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2023 (1) TMI 1048 - BOMBAY HIGH COURTDemand made by issuance of Form SVLDRS-3 - demand on the ground that the tax dues comprise of only duty amount and, therefore, only deposit of any stage is allowed under Section 124 (2) of the Finance Act, 2019 pertaining to the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - HELD THAT:- It is not in dispute that the Petitioner has, prior to the issuance of the show cause notice, paid an amount of Rs.1,49,35,618/- electronically out of which a sum of Rs.1,09,06,948/- was deposited under the Accounting Code 00441480 as tax receipts and Rs.40,28,670/- was deposited under Accounting Code 00441481 towards interest under other receipts. That, during the pendency of the show cause notice, Petitioner had also requested for change of Accounting Code in respect of the interest amount to the Accounting Code relevant to tax receipts which request was also pending when the SVLDR Scheme was notified pursuant to which the Petitioner filed a declaration in Form SVLDRS-1 to avail of the scheme. The Designated Committee has issued form SVLDRS-3 without adjusting the amount of interest as tax dues, the reason being that “any amount paid” referred to in Section 124(2) referred to the tax dues as contained in Section 123(b) of the Finance Act which refers to the amount of duty as defined in Section 121(d) - The SVLDR Scheme is a beneficial legislation, not only for liquidation of legacy disputes for the benefit of the tax payers but also for recovery of unpaid taxes: it is a scheme for amicable resolution of disputes and in the interest of revenue. The Statement of Objects and Reasons clearly provide that the declarant would be entitled to benefits in the form of waiver of interest, fine, penalty and also immunity from prosecution. Keeping in mind these objectives, failure to adjust interest paid by the Petitioner, appears to be hyper-technical and should not come in the way of implementation of schemes of this nature. Petitioner cannot be deprived of the benefits of this scheme just because the amount of interest was deposited under Accounting Code 00441481 (Other Receipts (interest)) and not under 00441480 in respect of tax receipts which change of Accounting Code was pending with the Respondents Authorities at the time of filing of Form SVLDRS-1 by the Petitioner. Petitioner, cannot be penalized for depositing the amount under different head. Once the provision speaks of “any amount paid” without distinguishing between the heads of tax or between tax, interest or penalty, the provision mandates the deduction of the amounts deposited prior to issuance of the show cause notice. As rightly observed by the Madras High Court in M/S. VAMSEE OVERSEAS MARINE PRIVATE LIMITED VERSUS THE COMMISSIONER OF SERVICE TAX, DESIGNATED COMMITTEE [2021 (2) TMI 801 - MADRAS HIGH COURT] the object of the scheme should not be lost sight of, as the scheme has itself been formulated for the smooth settlement of disputes. The interpretation of the provisions thereof should be to carry forward the object rather than to frustrate the same giving rise to more litigation. In our view, had the Designated Committee taken a pragmatic view, more so, in the light of the law settled by atleast three High Courts, this litigation was clearly avoidable. The Designated Committee ought to have given due credit of the sum of Rs. 40,28,670/- as interest deposited by Petitioner was prior to the issuance of the Show Cause Notice - Form 3 issued by the Designated Committee cannot be sustained and deserves to be set aside. Petition allowed.
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