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2021 (2) TMI 10 - HC - Service TaxRejection of SVLDRS application for non-payment of dues (service tax) - Seeking to reconsider its declaration under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 by allowing pre-deposit made by the petitioner while the appeal is pending - basic grievance of the petitioner is non-acceptance or rather disallowance by the designated committee i.e., respondent No.3 of two payments made by the petitioner through its client M/s. Walchandnagar Industries Limited and additional payment as pre-deposit made by the petitioner thus resulting in the amount payable by the petitioner which it says is not required to be paid under the scheme - HELD THAT:- What is deducible is that service tax department had initiated investigation against the petitioner on the ground of alleged non-payment of service tax dues covering the period from 01.04.2006 to 31.03.2011. During the investigation period, petitioner had made a deposit of ₹ 1,30,00,000.00. This is admitted by the respondents and accepted as a pre-deposit while determining the outstanding dues payable by the petitioner. After issuance of the show cause-cum-demand notice dated 20.04.2012, petitioner has stated that it had made further payments of ₹ 46,44,094.00 covering the period under investigation through its client M/s. Walchandnagar Industries Limited; in addition further sum was paid which pertained to the period from 01.04.2011 to 31.03.2012 which was beyond the period of investigation. This amount was not accepted as payments made on behalf of the petitioner by the adjudicating authority i.e., the Commissioner on the ground that no evidence was submitted to that effect. Regarding the further payments made by the petitioner to the extent of ₹ 56,11,819.00, stand taken by the respondents is that the challans pertaining to payment of the aforesaid amount were from August, 2013 to April, 2015. Designated committee could not ascertain whether the said payment was for the period covered by the investigation or for the period beyond the investigation. Therefore, designated committee could not provide relief to the petitioner vis-a-vis the amount of ₹ 56,11,819.00. In paragraph 21 of the reply affidavit, it is stated that designated committee could not ascertain with confidence whether the said payment pertained to the period covered by the investigation i.e., by the order-in-original or pertained to period post 2012. Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 has been introduced primarily for liquidation of past disputes pertaining to central excise and service tax so that trade and industry can move ahead so also the tax administration which can then fully focus on the smooth implementation of goods and services tax (GST). Basic thrust is to unload the baggage of pending litigations centering around service tax and excise duty which stood subsumed in GST. As an incentive those making the declaration and paying the declared tax verified and determined in terms of the scheme would be entitled to certain benefits in the form of reduced tax liability, waiver of interest, fine, penalty and immunity from prosecution. This is a beneficial scheme for settlement of legacy disputes. Therefore, the officials while considering declarations made under the scheme must have the broad picture in mind. The approach should be to ensure that the scheme is successful and, therefore, a liberal view embedded with the principles of natural justice is called for. In the instant case, as against the petitioner’s claim of pre-deposit of two amounts of ₹ 46,44,094.00 and ₹ 56,11,819.00, designated committee did not accept payments of the two amounts as pre-deposit. In fact in the impugned order dated 25.02.2020, which is in Form No.SVLDRS-3, no reasons have been assigned for exclusion of the two amounts - In so far the second amount of ₹ 56,11,819.00 is concerned, stand taken is that though the said amount has been received by the department, it could not be verified with confidence whether the said payment pertained to the period covered by investigation i.e., by the order-in-original or for the period post the period of investigation. Since the verification carried out by respondent No.3 cannot be said to be a full and complete verification in terms of section 126(1) and rule 6(1), we are of the considered opinion that the matter is required to be remitted back to the designated committee for taking a fresh decision in the matter after giving an opportunity of hearing to the petitioner and thereafter to pass a speaking order with due intimation to the petitioner. Matter is remanded back to respondent No.3 for taking a fresh decision in the matter after giving due opportunity of hearing to the petitioner which shall be informed about the place, date and time of hearing. Respondent No.3 shall thereafter pass a speaking order in accordance with law with due intimation to the petitioner - Petition allowed by way of remand.
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