New GST amnesty scheme notified: Waiver of interest and penalty on GST tax demand for eligible taxpayers to be effective from November 1, 2024

The new GST amnesty scheme, effective from November 1, 2024, aims to provide a waiver of interest and penalties for eligible taxpayers on non-fraudulent GST demands from FY 2017-18 to FY 2019-20. Announced in Budget 2024, this scheme is targeted at giving relief to taxpayers who faced significant demands due to initial filing errors during the early years of GST implementation.

Eligibility Criteria:

• The scheme is applicable to GST-registered taxpayers assessed under Section 73 for non-fraudulent GST demands.
• The waiver covers only the interest and penalty amounts; the principal tax demand must still be paid.

How It Works:

• Application Process:

  • FORM GST SPL-01: For notices or statements issued under clause (a) of sub-section (1) of section 128A.
  • FORM GST SPL-02: For orders issued under clauses (b) and (c) of sub-section (1) of section 128A.
  • Applications must be filed electronically on the common portal, along with payment details made via FORM GST DRC-03.

• Conditions:

  • The payment towards the tax demands must be made by crediting the electronic liability register.
  • For demands due to erroneous refunds or other reasons, the full tax amount must be paid before applying.

• Time Limits:

  • Applications must be submitted within three months from the notified date under section 128A.
  • For cases requiring FORM GST SPL-02, the time limit extends to six months from the communication of the order.

• Documentation:

  • Applicants must provide evidence of withdrawal of any appeals or writ petitions to qualify for the waiver.
  • If the withdrawal order is pending, a copy of the application for withdrawal must be submitted, with the final order to be uploaded within one month of issuance.

• Approval Process:

  • The proper officer will review the application and issue a notice (FORM GST SPL-03) if the application is liable for rejection.
  • Applicants can respond to the notice in FORM GST SPL-04 within one month.
  • If satisfied, the officer will approve the waiver in FORM GST SPL-05.
  • If not, the application will be rejected in FORM GST SPL-07.

• Appeal and Restoration:

  • If an application is rejected, the original appeal may be restored if no new appeal is filed.
  • If an appeal against the rejection is upheld, the appellate authority will pass an order in FORM GST SPL-06, concluding the proceedings under section 128A.

• Validity and Voidance:

  • The waiver becomes void if additional tax liabilities are not paid within the specified time.
  • Similarly, if interest or penalty for erroneous refunds or other periods is not paid within three months, the waiver will become void.

Expert Opinions:

• Siddharth Surana: Highlighted the importance of the waiver for non-fraudulent taxpayers from FY 2017-18 to FY 2019-20.
• Ankit Jain: Emphasized the relief provided by the waiver, reducing the burden of significant demands due to initial GST filing errors.

This scheme is a significant step towards alleviating the financial burden on taxpayers from the early years of GST implementation, ensuring compliance and reducing litigation.

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