2021 (11) TMI 554 - HC - Service Tax

Dismissal of Writ Petition Over Recovery Notice Under Sabka Viswas Scheme

The Court dismissed the writ petition challenging the recovery notice under the Sabka Viswas Scheme due to the petitioner's failure to deposit the ... Amnesty scheme - Sabka Viswas (Legacy Dispute Resolution Scheme, 2019) - condition precedent of deposit for waiver - automatic dismissal on failure to pay by cut-off date - no extension of scheme period - challenge to recovery noticeAmnesty scheme - condition precedent of deposit for waiver - automatic dismissal on failure to pay by cut-off date - no extension of scheme period - Whether the petitioner, having failed to deposit the prescribed sum by the cut-off date under the Sabka Viswas scheme, was entitled to relief or extension and could restrain recovery by invoking the scheme. - HELD THAT: - The scheme required deposit of a specified portion of the disputed tax by the cut-off date as a condition for waiver of the remaining liability. It is admitted that the last date for payment was 30.06.2020 and that the petitioner did not make the deposit by that date. The petitioner did not dispute the departmental computation of the amount to be deposited. The scheme contains no provision for extending the time for payment and expressly contemplates termination of the scheme on expiry of the period. On these admitted facts and in view of the scheme's terms, the petitioner's grounds of personal illness and alleged portal/system difficulties did not entitle him to an extension or prevent automatic dismissal of his application under the scheme; accordingly the department was entitled to proceed with recovery.Writ petition dismissed; no extension of time or relief under the scheme available to the petitioner and recovery may proceed.Final Conclusion: The petitioner, having failed to make the deposit required by the Sabka Viswas scheme by the prescribed cut-off date and in the absence of any provision for extension, was not entitled to relief; the writ petition challenging the consequent recovery notice is dismissed. Issues:Challenge to recovery notice under Sabka Viswas Scheme for unpaid service tax.Analysis:The petitioner, engaged in construction services, was found liable for unpaid service tax for the financial years 2008-09 to 2011-12. The Service Tax Department demanded Rs. 28,11,443 with interest. The petitioner's appeal against the order was dismissed in 2018. Subsequently, the Government introduced the Sabka Viswas Scheme in 2019 for resolving legacy disputes. The scheme required a partial tax deposit by a specified date for the remaining tax to be waived. The petitioner was asked to deposit Rs. 10,40,177 by 30.06.2020 to avail the scheme's benefits. Despite extensions, the petitioner failed to make the payment due to personal health reasons and technical issues in making the payment through the Department's portal.The Court noted that the payment deadline was clearly set as 30.06.2020, with no provision for further extensions under the scheme. The petitioner did not dispute the calculated amount or the communication from the Department. As the scheme automatically ended upon the deadline's expiration, the Court found no grounds for granting an extension based on the petitioner's reasons. Consequently, the Court dismissed the writ petition challenging the recovery notice under the Sabka Viswas Scheme.In conclusion, the judgment upheld the strict adherence to the scheme's terms regarding payment deadlines and extensions. The Court emphasized the importance of complying with the scheme's requirements and found no basis for extending the deadline beyond what was specified, ultimately leading to the dismissal of the petitioner's challenge to the recovery notice.