Designated Committee Under Sabka Vishwas Scheme May Reject Application For Compounding Tax Over Bogus Documents: Telangana High Court

A division bench of the Andhra Pradesh High Court has dismissed a writ petition filed by M/s Diwakar Road Lines challenging the rejection of an application to compound all previous service tax by way of a one-time settlement. The bench held that even though the statute does not prescribe for the rejection of any application, the committee may reject an application when the documents relied upon are ingenuine. The Division Bench comprising of Justice R. Raghunandan Rao and Justice Harinath. N while passing the order, differentiated from an order passed by the Karnataka High Court, holding that not permitting rejection of application when the documents themselves are ingenue would result in an 'extreme situation.' “In the present case, the Designated Committee hadset out the reasons for rejection as filing of bogus certificates and notices. This Court is of the opinion that, where applications had been filed by producing documents which are not genuine, the same can be rejected by the Designated Committee. Any other view, would mean that a person claiming the benefit of the scheme can come forward with any kind of document and the Designated Committee is precluded from going into the question of whether the said document is genuine or not. Such a view, would result in extreme situations.” As per the contentions of the petitioner, (a contract carriage of air-conditioned buses and non-air conditioned busses) the Tax Department issued her a notice in 2016 to pay service tax on the operation of air-conditioned buses. She made an application under the scheme 'Sabkha Vishwas (Legacy Dispute Resolution) Scheme 2019, under which, provisions were made to compound tax under various Acts. She stated that her application was rejected, and challenging the same, the present Writ was filed. The Counsel for respondents contended the notice did not disclose the amount payable and that it was by a person who was not competent and did not have jurisdiction. It was contended that the notice should ideally have been issued by the Superintendent or the Jurisdictional Assistant Commissioner (JAC), however, it was issued by the Superintendent of Central Tax. It was also brought to the notice of the Court that amounts disclosed by the petitioner before different authorities did not tally. That there was no entry in the outward register for the notice, thus, it could be concluded that the same was issued out of ordinary course. The petitioner relied on Jagadish Advertising Vs. Designated Committee, (Karnataka) contending that the committee had no authorisation to reject any application. The Bench could not accept this explanation as the documents relied upon were themselves under challenge. Thus, the writ was dismissed. M/s Diwakar Road Lines vs. The Union Of India and Others Counsel for petitioner: Harish Kumar Rasineni Counsel for respondents: Nagaraju Naguru, Dilip Jayaram S, Y.N. VivekanandaCitation: 2025 LiveLaw (AP) 22 Click Here To Read/Download The Order

Designated Committee Under Sabka Vishwas Scheme May Reject Application For Compounding Tax Over Bogus Documents: Telangana High Court

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Designated Committee Under Sabka Vishwas Scheme May Reject Application For Compounding Tax Over Bogus Documents: Telangana High Court

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