Designated Committee Sabka Vishwas vs. M/S Pierian Services PVT LTD

Facts

The Revenue (appellants) issued an Order-in-Original on September 27, 2018, raising a demand of Rs. 1,77,06,985/- towards service tax. The assessee (respondent), M/s Pierian Services Pvt Ltd, challenged this before the CESTAT and made a pre-deposit of Rs. 27,66,646/-. Subsequently, the assessee sought resolution under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019. The Designated Committee noted the pre-deposit and appropriated 50% of the demand (Rs. 88,53,492/-), denying relief and proposing a payable amount of Rs. 60,86,846.50. The assessee filed a writ petition, contending that an audit revealed total payments of Rs. 2,52,46,749/-, an excess of Rs. 92,33,857/- over the 50% demand. The Single Judge allowed the writ petition, directing the Revenue to issue a discharge certificate.

Held

The Court held that whether an amount is paid as pre-deposit for an appeal or is already deposited as tax, it goes to the Treasury of the Central Government and must be accounted for. The Court noted that the assessee's contention that Rs. 92,00,000/- was already in deposit with the Revenue was not denied. Given this undisputed fact, the Court found no reason to interfere with the order of the Hon'ble Single Judge. The ratio decidendi is that all amounts deposited by an assessee with the government, irrespective of the head of deposit (pre-deposit for appeal or tax payment), should be considered when determining the final liability under a dispute resolution scheme, provided the fact of such deposit is not disputed. The appeal was dismissed, upholding the Single Judge's direction to issue an appropriate discharge certificate.

Key Issues

1. Whether the Designated Committee, while considering a dispute resolution under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, could take into account amounts deposited by the assessee beyond the specific pre-deposit made for the appeal before the CESTAT. Petitioner's Argument (Revenue): The Designated Committee could only consider the pre-deposit of Rs. 27,66,646/-. Amounts paid under different heads or in excess of the pre-deposit should not have been considered, as the scheme's condition required depositing 50% of the disputed amount (Rs. 1,77,06,985/-), which was Rs. 88,53,492/-. The committee should have focused only on the amount due and the pre-deposit. Respondent's Argument (Assessee): An audit report confirmed total deposits of Rs. 2,52,46,749/-. The 50% of the tax due (Rs. 88,53,492/-) was less than the excess amount of Rs. 92,00,000/- (calculated by deducting Rs. 1,60,00,000/- from Rs. 2,52,46,749/-) already in deposit with the Revenue. The Single Judge correctly considered these undisputed facts.