Adjustment of excess pre-deposit under the Sabka Vishwas Scheme was permitted against another pending legacy demand.

Under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, an excess pre-deposit made by the same declarant against one demand could be adjusted against liability under another pending demand relating to the same subject matter, because the Scheme contained no express bar on such adjustment. The Court relied on the departmental circular stating that deposits made during enquiry, investigation, audit, or appellate proceedings may be deducted or adjusted while computing the amount payable. Since the declarant sought adjustment, not refund, the excess deposit was treated as available for set-off against the second demand.

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Issues: Whether the excess pre-deposit made by the declarant in respect of one demand could be adjusted towards the amount payable under another demand while granting relief under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019.

Analysis: The Scheme did not provide for refund of excess deposit, but there was no specific prohibition against adjustment of an excess amount already deposited by the same declarant against a different pending demand relating to the same subject matter. The departmental circular clarified that deposits made at stages of enquiry, investigation, audit, or appellate proceedings could be deducted or adjusted while issuing the statement of amount payable. The Court also noted that the declarant had not sought refund, only adjustment, and that the Scheme was intended to resolve legacy disputes by giving effect to such deposits.

Conclusion: The excess amount deposited in relation to the first demand was liable to be adjusted against the liability arising from the second demand, and the challenge to such adjustment failed.

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