Sabka Vishwas Scheme quantification includes admitted liability before cutoff, and rejection without hearing breaches natural justice.

Liability admitted and quantified before the 30 June 2019 cutoff satisfied the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 requirement for the investigation, enquiry or audit category, because quantification includes written communication of duty demand and an admission of liability during investigation or enquiry. The declarant's statement admitting service tax liability, acknowledged by the department, was sufficient quantification, so the declaration was wrongly treated as ineligible. A rejection affecting eligibility and civil consequences could not be made without giving the declarant a hearing; summary rejection breached natural justice. The rejection was set aside and the declaration was remanded for reconsideration with a hearing and a fresh speaking order.

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Issues: (i) Whether the petitioner's declaration under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 was valid where the service tax liability had been admitted and quantified before the cutoff date of 30 June 2019; (ii) Whether rejection of the declaration without hearing the declarant was sustainable.

Issue (i): Whether the petitioner's declaration under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 was valid where the service tax liability had been admitted and quantified before the cutoff date of 30 June 2019.

Analysis: Eligibility under the "investigation, enquiry or audit" category turned on whether the duty demand had been quantified on or before the cutoff date. Quantification, as clarified in the Board circular, includes written communication of duty demand and also duty liability admitted by the person during investigation or enquiry. The petitioner's director had admitted the service tax liability in statements recorded before the cutoff date, and the departmental reply itself acknowledged that admission. That admission constituted sufficient quantification for purposes of the scheme.

Conclusion: The declaration was wrongly treated as ineligible, and the petitioner was eligible to seek relief under the scheme.

Issue (ii): Whether rejection of the declaration without hearing the declarant was sustainable.

Analysis: Where the designated committee proposes to reject a declaration, particularly on a ground affecting eligibility and civil consequences, the declarant must be given an opportunity to explain. A summary rejection without hearing would be contrary to natural justice and inconsistent with the object of the scheme.

Conclusion: The rejection order could not be sustained without affording a hearing to the petitioner.

Final Conclusion: The rejection was set aside and the matter was sent back for reconsideration of the declaration as a valid claim under the scheme, with an opportunity of hearing and a fresh speaking order.

Ratio Decidendi: Under the scheme, duty dues are treated as quantified when there is a written communication or an admission of liability during investigation or enquiry before the cutoff date, and a declaration affecting eligibility cannot be summarily rejected without complying with natural justice.

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