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Issues: (i) whether redemption fine could be demanded as a condition for availing settlement under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019; (ii) whether the declarations filed under the category of enquiry or investigation were hit by the disqualification under the Scheme for want of quantification of duty by 30 June 2019; and (iii) whether the partners' declarations were liable to fail consequentially with the firm's declarations.
Issue (i): whether redemption fine could be demanded as a condition for availing settlement under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019.
Analysis: The Scheme requires payment of tax dues, which are defined with reference to disputed duty, and the amount of duty is confined to central excise duty, service tax and cess. On that framework, redemption fine is not a precondition for settlement. The Scheme's immunity provision also supports waiver of further duty, interest and penalty once the prescribed duty amount is paid. The Court also relied on the consistent view taken in earlier decisions and the official clarifications that the Scheme extends to fine as well.
Conclusion: The objection that waiver of redemption fine is unavailable under the Scheme was rejected, and the rejection on that ground was set aside in favour of the assessee.
Issue (ii): whether the declarations filed under the category of enquiry or investigation were hit by the disqualification under the Scheme for want of quantification of duty by 30 June 2019.
Analysis: The Scheme disqualifies a declarant only where an enquiry, investigation or audit was pending and the duty involved had not been quantified by the cutoff date. The recording of the representative's statement constituted enquiry or investigation within the Scheme. The duty involved had already been quantified through the earlier court-directed provisional clearance formula. The twin conditions for disqualification were therefore not satisfied.
Conclusion: The declarations under this category were held to be eligible and the rejection was quashed in favour of the assessee.
Issue (iii): whether the partners' declarations were liable to fail consequentially with the firm's declarations.
Analysis: The rejection of the partners' declarations was founded entirely on the rejection of the firm's declarations. Once the firm's rejections were held unsustainable, the consequential basis for rejecting the partners' declarations ceased to exist.
Conclusion: The partners' declarations were also set aside and were directed to be processed in favour of the assessee.
Final Conclusion: The Court granted relief by invalidating the rejection of the Scheme declarations and directing the authorities to process the declarations and issue the consequential forms for settlement.
Ratio Decidendi: Under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, settlement is to be tested with reference to the defined tax dues and quantified duty, and redemption fine cannot be insisted upon as a precondition where the Scheme otherwise grants immunity from further liability; a declaration under the enquiry or investigation category cannot be rejected if duty was already quantified before the cutoff date.
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