GST Circular for Amnesty Scheme Expected to Come in Oct or Nov 2024

The Ministry of Finance is anticipated to issue a circular for the much-expected GST Amnesty Scheme, which was suggested in the Budget 2024, sources said.

The motive of the scheme is to furnish relief to the assesses by exempting the interest and penalties as per the specified conditions for the tax matters that emerged between July 1, 2017, and March 31, 2020. It wraps show cause notices (SCNs), adjudicating orders, and appeal orders issued for the financial years 2017-18, 2018-19, and 2019-20.

Under the sources, as per the scheme the assesses can have the advantage of a waiver of interest and penalties if they pay the whole due tax amount by March 31, 2025.

As per the government source, the cases related to the GST refunds are not included in the scheme. The assessees engaged in the plea or court proceedings should withdraw such matters to be qualified for amnesty. Also, if a matter is solved under the scheme, it cannot be petitioned against.

The scheme applicability is anticipated to start around October or November 2024, as per the official notification issuance. Also, an ongoing industry representation advocates for the inclusion of matters with demands only for the interest or penalties, and for considering the transitional credit disputes under the scheme.

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The scheme functions on a show cause notice or order-wise basis, demanding the assesses to address all the problems for a particular SCN or order if they opt to take part. We have illustrated that in case the tax amount has been filed before and merely the interest and or penalty are due then technically these are not engaged in the scheme under the legislated Section 128A of CGST Act; such matters are required to be included.

The other problem is that there should be a provision for carving out the three FYs 17-18 to 19-20 out of the SCN/Order for which Amnesty can be claimed, whereas the balance years could be mitigated via the assessee, for the hoped and another representation of the tax professionals is that the input tax credit (ITC) ledger must be permitted to get utilised to make the tax payment under the scheme.

Additional representation is towards the matter for the mentioned fiscal years there are disputed towards the time-restricted duration of the ITC under section 16(4) for which relief is available in the new Sections 16(5) and 16(6) of Central Goods and Services Tax Act; In such case, these amounts u/s 16(4) must be permitted to be lowered from the disputed amount for which the benefit of the Scheme can be claimed.