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2015 (3) TMI 633 - HC - Service TaxEntitlement for availing the scheme of Voluntary Compliance Encouragement Scheme (VCES) - rejection of declaration - petitioner pointed out that though ST 3 returns were filed earlier but they are eligible for the scheme as true liability was not disclosed at the time of filing of ST 3 returns. - Held that:- the authority undertakes the task of bifurcating or computing the liability by showing some disparity or difference in the figures of the service tax returns, and the disclosures or the declarations filed in a prescribed form pursuant to this scheme. We have no provision therefore before us which would enable us to sustain the exercise and which is carried out by the respondent no.3 The declaration which has been made by a person against whom an inquiry or investigation in respect of service tax not levied or not paid or short levied or short paid and in terms of clause 106(2) is a situation which is not before us and equally not before the Designated Authority also. We do not see how therefore the clauses of the scheme would enable the authority to come to this conclusion. The further stipulation in the scheme and particularly the Service Tax Voluntary Compliance Encouragement Rules, 2013, indicate as to how the Designated Authority ought to have dealt with the declaration in terms of the scheme. It may be that the eventual order or direction would uphold the declaration or while upholding it issue such other orders and directions, as are permissible in the scheme. However, to reject the scheme outright by the exercise undertaken was not permissible. Writ petition allowed - The declaration now shall be dealt with and scrutinized in terms of the Service Tax Voluntary Compliance Encouragement Scheme, 2013 and the Service Tax Voluntary Compliance Encouragement Rules, 2013 - Decided in favor of assessee.
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