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2021 (2) TMI 11 - BOMBAY HIGH COURTRejection of SVLDRS application for non-payment of dues (service tax) - Principles of Natural Justice - seeking direction to the respondents to afford an opportunity of hearing to the petitioner and thereafter pass appropriate order in terms of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - non-consideration of the CENVAT credit as pre-deposit made by the petitioner while granting tax relief under the scheme. Personal hearing denied to the petitioner - HELD THAT:- What transpires is that when the amount estimated to be payable by the declarant, as estimated by the designated committee, exceeds the amount declared by the declarant in the declaration then the designated committee shall issue in electronic form an estimate of the amount payable by the declarant within 30 days. After such estimate is issued in the prescribed format, 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. However, as per the proviso on sufficient cause being shown by the declarant only one adjournment may be granted by the designated committee. While giving an opportunity of hearing to the declarant by the designated committee when its estimation exceeds that of the declarant has been made mandatory, granting of adjournment of such opportunity of hearing or confining the same to only one adjournment by the designated committee has been made discretionary. Elaborating further we may say that on sufficient cause being shown the hearing may be adjourned. Thus, discretion has been vested on the designated committee to grant adjournment of personal hearing in an appropriate case. Such discretionary power has to be exercised in a just, fair and judicious manner. But if on the adjourned date, for reasons beyond the control of either the designated committee or of the declarant or for any act of God, say for example, there is fire or flood or an earthquake or a pandemic as in the present case, the hearing cannot take place, can it be construed that there can be no further hearing beyond the date of hearing fixed. Such a view besides being too narrow and rigid would also be opposed to the very principles of natural justice which is nothing but fair play in action. In our view, in such a situation the adjourned date of personal hearing would not be considered as the date of hearing and, therefore, a fresh date of personal hearing would have to be granted - coming to the facts of the present case, we find that designated committee had initially fixed personal hearing on 19.03.2020. Petitioner while objecting to the estimated amount determined by the designated committee urged adjournment of the personal hearing fixed on 19.03.2020 on account of short notice and due to the situation arising out of Covid-19 pandemic. While petitioner suggested 06.04.2020 as the adjourned date of hearing, respondent No.4 fixed the personal hearing on 30.03.2020. Non-consideration of the CENVAT credit as pre-deposit made by the petitioner while granting tax relief under the scheme - HELD THAT:- Since we have taken the view that the impugned decision contravenes the principles of natural justice causing prejudice to the petitioner and consequently the matter is required to be remanded back to the designated committee, it is not necessary to delve into the second grievance of the petitioner i.e., to treat the CENVAT credit amount of ₹ 3,28,49,069.00 as pre-deposit of the petitioner while granting relief under the scheme - there is one more aspect which we would like to briefly dilate upon. In their affidavit, respondents have stated that designated committee (respondent No.4) has limited the pre-deposit of the petitioner to cash payment of ₹ 1,11,25,000.00 and thus denying the benefit of CENVAT credit on the basis of reports received from the Deputy Director, DGGI Zonal Office, Mumbai dated 04.03.2020 and 16.03.2020. Neither of the two reports have been annexed to the impugned order dated 05.05.2020 nor furnished to the petitioner. The said reports have also not been annexed to the reply affidavit. It is a settled proposition of law that when an authority relies upon a document to take a decision which is adverse or prejudicial to a party, principles of natural justice demands that copy of such document or the essence thereof should be furnished to the affected party before the decision is taken so that the affected party can properly defend its case. Failure to do so would result in violation of the principles of natural justice and fair play in action which would vitiate the decision making process and ultimately the decision taken. Matter is remanded back to respondent No.4 to consider the declaration of the petitioner vis-a-vis claim of CENVAT credit of ₹ 3,28,49,069.00 as pre-deposit in addition to the cash deposit of ₹ 1,11,25,000.00. While doing so respondent No.4 shall provide an opportunity of hearing to the petitioner and thereafter pass a speaking order with due intimation to the petitioner - petition allowed by way of remand.
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