By TIOL News Service

CHANDIGARH, DEC 12, 2013 : THE ST VCES, 2013 is drawing to a close and as reported in DDT 2250, the clarifications from the CBEC keep trickling in. These merely indicate that there are many obstacles being placed in the path by the designated authorities to prevent a declarant from taking the ST VCES-1 route or for that matter dissuade them from coming clean. In these circumstances, it is a prudent move made by the Board to go that extra mile and iron out those creases by issuing clarifications and exhorting the Revenue authorities to ensure that the scheme is a success.

Interestingly, the Board had come out with a dampener in its Circular  170/5/2013-ST  dated 8th August, 2013 while clarifying thus –

This portion of the Circular was put to test in a matter that came up before the Punjab & Haryana High Court in a Civil Writ Petition few days back.

And the High Court has held thus -

“The impugned order, in our considered opinion, is appealable, under Section 86 of the Indian Finance Act, 1994, particularly as the scheme under which the petitioner has applied, is part and parcel of the aforesaid Finance Act, by virtue of the Indian Finance Act, 2013.

We are unable to accept correctness of instructions issued by the Central Board of Excise and Customs, for the simple reason that after incorporation of the Service Tax Voluntary Compliance Encouragement Scheme into the Finance Act, all other provisions of the Act except to the extent specifically excluded, apply to proceedings under the scheme. The impugned order passed by the Deputy Commissioner of Central Excise and Service Tax would necessarily be appealable under Section 86 of the Indian Finance Act, 1994…”

The Writ Petition was allowed to be withdrawn with the liberty to file an appeal and the same was directed to be decided within a fortnight.

In passing : Probably the section referred to ought to have been section 85 as the Designated authority is a Deputy Commissioner. But that should not take away the essence of the decision. Coupled with the fact that the laddoo scheme is gathering momentum but is drawing to a close, the above High Court order should be one more valid reason for the Board to extend the expiry date of the ST VCES, 2013.

(See 2013-TIOL-1016-HC-P&H-ST )