Scheme For Ending The Disputed Tax Demands of Central Excise, Service Tax and Cesses

1. The name of the scheme is “SABKA VISHWAS (LEGACY DISPUTE RESOLUTION) SCHEME, 2019” which is introduced to settle the disputed tax demandsofCentral Excise, Service Tax and Cesses which have got subsumed in GST.

2. The said scheme provides relief from tax demands ranging from 40% to 70% of the tax dues depending upon the amount of tax dues involved and the nature/ stage of the case.

3. ‘Tax dues’ means:
i) The amount of duty stated to be payable in the Show Cause Notice has been received by the person on or before 30.06.2019.
ii) The amount of duty which is being disputed in an appeal pending before the appellate authority i.e., Commissioners (Appeals), Tribunal, High Court or Supreme Court on or before 30.06.2019.
iii) The amount of duty quantified in an inquiry or investigation or audit on or before 30.06.2019.
iv) The amount of tax voluntarily disclosed.
v) Where the amountis in arrears.

4. The scheme is available to all persons except few specified persons, specified under the scheme.

5. The amount payable under this scheme has to be paid in cash.The amount already deposited shall not be refunded, if paid in excess of the amount payable under this scheme.

6. The scheme also provides relief from payment of interest and penalty. For voluntary disclosure, the relief is regarding waiver of interest and penalty on payment of full tax dues disclosed.

7. The person discharged under the scheme shall also not be liable for prosecution.

ALA Comments
1. A good initiative by the Government of India to settle all pending tax litigations in the Courts,Tribunals etc. with an attractive scheme. Similar type of scheme should be broughtby the States.

2. Every Assessee who is litigating the tax demands should assess this scheme on various parameters such as merits of the case, condition of payment in cash etc. as in certain cases with payment of only 30% of tax dues in Cash, demand of tax, interest and penalty get settled.

3. A good option to deposit of left out taxes without payment of interest and penalty through voluntary disclosure.


GST Law India is a blog on GST and allied commercial laws managed by members of the law firm ALA Legal.