Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019

Last Updated at: May 15, 2020
1141
Sabka Vishwas - (Legacy Dispute Resolution) Scheme, 2019
Sabka Vishwas kitty hits over Rs 38,000 cr. Finance ministry received around 189,000 applications under the Sabka Vishwas (Legacy Dispute Resolution Scheme) 2019, which kicked off in September and concluded recently.“The government had set a target of 184,000 taxpayers with tax collection of over Rs 35,000 crore.

 

The Sabka Vishwas (Legacy Dispute Resolution) Scheme is a one-time initiative for the liquidation of the previous disputes of Service Tax and Central Excise as well as to make sure disclosure of the unpaid taxes by the individual eligible to make the declaration.

The scheme comes into existence with a validity of four months commencing from September 1, 2019, to December 31, 2019. According to the scheme, eligible individuals should declare the tax dues and pay the same according to the provisions of the Scheme. It also provides for some immunities such as interest, penalty or any other proceedings under the Chapter V of the Finance Act, 1944 or Central Excise Act, 1944 to those individuals who pay the declared tax dues.

Objectives

  • To boost voluntary disclosure of the past disputes of central excise, service tax and twenty-six other indirect tax enactments.
  • To facilitate an eligible individual to declare the unpaid tax dues and pay the same according to the provisions of this scheme.
  • To provide some kind of immunities, along with penalty, interest or any other proceedings along with the prosecution, to eligible individuals who pay the declared tax dues.
Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019

Benefits

    • All those cases where no appeal has been filed by the taxpayer before the end of the time period.
    • Any kind of tax dispute in any of the appellate forum which has got finality.
    • The taxpayer has admitted the tax liability in a return filed on or before 30th June 2019.

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Benefits which cannot be availed

  • The applicant who has filed an appeal before the appellate forum and final hearing completed on or before 30th June 2019.
  • Has been convicted under the indirect tax enactment for any kind of offence for the matter for which he/she intends to file a declaration.
  • Has been issued a Show Cause Notice (‘SCN’) and final hearing has already taken place on or before 30th June 2019.
  • Has been issued an SCN for a flawed refund.
  • Has been subjected to investigation or enquiry or audit and amount of duty not quantified on or before 30th June 2019.
  • Has filed an application in the settlement commission for the settlement of the case.
  • Aims to file a declaration with respect to the excisable goods which are petroleum, tobacco and related tobacco products as mentioned in the fourth schedule to the Central Excise Act, 1944.
  • Makes a voluntary disclosure after being exposed to inquiry or audit or investigation or having filed a return, wherein he/she has pointed out an amount of duty as payable, but has not paid it.

Relief

  • Where an appeal has been filed or an SCN has been issued, or inquiry, audit or investigation against the declarant has been conducted on or before the 30th June 2019 in which the amount of duty quantified is
  1. Rs. Fifty lakhs or less, 70% of the tax dues will be waived off.
  2. More than Rs. Fifty lakhs, 50% of the tax dues will be waived off.
  • Where the tax dues are applicable to an SCN for the late fee or penalty only, and the amount of duty in the present notice has been paid or it is nil, then 100% of the amount of penalty or late fee shall be waived off.
  • Where tax dues are in arrears and the amount of duty is:
  • fifty lakhs or less, then 60% of the tax dues will be waived off.
  • More than Rs. Fifty lakhs, then 40% of the tax dues will be waived off.
  • Where declarant has indicated in the return form (filed under the Indirect-tax enactment) an amount of duty as payable but not paid it and the duty of amount is-
  1. Rs. Fifty lakhs or less, then 60% of the tax dues will be waived off.
  2. More than Rs. Fifty lakhs, then 40% of the tax dues will be waived off.
  • In the case of a voluntary disclosure made by the declarant, then, no relief will be accessible with respect to tax dues.

Along with this, the declarant should not be liable to pay any further interest, duty or penalty and his/her case shall not be revived in any other proceeding under the indirect tax regime. Nevertheless, if any kind of false declarations is made involuntary disclosure, proceedings under the applicable laws shall be commenced within a time limit of one year.

Restrictions

  • Tax dues payable are not paid through the input tax credit account.
  • Tax dues paid should not be taken as an input tax credit or entitle any individual to take an input tax credit as a recipient of the excisable goods and taxable services.
  • Tax dues paid are not refundable at any cost.

So, these are the objectives, benefits, reliefs, restrictions etc. of the Sabka Vishwas Scheme, 2019.

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Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019

1141
Sabka Vishwas kitty hits over Rs 38,000 cr. Finance ministry received around 189,000 applications under the Sabka Vishwas (Legacy Dispute Resolution Scheme) 2019, which kicked off in September and concluded recently.“The government had set a target of 184,000 taxpayers with tax collection of over Rs 35,000 crore.

 

The Sabka Vishwas (Legacy Dispute Resolution) Scheme is a one-time initiative for the liquidation of the previous disputes of Service Tax and Central Excise as well as to make sure disclosure of the unpaid taxes by the individual eligible to make the declaration.

The scheme comes into existence with a validity of four months commencing from September 1, 2019, to December 31, 2019. According to the scheme, eligible individuals should declare the tax dues and pay the same according to the provisions of the Scheme. It also provides for some immunities such as interest, penalty or any other proceedings under the Chapter V of the Finance Act, 1944 or Central Excise Act, 1944 to those individuals who pay the declared tax dues.

Objectives

  • To boost voluntary disclosure of the past disputes of central excise, service tax and twenty-six other indirect tax enactments.
  • To facilitate an eligible individual to declare the unpaid tax dues and pay the same according to the provisions of this scheme.
  • To provide some kind of immunities, along with penalty, interest or any other proceedings along with the prosecution, to eligible individuals who pay the declared tax dues.
Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019

Benefits

    • All those cases where no appeal has been filed by the taxpayer before the end of the time period.
    • Any kind of tax dispute in any of the appellate forum which has got finality.
    • The taxpayer has admitted the tax liability in a return filed on or before 30th June 2019.

Get a FREE legal advice

Benefits which cannot be availed

  • The applicant who has filed an appeal before the appellate forum and final hearing completed on or before 30th June 2019.
  • Has been convicted under the indirect tax enactment for any kind of offence for the matter for which he/she intends to file a declaration.
  • Has been issued a Show Cause Notice (‘SCN’) and final hearing has already taken place on or before 30th June 2019.
  • Has been issued an SCN for a flawed refund.
  • Has been subjected to investigation or enquiry or audit and amount of duty not quantified on or before 30th June 2019.
  • Has filed an application in the settlement commission for the settlement of the case.
  • Aims to file a declaration with respect to the excisable goods which are petroleum, tobacco and related tobacco products as mentioned in the fourth schedule to the Central Excise Act, 1944.
  • Makes a voluntary disclosure after being exposed to inquiry or audit or investigation or having filed a return, wherein he/she has pointed out an amount of duty as payable, but has not paid it.

Relief

  • Where an appeal has been filed or an SCN has been issued, or inquiry, audit or investigation against the declarant has been conducted on or before the 30th June 2019 in which the amount of duty quantified is
  1. Rs. Fifty lakhs or less, 70% of the tax dues will be waived off.
  2. More than Rs. Fifty lakhs, 50% of the tax dues will be waived off.
  • Where the tax dues are applicable to an SCN for the late fee or penalty only, and the amount of duty in the present notice has been paid or it is nil, then 100% of the amount of penalty or late fee shall be waived off.
  • Where tax dues are in arrears and the amount of duty is:
  • fifty lakhs or less, then 60% of the tax dues will be waived off.
  • More than Rs. Fifty lakhs, then 40% of the tax dues will be waived off.
  • Where declarant has indicated in the return form (filed under the Indirect-tax enactment) an amount of duty as payable but not paid it and the duty of amount is-
  1. Rs. Fifty lakhs or less, then 60% of the tax dues will be waived off.
  2. More than Rs. Fifty lakhs, then 40% of the tax dues will be waived off.
  • In the case of a voluntary disclosure made by the declarant, then, no relief will be accessible with respect to tax dues.

Along with this, the declarant should not be liable to pay any further interest, duty or penalty and his/her case shall not be revived in any other proceeding under the indirect tax regime. Nevertheless, if any kind of false declarations is made involuntary disclosure, proceedings under the applicable laws shall be commenced within a time limit of one year.

Restrictions

  • Tax dues payable are not paid through the input tax credit account.
  • Tax dues paid should not be taken as an input tax credit or entitle any individual to take an input tax credit as a recipient of the excisable goods and taxable services.
  • Tax dues paid are not refundable at any cost.

So, these are the objectives, benefits, reliefs, restrictions etc. of the Sabka Vishwas Scheme, 2019.

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A lawyer with 14 years' experience, Vikram has worked with several well-known corporate law firms before joining Vakilsearch.