India Budget 2019: The proposed dispute resolution cum amnesty scheme covers past cases involving taxes which have got subsumed in GST, namely Central Excise, Service Tax and cesses.
With Rs 3.75 lakh crore blocked in excise and service tax litigation, the government Friday announced a dispute resolution cum amnesty scheme for settling such legacy cases. As per the ‘Sabka Vishwas Legacy Dispute Resolution Scheme, 2019’ announced in Budget 2019-20, interest and penalty will be waived on payment of full tax dues for voluntary disclosures. The person shall also not be liable for prosecution. However, for cases other than voluntary disclosure, relief under the scheme would vary from 40 per cent to 70 per cent of the tax dues, depending on the amount involved. The requirement to pay interest and penalty would be waived.
The proposed dispute resolution cum amnesty scheme covers past cases involving taxes which have got subsumed in GST, namely Central Excise, Service Tax and cesses. “All persons are eligible to avail the scheme except a few exclusions including as those convicted under the act in the case for which he intends to make declaration and those who have filed an application before the Settlement Commission,” the Budget document said.
The scheme provides for method of payment of tax dues, arrears and restrictions regarding the manner of payment and would become available from a date to be notified. Finance Minister Nirmala Sitharaman, in her Budget speech, said GST has just completed two years but huge pending litigation from pre-GST regime continues to be a concern.
“More than (Rs) 3.75 lakh crore is blocked in litigations in service tax and excise. There is a need to unload this baggage and allow business to move on. “I, therefore, propose, a Legacy Dispute Resolution Scheme that will allow quick closure of these litigations. I would urge the trade and business to avail this opportunity and be free from legacy litigations,” she said.