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The right to being heard is a fundamental right for any individual, violation of that can be termed a violation of a fundamental right. Refraining one from being heard is as good as going against the natural justice principles. This Judgment is pronounced by R. D. DHANUKA AND S. M. MODAK, JJ on 31.01.2022 in UCC INFRASTRUCTURE PVT.LTD.THROUGH ITS DIRECTOR MR.MONTY R. KHUSHALANI V. UNION OF INDIA, NEW DELHI, AND ORS.

The Central Government proposed the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (for short, ‘the said Scheme’) in the 2019-20 budget to assist taxpayers in resolving disputes arising under previous laws (service tax and central excise) that have been absorbed by the Goods and Services Tax (GST). Under the ‘voluntary category,’ the petitioner filed an Electronic Declaration Form under SVLRDS-1 on the CBEC website, declaring Rs.36,24,108/- as the tax dues for 1 September 2015 to 30 June 2017.

The petitioner received an order from respondent no.3 to reject the declaration as mentioned above. The petitioner was not entitled to select for the said Scheme since the inquiry against them had begun before they chose for it. The petitioner objected to the ruling, claiming that the declaration form supplied by the petitioner could not have been rejected. The respondents denied the petitioner’s application because the petitioner had been subjected to an inquiry and was not entitled to submit a declaration under the ‘voluntary category.’

Mr. Raichandani, learned counsel for the petitioner, drew our attention to the declaration forms filed by the petitioner and the impugned orders passed by the respondents rejecting the declaration forms filed by the petitioner because the petitioner was not eligible to opt under the said Scheme because an investigation had already been initiated and was pending against the petitioner. He claims that any inquiry started after the deadline is irrelevant and that the petitioner’s declaration forms could not have been rejected for this reason. In support of this argument, experienced counsel referred us to this Court’s Judgment in M/s. New India Civil Erectors Private Limited v. Union of India and Ors. in Writ Petition (Lodging) No. 989 of 2020, handed down on 12^th  March 2021.

Mr. Bangur, learned counsel for the respondents, drew the Judge’s attention to different paragraphs of the said Judgment in the matter of M/s. New India Civil Erectors Private Limited (supra), arguing that even though the summons was issued after the cut-off date, the respondents’ rights to continue the inquiry under Section 129(2)(c) of the said Scheme are not revoked. He contends that if the particulars supplied by the petitioner in the declaration are discovered to be false within one year of the issuing of the discharge certificate, it would be considered that the statement was never made, and proceedings will be started under the applicable indirect tax enactment.

After considering all the facts and after referring to other precedent cases, the Learned Judge concludes that while rejecting the petitioner’s declaration form, the respondents also denied him the right to be heard. If the respondents had given the petitioner a chance, the petitioner would have pointed out that the cut-off date could not be used to declare the petitioner’s application inadmissible. This Court believes that the contested ruling is a blatant breach of natural justice principles.

However, we are aware of the respondents’ powers under Section 129(2)(c) of the said Scheme, which allows the respondents to take appropriate action against the petitioner if the respondents discover any material particular in the declaration to be false within one year of the date of issuance of the discharge certificate. In this case, the respondents must continue as if the order had never been made, and procedures under the appropriate indirect tax enactment would be initiated.

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Reviewed by Rangasree