Designated Committee's computational error in Sabka Vishwas Scheme corrected, deposit amount reduced after considering investigation payments

Gujarat HC allowed petition under Article 226 challenging service tax recovery under Sabka Vishwas Scheme. Court found Designated Committee erred in computing amount payable under SVLDRS by not considering Rs. 30,36,101 deposited during investigation, instead only accounting for Rs. 4,86,851 pre-deposit for appeal. HC held petitioner should deposit Rs. 30,82,811 within four weeks with 9% interest from 06.03.2020, ruling this would not constitute time extension as committee's computational error necessitated correction.

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Issues:
1. Interpretation of Sabka Vishwas Scheme under Article 226 of the Constitution of India.
2. Computation of pre-deposit amount for availing benefits under SVLDRS.
3. Consideration of amount already deposited by the petitioner during investigation.
4. Extension of time period for deposit under SVLDRS due to Covid-19 pandemic.

Analysis:

Issue 1: Interpretation of Sabka Vishwas Scheme under Article 226 of the Constitution of India
The petitioner sought relief under Article 226 for issuance of a Writ in the nature of Mandamus or any other writ to direct the respondent to accept a specific pre-deposit amount under the Sabka Vishwas Scheme. The High Court considered the petition and the controversy involved, highlighting the narrow compass of the matter. The court proceeded with the hearing with the consent of both parties.

Issue 2: Computation of pre-deposit amount for availing benefits under SVLDRS
The petitioner, engaged in the business of providing services, had filed declarations under the Sabka Vishwas Scheme. Discrepancies arose in the computation of the amount payable under the scheme, with the Designated Committee issuing Form SVLDRS-3 for a higher amount than the petitioner's claimed pre-deposit. The petitioner contended that the Committee failed to consider the amount already deposited, leading to an incorrect determination of the payable sum.

Issue 3: Consideration of amount already deposited by the petitioner during investigation
The court noted that the petitioner had indeed deposited a specific amount during the investigation, which was adjusted in the final tax liability determination. The Designated Committee's failure to account for this deposit resulted in an erroneous calculation of the payable sum under the Sabka Vishwas Scheme. The court emphasized the importance of considering the amount already paid by the petitioner towards the outstanding liability.

Issue 4: Extension of time period for deposit under SVLDRS due to Covid-19 pandemic
The respondent argued against extending the time period for deposit, citing previous legal precedents emphasizing adherence to scheme terms without modifications. However, the court found that allowing the petitioner to deposit the correct amount, inclusive of the previous deposit, would not amount to an impermissible extension of the time period. The court directed the petitioner to deposit the revised sum within a specified period, along with applicable interest, and ordered the respondent to issue the necessary certificate upon payment.

In conclusion, the High Court granted relief to the petitioner, emphasizing the correct computation of the payable amount under the Sabka Vishwas Scheme and directing the respondent to act accordingly.

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