Orissa High Court
M/S. Nagen Hospitality Services Pvt vs Central Board Of Indirect Taxes And .... ... on 6 April, 2021
Author: B. P. Routray
Bench: B. P. Routray
IN THE HIGH COURT OF ORISSA AT CUTTACK
W.P.(C) No.24376 of 2020
AND
W.P.(C) No.24377 of 2020
In W.P.(C) No.24376 of 2020
M/s. Nagen Hospitality Services Pvt. .... Petitioner
Ltd.
In W.P.(C) No.24377 of 2020 ... Petitioner
M/s. Nagen Caterer
Mr. R.P. Kar, Advocate
-versus-
Central Board of Indirect Taxes and .... Opposite Parties
Customs and Others
Mr. R.S. Chimanka, Senior Standing Counsel
CORAM:
THE CHIEF JUSTICE
JUSTICE B. P. ROUTRAY
ORDER
Order No. 06.04.2021
Dr. S. Muralidhar, CJ
06. 1. Both the petitions arise of out of common set of facts and are accordingly being disposed of by this common order.
2. M/s. Nagen Hospitality Services Pvt. Ltd. (NHSPL), the Petitioner in W.P. (C) No.24376 of 2020, is a company providing hospitality and canteen services in the factories located in industrial areas. It is a registered dealer under the service tax law. It has been filing statutory returns and making payment of tax.
Page 1 of 73. The Director General of Central Excise Intelligence (DGCEI), Bhubaneswar investigated NHSPL and issued it a Demand-cum- Show Cause Notice (SCN) dated 6th October, 2016 calling upon NHSPL to explain why it should not be asked to pay service tax including ED Cess and SHEd Cess amounting to Rs.25,38,577/- apart from the interest and penalty for the years 2011-12 to 2015-
16. Thereafter an order-in-original dated 31st August, 2018 was passed by the Asst. Commissioner, CGST & Customs, Cuttack confirming the demand. Aggrieved by that order, NHSPL filed an appeal before the Commissioner (Appeals), CGST, Bhubaneswar on 26th November, 2018. The appeal is stated to be pending.
4. Meanwhile, the Central Government announced the Sabka Viswas Legacy Dispute Resolution Scheme, 2019 (SVLDRS) in terms of Section 132 (1) and (2) of the Finance Act, 2019. With a view to availing the benefit under the SVLDRS, NHSPL filed an application in form SVLDR-I seeking tax relief in the sum of Rs.7,79,282.80. The declaration was registered as ARN- LD1912190001701 dated 19th December, 2019. NHSPL states while initially filing Form SVLDRS-1, it made a mistake in indicating the category as 'arrears' and sub-category 'appeal not filed or appeal having attained finality' whereas it should have indicated the category as 'litigation'. Correspondingly, the tax relief was wrongly indicated as Rs.7,79,282.80 instead of Rs.1,71,203.10.
5. Once it realized the mistake, NHSPL on 14th January, 2020 filed a fresh declaration in form SVLDRS-1 under the category Page 2 of 7 'litigation' and sub-category 'appeal pending' vide ARN- LD1401200005348 showing the tax amount of Rs.1,71,203.10.
6. The Designated Committee (Opposite Party No.2) issued the SVLDRS-3 being the estimate under Section 127 of the Finance Act, 2019 read with Rule 6(2) of the Sabka Vishwas (Legacy Dispute Resolution) Schemes Rules, 2019 (SVLDRS Rules, 2019) in terms of the wrong SVLDR-1 dated 19th December, 2019 filed by NHSPL and failed to consider the corrected form SVLDRS-1 filed by it on 14th January, 2020.
7. On 29th June, 2020 NHSPL sent an e-mail to the authorities pointing out the above facts. However, no response was received. In the circumstances Writ Petition (Civil) No.24376 of 2020 was filed in which notice was issued by this Court on 25th September, 2020. It was further directed that the pending appeal before the Commissioner (Appeals) would not be disposed of and in the meantime, it would be open to NHSPL to pay the admitted amount of tax.
8. Mr. R.P. Kar, learned counsel appearing for NHSPL, informs the Court that pursuant to the above order, NHSPL has already paid the admitted amount of tax of Rs.1,71,203.10.
9. As far as Writ Petition (Civil) No.24377 of 2020 is concerned, the Petitioner therein M/s. Nagen Caterer (NC) is a firm that carries on the business of providing canteen and housekeeping services in several factory premises. NC is a dealer registered as Page 3 of 7 such under the relevant Service Tax law. It has been filing returns and making payment of tax through challans.
10. The DGCI, Hyderabad Zonal Unit investigated NC and issued it a SCN dated 27th September, 2016 calling upon it to pay a sum of Rs.1,16,91,632/- towards service tax including ED Cess and SHEd Cess apart from interest and penalty for the period 2011-12 to 2015-16 invoking Section 73 of the Finance Act, 2019.
11. Against the order dated 14th December, 2017 passed by the Joint Commissioner, GST and Central Excise, Bhubaneswar, NC filed an appeal before the Commissioner (Appeals), which is stated to be pending.
12. NC filed an application under Form SVLDR-1 seeking to avail tax relief amounting to Rs.20,56,588/- under the category 'litigation' on 14th January, 2020. It is stated that the Designated Committee, without issuing SVLDRS-3 i.e. the estimate, inadvertently issued Forms SVLDRS-2 and SVLDRS-2A which were not required in the facts and circumstances of the case. Despite NC writing to the authorities on 29th June, 2020 pointing out the above defects, no response was received thereto. Thereafter, W.P.(C) No.24377 of 2020 was filed in which while issuing notice on 25th September, 2020 this Court directed that in the meantime the appeal filed by NC would not be disposed of and it would be open to NC to pay the admitted amount of tax.
Page 4 of 713. Mr. Kar, learned counsel for NC states that it has since paid the admitted amount tax. He, however, points out that it the SVLDRS- 2, the authorities have indicated the pre-deposit amount as Rs.33,86,126/- whereas it should be Rs.39,41,880/-. The corresponding tax dues less tax relief payable works out to Rs.20,56,588/-, which NC has paid.
14. Counter affidavits have been filed in both the writ petitions not disputing the fact that each of the Petitioners had filed an application under Form SVLDR-1 as far as W.P.(C) No.24376 of 2020 is concerned. However, the Opposite Parties seek to explain that they did not consider the subsequent corrected file SVLDRS-1 filed by NHSPL on 14th January, 2020 only because the Petitioner did not send any communication to the Designated Committee about the initial application having been filed with wrong details.
15. As far as the above submission is concerned, the Court is of the view that the very fact that the Designated Committee granted registration number for the correctly filed SVLDRS-1 on 14th January, 2020 shows that the earlier objections were waived. Having processed the subsequently filed SVLDRS-1 and indicating those details in the SVLDRS-3 issued, there appears to be no justification for Opposite Parties to not accept NHSPL's calculation of tax amount due as Rs.1,71,203.10.
16. Consequently, a direction is issued to the Opposite Party No.2 i.e. Designated Committee to accept the SVLDRS-1 filed by NHSPL by issuing the SLVDRS-3 and since the payment of the Page 5 of 7 admitted tax has already been paid to issue discharge in Form SLVDRS-4 to NHSPL.
17. As far as the second writ petition filed by NC is concerned, in the counter affidavit again there is no explanation why the Designated Committee issued SVLDRS-2 and SVLDRS-2A without issuing SVLDRS-3. It is also not in dispute that the pre- deposit amount indicated therein is Rs.33,86,126/- whereas it should be Rs.39,41,880/- as indicated by NC in SVLDRS-1. The only defence put forth is that this was accepted by NC. This is incorrect since NC did write to the authorities on 29th June 2020 which fact is not disputed by the Opposite Parties in the counter affidavit.
18. Consequently, both the writ petitions are disposed of by issuing the following directions:
(i) In W.P.(C) No.24376 of 2020 a direction is issued to the Designated Committee to issue to NHSPL not later than 3rd May, 2021 the revised SVLDRS-3 indicating the tax due amount as Rs.1,71,203.10. Since the Petitioner has already paid that amount, the Opposite Parties will issue a discharge in Form SLVDRS-4 by the same date. NHSPL will on the above basis seek disposal of the pending appeal in accordance with law.
(ii) As far as W.P.(C) No.24377 of 2020 is concerned, the Designated Committee (Opposite Party No.2) will issue to NC by 3rd May 2021 the corrected SVLDRS-3 showing the corrected pre-
deposit figure as Rs.39,41,880/-. Since NC has already paid the Page 6 of 7 admitted tax liability as indicated therein, the Opposite Parties will also issue in favour of NC by the same date the SVLDRS-4. The SVLDRS-2 and SVLDRS-2A already issued stands quashed. It will be open to NC to seek disposal of the pending appeal thereafter in accordance with law.
19. This Court's attention was drawn to the instructions dated 17th March, 2021 issued by the Central Excise and Customs, Department of Revenue, Government of India permitting manual processing of the declaration filed under SVLDRS Rules, 2019 in order to comply with the directions of this Court. It is directed that the said instructions shall be followed in these two cases as well.
20. The writ petitions are disposed of in the above terms.
( S. Muralidhar) Chief Justice (B.P. Routray) Judge S.K. Jena/P.A. Page 7 of 7