Sabka Vishwas Scheme coverage extended to redemption fine, and rejection of the declaration on exclusion grounds was unlawful.

Under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, the amount payable was confined to the prescribed percentage of the disputed excise duty, and redemption fine was not to be treated as outside the Scheme's relief where the duty component had been settled. The Bombay HC analysis noted that once the covered tax dues were discharged, no further duty, interest, penalty, or fine could survive in respect of that dispute, and redemption fine was treated as akin to penalty for this purpose. Rejection of the declaration on the footing that redemption fine was excluded was therefore contrary to the governing interpretation, and the declaration could not be denied on that ground.

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Issues: Whether redemption fine was covered by the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, and whether rejection of the declaration on the ground that redemption fine was not covered was valid.

Analysis: The Scheme treated "tax dues" as the disputed amount of duty and, on a conjoint reading of the relevant provisions, the amount payable for availing the Scheme was the prescribed percentage of excise duty and not redemption fine. Once the duty component was settled under the Scheme, the declarant was not liable to further duty, interest, penalty, or fine in respect of the covered dispute. The earlier coordinated decision relied upon held that redemption fine is akin to penalty and that the benefit of the Scheme extends to it. The rejection could not be justified by adding new reasons beyond those stated in the impugned communication, and the recorded ground that the Scheme did not cover redemption fine was contrary to the governing interpretation.

Conclusion: The rejection of the declaration was unlawful and the petitioner was entitled to relief under the Scheme.

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