Simplified Explanation of the Judgment
In this writ petition, a company engaged in business activities had approached the Patna High Court after its application under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS) was rejected by the designated authority. The petitioner was facing proceedings initiated by the Directorate General of GST Intelligence (DGGI), Zonal Unit, Patna, relating to pre-GST indirect tax liabilities. During this process, the petitioner opted for the Sabka Vishwas Scheme to settle its disputes and obtain amnesty from past dues.
The Sabka Vishwas Scheme was introduced by the Central Government as a one-time amnesty scheme to resolve pending disputes relating to central excise and service tax. It allowed taxpayers to declare their dues, pay a reduced amount, and obtain waiver from interest, penalty, and prosecution. For this purpose, a Designated Committee under the scheme was responsible for verifying declarations and issuing discharge certificates.
In this case, the petitioner submitted its declaration under the scheme. According to documents issued from the Revenue’s own electronic system (referred to in the judgment as Annexure-2 and Annexure-3), the petitioner had already deposited around ₹72,50,000 towards the disputed dues. However, when the Designated Committee passed the impugned order dated 20.02.2020, rejecting the petitioner’s application, this substantial deposit was not reflected in the order.
The petitioner contended before the High Court that once the Revenue’s own records showed such deposit, the Designated Committee was bound, under Clause 127 of the Scheme, to accept the declaration and issue a discharge certificate after appropriate verification, rather than rejecting the application. The petitioner therefore challenged the rejection order through this writ petition.
On the other hand, counsel for the Revenue defended the rejection by referring to the original proceedings initiated by the DGGI and to a communication (Annexure-3) calling for further documents from the petitioner. Additionally, the Revenue pointed out the issue of eligibility under Clause 125 of the Scheme, which excludes certain categories of persons from availing the benefit. Although this eligibility aspect was not clearly dealt with in the impugned order itself, it was mentioned in the counter affidavit filed before the Court.
The Division Bench, headed by the Hon’ble Chief Justice and Hon’ble Mr. Justice S. Kumar, carefully examined the nature of the Scheme and the material on record. The Court described the Sabka Vishwas Scheme as being in the nature of an amnesty meant to finally resolve legacy disputes and reduce litigation. It noted that:
- There was a clear discrepancy between the Revenue’s own portal documents (showing the deposit of ₹72,50,000) and the impugned order which did not properly reflect this amount.
- The call for documents (Annexure-3) did not clearly specify what exact documents were required to be furnished, yet the material on record already showed substantial payment by the petitioner.
At the same time, the Court also accepted the Revenue’s contention that the issue of admissibility of the petitioner’s right to avail the Scheme, in light of the exclusions under Clause 125, was an aspect requiring examination by the competent authority under the Scheme.
Taking a balanced approach, instead of straightaway granting relief to the petitioner or upholding the rejection, the Court decided that the proper course would be to:
- Quash the impugned rejection order dated 20.02.2020, and
- Remand the matter back to the Designated Committee for fresh consideration on all questions of fact and law under the Scheme.
The Court recorded the petitioner’s willingness to fully cooperate. It was noted that the petitioner would appear before the Designated Committee on 25.01.2022 and furnish all documents required for availing benefits under the Scheme. The Court directed the Designated Committee to pass an appropriate, reasoned order strictly in accordance with the provisions of the Sabka Vishwas Scheme within four weeks from that date.
Importantly, the Court clarified that since the petitioner had applied under the Scheme within the prescribed time, the fact that the Scheme period had since expired would not come in the way of the authorities deciding the petitioner’s case. Thus, even though the Sabka Vishwas Scheme had formally closed, the Designated Committee was bound to reconsider the petitioner’s case and pass a fresh order.
Further, the Court reserved liberty to the petitioner to avail appropriate remedies, including those available under Clause 128 of the Scheme, in case it remained aggrieved by the fresh decision. The Court expressed hope that the authority would act in a manner that advances the cause of justice and the objective of the Scheme.
In conclusion, the writ petition was disposed of with directions, without giving a final ruling on eligibility or the exact amount payable, but ensuring that the petitioner received a fair, lawful, and reasoned reconsideration under the Sabka Vishwas Scheme.
Significance or Implication of the Judgment
This judgment is important for both taxpayers and tax authorities dealing with the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 and similar amnesty schemes in the future.
- Protection of bona fide applicants under amnesty schemes
The Court made it clear that once an assessee has opted into an amnesty scheme like Sabka Vishwas within time, the subsequent closure of the scheme cannot be used as a shield to deny consideration of that application. Authorities are duty-bound to decide such applications even after the closure date, where the declaration was filed in time but remained undecided or was decided improperly. - Importance of consistency with departmental records
The judgment underscores that decisions of Designated Committees must be consistent with their own official records, such as portal-generated documents showing payment of tax. A rejection order which ignores such material may be vulnerable to challenge. - Duty to pass reasoned and lawful orders
The decision reinforces the obligation of quasi-judicial authorities to pass reasoned orders that deal with relevant facts, including deposits made, eligibility criteria, and statutory provisions such as Clauses 125, 127 and 128 of the Scheme. - Balance between revenue interests and taxpayer relief
While the Court did not automatically grant the petitioner full relief, it ensured a fair reconsideration. This shows a balanced approach: the Court protects public revenue by allowing the authority to examine eligibility, but it also protects the taxpayer from mechanical or flawed rejection orders. - Guidance for future dispute resolution schemes
For future dispute resolution or amnesty schemes—whether under GST or other tax laws—this judgment serves as guidance: clear communication, proper recording of payments, and fair hearing are essential, and authorities cannot rely on technicalities or incomplete reasoning to deny benefits.
Legal Issue(s) Decided and the Court’s Decision with Reasoning
- Whether the Designated Committee was justified in rejecting the petitioner’s declaration under the Sabka Vishwas Scheme without accounting for the deposits shown in Revenue records.
- The Court found that there was a discrepancy between the Revenue’s portal documents showing payment of approximately ₹72,50,000 and the impugned order which did not reflect this amount.
- This inconsistency made the rejection order unsustainable and warranted interference.
- Whether the petitioner’s eligibility under Clause 125 of the Sabka Vishwas Scheme could be ignored by the authority or the Court.
- The Court accepted that eligibility under Clause 125 is a genuine issue that must be considered.
- However, since the impugned order did not properly address this question, and it only appeared indirectly in the counter affidavit, the Court held that the matter should be reconsidered by the Designated Committee itself.
- What is the appropriate relief when an order under the Scheme is flawed but eligibility is disputed?
- Instead of deciding eligibility on its own, the Court quashed the rejection order and remanded the case to the Designated Committee for fresh decision on all factual and legal aspects.
- This approach respects the statutory framework of the Scheme and allows the specialized authority to apply Clauses 125, 127 and 128 properly.
- Whether expiry of the Sabka Vishwas Scheme period bars consideration of a pending or wrongly decided declaration.
- The Court held that where the declarant had applied within time, the closure of the Scheme does not prevent the authority from deciding the matter afresh in accordance with law.
- This ensures that the purpose of the Scheme—to settle legacy disputes—is not defeated by procedural delays or faulty orders.
Case Title
Expression Buildtech Private Limited v. Union of India & Ors.
Case Number
Civil Writ Jurisdiction Case No. 455 of 2021
Coram and Names of Judges
- Hon’ble the Chief Justice (Sanjay Karol, CJ)
- Hon’ble Mr. Justice S. Kumar
Names of Advocates and Who They Appeared For
- For the petitioner: Mr. D. V. Pathy, Advocate
- For the respondents (Union of India / Revenue authorities):
- Dr. K. N. Singh, Additional Solicitor General (A.S.G.)
- Mr. Anshuman Singh, Advocate
Link to Judgment
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