Note on Sabka Vikas (Legacy Dispute Resolution) Scheme, 2019 and Rules thereon

Update Source : Notification No. 04/2019 Central Excise-NT and Notification No. 05/2019 Central Excise-NT , Central govt. has notified Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 and Sabka Vishwas (Legacy Dispute Resolution) Scheme Rules, 2019

Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 and Rules, 2019:

Central Board of Indirect Tax and Customs (CBIC) vide Notification No. 04/2019 Central Excise-NT and Notification No. 05/2019 Central Excise-NT, has notified Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 and Sabka Vishwas (Legacy Dispute Resolution) Scheme Rules, 2019 respectively which shall come into force w.e.f. September 1, 2019.

Salient features of the scheme is as under –

Cases which are covered in the Scheme –

  • A show cause notice or appeals arising out of a show cause notice pending as on the 30th day of June, 2019
  • An amount in arrears
  • An enquiry, investigation or audit where the amount is quantified on or before the 30th day of June, 2019
  • A voluntary disclosure.

Exclusions from the Scheme –

  • Cases in respect of excisable goods set forth in the Fourth Schedule to the Central Excise Act, 1944 (this includes tobacco and specified petroleum products)
  • Cases for which the taxpayer has been convicted under the Central Excise Act, 1944 or the Finance Act, 1944
  • Cases involving erroneous refunds
  • Cases pending before the Settlement Commission.

Benefits of the Scheme –

  • Total waiver of interest, penalty and fine
  • Immunity from prosecution
  • Cases pending in adjudication or appeal, a relief of 70% from the duty demand if it is ₹ 50 Lakh or less and 50% if it is more than ₹ 50 Lakh
  • The same relief for cases under investigation and audit where the duty involved is quantified on or before 30th June, 2019
  • In case of an amount in arrears, the relief offered is 60% of the confirmed duty amount if the same is ₹ 50 Lakh or less and it is 40% in other cases
  • In cases of voluntary disclosure, the declarant will have to pay full amount of disclosed duty.

Other Points to Note –

  • Facility for adjustment of any deposits of duty already made
  • Settlement dues to be paid in cash electronically only and cannot be availed as input tax credit later
  • A full and final closure of the proceedings in question. The only exception is that in case of voluntary disclosure of liability, there is provision to reopen a false declaration within a period of one year
  • Proceedings under the Scheme shall not treated as a precedent for past and future liabilities
  • Final decision to be communicated within 60 days of application
  • No final decision without an opportunity for personal hearing in case of any disagreement
  • Proceedings under the Scheme will be fully automated.

Tax Marvel Comments – The entity should make a careful analysis of all pending disputes which is eligible for settlement under this Scheme. No doubt this is one time opportunity to clear all eligible pending disputes which shall save litigation cost as well as manpower time.

The FAQ for the said scheme which was released by CBIC can be accessed through the following link

Note – This is for information only. For exact details of changes, the notification/Circular may please be referred to, as and when they are issued.

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  1. JAYA TRINIDAD says:

    Hi I would like to benefit under this scheme. My Client could not pay his service tax liability because of lac of funds. Can he pay now by availing this scheme. Also how do we file the return?

  2. chetan says:

    one of my client is showing service tax liability in the income tax audit but he never received notice from service tax department
    now after working on the same we understand that the liability shown in incometax audit is far larger then actual….
    (but still cant find actual liability due to lack of information )
    question :- will it be suitable for me to take the advantage of this scheme…?
    how to reach to voluntary liability….?

  3. Ajit Sharma says:

    I would like to take benefit under Sabka Vishwas Scheme for Service Tax. The only problem I am facing is not able to remember my user id & Password or email of my online account. Please guide me what is the alternate solution to credit my Tax under the amnesty scheme online. Can I create my nrw user id online or any alternate option to pay taxes online ? Please Help.

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