Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 has been made effective from 1 September, 2019. As per the said scheme, a person can liquidate legacy cases of Central Indirect Tax Acts locked up in litigation at various forum through this scheme. The scheme is also aimed to give an opportunity to those who have failed to correctly discharge their tax liability.
This scheme is a one-time opportunity to close the legacy disputes and provides for voluntary disclosure of unpaid tax liability. All pending disputes should be evaluated in order to take a rational decision whether to opt for this scheme or not. Particularly, cases where demands are less than INR 50 lakhs or cases where the assessee’s chances of success is low, this scheme appears to be beneficial considering the time and cost involved in the litigation. At the same time, where the case involves an ‘industry issue’ or where assessee’s chances of success are relatively more, the decision to opt for this scheme may differ.
Snapshot of the same has been captured below.
RELIEF AVAILABLE UNDER THE SCHEME
|
Relief Available |
|
Tax Dues Relatable To |
Case A [Amount of Duty = 50 Lakh or Less] |
Case B [Amount of Duty = More Than INR 50 Lakh] |
Show cause notice (SCN) / appeal pending as on 30.06.2019 |
70% |
50% |
SCN issued only with respect to late fee/ penalty, and tax amount is paid or NIL |
Entire Amount of Late Fee/Penalty |
|
Amount relating to arrears of tax or amount indicated in returns but not paid |
60% |
40% |
Enquiry/ investigation/ audit and amount quantified on or before 30.06.2019 |
70% |
50% |
Voluntary Disclosure |
No Relief for Tax Due. Relief of Penalty & Interest would be available. |
PERSONS ARE WHO ELIGIBLE UNDER THE SCHEME
All persons shall be eligible to make a declaration under this Scheme except the following:
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