Committees are bound to hear tax payers in case of any discrepancies if a statute directs them to do so: Chhattisgarh High Court
In a petition filed with respect to levy of tax which was claimed under Form SVLDRS-1 i.e., the claim under the Scheme of Sabka Vishwas (Legacy Dispute Resolution) Scheme 2019, the Hon’ble Shri Justice Goutam Bhaduri ruled that, “The order which is on record whereby the declaration of the petitioner was rejected, meaning thereby he would be liable to pay the additional amount, which would be a levy imposed. In order to impose such levy, the designated committee was duty bound to hear the petitioner by giving him an opportunity of hearing. Considering the benevolent scheme which has been set into motion by the respondents, the petitioner was required to be heard even otherwise under the statutory mandate” in the case Chhattisgarh Cement Carriers Vs. Union Of India and others [WPT No. 70 of 2021] The brief facts of the case are, the petitioner filed the service tax returns and had duly paid the admissible service tax but after the deadline. He did not pay any penalty for the late filing since he had applied for the SVLDRS scheme which promised to give a waiver from any such penalties. The respondent without giving an opportunity to hear the petitioner passed an order which rejected the form submitted under the scheme. Aggrieved by this, the petitioner filed a case before the High Court of Chhattisgarh, Bilaspur. The scheme was introduced under Section 125 of the SVLDRS scheme which prescribes the eligible persons to make declaration under the scheme except certain categories. The scheme was predominantly was in nature of benevolent legislation and was aimed to put an end to existing or previous disputes. Asper the scheme, once such a declaration is filed by the assessee, the designated committee must verify this declaration and issue a statement. Section 127(3) of the SVLDRS scheme states that, “After the issue of the estimate under sub-section (2), the designated committee shall give an opportunity of being heard to the declarant, if he so desires, before issuing the statement indicating the amount payable by the declarant: Provided that on sufficient cause being shown by the declarant, only one adjournment may be granted by the designated committee.”
 1 AFRHIGH COURT OF CHHATTISGARH AT BILASPURWPT No. 721•Chhattisgarh Cement Carriers Having Its Office At Satkar Complex 1stFloor Ring Road No.2 Bhanpuri Raipur Through Its Proprietor ChintanBabaria S o Pankaj Babaria Aged About 35 Years R o F. No. 5ab NirmalGanga Apt. Opp. Dagdi Park 110 Ramdaspeth Nagpur 10Petitioner Versus 1.Union Of India Through Its Secretary Finance Department Of Revenue Room No. 46 North Block New Delhi 110001.2.The Central Board Of Indirect Taxes And Customs Through Its Chairman Ministry Of Finance Department Of Revenue Room No.46 North Block New Delhi 1100013.Principal Commissioner Central Excise Customs And Service Tax CentralExcise Building Tikra Para Dhamtari Road Raipur Chhattisgarh Pin 492001 4.The Designated Committee Constituted Under Rule 5 Of The SabkaVishwasRules 2019 Headed By TheAdditional Commissioner Central Excise Customs And Service Tax Central Excise Building Tikra Para Dhamtari Road Raipur Chhattisgarh Pin 492001 RespondentsFor Petitioner :Mr. Abhay Agrawal Advocate For Respondents:Mr. Ramakant Mishra A.S.G.Hon ble Shri Justice Goutam BhaduriOrder on Board15.06.20211.Heard on admission.2.The challenge in this writ petition is to the levy of tax which was claimedunder Form SVLDRS 1 i.e. the claim under the Scheme of Sabka Vishwas(Legacy Dispute Resolution) Scheme 2019. The claim of the petitioner isthat they have filed the service tax return in Form ST 3 for the period fromApril 2014 to September 2014 on 11.08.2015 and had duly paid theadmissible service tax dues but it was filed late. The petitioner did not payany interest or penalty as applicable for the aforesaid period as a result ofwhich the petitioner had applied under the SVLDRS Scheme to get waiverfrom interest and penalty as was promised under the Scheme of 2019. It is 2 AFRcontended that the respondent No. 4 without considering the provision ofScheme of 2019 and without giving any opportunity of hearing to thepetitioner passed the order on 16.03.2020in a mechanicalmanner by which the Form SVLDRS 1 submitted by the petitioner wassummarily rejected.3.The case of the petitioner is that the Form under the SVLDRS Scheme wasfiled on 28.12.2019 and the order under challenge by Annexure P 1 castesa duty upon the petitioner to pay the penalty and interest for late payment oftax. It is stated that the said order was passed without giving anyopportunity of hearing to the petitioner. 4.The petitioner is an assessee under the Finance Act 1994 for payment ofservice tax. It is not in dispute that the petitioner had to pay the service taxand the return was filed by them with delay for the different assessmentyears. The Government of India introduced the scheme named and styledas Sabka VishwasScheme 2019wherein it was contemplated that theamount declared means the amount declared by the declarant underSection 125 of the SVLDRS Scheme and the amount estimated wasdescribed as the amount estimated by the designated committee underSection 127 of the SVLDRS Scheme. The scheme which was introducedunder Section 125 of the SVLDRS Scheme prescribes the eligible personsto make declaration under the scheme except certain categories. Thescheme was predominantly was in nature of benevolent legislation and wasaimed to put an end to existing or previous disputes.5.For the sake of brevity Section 125 of the SVLDRS Scheme is reproducedhereinbelow which purports the eligible persons except certain categories.“125.(1) All persons shall be eligible to make a declarationunder this Scheme except the following namely: 3 AFR(a) who have filed an appeal before the appellate forum andsuch appeal has been heard finally on or before the 30th dayof June 2019who have been convicted for any offence punishableunder any provision of the indirect tax enactment for thematter for which he intends to file a declarationwho have been issued a show cause notice underindirect tax enactment and the final hearing has taken placeon or before the 30th day of June 2019who have been issued a show cause notice underindirect tax enactment for an erroneous refund or refundwho have been subjected to an enquiry or investigation oraudit and the amount of duty involved in the said enquiry orinvestigation or audit has not been quantified on or before the30th day of June 2019a person making a voluntary disclosure after being subjected to any enquiry or investigation oraudit or having filed a return under the indirect tax enactment wherein he has indicated an amount of duty as payable buthas not paid itwho have filed an application in the SettlementCommission for settlement of a casepersons seeking to make declarations with respect toexcisable goods set forth in the Fourth Schedule to theCentral Excise Act 1944.(2) A declaration under sub sectionshall be made in suchelectronic form as may be prescribed.”6.According to the Scheme once the assessee avails the Scheme and filesthe return by declaration the verification of declaration by the designatedcommittee was prescribed under Section 126 of the SVLDRS Scheme andthe issue of statement by the designated committee is covered underSection 127 of the SVLDRS Scheme. For the sake of convenience therelevant part of Section 127 of the SVLDRS Scheme is reproducedhereinbelow: 4 AFR“127.(1) Where the amount estimated to be payable by thedeclarant as estimated by the designated committee equals the amount declared by the declarant then thedesignated committee shall issue in electronic form astatement indicating the amount payable by the declarant within a period of sixty days from the date of receipt of thesaid declaration.(2) Where the amount estimated to be payable by thedeclarant as estimated by the designated committee exceeds the amount declared by the declarant then thedesignated committee shall issue in electronic form anestimate of the amount payable by the declarant within thirtydays of the date of receipt of the declaration.(3) After the issue of the estimate under sub sectionthedesignated committee shall give an opportunity of beingheard to the declarant if he so desires before issuing thestatement indicating the amount payable by the declarant: Provided that on sufficient cause being shown by thedeclarant only one adjournment may be granted by thedesignated committee.(4) After hearing the declarant a statement in electronicform indicating the amount payable by the declarant shallbe issued within a period of sixty days from the date ofreceipt of the declaration.”7.The petitioner claims that he had applied under the said scheme and hasapplied for exemption from penalty and the interest on the payment of lateservice tax in the Form SVLDRS 1 by Annexure P 1 which was rejected bythe Committee with the following endorsement: “Remarks:SVLDRS 1 rejected being unfit as period reason relief appliedfor is not clear being NIL declaration in “Tax dues declared inreturn as payable but not paid category”.8.As per Section 127 of the SVLDRS Scheme when the declaration made bythe petitioner was rejected meaning thereby he would be liable to pay 5 AFRfurther interest and penalty on late payment and return. However to levyany such liability under Section 127 of the SVLDRS Scheme under Section127(3) it mandates that after the issue of estimate under Section 127(2) the designated committee shall give opportunity of being heard to thedeclarant if he so desires before issuing the statement indicating theamount payable by the declarant.9.The order which is on record whereby the declaration of the petitioner wasrejected meaning thereby he would be liable to pay the additional amount which would be a levy imposed. In order to impose such levy thedesignated committee was duty bound to hear the petitioner by giving himan opportunity of hearing. Considering the benevolent scheme which hasbeen set into motion by the respondents the petitioner was required to beheard even otherwise under the statutory mandate.10.Therefore the order whereby the Form SVLDRS 1 was rejected bythe designated committee which is embodied in the remarks column is set aside. The cases are remanded back to the designated committee with adirection to give an opportunity of hearing to the petitioner by adhering tothe rules of natural justice. After hearing the petitioner the designatedcommittee shall be at liberty to pass the orders in accordance with law.11.Accordingly the writ petition is allowed to the extent indicatedhereinabove.Sd JudgeVishakha 