Gujarat High Court Denies SVLDRS Benefit For Unquantified Tax Liability Before 30 June 2019 Cut-Off

The Gujarat High Court on 18 June 2026 held that a taxpayer cannot claim benefit under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS) merely on the basis of admitting part of its tax liability during investigation, and that the entire tax liability must be quantified on or before the statutory cut-off date of 30 June 2019 for eligibility under the Scheme.

A Division Bench comprising Justices A.S. Supehia and Vaibhavi D. Nanavati dismissed the writ petition filed by Planet Automotive Pvt. Ltd. and another, and upheld the rejection of their declaration under the Scheme. The Bench held:

“The benefit is only extended to those persons in whose case, the liability of the tax is quantified on or before 30.06.2019, in case any inquiry / investigation / audit is pending against the declarant.”

The petitioners, an authorised Hyundai dealer, faced investigation over alleged non-payment of service tax. During the investigation, they admitted a service tax liability of Rs. 25.73 lakh and filed a declaration under SVLDRS seeking settlement.

However, the designated authorities rejected their declaration on the ground that they did not quantify the service tax liability before the cut-off date of 30 June 2019.

Before the High Court, the petitioners argued that their admission of liability during investigation amounted to “quantification” under the Scheme. They also contended that the authorities violated the Scheme by rejecting the declaration without granting a hearing.

Rejecting these arguments, the Bench held that a partial admission during investigation does not amount to final quantification of the tax liability. It observed that the Scheme requires quantification of the entire duty payable, not merely an admitted portion. The judges noted:

“The Scheme or the Circular does not stipulate any eventuality which makes an assessee eligible for the Scheme on acceptance of the part of the amount of tax liability during the investigation/inquiry.”

Further, the Bench further held that since the petitioners failed to meet the eligibility conditions under SVLDRS, the authorities were not required to constitute a Designated Committee or grant a personal hearing before rejecting the declaration.

Accordingly, the High Court dismissed the writ petition, finding no infirmity in the authorities' decision.

For Petitioners: Mr. Hardik P. Modh

For Respondents: Mr. Utkarsh R. Sharma