2020 (11) TMI 89 - HC - Customs

Section 128 SVLDRS allows rectifying declarant errors; no multiple declarations, litigation and voluntary disclosure mutually exclusive

HC held that Section 128 of SVLDRS empowers the designated committee to rectify any error apparent on the face of the record, including mistakes committed ... SVLDRS scheme - petitioner’s rectification application rejected on the ground that Section 128 confers limited powers upon the designated committee and it is not empowered to rectify errors committed by the petitioner/applicant/ declarant/assessee - HELD THAT:- Section 128 of SVLDRS does not state that an error/mistake apparent on the face of the record that can be rectified is of the designated committee alone. This Court is also of the view that an error/mistake apparent on the face of the record by the declarant/assessee/applicant would also fall within the scope and ambit of Section 128 of SVLDRS - Further, if the error/mistake committed by the declarant/assessee/ applicant while filing the form is not rectified, it is bound to result in a mistake/error in the decision/order passed by the designated committee. Consequently, an error committed by the assessee, which inevitably leads to an error in the order of the designated committee, can be rectified by the designated committee under Section 128 of SVLDRS. The stand of the respondent no. 2 that there is no bar on filing of multiple declarations by any assessee is misconceived on facts and untenable in law. Firstly, SVLDRS does not provide for resubmitting an application under the said Scheme. Secondly, for a declaration under ‘litigation’ category, ‘voluntary disclosure’ category, being mutually exclusive, is ruled out. Thirdly, any fresh declaration after issuance of SVLDRS-3 on 03rd January, 2020 would end up in a chaotic situation as then there would be two SVLDRS-3. The respondent No.2 is directed to rectify the declaration dated 30th December, 2019 and consider it as one filed under the ‘litigation’ category instead of ‘voluntary disclosure’ and process the same in accordance with law within four weeks - Petition disposed off. Issues Involved:1. Challenge to the order dated 21st August 2020.2. Scope and ambit of Section 128 of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS).3. Whether clerical or arithmetical errors made by the applicant fall within the ambit of Section 128.4. Whether the petitioner’s error in filing the declaration under the wrong category can be rectified.5. Interpretation of provisions of an amnesty scheme.6. Whether the petitioner could file multiple declarations under SVLDRS.7. Relevance of previous judgments to the present case.Detailed Analysis:1. Challenge to the order dated 21st August 2020:The petitioner challenged the order dated 21st August 2020, passed by respondent no.2, seeking to read down Section 128 of SVLDRS to include clerical or arithmetical errors by the applicant and to rectify the declaration filed under the 'voluntary disclosure' category to 'litigation' category.2. Scope and Ambit of Section 128 of SVLDRS:Section 128 allows the designated committee to modify its order to correct an arithmetical or clerical error apparent on the face of the record within thirty days of issuing a statement indicating the amount payable by the declarant. The court emphasized that an error/mistake apparent on the face of the record means a patent, manifest, and self-evident error that does not require elaborate discussion of evidence or argument to establish it.3. Whether clerical or arithmetical errors made by the applicant fall within the ambit of Section 128:The petitioner argued that the error was clerical and apparent on the face of the record, thus falling within the ambit of Section 128. The court agreed, stating that Section 128 does not specify that the error must be committed by the designated committee alone. Errors by the declarant that lead to errors in the committee's order can also be rectified under this section.4. Whether the petitioner’s error in filing the declaration under the wrong category can be rectified:The court found that the petitioner’s mistake was procedural/clerical and inadvertent, not made to claim any undue benefit. The petitioner was eligible for benefits under the 'litigation' category but filed under 'voluntary disclosure' by mistake. The court held that rectifying this error would not grant any undue advantage and directed the respondent to rectify the declaration.5. Interpretation of provisions of an amnesty scheme:The court emphasized that a liberal interpretation should be given to SVLDRS to unload legacy disputes and allow businesses to make a fresh beginning. The narrow approach suggested by the respondent would defeat the scheme's purpose.6. Whether the petitioner could file multiple declarations under SVLDRS:The court found the respondent's argument that multiple declarations could be filed to be misconceived. SVLDRS does not provide for resubmitting applications, and filing a fresh declaration after issuance of SVLDRS-3 would create a chaotic situation.7. Relevance of previous judgments to the present case:The court distinguished the present case from the judgment in Manpreet Engineering & Const. Co., where the assessee failed to comply with the scheme's provisions. The court also referenced the Gauhati High Court's judgment in M/S. Urban Systems, which allowed rectification of similar errors under SVLDRS.Relief:The court set aside the impugned order and directed respondent no.2 to rectify the declaration dated 30th December 2019, considering it as filed under the 'litigation' category and process it in accordance with the law within four weeks. The writ petition was disposed of with these directions.