Orissa High Court
M/S. Orissa Stevedores Ltd vs Designated Committee on 23 October, 2024
Author: Arindam Sinha
Bench: Arindam Sinha, M.S. Sahoo
IN THE HIGH COURT OF ORISSA AT CUTTACK
W.P.(C) No. 25292 of 2020
M/s. Orissa Stevedores Ltd. .... Petitioner
-Versus-
Designated Committee, .... Opposite Parties
Central GST and Customs
and others
Advocates appeared in this case :
For Petitioner : Mr. Jagabandhu Sahoo, Sr. Advocate
Mrs. Kajal Sahoo, Advocate
For Opposite Parties: Mr. T.K. Satapathy,
Sr. Standing Counsel
CORAM:
THE HON'BLE MR. JUSTICE ARINDAM SINHA
AND
THE HON'BLE MR. JUSTICE M.S. SAHOO
JUDGMENT
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Dates of hearing: 29th August, 2024 and 23rd October, 2024
Date of judgment: 23rd October, 2024
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ARINDAM SINHA, J.
1. Mr. Sahoo, learned senior advocate appears on behalf
of petitioner and submits his client was issued show cause
notice (SCN) dated 23rd April, 2015 alleging short payment of
service tax for period 2013-14. Pursuant to receiving the SCN
his client applied under Sabka Vikas (Legacy Dispute
Resolution) Scheme, 2019 in prescribed form SVLDRS-1. He
demonstrates from the form, SCN date is 23rd April, 2015 and
demand for tax in excess of ₹16.15 crores. In the form his client
had claimed deposit of duty at almost ₹10 crores.
2. Revenue issued SVLDRS-2 reiterating tax due on
allegation that there was zero pre-deposit. He points out from
disclosures in the writ petition, his client had applied for
information and it was obtained. The information was, his
client had claimed adjustment of CENVAT credit at
approximately ₹19.15 crores and made cash payment of ₹26
crores. He submits, thereby stands demonstration that the
adjustment and payments were for financial year 2013-14. This
was not taken into account in issuing, SVLDRS-2 and
thereafter SVLDRS-3.
3. Mr. Sahoo then draws attention to circular dated 27th
August, 2019 issued by Government of India, Ministry of
Finance Department of Revenue, Central Board of Indirect
Taxes and Customs. He points out from clause (c) in paragraph
10 that even disputed amount of CENVAT credit is to be
adjusted under the scheme. The clause is reproduced below.
"(c) This Scheme provides for adjustment of any
amount paid as pre-deposit during appellate
proceedings or as deposit during enquiry,
investigation or audit [Sections 124(2) and 130(2)
refer]. In certain matters, tax may have been
paid by utilizing the input credit, and the matter
is under dispute. In such cases, the tax already
paid through input credit shall be adjusted by
the Designated Committee at the time of
determination of the final amount payable under
the Scheme."
(emphasis supplied)
His client has thus moved Court to show pre-deposit by
aggregate of cash and credit. Inspite thereof, upon issuance of
SVLDRS-3 and during pendency of the writ petition, notice
dated 5th February, 2021 was issued, purportedly to give
opportunity of personal hearing. This notice is perpetration of
the department's contention that his client is not entitled to the
relief under the scheme. Hence, the SCN and subsequently
issued notice for personal hearing, brought on record by
amendment, are under challenge. He submits, the notice be set
aside for the matter to be restored to the
Department/Designated Committee, for reconciliation.
4. Mr. Satapathy, learned advocate, Senior Standing
Counsel appears on behalf of revenue and opposes the writ
petition. He submits, particulars of the cash payments, brought
on record from information obtained include payments made
for other period(s). So far as the CENVAT credit is concerned,
it was disallowed. It cannot be adjusted.
5. Considering pursuant to the SCN petitioner had applied
under the scheme and in view of aforesaid facts, we direct that
the personal hearing will be for purpose of the
Department/Designated Committee to conclude on petitioner's
assertion that 50% or more of the demand was paid and it is
entitled to relief against the balance, under the scheme. The
Department/Designated Committee will do well to pass a
reasoned order such that points urged by petitioner in the writ
petition and as may be urged before it regarding the scheme
applying to it, are dealt with without leaving any ambiguity. In
event the Department/Designated Committee concludes that
petitioner is not entitled to relief under the scheme, it will then
issue fresh notice for personal hearing on the demand. We
make this direction in view of clause (c) in aforesaid circular
dated 27th August, 2019 and absence of anything on record or
submission made that exercise of reconciliation was undertaken
in respect of the particulars of the cash payments.
6. Be it recorded that there was no issue before us
regarding petitioner having duly applied under the scheme.
7. The writ petition is disposed of.
(Arindam Sinha)
Judge
(M.S. Sahoo)
Judge
Jyoti
Location: HIGH COURT OF ORISSA
