TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 1160
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....or the amount eventually payable and is hence, covered by the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (hereinafter, 'the SVLDR Scheme') or not. 4. The background giving rise to the petitions is that initially on 2nd November, 2004, the officers from Directorate General of Central Excise Intelligence (hereinafter, 'DGCEI') conducted searches linked to the three Petitioner firms. The details of the said search conducted at the premises of the Petitioner firms are detailed hereinafter: a. Art N Glass India Pvt. Ltd. (hereinafter, 'ANG') - Search at their premises, inter-alia, resulted in seizure of goods valued at Rs. 9,73,100/- b. Design Glass Works (hereinafter, 'DGW'): Proprietary concern of Late Mr. M.P. Pathak - Search at the premises, resulted in the seizure of goods worth Rs. 19,42,800/-. c. Nangloi Glass & Plywood Co. (hereinafter, 'NGPC'): Proprietary concern of Mr. Lokesh Pathak- Search at the premises resulted in the resumption of some documents, but goods were not seized. d. Residence of Mr. Lokesh Pathak - Search at the residential premises of Sh. Lokesh Pathak, resulted in seizure of cash amounting to Rs. 63,82,000/-. 5. Upon conclusion of the ab....
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....under Rule 209A of the Central Excise Rules, 1944 read with Rule 26 of the Central Excise Rules, 2002 and read with Section 38A of the Central Excise Act, 1944." 7. Thereafter, appeals were filed by the Petitioners against the OIO and the said appeals were disposed by the Central Excise & Service Tax Appellate Tribunal (hereinafter, 'CESTAT') vide its Final Orders No. 54951-54955 dated 9th November, 2016 (hereinafter, 'the final order'). In the final order, CESTAT found that joint liabilities cannot be fastened and hence remitted the matter back for de-novo adjudication. The operative portion of this order passed by CESTAT dated 9th November 2016 reads: "8. In the view of the serious legal infirmities observed in the impugned order, the same is set aside. The matter is remanded back to the Original Authority for a fresh decision. A clear finding is required to be recorded about the status of these three units, which includes their bona fide existence, or otherwise. The duty liability, if any, has to be fastened against an identified-unit-assesses. Similarly, penalties, if required, are to be imposed on the identified persons on contraventions, if any found. We are not passing an....
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....rmation Commission which allowed the appeal vide its orders dated 26th September, 2023, wherein it was directed as under: "Decision: The Commission based on a perusal of the facts on record and after hearing the submissions of the parties observes that the invocation of Section 8(1)(h) of the RTI Act was without any basis and the case at hand attracts severe admonition for the prima-facie arbitrary yet mindless approach displayed by Debashish Dutta, then CPIO. Now, the present CPIO is hereby directed to provide a revised reply to the Appellant incorporating the available information as sought for in the instant RTI Application. The said information shall be provided free of cost by the CPIO to the Appellant within 15 days of the receipt of this order under due intimation to the Commission. Further, for taking note of the admonition recorded in the matter against the reply of 13.09.2022, a copy of this order shall be served to Debashish Dutta, then CPIO by the present CPIO under due intimation to the Commission within 2 days of the receipt of this order. The appeal is disposed of accordingly." 16. In compliance with the order of the Central Information Commission, on 25th....
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....tment, on account of- (i) no appeal having been filed by the declarant against an order or an order in appeal before expiry of the period of time for filing appeal; or (ii) an order in appeal relating to the declarant attaining finality; or (iii) the declarant having filed a return under the indirect tax enactment on or before the 30th day of June, 2019, wherein he has admitted a tax liability but not paid it (d) "amount of duty" means the amount of central excise duty, the service tax and the cess payable under the indirect tax enactment; (e) "amount payable" means the final amount payable by the declarant as determined by the designated committee and as indicated in the statement issued by it, in order to be eligible for the benefits under this Scheme and shall be calculated as the amount of tax dues less the tax relief; 123. For the purposes of the Scheme, "tax dues" means- 123 (a)...... (b) where a show cause notice under any of the indirect tax enactment has been received by the declarant on or before the 30th day of June, 2019, then, the amount of duty stated to be payable by the declarant in the said notice: Provided that if the said notice has been issued to....
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....osit already paid by the declarant exceeds the amount payable by the declarant, as indicated in the statement issued by the designated committee, the declarant shall not be entitled to any refund. 127(8)- On payment of the amount indicated in the statement of the designated committee and production of proof of withdrawal of appeal, wherever applicable, the designated committee shall issue a discharge certificate in electronic form, within thirty days of the said payment and production of proof. 129. (1) Every discharge certificate issued under section 126 with respect to the amount payable under this Scheme shall be conclusive as to the matter and time period stated therein, and- (a) the declarant shall not be liable to pay any further duty, interest, or penalty with respect to the matter and time period covered in the declaration; (b) the declarant shall not be liable to be prosecuted under the indirect tax enactment with respect to the matter and time period covered in the declaration; (c) no matter and time period covered by such declaration shall be reopened in any other proceeding under the indirect tax enactment. (2) Notwithstanding anything contained in sub-sec....
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....did not adjudicate and finally decide the appeals on the merits thereof. Hence, the matter was never finally decided by the CESTAT and was supposed to be freshly considered by the original authority. 25. Further a perusal of Section 123 (b) of the SVLDR Scheme would show that `tax dues' in terms of the said provision would mean the duty payable in a show cause notice issued prior to 30th June 2019. In the present case, upon remand by CESTAT, the SCN was to be adjudicated afresh by the Adjudicating authority. Thus, the SCN had raised a demand which was pending and yet to be adjudicated. 26. In view of the above, this Court is of the opinion that the Petitioners herein do not fall under the category of ineligible applicants, as stated under Section 125(1)(a) of the SVLDR Scheme. Thus, the declarations filed by the Petitioners under the Scheme shall not be deemed to be considered ineligible. 27. The SVLDR Scheme applies to legacy disputes and under Section 124 of the SVLDR Scheme, different amounts are prescribed, which if paid, would result in a discharge certificate being issued to the tax payer stating that their liability stands discharged. 28. Various amounts which are prescr....
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....der: "12F. Power of search and seizure - (1) Where the Joint Commissioner of Central Excise or Additional Commissioner of Central Excise or such other Central Excise Officer as may be notified by the Board has reasons to believe that any goods liable to confiscation or any documents or books or things, which in his opinion shall be useful for or relevant to any proceedings under this Act, are secreted in any place, he may authorise in writing any Central Excise Officer to search and seize or may himself search and seize such documents or books or things. [(2) The provisions of the Code of Criminal Procedure, 1973 (2 of 1974), relating to search and seizure shall, so far as may be, apply to search and seizure under this section subject to the modification that sub-section (5) of Section 165 of the said Code shall have effect as if for the word "Magistrate", wherever it occurs, the words [Principal Commissioner of Central Excise or Commissioner of Central Excise] were substituted.]] 34. Option to pay fine in lieu of confiscation.- Wherever confiscation is adjudged under this Act or the rules made thereunder, the officer adjudging it, shall give the owner of the goods an option ....
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....; from the consequences of issuance of a Discharge Certificate (under section 129 of the Scheme), undoubtedly, the word 'penalty' appearing in section 129 of the Scheme includes, within its plain ambit, both, a penalty in personam and a penalty in rem. Here, both, personal penalty and the penalty in rem arose from a single transaction. Clearly, both penalties are part of the same dispute, for a common period. It is so because even according to the revenue both those penalties were imposed vide the Order-in-Original 2/A/Ayukt/M/97 dated 14.08.1997. Though that order has not been shown to us, yet it is not the case of the revenue that the 'redemption fine' in question was imposed on the petitioner, independent of that order. The revenue only contends that by its very nature, 'redemption fine' is not a 'penalty' at all. That submission is contrary to the law laid down by the Supreme Court. We have no hesitation to hold, 'redemption fine' is a kind or type of 'penalty' under the Central Excise Act, 1944. xxxx 35. As noted above, the Scheme being a piece of reformative legislation, 'redemption fine' that is a penalty in rem mus....
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....uss further since the facts here exclude estoppel". We have no reason to apply a different yardstick to allow the respondent authorities to overlook the clear and binding statutory provision, in favour of the concession claimed to have been made by the petitioner. The concession, if any, made by the petitioner in the Discharge Certificate proceedings - to deposit the 'redemption fine', would remain contrary to the express provision of law and therefore unenforceable and of no consequence." 38. Similarly, in Synpol Products Pvt. Ltd. v. Union of India 2020 (374) E.L.T. 851 (Guj.), the Gujarat High Court has taken a similar view to the following effect: "10. In view of the above facts and situation, when the respondents had issued show cause notice demanding excise duty together with confiscation of the goods in terms of Rule 25(a) and (d) of the Central Excise Rules, 2002 and redemption fine in lieu of confiscation under Rules 25 as goods were not available for confiscation, it is clear that by issuing the show cause notice, the respondent has invoked Rule 25 of the Central Excise Rules, 2002 for levy of redemption fine in lieu of confiscation as goods which were sought....
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....gnated committee are therefore quashed and set aside. As observed by the Coordinate Bench of this court, the order passed in this petition would also apply to the similarly situated declarants who have not approached this Court, in order to reduce the multiplicity of proceedings. Accordingly, this order would apply to the cases of all the declarants involving confiscation/redemption fine. In such circumstances, the respondent authorities are directed to issue necessary discharge certificate under Section 129 of the Finance Act, 2019 to the petitioners subject to fulfilment of all other conditions as per the Scheme. Rule is made absolute to the aforesaid extent, with no order as to costs." 39. The SLP being SLP (C) No. 449/2021 against this decision of the Gujarat High Court has been dismissed. Subsequently, this very view has been followed in respect of the SVLDR Scheme by the Punjab and Haryana High Court in M/s Shoe Sales Corporation CWP-1493-2021 & CWP-1496-2021 where the decision in Synpol Products Pvt. Ltd. (supra) and in M/s Jay Shree Industries (supra) have been followed in the following terms: "The petitioner-M/s Shoe Sales Corporation is seeking writ of certiorari for s....
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....nts of the Sabka Vishwas Scheme, 2019, it was held that when the Central Board of Indirect Taxes and Customs had issued flyers, press release and FAQs, it was clearly stated that there would be full waiver of interest, fine and penalty and also complete immunity from prosecution and the cases involving redemption of fine and confiscation cannot be excluded under the said scheme. In this backdrop, the explanation given by the Board with respect to redemption fine cannot be treated separately than the amount of duty under the scheme. The term 'fine' mentioned in the Board's flyers, press release and FAQs cannot be fine imposable under Section 9 of the Central Excise Act, 1944 and the fine mentioned in flyers, press release and FAQs is redemption fine only, As per Section 125 of the Scheme, a declarant cannot be made ineligible to file a declaration for non-payment of redemption fine. The declarant is required to include redemption fine as part of the duty demanded so as to calculate the amount in arrears as per Section 121 (c) of the Scheme. Leamed counsel for the petitioner has also stated that Special Leave to Appeal (C) No. 449 of 2021 against the aforesaid judgment has ....
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.... 3.7 Assuming we accept the contention of respondents that "redemption fine" is nothing but a "duty" then even in that case, the SVLDR Scheme grants immunity/waiver from such "redemption fine" if the basic excise duty is paid as per the Scheme. This is so because under Section 124, what is required to be paid is the prescribed percentage of "tax dues" which is defined in Section 123 to mean the amount of duty disputed and the "amount of duty" is further defined in Section 121 (d) to mean the amount of "central excise duty". Therefore, when Section 124 speaks of payment required to be made of the tax dues, it is certain percentage of central excise duty which entitles the applicant to waiver/immunity under Section 129 of the SVLDR Scheme. Therefore, payment has to be of basic excise duty and not redemption fine to avail benefit of SVLDR Scheme. Admittedly, "redemption fine" cannot be considered as "central excise duty". Section 129 (1)(a) which provides immunity/waiver states that the declarant shall not be liable to pay any further duty, interest or penalty. The phrase "further duty" by accepting the contention of respondents would cover redemption fine also. To put it simply, what....
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....cheme then Section 129 provides that the applicant shall not be liable to pay any further duty, interest or penalty with respect to the period covered in the declaration. Although in Section 129 (1) (a) of SVLDR Scheme redemption fine is per se not included, but the Central Board of Indirect Taxes and Customs issued flyers, wherein it is stated that the benefit under the Scheme would be total waiver of interest, penalty and fine. To the same effect, is the press note dated 22nd August 2019 issued by the Ministry of Finance, Government of India, wherein it is clarified that there would be no other liability of interest, fine or penalty if the dispute is resolved under the SVLDR Scheme. This issue had come up for consideration before the Allahabad High Court in M/s. Jay Shree Industries (supra) wherein on similar facts, the High Court clarified by analysing the meaning of duty, penalty and fine and came to a conclusion that redemption fine under Section 34 of the Central Excise Act is only a payment akin to penalty and, therefore, a declarant is entitled to the waiver of redemption fine under Section 129 of SVLDR Scheme. The very same issue also arose before the Gujarat High Court in....