Docland Services LTD vs. Commissioner Of Central Goods And Services Tax Delhi East

Held

The Court held that the petitioner's contention that the timelines for making payment under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, were extended was unmerited. The Court found no infirmity with the decision that the time for payment was not extended. The Scheme is a statutory scheme enacted under the Finance Act, 2019, and Section 127(5) expressly stipulates the payment timelines, which could only be extended by law. The Court was not impressed with the argument that the sacrosanct part of the Scheme was only making a declaration and that the payment timeline could be extended. The Scheme was to be read as a whole, and since the petitioner had not complied with its requirements, they were not entitled to any benefit from it. The Court also noted that the authorities had examined the Supreme Court's orders and sought legal opinion, concluding that they applied to judicial and quasi-judicial proceedings, not to the payment timelines of the Scheme. Therefore, the petition was dismissed.

Facts

The petitioner, Docland Services Ltd., filed a writ petition challenging an order dated 13.06.2022, which was passed in compliance with a previous High Court order. The petitioner provides services claimed to be exempt from tax. An investigation by the Anti Evasion unit led to a Show Cause Notice dated 07.09.2018, demanding service tax of ₹94,82,291/-, interest, and penalties under the Finance Act, 1994. The petitioner opted for the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, but failed to make the required payment by the stipulated deadline of 30.06.2020. The petitioner contended that the payment timeline was extended due to the COVID-19 pandemic and Supreme Court orders regarding extension of limitation, but these arguments were rejected by the authorities.

Key Issues

1. Whether the timeline for making payment under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, was extended due to the COVID-19 pandemic and the Supreme Court's orders in Suo Moto Writ Petition (C) No. 3/2020, despite the statutory timelines stipulated in Section 127(5) of the Finance Act, 2019. The petitioner argued that the dominant part of the Scheme was making a declaration, and once the amount payable was determined, the payment timeline was not sacrosanct. They claimed to have been informed by their consultant that the payment deadline was extended to 31.03.2021 due to COVID-19. Furthermore, the petitioner contended that the timelines should be extended in view of the Supreme Court's orders in Suo Moto Writ Petition (C) No. 3/2020 concerning the extension of limitation. The respondent (revenue) contended that the Scheme's timelines were statutory and could only be extended by law. They argued that the Supreme Court's orders in Suo Moto Writ Petition (C) No. 3/2020 applied only to judicial and quasi-judicial proceedings and not to statutory schemes like the Sabka Vishwas Scheme.