Statutory immunity under the Voluntary Compliance Encouragement Scheme follows once declared dues and interest are paid on time.

A declarant under the Voluntary Compliance Encouragement Scheme is entitled to statutory immunity when the declared tax dues and interest are paid within the prescribed time and the Designated Authority accepts the declaration. On those facts, Section 108 operates to bar penalty, interest, and further proceedings under the Chapter, and the impugned demand order cannot stand. The article applies the scheme as a completed statutory benefit once compliance and acceptance are established, leaving no basis for continued recovery action.

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Issues: Whether the appellant, having declared tax dues under the Voluntary Compliance Encouragement Scheme and paid the declared tax along with interest within the prescribed time, was entitled to the statutory immunity and consequential setting aside of the impugned order.

Analysis: The declaration was made under the Scheme framed in Chapter V and VA of the Finance Act, 1994, and the declared tax dues were accepted by the Designated Authority. The record showed payment of the declared tax dues and the interest within the time contemplated by Section 107 and the consequent statutory requirement under Section 108 that a declarant, upon such payment, is entitled to immunity from penalty, interest, and other proceedings under the Chapter. The earlier tribunal view relied upon applied the same principle and held that further demand proceedings were not maintainable once the scheme benefit had been validly availed and acknowledged.

Conclusion: The declaration under the Scheme stood accepted, the appellant was entitled to immunity, and the impugned order was not sustainable.

Final Conclusion: The appeal succeeded and the order under challenge was set aside because the statutory scheme benefit had been validly granted and fully worked out.

Ratio Decidendi: Once a declarant under the statutory voluntary compliance scheme has paid the declared tax dues and interest within the prescribed time and the Designated Authority has accepted the declaration, immunity from penalty, interest, and further proceedings follows as a matter of statutory entitlement.

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