Opel Auto Products Private Limited vs. Union Of INDIA And Another

Held

The Court held that the letter dated September 24, 2019, relied upon by the petitioner, does not demonstrate a final quantification or determination of the liability. It was considered at best a preliminary figure. Therefore, the Court found no fault with the action of the respondents in refusing to accept the petitioner's application to be covered under the SVLDRS Scheme. The reasoning is that the scheme requires a determined due amount, and the letter in question was not considered sufficient evidence of such determination. The ratio decidendi is that a preliminary indication of tax liability in correspondence does not equate to a final determination required for eligibility under dispute resolution schemes like SVLDRS. The petition was dismissed.

Facts

The petitioner, Opel Auto Products Private Limited, is challenging the respondents' action of issuing recovery notices despite the petitioner's application under the Sabka Vishwas (Legacy Disputes Resolution) Scheme, 2019 (SVLDRS Scheme). During an inquiry by the Anti-Evasion CGST, Gurugram, on January 12, 2018, the petitioner's Unit Head stated a service tax liability of Rs. 20 Lakhs. The petitioner deposited Rs. 2 Lakhs and requested installments. Subsequently, the petitioner was informed on December 18, 2018, that the service tax case was under inquiry. The petitioner applied under the SVLDRS Scheme, but its application was reportedly not accepted because the due amount had not been determined. The petitioner argues that a letter dated September 24, 2019, from the respondents to one of its suppliers, stating that the petitioner had defaulted on service tax payments of Rs. 20 Lakhs for the period 2015-16 to June 2017, indicates that the liability was determined.

Key Issues

1. Whether the letter dated September 24, 2019, from the respondents to a supplier of the petitioner, stating that the petitioner had defaulted on service tax payments of Rs. 20 Lakhs for the period 2015-16 to June 2017, constitutes a determination of liability for the purpose of acceptance under the SVLDRS Scheme, 2019, as per the relevant provisions of the scheme? Petitioner's contention: The petitioner argues that the aforementioned letter clearly shows that its liability stands determined, thereby fulfilling a prerequisite for acceptance under the SVLDRS Scheme. Respondents' contention: The respondents have not recorded any specific arguments in the judgment regarding this issue. However, their action of refusing the application implies they did not consider the liability determined.