Natural justice under Sabka Vishwas Scheme requires a hearing before rejecting a declaration and exposing the declarant to liability.

Rejection of a declaration under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 without granting a hearing was contrary to the Scheme's mandate. The Scheme was treated as a benevolent mechanism for settling legacy indirect tax disputes, and the designated committee was required to follow Section 127, including giving the declarant an opportunity of hearing where the estimated amount exceeded the declared amount. A rejection entered only by way of remarks, without hearing the declarant, failed to satisfy natural justice and the statutory procedure. The rejection was therefore set aside and the matter remanded for fresh consideration after hearing the declarant.

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Issues: Whether rejection of the declaration filed under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 without granting an opportunity of hearing was sustainable.

Analysis: The Scheme was held to be a benevolent dispute resolution measure intended to settle legacy indirect tax disputes. Section 127 provided for estimation by the designated committee and, where the estimated amount exceeded the declared amount, an opportunity of hearing before issuing the final statement. Since the rejection of the declaration would expose the declarant to further liability, the statutory scheme required compliance with natural justice. The rejection made only by a remarks entry, without hearing the declarant, was inconsistent with the mandate of the Scheme.

Conclusion: The rejection of the declaration was unsustainable for want of hearing and was set aside. The matter was remanded to the designated committee for fresh consideration after granting an opportunity of hearing.

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