Pre-deposit adjustment under SVLDRS must be given effect when computing the amount payable under the settlement scheme.

Section 124(2) of the Finance Act, 2019 requires deduction of amounts already paid as pre-deposit or as deposits during enquiry, investigation or audit when computing the amount payable under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019. The Madras High Court noted that the petitioner had paid duty and interest before the show cause notice and before issuance of the SVLDRS statement, and held that the department could not refuse credit merely because the payments were not made under protest. The amount deposited was therefore required to be adjusted, and the refusal to grant such credit was unsustainable.

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Issues: Whether the amount already deposited by the petitioner towards duty and interest was liable to be adjusted while determining the amount payable under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019.

Analysis: Section 124(2) of the Finance Act, 2019 mandates deduction of any amount paid as pre-deposit at any stage of appellate proceedings or as deposit during enquiry, investigation or audit while issuing the statement indicating the amount payable by the declarant. The petitioner had already deposited amounts towards duty and interest before the show cause notice and before the issuance of the SVLDRS statement. The departmental objection that the amount was not paid under protest did not alter the statutory command, because the Scheme required adjustment of eligible pre-deposits and did not permit their exclusion from the settlement computation.

Conclusion: The amount deposited by the petitioner was required to be adjusted under the Scheme, and the refusal to give such credit was unsustainable.

Final Conclusion: The petitioner was entitled to the benefit of adjustment of the pre-deposited amount and issuance of the settlement form under the SVLDRS Scheme.

Ratio Decidendi: Under Section 124(2) of the Finance Act, 2019, amounts already paid as pre-deposit or deposit during enquiry, investigation or audit must be deducted while computing the amount payable under the SVLDRS Scheme.

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