Two Days Delay In Paying Last Instalment Under VAT Amnesty Scheme Owing To Technical Glitch Is Condonable: Gujarat High Court

The Gujarat High Court has extended benefit of Amnesty Scheme under the Gujarat Value Added Tax (GVAT) Act, 2003 to dealer who was precluded from making full payment under the Scheme on account of 'automatic' re-adjustment of instalment amount. The Division Bench, comprising Justice Bhargav D. Karia and Justice Pranav Trivedi set aside rejection of application under the Scheme noting that non-payment of differential amount was only due to technical glitches of the online portal. The High Court emphasized on 'clear and unequivocal intent' to avail the Scheme and observed that “The delay of 2 days in making the payment in the aforesaid Scheme is condoned.” The “Vera Samadhan Yojna” (Amnesty Scheme) was floated by Gujarat Government for settlement of legacy disputes related to various commercial taxes, including GVAT Act, the Central Sales Tax (CST) Act, 1956 and the Gujarat Tax on Entry of Specified Goods into Local Areas Act, 2001 as well as to mitigate litigation. The Scheme launched on September 15, 2019, and later revised in December, 2019 provided for payment in instalments. Petitioner filed an application under the Scheme and was required to pay an amount of Rs.12,50,258 towards full and final settlement of outstanding dues. It was required to deposit an amount of Rs.12,50,258 on or before August 31, 2021. For the first five instalments an amount of Rs.1,25,025.8 was paid. For the sixth instalment online portal readjusted the instalment amount to Rs.1,02,293.84, automatically. This resulted in short payment of Rs. Rs.34,102 as on due date i.e. August 31, 2021. Prior to the due date, Petitioner made attempts to make payment of short paid amount on the online portal as evidenced by E-payment screenshots. However, the E-payment option indicated that any payment made through this option will not be reconciled with Amnesty Scheme. Thereafter, Petitioner made payment of Rs. 40,500 was made on September 02, 2021 i.e. two days after the scheduled deadline together with a letter requesting the Sales Tax Officer (Respondent) to accept the payment. Despite the request, the Respondent rejected application of Petitioner. Also, Respondent froze the Bank Account and created lien on the outstanding dues under VAT. Petitioner filed the writ petition under Article 226 and 227 of the Constitution, against order passed by the Respondent by which application under “Vera Samadhan Yojna” under the GVAT Act for assessment year 2015-16 was rejected on the ground of two days delay in depositing last instalment. On denial of benefit of Amnesty Scheme caused due to readjustment of the instalment amount, the High Court cited its earlier decision in case of Pranav Ashokkumar Shah wherein it was held that “This Court is accordingly of the view that the Petitioner, due to demonstrable hardships was unable to pay the last two installments under the said Scheme after having diligently paid the first ten installments within the stipulated time, cannot be said to have rewritten or modified the “Vera Samadhan Yojna 2019” in any manner. As held in the catena of decisions of this Court, the Hon'ble Delhi High Court as well as the Hon'ble Supreme Court, the object and purpose of an Amnesty Scheme has to be seen from that angle which furthers the object of the Scheme, than which merely renders the Scheme illusory and denies the benefit to the Assessee and adds to the pendency of conflicts with the State. In such view of the matter, the present petition succeeds. The order dated 02.05.2022 disposing of the Petitioner 's application under “Vera Samadhan Yojna 2019” is hereby quashed and set aside. The delay of 29 days in making the payment under the aforesaid scheme is hereby condoned. Consequently, the Demand Notice dated 10.07.2023 is also set aside. Rule is made absolute to the aforesaid extent. No order as to costs.” In view of the above, the High Court allowed the writ petition. Case Name: Kamnath Private Limited vs. State Tax Officer Case No. : Special Civil Application No. 1231 of 2024 Date of Decision: 16.10.2025 Appearance: Advocates Jaimin R Dave, Hirva R. Dave, Priyank S. Dave appeared on behalf of the Petitioner, whereas Respondent was represented by Assistant Government Pleader Shrunjal Shah. Click Here To Read/Download The OrderCitation : 2025 LiveLaw (Guj) 187

Two Days Delay In Paying Last Instalment Under VAT Amnesty Scheme Owing To Technical Glitch Is Condonable: Gujarat High Court

Parul Bose

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