The court rules in favor of the petitioner, emphasizing the conclusive nature of the Discharge Certificate under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019.
In a significant ruling, the Bombay High Court has set aside show cause notices issued against Astute Valuers and Consultants Pvt. Ltd., declaring them contrary to the provisions of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS). The Division Bench comprising Justices M.S. Sonak and Advait M. Sethna held that once a Discharge Certificate is issued under Section 129 of the Finance Act, 2019, it conclusively settles the liability for the period covered, barring further proceedings, including demands for interest or penalty.
Astute Valuers had approached the court challenging the legality of the show cause notices demanding interest on delayed payment of service tax after the issuance of the Discharge Certificate dated February 22, 2020. The court noted that the SVLDRS was introduced as a one-time measure for the liquidation of past disputes and emphasized the scheme's objective of resolving tax disputes amicably while protecting revenue interests.
The petitioner, represented by Mr. Bharat Raichandani, argued that the issuance of the Discharge Certificate should have marked the end of the matter. Despite the certification of full and final settlement of tax dues, the respondents issued subsequent notices demanding interest, which the petitioner claimed was legally unsustainable and contrary to the Finance Act, 2019.
The High Court upheld these contentions, stating that the Discharge Certificate is conclusive of the matter and the time period covered therein. It also reinforced that clerical errors in the SVLDRS declaration fall within the scope of Section 128 for rectification, and relief cannot be denied for bona fide errors made while filing the declaration.
The court's judgment is expected to set a precedent in similar cases where taxpayers seek relief under SVLDRS. The ruling underscores the importance of implementing such schemes without unnecessary technicalities, ensuring ease of doing business and fostering trust between taxpayers and authorities.
Bottom Line:
Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS) - Discharge Certificate issued under the scheme is conclusive and bars further proceedings for the same period and liability once settled.
Statutory provision(s): Finance Act, 2019 Sections 124, 128, 129
