Understanding  the New GST Amnesty Scheme: Let’s Discuss Waiver of interest and penalty

 

𝐴𝑡𝑡𝑒𝑛𝑡𝑖𝑜𝑛 𝐺𝑆𝑇 Payers The 53rd GST Council meeting brought some welcome relief for the taxpayers: an Amnesty Scheme for interest and penalty waiver on taxes from the initial 3 years of GST (April 2017-March 2020).

Here’s the gist:
A new section 128A has been introduced that offers a waiver of interest and penalty on the condition that the tax amount is paid by March 31, 2025, and a notice has been issued under section 73.
Sounds great, right? But hold on… there’s more to unpack…

– Section 74 vs 73: The scheme applies to Section 73 notices. In cases, where notices are issued under Section 74 but ingredients of fraud, willful-misstatement or suppression of facts are absent, it would be beneficial to contest the notice for getting the matter ultimate adjudicated to Section 73 to claim benefit. However, in the event that the final adjudication extends beyond the March 2025 deadline, should the government consider an extension for such cases?

– Partial Payments & Multiple Issues: The language of the press release seems to indicate that the entire tax amount of the notice needs to be paid to avail the benefit of the scheme. This can be problematic if the SCN involves multiple issues and the tax has only been discharged only in respect of a few of them. Ideally, the waiver should be applicable on an issue-wise basis in such notices. What are your views?

– Interest & Penalty Only Notices: If notices are issued solely for interest & penalty, fit case for benefit under the scheme.

– Interest & penalty already paid: Biggest question is whether refund can be claimed? All amnesty scheme under GST in past have been without refund. May be same condition to continue. Not justifiable for such diligent taxpayers to get unreasonably hit. Your views?

– Matters already in writ or appeals: Withdrawal of matters pre-requisite for claiming benefit? If you want to take benefit of amnesty, probably you may have to forego your right to contest and withdraw appeal/writ. Your views?

– Multiple SCNs out of a single Audit: If you have multiple notices arising from a single audit, would amnesty be evaluated for each notice individually? Looks so.

Let’s decode this scheme together!
Share your thoughts and any practical scenarios you can think of in the comments. The more we discuss, the clearer things will be for everyone!