Section 125 of the Finance (No. 2) Act, 2019 provides for eligibility of declaration except for selected exclusions. In litigation cases, it prohibits those cases where the appeal has been finally heard on or before 30.06.2019 and in enquiry/ investigation/ audit, where the duty has not been quantified before 30.06.2019. Tax dues have been defined in clause (a), (b), (c), (d) and (e) of Section 123 which also refer to the cut-off date of 30.06.2019 in case of litigation and enquiry/ investigation/ audit. However, "amount of arrear" as defined in sub-clause (i) and (ii) of clause (c) of Section 121 of the Act, does not provide any such cut-off date. The said clause reads as under:- "(c)" amount in arrears" means the amount of duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as not proper in the eyes of law as there was no appeal pending as on 30th June 2019 contemplated in terms of Section 123 of the Scheme. It is submitted that the declaration made by the petitioner was therefore within time covered under Circular dated 12th December 2019 but rejected on misconception that it fell under "Litigation" category and not "amount in arrears". It is submitted that under Section 121 Sub-section (i)(c) an appeal, if any, could be filed only by the declarant and not on the part of the respondent Department. So on a holistic construction of the entire Scheme and even applying the relevant provisions of Section 123 read with Section 125 of the Scheme, the declaration made by the petitioner under "amount in arrears" category could not have been rejected on the ground that the respondent contemplated preferring the appeal against the order in original and that too beyond the period of limitation." 11. It further transpires that crux of the case revolves around the category i.e., arrears or litigation under which the case of the Petitioner will fall. From bare perusal of the aforesaid provisions of Scheme, it would transpire that the nature of cases falling under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellate Forum. Indeed, for the purpose of determination of tax dues, the case of the petitioner does not fall under Section 123 of the scheme of 2019 as Department had not preferred an Appeal against the Order-in-Original as on the said date. It further appears that the appeal of the Department has been filed after the expiry of period of limitation prescribed under Section 86(3) of the Finance Act as the said provision provides a period of limitation of three months which has expired on 14.04.2020. Thus, it transpires that in the opinion of the respondent filing of the appeal has led to change in the category of petitioner from "arrear category" to "litigation category" which view is beyond the letter and spirit of the scheme." 9. Per contra, learned advocate Mr. Siddharth Dave for the respondent submitted that admittedly, the petitioner did not pay the amount required to be paid as per Form SVLDRS-3 within 30 days or within the extended period of time and as such, as per the provision of section 126 read with the provision of section 127 (4) of the SVLDRS and as such, the petitioner is not liable to any relief. 9.1 It was further submitted that the designated authority has con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 124. Relief available under the Scheme:- (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; …………. 126. Verification of declaration by designated committee. (1) The designated committee shall verify the correctness of the declaration made by the declarant under section 125 in such manner as may be prescribed: Provided that no such verification shall be made in case where a voluntary disclosure of an amount of duty has been made by the declarant. (2) The composition and functioning of the designated committee shall be such as may be prescribed. 127. Issue of statement by designated committee. (1) Where the amount estimated to be payable by the declarant, as estimated by the designated committee, equals th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he petitioner has been vigilant to challenge such SVLDRS-3 immediately by preferring this petition and this Court has directed the petitioner to deposit 60% of the tax arrears amounting to Rs. 31,32,551.60 which petitioner has already deposited. 13. Therefore, in the facts of the case, when there was no appeal pending filed by the petitioner, the amount of demand raised in the Order-in-original would become the tax dues being the amount in arrears as per clause (e) of section 123 of SVLDRS and accordingly, the petitioner is entitled to get the benefit of the provision of section 124 of the SVLDRS by paying 60% of the amount in arrears as tax dues which the petitioner has already deposited. 14. In view of the above facts, the respondent-authority is required to issue revised Form SVLDRS-3 along with Form SVLDRS-4 as per the provision of SVLDRS accepting the amount of Rs. 31,32,551.60 deposited by the petitioner as eligible amount for granting the benefit of SVLDRS. All subsequent proceedings would therefore be of no consequence and are accordingly required to be set aside. 15. In view of foregoing reasons, the petition succeeds and is allowed. The respondents are therefore, direc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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