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of <h1>High Court upholds Sabka Vishwas Scheme for petitioner's tax liability admission. Order set aside, matter remanded for reconsideration.</h1> <h3>M/s. K.N. Rai (Proprietorship firm) Through Kirit Kedarnath Rai Versus Union of India & Ors.</h3> M/s. K.N. Rai (Proprietorship firm) Through Kirit Kedarnath Rai Versus Union of India & Ors. - 2021 (46) G.S.T.L. 239 (Bom.) , [2021] 89 G S.T.R. 154 (Bom) Issues Involved:1. Eligibility under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019.2. Quantification of tax dues before the cut-off date of 30.06.2019.3. Rejection of the declaration based on non-finalization of tax dues by the cut-off date.Detailed Analysis:1. Eligibility under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019:The petitioner sought quashing of the rejection of its declaration under the Sabka Vishwas Scheme and requested reconsideration after a hearing. The petitioner, a proprietorship firm providing construction services, claimed exemption from service tax under an amended Exemption Notification dated 20.06.2012. However, the Service Tax Department initiated an enquiry for the period 2014-15 to June 2017, asserting that the services were taxable post-amendment from 01.04.2015.2. Quantification of Tax Dues Before the Cut-off Date of 30.06.2019:The petitioner admitted a service tax liability of Rs. 1,26,54,725.00 in a statement recorded on 28.06.2019. The Sabka Vishwas Scheme, introduced by the Central Government in 2019, required tax dues to be quantified by 30.06.2019 for eligibility. The petitioner submitted a declaration under the scheme on 21.11.2019, but it was rejected on 12.02.2020 because the tax dues were not finalized by the cut-off date.3. Rejection of the Declaration Based on Non-finalization of Tax Dues by the Cut-off Date:The respondents contended that the quantification of tax dues was not finalized by 30.06.2019, making the petitioner ineligible under the scheme. The petitioner’s declaration was based on a statement recorded just two days before the deadline, which the respondents argued was insufficient time for finalizing the tax liability.The High Court referred to previous judgments, including Thought Blurb Vs. Union of India and M/s. G. R. Palle Electricals Vs. Union of India, which clarified that 'quantified' means a written communication of the amount of duty payable, including a letter intimating duty demand or duty liability admitted during enquiry, investigation, or audit. The Court noted that the petitioner’s tax liability was admitted on 28.06.2019, before the cut-off date, thus fulfilling the scheme's requirements.Conclusion:The Court concluded that the petitioner’s admission of tax liability on 28.06.2019 met the scheme's criteria. The rejection of the declaration was unjustified as the tax dues were quantified before the cut-off date. The impugned order dated 12.02.2020 was set aside, and the matter was remanded for reconsideration of the petitioner’s declaration as a valid one under the scheme. The respondents were directed to complete this process within six weeks, ensuring due opportunity of hearing.Order:The Writ Petition was allowed, and the respondents were instructed to act on a digitally signed copy of the order. No costs were awarded.
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