The Rajasthan High Court ruled that the action of the department in initiating enquiry, denying the opportunity to avail SVLDR Scheme benefit is absolutely illegal.
The division bench of Justice Sandeep Mehta and Justice Chandra Kumar Songara in light of the observations made by the Bombay High Court in the case of UCC Infrastructure Pvt. Ltd. vs. Union of India & Ors. held that the action of the respondents in initiating the enquiry and denying the petitioner the opportunity to avail benefit under the SVLDR Scheme is absolutely illegal and unjustified.
The petitioner is a proprietorship firm registered under the GST. A scheme under the title of ‘Sabka Vikas Legacy Dispute Resolution Scheme, 2019 (SVLDR Scheme) for voluntary disclosure was floated by the respondents. The petitioner claims to have opted for the said Scheme and submitted an application and along therewith, he also deposited the due service tax by way of voluntary disclosure. The said application of the petitioner under Section 129(2)(c) of the Finance Act, 2019 has been rejected by an order issued by the Joint Commissioner, CGST and Excise Duty Commissionerate, Jodhpur which is assailed in the writ petition.
Advocate Gajendra Panwar, representing the petitioner, submitted that the petitioner was entitled to apply under the SVLDR Scheme and he filed the timely application and deposited the due tax amount under the said Scheme.
He contended that that the enquiry notice under Section 125(1)(i) of the GST Act as referred to in the order was issued after the cut-off date and as such, the same was time barred and could not be used as a ground to deprive the petitioner from taking benefit of the Voluntary Disclosure Scheme.
Advocate Rajvendra Saraswat, representing the respondent department, submitted that the notice for initiation of enquiry was issued to the petitioner and the petitioner had been requested to provide the documents for conducting audit of the firm and thus, the enquiry having been initiated, the petitioner was precluded from applying under the SVLDR Scheme.
The court quashed and set aside the impugned order and directed that the Declaration Forms filed by the petitioners are restored to file and are remanded to the respondent for taking a fresh decision on these two declaration forms filed by the petitioner by treating the same as valid declarations under the ‘voluntary disclosure’ category and thereafter grant the admissible relief to the petitioner.
The court further directed that the respondents shall grant an opportunity of personal hearing to the petitioner by issuing seven days clear notice before the date of proposed hearing.
The court made it clear that the respondents are empowered to take action under Section 129(2)(c) of the said Scheme, if within a period of one year of issuance of the discharge certificate against the petitioner, the respondent finds that the material particulars furnished in the declaration filed by the petitioner are found to be false.
Case title: M/s Sonjoli Construction Co. v/s Union of India and Ors.
Citation: D.B. Civil Writ Petition No. 5423/2021