Discharge certificates secured in seizure cases

Delhi HC held seizure and redemption fine cases are covered under the SVLDR Scheme, 2019 — directed Department to issue discharge certificates.

The issue

Declarations under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 were being resisted on the footing that matters involving seizure and redemption fine fell outside it — leaving a taxpayer who had declared in good faith, and paid, without the discharge certificate that gives the scheme its entire value.

Four questions arose, raised in Gaurav Jain v. Union of India, W.P.(C) 1748/2020: whether seizure cases are covered under the SVLDR Scheme, 2019; whether payment of redemption fine is a pre-condition for issuance of a discharge certificate; whether cases in which the redemption fine is not quantified are eligible for the scheme; and whether redemption fine is covered by the expression ‘penalty’.

Why it matters

The Delhi High Court held that seizure and redemption fine cases are covered under the SVLDR Scheme, 2019, and directed the department to issue discharge certificates.

If you made a declaration under the scheme and the certificate has been withheld on this ground, the position has been decided and the remedy is available.

Related practice area

This matter falls within our central excise & service tax practice.