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2020 (12) TMI 32 - HC - Service TaxSVLDRS - Rejection of application under Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - amount in arrears - allegation that petitioner No. 1 stood ineligible to file declaration under the arrears category - Stand taken by the respondents to justify rejection ofthe declaration of petitioner No.1 is that under section 125(1) (c) the final hearing in the case of petitioner No.1 who had been issued a show cause notice had taken place on 9th May, 2019 i.e. before 30th June, 2019. Therefore, petitioner No.1 was not eligible to make the declaration. HELD THAT:- It is true that petitioner No.1 had filed the declaration under arrears category with sub-categorization of appeal not filed or appeal having attained finality - When we talk about arrears or arrears category under the scheme, section 123 (e) has to be read together with section 121(c)(i). A conjoint reading of the two provisions would indicate that tax dues would mean the amount in arrears which in a given case like that of petitioner No.1 would be on account of no appeal having been filed by the declarant against an order or against an order in appeal before expiry of the period for filing appeal. In the present case, pursuant to the show cause notice though the final hearing had taken place on 9th May, 2019 before the cut off date of 30th June, 2019, the order in original was subsequently passed on 9th August, 2019. Against this order in original no appeal was filed by petitioner No.1 who filed the declaration under the arrears category on 8th January, 2020 by which time the limitation period for filing appeal against the order in original had expired. The Board clarified in circular dated 12th December, 2019 that since the main objective behind the scheme is to liquidate the legacy cases under central excise and service tax, it would be desirable that the tax payer is given an opportunity to avail its benefit - As per the answer given above by the department itself, in a case where show cause notice was issued and final hearing had taken place on or before 30th June, 2019, the declarant would not be eligible to make a declaration under the litigation category but once the order is passed the declarant can file a declaration under the arrears category provided no appeal against the order is filed or the appeal period is over. Thus, rejection of the declaration of the petitioner dated 8th January, 2020 by the Designated Committee on 14th February, 2020 is not justified. Accordingly the same is hereby set aside and quashed - petitioner No.1 is eligible to file declaration under the arrears category - the matter is remanded back to the Designated Committee to consider the declaration of petitioner No.1 dated 8th January, 2020 as a valid declaration and thereafter grant consequential relief in terms of the scheme after giving an opportunity of hearing to the petitioners. Petition allowed by way of remand.
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