Sabka Vishwas arrears classification turns on crystallised tax dues after final adjudication, not on an earlier notice.

The note explains that, where a service tax liability had already been quantified and confirmed in an Order-in-Original that attained finality, the amount qualified as "amount in arrears" and therefore as "tax dues" under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019. It states that the Scheme and Rules allowed a separate declaration in the arrears category, and that the mere existence of an earlier show cause notice did not control classification once the demand had crystallised. The text also reflects the Scheme's beneficial purpose and says a declarant should not be placed in a worse position when seeking its benefit.

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Issues: Whether the declarant was entitled to avail the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 under the arrears category on the basis of the adjudicated service tax demand, and whether the Designated Committee was justified in treating the declaration as one falling under the litigation category.

Analysis: The declaration was filed after an Order-in-Original had already quantified and confirmed the service tax liability. The adjudication order had attained finality because no appeal was filed, and the confirmed amount therefore answered the description of "amount in arrears" and consequently "tax dues" under the Scheme. The Scheme and the Rules permitted a separate declaration for arrears, and the pendency of the earlier show cause notice did not control the classification once the demand had been crystallised by the adjudication order. The Court applied the object of the Scheme as a beneficial legacy dispute resolution measure and held that a declarant should not be placed in a worse position than before seeking its benefit.

Conclusion: The declaration was correctly made under the arrears category, the Designated Committee's contrary treatment was unsustainable, and the petitioner was entitled to computation of the payable amount on the basis of the confirmed demand.

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