M/S Hindustan Electric Store vs. Union Of INDIA & Ors.

Held

The Court held that the writ petitions were liable to be dismissed primarily on the grounds of delay and laches. The petitioners failed to provide any cogent explanation for the 2.5-year delay in approaching the Court after their applications under the SVLDR Scheme were rejected. Furthermore, the Court noted that the petitioners had not followed the procedural instructions and compliances communicated by the Designated Committee, as evidenced by the remarks on the acknowledgement receipts. The Court found that these crucial facts were deliberately concealed in the pleadings. The judgments cited by the petitioners were distinguished on the grounds that they were either decided in early 2020 or the petitioners in those cases had approached the Court much sooner after rejection, and the facts and circumstances were distinguishable from the present case. The Court also observed that the SVLDR Scheme had concluded over 2.5 years prior, and no similar scheme had been floated, making it difficult to grant the relief sought. The principle of "one who seeks equity must come with clean hands" was also invoked due to the concealment of facts.

Facts

The petitioners, manufacturers of electrical goods, had goods seized for being unaccounted for. They paid duty, interest, and penalty. Subsequently, a show cause notice was issued proposing confiscation and penalty. The Order-in-Original imposed redemption fines ranging from Rs. 4,000/- to Rs. 1,00,000/-. These orders were upheld by the Commissioner (Appeals) and later by the Customs Excise and Services Tax Appellate Tribunal (CESTAT) by a common order dated 29.12.2017. The petitioners applied under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDR Scheme) on 10.12.2019 and 04.12.2019. Their applications were rejected via emails dated 25.12.2019. The present writ petitions were filed on 31.05.2022, challenging these rejections.

Key Issues

1. Whether the rejection of the petitioners' applications under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDR Scheme) by the Designated Committee was justified, considering the nature of the dispute involving redemption fines, and whether the petitioners had followed the prescribed procedure under the Scheme. 2. Whether the present writ petitions are maintainable due to significant delay and laches, given that the rejection orders were issued on 25.12.2019 and the petitions were filed approximately 2.5 years later, without a cogent explanation for the delay. Petitioner's arguments: The petitioners contended that their applications under the SVLDR Scheme should have been adjudicated. They relied on various judgments from coordinate benches of the Delhi High Court and other High Courts where similar rejections under the SVLDR Scheme were set aside, and opportunities for hearing were granted. Revenue's arguments: The respondents argued that the petitioners failed to follow the prescribed procedure under the SVLDR Scheme, as indicated by the remarks on the acknowledgement receipts. They also emphasized the considerable delay and laches in filing the writ petitions, citing Supreme Court judgments on the principle of delay and laches, and argued that the petitioners had not approached the court with clean hands due to concealment of facts.