2022 (12) TMI 824 - HC - Service Tax

Writ petition dismissed for late payment under Sabka Vishwas Scheme. Ineligibility confirmed due to false disclosures.

The court dismissed the writ petition as the petitioner failed to make a correct declaration and pay the specified amount within the stipulated time under ... Sabka Vishwas (Legacy Dispute Resolution) Scheme 2019 - declaration in SVLDRS-1 made in time - denial of benefit of scheme for not having paid the amount mentioned in SVLDRS-3 dated 13.1.2020 within 30 days stipulated by the Designated Committee in SVLDRS-3 dated 13.1.2020 - correct declaration of the tax payable made or not - HELD THAT:- The petitioner as a declarant was expected to pay both the tax and the interest thereon. The only concession which the petitioner would have got was against the imposition of penalty if Form SVLDRS-1 filed by the petitioner was accepted - In the case of “voluntary disclosure”, the Designated Committee is not expected to verify the disclosure in the declaration made in Form SVLDRS-1. The Designated Committee, merely relies on the declaration in Form SVLDRS-1. In the declaration, the petitioner has stated that the declaration was being made under the “voluntarily category” - the declaration was filed in time as is evident from a reading of Rule 3 of the Sabka Vishwas (Legacy Dispute Resolution) Scheme Rules, 2019. However, as per Section 125(1)(e), a person who has been subjected to an enquiry of investigation or audit and the amount of duty involved in the said enquiry or investigation or audit has not been quantified on or before the 30th day of June 2019, shall not be entitled to file a declaration under the scheme. The petitioner however failed to pay even the amount specified in Form SVLDRS-3 in time. The petitioner appears to have made belated attempt to pay the amount on 16.3.2020. This was long after the period specified in Form SVLDRS-3 had expired. The amount which was initially debited from the petitioners account was however later recredited back. Thereafter, the petitioner did not take steps to make the payment. Meanwhile, lockdown was imposed due to outbreak of COVID 19 pandemic. Demand alongwith interest and penalty upheld - there is no merits in the present writ petition - petition dismissed. Issues Involved:1. Timeliness of the declaration in SVLDRS-1 under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019.2. Denial of scheme benefits for failure to pay the amount within the stipulated time.3. Correctness of the tax payable declaration by the petitioner.4. Eligibility for filing the declaration under the scheme.Detailed Analysis:1. Timeliness of the Declaration in SVLDRS-1:The petitioner filed the declaration in Form SVLDRS-1 on 31.12.2019, which was within the original deadline of 31.12.2019, later extended to 15.01.2020. However, the petitioner failed to pay the specified amount within the 30-day period stipulated by the Designated Committee, which expired on 12.02.2020. The petitioner attempted to make the payment on 16.03.2020, which was beyond the extended deadline.2. Denial of Scheme Benefits:The petitioner did not pay the amount specified in Form SVLDRS-3 within the stipulated 30 days. Although the petitioner attempted to make the payment on 16.03.2020, this was after the deadline had expired. The payment was initially debited but later re-credited due to technical issues. The petitioner did not take further steps to make the payment. The Central Board of Indirect Taxes and Customs extended the payment deadline to 30.06.2020 due to the COVID-19 pandemic, but this extension applied only to those required to pay between 20.03.2020 and 29.06.2020, not to the petitioner whose due date expired on 12.02.2020.3. Correctness of the Tax Payable Declaration:The petitioner declared the tax dues under the 'voluntary disclosure' category. As per Section 124(1)(e) of the Finance Act, 2019, in cases of voluntary disclosure, no relief is available regarding tax dues. The Designated Committee is not expected to verify the disclosure in voluntary cases. The petitioner was required to pay both the tax and interest, with only a concession against penalty if the declaration was accepted. The petitioner did not make a correct declaration and failed to pay the amount in time.4. Eligibility for Filing the Declaration:Under Section 125(1)(e) of the Finance Act, 2019, a person subjected to an enquiry, investigation, or audit, where the amount of duty involved was not quantified by 30.06.2019, is not entitled to file a declaration under the scheme. The Order in Original No. KVPT-ST-000 AC-05/2021 dated 30.11.2021 confirmed that the petitioner was not eligible to file the declaration as the disclosures made were not true, and the petitioner was debarred under Section 125(1)(e).Conclusion:The writ petition was dismissed due to the petitioner's failure to make a correct declaration and pay the amount in time. The petitioner was given liberty to file a statutory appeal before the second respondent within thirty days from the receipt of the order.