Relief to Patanjali: Uttarakhand HC allows Adjustment of Interest paid prior to SCN for Waiver under 'Sabka Vikas' Amnesty Scheme [Read Order]

In a major relief to M/s Patanjali Ayurved Ltd, the Uttarakhand High Court has directed the central excise department to adjust the amount of interest paid under protest, prior to issuance of show cause shall be considered as pre-deposit while disposing of his application for a waiver under ‘Sabka Vikas (Legacy Dispute Resolution) Scheme, 2019’ which was issued under Section 24 of the Finance Act.

The petitioner-Company approached the Court seeking a direction to the department to issue fresh Form No. 3 and adjust the number of Rs. 3,19,69,680/- towards the deposit already made.

Justice Sanjaya Kumar Mishra held that sub-section (2) of the aforesaid section is relevant for this case.

“It is noticed, on plain reading of the same, that the relief calculated under Sub-section (1) shall be subject to the condition that any amount paid as pre-deposit at any stage of appeal proceedings under the indirect tax enactment or as a deposit during enquiry, investigation or audit shall be deducted when issuing the statement indicating the amount payable by the declarant. Thus, it is clear that the statute itself does not make any distinction between payment of taxes, interest thereon or any penalty in the amount which has been deposited during enquiry, investigation or audit shall be deducted while issuing the statement and shall be adjusted while calculating relief to the declarant,” the Court said.

Holding in favour of the Company, the Court held that section 124 of the Finance Act, 2019, is a benevolent provision.

“The Parliament in its wise discretion thought it proper to grant one-time relief to all taxpayers under the GST Scheme so that disputes can be resolved amicably and restrictive parochial interpretation of the provisions should be avoided by the Courts and also by the Authorities so that objects of the beneficial scheme can be achieved. Therefore, this Court, even though was informed that the Scheme has already come to its conclusion and the auto-populated form has already expired, the Court is inclined to allow the writ petition,” the Court said.

To Read the full text of the Order CLICK HERE

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