M/S Taneja Iron And Steel Co. LTD. Through Manoj Teneja vs. The Central Board Of Indirect Taxes And Customs ( CGST And Central Excise )

Held

The Court held that the petitioner was not eligible to make a declaration under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019. The reasoning was based on Section 125 of the Finance Act, which explicitly excludes persons who have filed an appeal before the appellate forum and such appeal has been heard finally on or before June 30, 2019. In this case, the petitioner's appeal before the Customs, Excise and Service Tax Appellate Tribunal had attained finality before the introduction of the Scheme. The Court distinguished the present case from the Gujarat High Court's decision in Synpol Products Pvt. Ltd. vs. UOI, finding that the petitioner's case was adjudicated up to the appellate level much before the Scheme was introduced. Therefore, the designated committee rightly rejected the petitioner's application. The Court did not decide on the interpretation of 'amount in arrears' as the primary ground for rejection was ineligibility under Section 125(1)(a). The petition was dismissed.

Facts

The petitioner, M/s Taneja Iron and Steel Co. Ltd., is aggrieved by the rejection of its application and appeal under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDR). The dispute originated from a visit by Preventive Officers on 09.03.2010, where uncounted spring leaves valued at Rs. 2,76,58,852/- were found. This led to confiscation of goods under Rule 25 of the Central Excise Rules, 2002, with a redemption fine of Rs. 50 Lacs. Adjudication resulted in a penalty of Rs. Ten Lacs under Rule 25 and Rs. Five Lacs on the Director. The Appellate Authority reduced the redemption fine to Rs. 30 Lacs and the penalty to Rs. 5 Lacs. A further appeal to the Customs, Excise and Service Tax Appellate Tribunal was dismissed, making the order final. The petitioner then applied under the SVLDR Scheme for settlement of the Rs. 30 Lacs redemption fine, but its application was rejected by the designated committee. A demand notice for Rs. 40 Lacs (Rs. 30 Lacs redemption fine and Rs. 10 Lacs penalty) was issued, leading to the present writ petition.

Key Issues

1. Whether the petitioner is eligible to make a declaration under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, considering the finality of the appeal before the Customs, Excise and Service Tax Appellate Tribunal prior to the Scheme's introduction? 2. Whether the redemption fine imposed in lieu of confiscation of goods can be considered part of the 'amount in arrears' for the purpose of the SVLDR Scheme, as argued by the petitioner based on the Gujarat High Court's decision in Synpol Products Pvt. Ltd. vs. UOI? Petitioner's Arguments: The petitioner contended that a similar issue was decided by the Gujarat High Court in Synpol Products Pvt. Ltd. vs. UOI, which held that the amount in arrears under the Scheme includes both duty and redemption fine. The petitioner argued that its dispute was pending during the Scheme's introduction, and the redemption fine should be treated as part of the duty amount for settlement under the Scheme. Revenue's Arguments: The judgment does not explicitly record arguments from the respondent revenue department. However, the court's reasoning implies that the revenue's position, which was accepted by the court, was that the petitioner was ineligible under Section 125 of the Finance Act due to the finality of the appeal.