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2020 (9) TMI 9 - HC - Service TaxRejection of declaration filed under the amnesty scheme- Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - settlement of Service tax dues - rejection of the declaration filed by the Petitioner on account of Petitioner’s eligibility relates to quantification of tax dues prior to the ‘relevant date’ - HELD THAT:- As per Section 123, in case of an enquiry or investigation or audit which is pending against the declarant, the amount of duty payable under any of the indirect tax enactments has to be quantified before 30th June, 2019. Section 125(1)(e) referred above, renders all such persons ineligible to make a declaration under the Scheme who have been subjected to an enquiry or investigation or audit and the amount involved has not been quantified on or before 30th June 2019. Thus, Section 125 (1)(e) in a way compliments Section 123 (c) of the Act and quantification of ‘tax dues’ is imperative for a declarant to become eligible for applying under the scheme. The meaning of the word ‘quantified’ has been extended and broadened, obviously keeping in view the objective of the Scheme by way of Circulars dated 12th December, 2019 and 27th August, 2019. By virtue of the circulars, the Respondents have clarified that the benefit of the Scheme can also be given to those cases where the duty involved is quantified by way of an admission made by the declarant in a statement made on or before 30th June, 2019. This admission can be during an enquiry, investigation or audit report etc. Now, let us examine whether the admission made by the Petitioner in the present case make it eligible under the scheme. Whether by virtue of the aforesaid admission, the ‘tax dues’ can be said to quantified by the Investigating Authority before 30th June, 2019? - HELD THAT:- The demand-cum-show cause notice dated 13th March, 2020, on the face of it relates to tax dues which are much more than the amount admitted by the Petitioner. No doubt, in so far as the Service Tax liability is concerned, which is one of the components of the demand-cum-show cause notice dated 13th March, 2020, there is no dispute between the parties with respect to the quantum. However, the aforesaid admission of liability of Service Tax, to our understanding, cannot be held to be quantification of the entire ‘tax dues’. It is admission of Service tax liability only. Petitioner’s contention that this should be treated as the quantified tax dues, is therefore, plainly incorrect. SVLDR is a beneficial scheme and purposive interpretation of its terms is desirable. However, we cannot give an interpretation that would run counter to its objective. The scheme is a one-time measure for liquidation of past disputes under the erstwhile regime and affords an opportunity of voluntary disclosure to non-compliant tax payers. The declarants are thus expected to come clean in order take its benefit. During investigation, Petitioner only admitted Service Tax liability and did not make any disclosure with respect to the other tax dues and as a result whereof, after investigation, Respondents have issued the demand-cum show cause notice for an amount of ₹ 13,77,13,890/-. This show cause notice would have to be adjudicated in entirety and cannot be done in a piecemeal manner - We cannot construe admitted tax liability to be ‘matter’ and the remainder dues as per show-cause notice to be a ‘separate matter’, especially since the investigation was still ongoing on the relevant date. Application was rightly dismissed.
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