Petitioner wrongly denied benefits under Sabka Vishwas Scheme 2019 despite duty liability quantified before cutoff date

The HC held that the petitioner's application under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 was wrongly rejected. The department rejected the application claiming tax amount was not quantified before June 30, 2019 during ongoing investigation. However, the court found that duty liability was actually quantified much prior to the cutoff date. The electronic system's rejection was deemed incorrect and illegal, contradicting the scheme's terms and departmental clarifications. The court ruled the petitioner was eligible for scheme benefits and allowed the petition.

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Issues involved: Challenge to rejection of application under Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 due to tax amount not quantified before 30th June 2019 and ongoing investigation.

Summary:
The Writ Petition challenges the rejection of the Petitioner's Application under the SVLDRS on the grounds of tax amount not being quantified before the specified date and an ongoing investigation. The Petitioner, a company engaged in hospitality business, had admitted the service tax liability for multiple financial years. Despite attempts to avail the SVLDRS scheme, the applications were rejected. The Petitioner contended that the duty payable was quantified on specific dates, making them eligible for the scheme. The Department's interpretation of the scheme's terms and conditions was crucial, as it defined eligibility criteria based on quantification of duty liability.

The Court noted that the duty liability was quantified before the cut-off date of 30th June 2019, as per the Petitioner's declarations. The rejection based on the investigation status was deemed incorrect, considering the scheme's guidelines and the Department's circular clarifying the quantification requirement. A previous judgment was cited where a similar declaration of tax amount entitled the petitioner to scheme benefits. Consequently, the Court held that the Petitioner was eligible for the scheme benefits and deemed the rejection illegal.

The Court allowed the Writ Petition, quashing the rejection order and directing the Department to consider the Petitioner's application within a specified timeframe. The Show Cause Notices issued post the filing of the Petition were also set aside. The judgment emphasized adherence to the scheme's provisions and timely consideration of applications, ensuring fair treatment in resolving tax disputes.

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