GST- Meeting
www.cbec.gov.in https://cbic-gst.gov.inCENTRAL BOARD OF INDIRECT TAXES & CUSTOMS
R. SRIVATSANAdditional Assistant Director & Sr. Faculty
NATIONAL ACADEMY OF CUSTOMS INDIRECT TAXES & NARCOTICSCHENNAI
04.10.2019
➢ A Pragmatic & Bold endeavour to resolve Central Ex., S.Tax and26 Cesses and allow business to make a new beginning.
➢ To off load 3.75 Lakh Crore locked up in litigations and has twocomponents (a) Dispute Resolutions and (b) Amnesty
➢ VIDS (1997)/ KVSS (1998)/ VCES (2013) /DTDS (2016) werealready floated by the Union Government earlier which were asuccess.
➢ Similar Schemes were offered by some states earlier also
➢ No Talk on Morality on Amnesty schemes as it is a Macro steptaken even if 40-50 Thousand Crores are collected, it willresolve the liquidity crisis at present. All negatives should takea back seat now.
PREAMBLE
➢ Success rate of Government Appeals are around 15-20% andtherefore this should reduce the dispute loads and should bepatronized. Appeals filed mechanically. Such issues will beresolved now.
➢ Transparency – No scope of interpretation by the Authorities –Clear reliefs – Standardized forms and procedures – should beeasy to avail the benefits extended by the scheme.
➢ Department has also doubled the Monetary limits of appealsand that will also automatically reduce litigations
➢ Interest of the Tax dues is compromised but the interest of theEconomy is ensured;
PREAMBLE
➢ This Scheme shall be called the Sabka Vishwas (LegacyDispute Resolution) Scheme, 2019.
➢ Scheme is Open from 01.09.2019 to 31.12.2019 (Notfn.
No:04/2019-CE (NT)
➢ The Scheme is applicable to the Central Excise Act, 1944or the Central Excise Tariff Act, 1985 or Chapter V ofthe Finance Act, 1994 and 26 other Acts and the Rulesmade thereunder.
➢ Pending Arrears and litigated disputes etc., before30-06-2019 are covered.
INTRODUCTION TO THE SCHEME
➢ Legislated through - Chapter V Section 120 to 135 of theFinance (No. 2) Act, 2019;.
➢ Procedures through SVLDRS Rules 2019 –Rule 1 to 9issued vide Notification No: 05/2019-CE, dt:21-08-2019.
➢ Standardized Forms SVLDRS Form 1, 2,2A, 2B,3 and 4also notified.
➢ Application only through at https://cbic-gst.gov.in withauto Acknowledgement bearing URN.
➢ The Application form has been designed with a set of10 questions to decide the eligibility about thescheme.
AUTHORITY
OBJECTIVES OF THE SCHEME
The Scheme provides that eligible persons
shall declare the unpaid tax dues and pay
the same in accordance with the provisions
of the Scheme.
The Scheme provides for certain immunities including
penalty, interest or any other proceedings & including
prosecution to those persons who pay the declared
tax dues.
1
2
3
The Scheme is a one time measure for
liquidation of past disputes of Central
Excise, Service Tax and 26 other indirect
tax enactments.
➢ An enquiry, investigation or audit where the amountis quantified / Communicated / Accepted on orbefore the 30th day of June, 2019
➢ A show cause notice or appeals arising out of aOrder pending as on the 30th day of June, 2019
➢ An amount in arrears
➢ A voluntary disclosure
Cases covered under the Scheme…
Including Cases under Call Book
Arrears arising out of SingleAppeal
(Dept. or Party appeal)
Enquiry or
Investigation
or Audit (quantified as on
30th June 2019)
SCN
issued(as on 30th June
2019)
An
amount in
Arrears
Arrears arising out of more than one appeal (Dept. and
Party appeal)
Voluntary
Disclosure
“Quantified” means a written communication of the amount of duty payable under the indirect tax enactment.
“Audit” means Scrutiny and
verification by CE Officer when a
written communication is sent
‘‘Enquiry or investigation’’, under any of the indirect tax enactment, shall include the following actions, namely:—
(i)search of premises;(ii)issuance of summons;(iii)Letters asking for production of accounts, documentsor other evidence;(iv)recording of statements.
TAX DUES
Q. Sl.No: 8
of Form
SVLDRS-1
EXAMPLES FOR TAX DUES
SCN FOR DUTY `1000 AND PENALTY `100
ORDER IS FOR `1000
AND PENALTY IS `100
SCN FOR DUTY `1000
AND PENALTY `100
ORDER IS FOR `900
AND PENALTY IS `90
SCN FOR DUTY `1000 AND
PENALTY `100
ORDER IS FOR `900 AND
PENALTY IS `90
ASSESSEE FILES APPEAL
AGAINST ORDER AND
DEPT FILES APPEAL FOR `100
PLUS PENALTY `10
SCN FOR DUTY
`1000 AND PENALTY
`100 & CONFIRMED.FIRST APPEAL
REDUCES DUTY TO
`900. FILES SECOND
APPEAL
TAX DUES
ARE `1000
TAX DUES
ARE `900
TAX DUES
ARE `1000
(900 + 100)
TAX DUES
ARE `900
“Amount payable” means the final amount payable by the declarant as
determined by the designated committee and as indicated in the statement
issued by it SVLDRS-3 and shall be calculated as the amount of tax dues less the
tax relief.
RELIEF AVAILABLE
SL.
NO:LEVEL OF PENDENCY
DUTY / TAX / CESS
AMOUNT INVOLVED
RELIEF IN
TAX/DUTY/ CESS
LIABILITY GRANTED
TAX/DUTY/CESS
PAYABLE
FINALLY
2.
The Show Cause Notice is only for
Penalty / Late Fee and the Tax is
either paid or NIL. Penalty is
imposed for Partners etc.,
Penalty / Fine /Late
Fee
Entire
Penalty
or Late
Fee
NIL
1.
Amount Pending as Dispute on
Account of Show Cause Notice /
Appellate Authority as on 30th
June 2019
up to50 Lakhs 70% 30%
>50 Lakhs 50% 50%
PENALTY / INTEREST AND PROSECUTION ARE WAIVED COMPLETELY
RELIEF AVAILABLE
SL.
NO:LEVEL OF PENDENCY
DUTY / TAX / CESS
AMOUNT INVOLVED
RELIEF IN
TAX/DUTY/ CESS
LIABILITY GRANTED
TAX/DUTY/CESS
PAYABLE
FINALLY
4.
Amount were assessed and
declared as self-admitted
liabilities but not paid.
up to50 Lakhs 60% 40%
>50 Lakhs 40% 60%
3.
Amount on account of
Arrears (where no further
appeals filed) or all appeals
lost.
up to50 Lakhs 60% 40%
>50 Lakhs 40% 60%
PENALTY / INTEREST AND PROSECUTION ARE WAIVED
RELIEF AVAILABLE
SL.
NO:LEVEL OF PENDENCY
DUTY / TAX / CESS
AMOUNT INVOLVED
RELIEF IN
TAX/DUTY/ CESS
LIABILITY GRANTED
TAX/DUTY/CESS
PAYABLE
FINALLY
5.
Amount Quantified &
Communicated in any Audit,
Enquiry, Investigation etc.,
uptoRs. 50 Lakhs 70% 30%
AboveRs. 50 Lakhs 50% 50%
PENALTY / INTEREST AND PROSECUTION ARE WAIVED
6. Voluntary DisclosureNo
ThresholdNIL 100%
Voluntarydisclosure under this
scheme
Not eligible for any tax relief,but relief available
for interest, Fines and penalty
No verification by designated committee
Within one year, if found to be false, appropriate proceedings shall be
initiated
CANNOT (VOLUNTARILY) MAKE A DISCLOSURE AFTER AN ENQUIRY OR INVESTIGATION OR AUDIT OR FOR AN AMOUNT DECLARED AS PAYABLE IN A RETURN FILED CONSEQUENT
TO SUCH PROCEEDINGS
VD - RELIEF AVAILABLE
14
PRECONDITIONS & RESTRICTIONS
PRECONDITIONS
➢ The relief calculated shall be
subject to the condition that any
amount paid as pre-deposit
shall be deducted when issuing
the statement indicating the
amount payable by the declarant.
➢ Provided that if the amount of
pre- deposit or deposit already
paid > the amount payable the
declarant shall not be entitled
to any refund.
RESTRICTIONS
(a)Shall not be paid through the
input tax credit account.
(b)Shall not be taken as input
tax credit; or entitle any
person to take input tax credit,
as a recipient, of the excisable
goods or taxable services.
(c)Shall not be refundable
under any circumstances.
A Declaration in
Electronic form
SVLDRS-1
A designated
committee shall
verify correctness
When amount declared =
Estimated Amount,a
statement in electronic form
shall be issued within 60 days
SVLDRS-3
When Estimated Amount >
Amount declared by
declarant, an estimate of payment
shall be issued within 30 days
SVLDRS-2 (PH)
One Personal Hearing will
be given, before issuing
statement of amount
payable
After hearing the declarant,
an e-statement indicating
amount payable shall be
issued within 60 days
The declarant shall
pay online within
30 days
On payment and production
of proof of withdrawal of
appeal, the committee shall
issue Discharge Certificate
within 30 days
Within 30 days of issuance of
Discharge Certificate, the
committee can modify its order
only to correct an arithmetical
error or clerical error
VERIFICATION OF DECLARATION
A TYPICAL FLOW CHART OF SEQUENCE OF PROCESSES
SVLDRS-2A
SVLDRS-3
SVLDRS-4
Step-1 Step-2
Step-3
Step-4Step-5
Step-2A
Step-2BStep-2C
Step-2D
a
b
d
e
f
g
h
Appeal before appellate forum and
heard finally on or before 30th
June 2019
Convicted for any offence for the
matter for which he intends to file a
declaration
Issued a SCN and final hearing
has taken place on or before
30th June 2019
a
b
c
Issued a SCN for erroneous
refund or refundd
Subjected to enquiry or
investigation or audit and
duty involved has not
been quantified on
or before 30th June 2019
e
Voluntary Disclosure after
being subjected to any
enquiry or investigation or
audit & filed a return,
indicating duty as payable, but
has not paid it
f
Excisable goods from Fourth Schedule to the Central Excise Act, 1944
Application in the
Settlement Commission
h
g
(8) Not eligible to make a declaration under the
scheme
C
Wrap up - Other features of the Scheme…
❖ Facility for adjustment of any deposits of duty already made
❖ Settlement dues to be paid in cash electronically only and cannotbe availed as input tax credit later
❖ A full and final closure of the proceedings in question. The onlyexception is that in case of voluntary disclosure of liability, thereis provision to reopen a false declaration within a period of oneyear.
❖ Proceedings under the Scheme shall not treated as a precedentfor past and future liabilities
❖ Final decision to be communicated within 60 days of application
❖ No final decision without an opportunity for personal hearing incase of any disagreement
❖ Proceedings under the Scheme will be fully automated
AFT
ERIS
SUA
NC
E O
F D
ISC
HA
RG
E C
ERTI
FIC
ATE
a) Not be liable to pay any further duty, interest, or penalty with respect to the matter and the time periodcovered.
b) Not be liable to be prosecuted under the Indirect
Tax enactment.
c) Shall not be reopened in any other proceedingunder the Indirect Tax enactment.
d) If false declaration is made in voluntary disclosure,proceedings under the applicable laws shall be started withina time-limit of one year.
Finally……………
➢ The taxpayer can apply for this scheme from https://cbic-gst.gov.in
➢ The taxpayer already registered under CE / ST can login andfill Part-B of SVLDRS Form-1.
➢ The unregistered taxpayer can register himself by fillingPart-A of SVLDRS Form -1.
How to Apply for SVLDRS, 2019…
➢ Enquiry Started – Amount not Quantified by 30-06-2019.
➢ Multiple Issues in a SCN – Selective option for one issue;
➢ Enquiry Started – Voluntary Disclosure is not allowed
➢ Contradiction between 124(1) (c)(iii) arrears category and 125(1)(f)(i) is a exception from VD for a defaulter.
➢ Co-Noticee – Can independently apply only on payment / settlement ofall dues of original notice otherwise he cannot apply.
➢ Periodical Notices – also eligible if it had been issued < 30-06-2019and no final hearing has taken place.
➢ Pre-deposit or any amount paid during investigation or Audit shall beadjusted (including those paid through CENVAT Credit) whileindicating the Estimated Amount payable from the Tax dues.
Some Issues – ClarifiedCircular No: 1071/04/2018-CX-8, dt:27-08-2019
➢ No refunds of Excess amounts.
➢ Immunity is only for the issue applied for and not across the board;
➢ False Voluntary Declaration – Undoes the amnesty and normalproceedings will resume as if the earlier proceedings were nevermade;
➢ Filing of Application is not admission of accusations in the SCN, it ismere expression of intend to resolve the disputes;
➢ Issue Filed with Settlement Commission – But the Commissionrejected the application or remanded back to the Original Authority– Declaration under the scheme can be made.
➢ A link is provided under SVLDRS form – 3 for Estimated amountpayment. Once challan is generated, payment can be madeelectronically.
Some Issues – Clarified
Circular No: 1071/04/2018-CX-8, dt:27-08-2019
➢ Eligibility is decided on Self Declaration – Wrong Declaration thesystem will allow (Sl.no:8) but if it is found later, it becomes voidand will be informed through a letter.
➢ Once SVLDRS is opted, it is deemed withdrawal of appeals;.Included Departmental appeal; except SC/HC. Dept. will withdrawimmediately after Discharge Certificate.
➢ Self assessed Tax admitted but not paid in return – each default isa separate case / Amount in Arrears – and separate Applicationneed to be filed;
➢ Cases where Notice is issued for appropriating duty already paidbut only for interest can also come into the scheme.
Some Issues – Clarified
Circular No: 1071/05/2018-CX-8, dt:27-09-2019
Some Issues – Clarified
Circular No: 1071/05/2018-CX-8, dt:27-09-2019
SCN FOR DUTY 1 Crore
Amount paid already: 60 Lakhs
Amount
Payable 40%
on 40 Lakhs
= 16 Lakhs
No appeal filed
Amount in Arrears: 40 Lakhs
Tax Dues: 40 Lakhs (< Rs.50 Lakhs)
Tax Relief: 60 %
SCN FOR DUTY 1 CroreConfirmed : 60 Lakhs
Amount Payable
50% on 1 Crore
= 50 Lakhs
Appeal filed by party for 60L and
Dept for 40LAmount in Litigation: 60+40 Lakhs
Tax Dues: 1 Crore (> Rs.50 Lakhs)
Tax Relief: 50 %
Dropped : 40 Lakhs
The Dte. Of Taxpayer
Services –CBIC have
come out with set of
FAQs on the subject
matter consisting of 43
questions which may be
referred for any further
apprehensions.
FAQs on the Scheme
If the tax/duty was paid during the investigation underprotest and
➢ this amount is in excess of the actual liability ormore than the prescribed amount to be paid underthe Scheme,
➢ such excess amount paid shall not be refundedunder the scheme.
In the cases of payment is made under protest, thisamnesty scheme may not be of any use.
Some Issues
Payment under Protest
Where the amount to be declared is based on the amount demanded inthe show cause notice, there could be many
➢ errors in the computation of demand such as arithmeticalerror, clerical error,
➢ wrong rate of tax/duty,
➢ exemptions not considered or
➢ part demand may fall beyond limitation period etc
Such errors could be there in case of appeals also.
Wrong invocation of Extended Period also?
Such cases may not come – Designated Committee cannot take a call onthat.
Some Issues –
Computation of benefit
If the Estimated amount indicated in thestatement issued by the designated committee isnot acceptable to the declarant,
➢ The declarant can walk off at any time.
Some Issues –
Withdraw The Declaration
Taxpayer select the scheme
The answer to first four question should be “No” in
order to apply for this scheme.
Different categories available under this
scheme. The taxpayer will select category ,
subcategory and duty type.
Form SVLDRS-1
Form SVLDRS-1
Form SVLDRS-1
Form SVLDRS-1
Form SVLDRS-1
Form SVLDRS-1
If the taxpayer doesn’t agree with the
Computer Generated amount then the taxpayer
can enter amount as per his calculation.
By clicking the submit button, Form SVLDRS-1 will be submitted to concerned Committee. ARN will generated & the taxpayer will be informed via email and SMS.
Form SVLDRS-1
Form SVLDRS-1
Form SVLDRS View
The tax officer will be shown options
to issue SVLDRS 2 & SVLDRS 3.
Form SVLDRS-2
If the taxpayer doesn’t agree with SVLDRS-2
and in case want adjournment. Form 2A
Form 2B
Adjournment of PH by the tax officer.
Form 2B
Adjournment of PH by the tax officer.
Form 3
Estimated Amount
Form 3
Estimated Amount
Challan generation and gateway to
make payment window.
SVLDRS-4 issued by the officer
after payment
Helpline No…
CBIC Mitra Helpdesk
Toll Free No. 1800-1200-232
Cbec-gst.gov.in>HELP>SELF SERVICE
Epilogue
Questions
52
G. S. Bhullar & Co.Chartered Accountants
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