Vikramaditya Hotel Private Imited vs. Union Of INDIA

Held

The Court held that the petitioner is not entitled to the benefit of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, as they failed to deposit the determined tax amount of Rs. 18,96,770/- by the extended due date of June 30, 2020. The Court reasoned that the Scheme had come to an end, and the Circular dated July 14, 2020, was merely an internal communication for data collection and did not extend the period of the Scheme. The Court relied on its previous decisions in Maya Fan Air Engineering Private Limited and Rakesh Kumar Jain, which held that no benefit can be granted to petitioners who could not deposit the determined amount before the last date. Therefore, directing the respondents to decide the petitioner's representation would be a futile exercise. The Court found no case for interference and dismissed the writ petition. No issue was expressly left undecided.

Facts

The petitioner, Vikramaditya Hotel Private Limited, engaged in the hotel business, was issued a show-cause notice on November 13, 2019, demanding service tax of Rs. 54,11,617/- for the period 2014-15 to 2017-18. The petitioner had deposited Rs. 5,00,000/- and Rs. 1,69,690/- prior to the notice. Subsequently, the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 was introduced. The petitioner applied for the scheme, and the Designated Committee determined their liability at Rs. 18,96,770/- on February 12, 2020. The petitioner was required to deposit this amount within 30 days, with an extension up to June 30, 2020. Due to COVID-19 related financial difficulties, the petitioner could not deposit the amount. Despite a circular dated July 14, 2020, from the Ministry of Finance, which directed collection of information from major declarants unable to pay dues by June 30, 2020, the Superintendent of Central Excise issued demand notices on July 20, 2020, and January 11, 2021, for the original demand, without deciding the petitioner's representation to clear the dues as determined under the scheme.

Key Issues

1. Whether the petitioner is entitled to the benefit of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, despite failing to deposit the determined tax amount by the extended due date of June 30, 2020? (Question of law turning on the interpretation of the Scheme's timelines and the effect of subsequent communications). Petitioner's contention: The petitioner argued that due to the COVID-19 pandemic and financial crunch, they could not deposit the amount by June 30, 2020. They relied on the Circular dated July 14, 2020, issued by the Ministry of Finance, which directed collection of information from major declarants who were unable to pay dues by June 30, 2020, and were likely to pay in the near future, suggesting a potential for delayed payment. They sought a direction to decide their representation and close the demand. Respondents' contention: The respondents argued that the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019, was in operation only until June 30, 2019, with the last date for payment of the settlement amount extended to June 30, 2020. Since the petitioner failed to deposit the determined amount by this date, no benefit could be granted. They contended that the Circular dated July 14, 2020, was an internal communication for data collection and did not extend the period of the Scheme.