2024 (1) TMI 1059 - HC - Service Tax

Kerala HC rejects extension plea under SUBKA VISHWAS Scheme Rules 2019 citing strict timelines and insufficient evidence of technical glitch

Coach India Versus Superintendent Of Central Tax And Central Excise Thrissur, Assistant Commissioner Central Tax And Central Excise, Ministry Of Finance, Central Board Of Indirect Taxes And Customs

Kerala HC dismissed petitioner's writ petition challenging denial of extension under SUBKA VISHWAS [Legacy Dispute Resolution] Scheme Rules, 2019. ... SUBKA VISHWAS” [Legacy Dispute Resolution] Scheme Rules, 2019 - petitioner was unable to make payment due to technical glitch - HELD THAT:- The “SUBKA VISHWAS” [Legacy Dispute Resolution] Scheme Rules, 2019, is self contained code. The SVLDRS-1 was to be uploaded online and SVLDRS-3 was also to be uploaded online within 60 days from the date of receipt of the SVLDRS-1. A declarant was required to make payment online within 30 days from the date of uploading of SVLDRS-3. Petitioner knew the provision as he had chosen to take benefit of the scheme by uploading SVLDRS-1. He knew that within 60 days from the date of uploading of SVLDRS-1, SVLDRS-3 would be uploaded and he would be required to make the payment within 30 days from the said date. Therefore, the petitioner’s contention that he could notice the SVLDRS-3 only on the website of the CBIC on or around 15.6.2020, and thereafter, he tried to make the payment but he failed for ‘technical glitches’ is not convincing. The petitioner’s allegation that there were ‘technical glitches’ is not supported by any cogent and credible evidence. The petitioner ought to have made the payment within 30 days from 19.02.2020 or till the extended time, which he failed to do so. Once the petitioner failed to comply with the provisions of the scheme, which is a complete code in itself, this court would not like to extend the limitation for making the payment under the scheme in exercise of its jurisdiction under Article 226 of the Constitution of India. In an identical matter, the Supreme Court has dismissed the Special Leave petition against an order of the jurisdictional High Court refusing to extend the time under the scheme for making payment as per SVLDRS-3. The present writ petition is dismissed. Issues Involved:The issues involved in the judgment are non-payment of service tax by a coaching center, applicability of the 'SUBKA VISHWAS' Scheme Rules, 2019, technical glitches in making online payment, and the jurisdiction of the High Court in extending the time limit for payment under the scheme.Non-Payment of Service Tax:The petitioner, a coaching center, failed to remit the service tax for the relevant year(s) despite providing services falling under the category of 'commercial training and coaching service'. A show cause notice was issued directing the petitioner to explain why the tax should not be levied and demanded.Applicability of 'SUBKA VISHWAS' Scheme Rules, 2019:The petitioner opted to avail the benefits under the 'SUBKA VISHWAS' Scheme Rules, 2019, by uploading Form SVLDRS-1 and quantifying the payable amount as Rs. 13,895. The designated committee issued SVLDRS-3 specifying the payable amount, but the petitioner faced challenges in making the payment due to technical glitches on the website.Technical Glitches in Online Payment:Despite attempts to make the payment online and transferring the amount to their Chartered Accountant, the petitioner could not complete the payment within the stipulated time frame. The petitioner cited technical issues on the website as the reason for the delay in payment.Jurisdiction of High Court in Extending Time Limit:The petitioner sought relief from the High Court, arguing that the technical glitches prevented timely payment and requesting an opportunity to pay the due amount with interest and penalty. However, the High Court held that the 'SUBKA VISHWAS' Scheme Rules, 2019, provided a specific timeline for payment, and the petitioner's failure to adhere to it precluded the extension of the time limit by the Court.The High Court emphasized that the scheme was a self-contained code where all declarations and payments were to be made online within specified timeframes. Despite the petitioner's claim of facing technical glitches, the Court found no credible evidence to support this assertion. As the petitioner did not comply with the scheme's provisions, the Court declined to extend the limitation for payment under Article 226 of the Constitution of India.In a similar case, the Supreme Court had dismissed a Special Leave petition against the refusal to extend the payment deadline under the scheme, reinforcing the principle that adherence to scheme conditions is crucial for availing benefits. Consequently, the High Court dismissed the writ petition, advising the petitioner to seek recourse through the appellate authority against the adjudication order.