Benefit Of Vera Samadhan Yojana-2019 Cannot Be Denied Due To Erroneous Payment Figure In Tax Intimation: Gujarat High Court

The division bench Justice Biren Vaishnav And Bhargav D. Karia opined, “Merely because, the intimation generated online has erroneously stated the amount which was not correct, the petitioner was not liable to make the payment of such amount to avail the benefit of the Scheme when it emerges from the record that there was no outstanding dues towards the principal amount of entry tax payable by the petitioner and such amount was paid by the petitioner before the due date i.e. 31.08.2021 as per the Scheme.”

“In such circumstances, the petitioner is entitled to the benefit of the Vera Samadhan Yojana- 2019 and merely because the respondent No.3 has changed the figure of payment to be made by the petitioner in the intimation as the figure shown in the in the intimation was erroneous, cannot come in way of the petitioner in the facts of the case to deny the benefit of the Vera Samadhan Yojna-2019 Scheme which is a benevolent scheme for the assessees floated by the State of Gujarat so as to see that the principal amount of tax is recovered on waiver of interest and penalty, if any, so as to reduce the future litigation,” the Court added.

The company, a distributor of Hyundai cars, had faced a tax dispute stemming from an error in tax computation during the period from June 1, 2017, to June 30, 2017.

The petitioner contended that they had paid a total tax of Rs. 32,20,901/- under the Entry Tax Act for the specified period. However, an error in tax calculation was later discovered, resulting in a shortfall in tax payment. Responding to this, the Gujarat government had introduced the Vera Samadhan Yojana-2019 to settle disputes under various tax laws, including the Entry Tax Act.

Under this scheme, taxpayers were eligible for the waiver of interest and penalties upon payment of the principal tax amount. The petitioner had applied for the scheme, stating their tax liability for the period as Rs. 1,80,75,735/- and providing proof of the tax payments made through challans.

However, upon receiving an online intimation regarding the amount payable under the scheme, the petitioner noticed an error in the stated amount, which exceeded their actual liability. The petitioner promptly brought this to the attention of the jurisdictional officer, who manually corrected the amount in the letter, reducing it to Rs. 1,48,54,834/-. Subsequently, the petitioner paid this corrected amount in installments.

During the pendency of the amnesty scheme, the petitioner was also assessed for taxes, taking into account the tax payments made under the amnesty scheme. Following this assessment, the petitioner paid an additional Rs. 1,31,641/- as determined by the assessment order.

However, in a letter dated July 20, 2022, the jurisdictional officer rejected the petitioner's application under the Vera Samadhan Yojana-2019, citing failure to pay the full amount initially intimated online.

The Gujarat High Court, after careful consideration of the facts and material on record, ruled in favor of the petitioner. The court emphasized that the petitioner had paid the entire amount of outstanding dues as per the corrected intimation and assessment order before the prescribed deadline of 31.08.2021.

As a result of this verdict, the court allowed the petition and quashed and set aside the impugned communication dated 20.07.2022.

“Respondents are directed to give benefit of Vera Samadhan Yojana-2019 to the petitioner and pass consequential order within a period of eight weeks from the date of receipt of copy of this order. Rule is made absolute to the aforesaid extent. No order as to costs,” the Court concluded.

Appearance: Uchit N Sheth(7336) For The Petitioner(S) No. 1,2 For The Respondent(S) No. 1 Government Pleader For The Respondent(S) No. 1,2,3

Live Law Citation: 2023 Livelaw (Guj) 152

Case Title: Planet Automotive Pvt. Ltd. Versus State Of Gujarat

Case No.: R/Special Civil Application No. 19475 Of 2022

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