Prior quantification and fair hearing govern eligibility under the Sabka Vishwas Scheme when service tax liability is admitted before the cut-off date.

An assessee's own admission and working of service tax liability before the statutory cut-off date can amount to prior quantification for eligibility under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019. Where the declaration is rejected on the footing that the department used a different quantified figure, fairness requires that the assessee be informed of that basis and given an opportunity to be heard before rejection. On the facts discussed, the declaration was treated as eligible because the dues had been quantified before the cut-off date, and rejection without hearing was unsustainable.

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Issues: (i) Whether the service tax dues were quantified before the cut-off date so as to make the petitioner eligible for benefit under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019; (ii) Whether rejection of the declaration without prior opportunity of hearing was sustainable.

Issue (i): Whether the service tax dues were quantified before the cut-off date so as to make the petitioner eligible for benefit under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019.

Analysis: The petitioner had, during investigation on 11 June 2019, quantified and admitted the service tax liability for the relevant period. A prior letter dated 1 March 2019 also contained the petitioner's own working of liability and a request that the department provide its working. In the absence of any response, the contention that the dues were not quantified before 30 June 2019 could not be accepted.

Conclusion: The dues were quantified before the cut-off date, and the petitioner was eligible under Section 125(1)(e) of the Finance (No. 2) Act, 2019.

Issue (ii): Whether rejection of the declaration without prior opportunity of hearing was sustainable.

Analysis: The declaration was rejected without hearing the petitioner, even though the department's basis for rejection was that the amount quantified by it differed from the petitioner's figure. The petitioner was entitled to know the quantified amount relied upon by the department before rejection, and denial of hearing was inconsistent with fair procedure on the facts of the case.

Conclusion: The rejection without prior opportunity of hearing was unsustainable.

Final Conclusion: The rejection of the declaration was quashed, the declaration was directed to be processed on the basis of the revised quantified amount, and the petitioner was granted the benefit of the Scheme.

Ratio Decidendi: Where an assessee has admitted and quantified tax liability before the statutory cut-off date, and the declaration is rejected without affording a hearing on the department's differing quantification, the declaration cannot be rejected on the ground of non-quantification.

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