M/S. Acme Trade And Agencies vs. The Union Of INDIA And 3 Ors.

Held

The Court held that an inadvertent mistake in not stating the correct penalty amount in Form SVLDRS-1 is a curable mistake, not an incurable one that disentitles the petitioner from the benefits of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019. The Court reasoned that the mistake did not allow the petitioner to claim an undue benefit they were otherwise not entitled to. The Scheme itself does not prohibit individuals with penalties from seeking its benefits; in fact, mentioning the penalty might be more advantageous for the assessee. The Court directed the petitioner to submit an application for correction of the information in the initial Form SVLDRS-1. The respondent authorities are to pass a reasoned speaking order on this application within two months of its receipt. The submission of a second SVLDRS-1 form, rejected as not maintainable, does not preclude the petitioner from seeking correction via the prescribed application process.

Facts

The petitioner, M/s. Acme Trade and Agencies, was imposed a penalty of Rs. 86,74,199/- by an order dated 31.12.2019. To avail the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, the petitioner submitted Form SVLDRS-1. However, inadvertently, the penalty amount was declared as '0' in the form. Consequently, their claim for the scheme's benefit was rejected by an order dated 31.12.2019, citing the incorrect declaration as the reason for rejection. The petitioner also submitted a second SVLDRS-1 form with the correct facts, which was rejected as not maintainable.

Key Issues

1. Whether an inadvertent mistake in not stating the correct penalty amount in Form SVLDRS-1 renders the claim for the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, incurable and disentitles the petitioner from its benefits, as per the Sabka Vishwas (Legacy Dispute Resolution) Rules, 2019? Petitioner's contention: The petitioner argued that the mistake in not mentioning the penalty was inadvertent and not made to gain an undue advantage. They relied on the principle that such mistakes should be curable. The petitioner also contended that the Scheme 2019 does not preclude individuals with penalties from availing its benefits, and in fact, mentioning the penalty might lead to greater exemption. Revenue's contention: The respondents, represented by the Ministry of Finance and GST authorities, rejected the claim based on the incorrect declaration in Form SVLDRS-1, deeming it an incorrect declaration and thus an incurable mistake.