Mentioning Proposed Penalty In Declaration Under SVLDR Scheme Not Incorrect: Gujarat HC
Kapil Dhyani
24 Oct 2024 10:00 AM IST
The Gujarat High Court has held that Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS) is applicable to any show cause notice for penalty/late fee, irrespective of whether it is under adjudication or appeal. A division bench of Justices Bhargav D. Karia and Mauna M. Bhatt cited FAQs of the scheme as per which, any person who has a show cause notice (SCN) for demand...
The Gujarat High Court has held that Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS) is applicable to any show cause notice for penalty/late fee, irrespective of whether it is under adjudication or appeal.
A division bench of Justices Bhargav D. Karia and Mauna M. Bhatt cited FAQs of the scheme as per which, any person who has a show cause notice (SCN) for demand of duty/tax and where the final hearing has not taken place as on June 30, 2019, is eligible to file declaration under SVLDRS.
In the case at hand, Petitioner- Ultratech Cement, was issued a SCN “proposing” penalty of over Rs. 20 crore for alleged wrong taking and distribution of ineligible CENVAT credit in relation to freight for outward transportation of goods.
On notification of the scheme, the Company filed a declaration under the Scheme, mentioning the penalty amount of Rs. 20,72,31,044/-.
The Deputy Commissioner of SVLDRS, rejected the company's declaration on the grounds of it being incorrect. The authority pointed out that the SCN nowhere quantified the amount of penalty as the same was yet to be adjudicated upon.
Before the High Court, the Petitioner contended that declaration in respect of SCN proposing to impose penalty is covered within the ambit of SVLDRS and mere mention of penalty amount would not render the declaration ineligible.
Respondent authorities on the other hand submitted that provisions of the SVLDRS would be applicable only in cases where a correct declaration has been.
The High Court observed that the SCN, pending adjudication, had proposed the levy of penalty amounting to Rs.20,72,31,044/-.
It also noted FAQ Nos.1 and 48 as per which the Scheme is applicable to any SCN for penalty/late fee, irrespective of whether it is under adjudication or appeal.
In this backdrop it observed,
“The case of the petitioner therefore would squarely fall in the eligible cases and merely because the petitioner has shown the amount of proposed penalty mentioned in the show cause notice would not make the declaration made by the petitioner as eligible under the Scheme.”
Accordingly, the Court directed the respondent authorities to issue Form SVLDRS-4 to the Petitioner, within 12 weeks.
Appearance: Advocate Anand Nainawati for petitioner; AdvocateHetvi Sacheti for Respondent
Case title: Ultratech Cement v. Union of India
LL Citation: 2024 LiveLaw (Guj) 160
Case no.: R/SPECIAL CIVIL APPLICATION NO. 14519 of 2020
