Some important points regarding Sabka Vishwas (Legacy Dispute Resolution)

[Ganeshan Kalyani]

The Central Government has introduced as scheme called SABKA VISHWAS (LEGACY DISPUTE RESOLUTION) SCHEME, 2019. This scheme came into effect from 01.09.2019 as is available till 31.12.2019. The Central Government has also made the rule called Sabka Vishwas (Legacy Dispute Resolution) Scheme Rules, 2019 vide Notification No. 05/2019 Central Excise-NT dated 21^st August, 2019. FAQs is also been published on this subject. A power point presentation is also published. The Act, Rules, FAQs, PPT is available in www.cbic.gov.in.

A tax payer can apply for this scheme in order to settle all the cases pending under Central Excise, Service Tax and allied taxes like Agricultural Produce Cess Act, Coffee Act etc. A tax payer can apply for this scheme if the Show Cause Notice is received by him and proceeding happened but final hearing is pending as on 30.06.2019. An Appeal is filed by him but final hearing is pending as on 30.06.2019.

A tax payer cannot apply under this scheme if Show Cause Notice was issued for an erroneous refund or refund, enquiry or investigation or audit is conducted but duty involved is not quantified as on 30.06.2019, an application is filed with the Settlement Commission for settlement of a case.

Quantum of relief under various case is given in the table below.

Sr. No.	Relief in case of	Duty involved	Relief
1	1) tax dues as per Show Cause Notice or as per Appeal where final hearing is pending as on 30th June, 2019 2) Tax arised out of an enquiry, investigation or audit where the amount is quantified on or before 30th June, 2019	Up to ₹ 50 lakhs	70% of the tax dues & interest, penalty is waived
		More than  ₹ 50 lakhs	50% of the tax dues & interest, penalty is waived
2	Late fee or penalty as per Show Cause Notice where the tax due is already paid or is NIL		Entire late fee or penalty is waived
3	1) Tax dues are relatable to an amount in arrears 2) Tax declared in the return as payable but not paid	Up to ₹ 50 lakhs	60% of the confirmed duty & interest, penalty is waived
		More than  ₹ 50 lakhs	40% of the duty involved & interest, penalty is waived
4	Voluntary disclosure of tax dues by the tax payer		No relief is given. Taxpayer has to pay entire tax due

A tax pay willing to avail the benefit of the scheme should apply by declaring the tax due. On receipt of the application an electronic form indicating the amount payable is issued to the tax payer within 30 days from the receipt of application. The tax dues is arrived at after adjusting the payment already made by the taxpayer in connection with the case. On receipt of electronic form a tax payer can pay the tax in cash within 30 days. The payment cannot be made using input tax credit. After making the payment the tax payer should submit a proof of payment of tax. After receiving the payment proof a discharge certificate will be issued within 30 days by the department. In any case, the final decision on the declaration will be communicated to the applicant within 60 days of filing of declaration.

A tax payer by opting for relief under this scheme the proceedings already in progress at various forum, except the pending case in High Court or Supreme Court will be deemed to have been withdrawn. And for the case pending before High Court or Supreme Court, the taxpayer has to file an application to respective Courts for withdrawal of the pending case.

Any amount paid under this Scheme shall not be refundable under any circumstances and amount paid shall not be taken as input tax credit.

The tax payer shall not be liable to pay any further duty, interest, or penalty with respect to the matter and time period covered in the declaration, the tax payer shall not be liable to be prosecuted under the indirect tax enactment with respect to the matter and time period covered in the declaration, no matter and time period covered by such declaration shall be reopened in any other proceeding under the indirect tax enactment.

However, a show cause notice can be issued for the same matter for a subsequent time period or for a different matter for the same time period. Further, in a case of voluntary disclosure where any material particular furnished in the declaration is subsequently found to be false, within a period of one year of issue of the discharge certificate, it shall be presumed as if the declaration was never made and proceedings under the applicable indirect tax enactment shall be instituted.