Gujarat Vat | Amnesty Scheme

Hello All,

Good news for businesses having pending litigation cases under Gujarat VAT and related laws.

Gujarat Government, as promised in the State Budget 2019, has issued resolution no. GST-102019-2006-Th dated 11 September 2019 to provide an amnesty scheme. The pure purpose of this scheme is to reduce pending litigation, start afresh and smooth transition of GST.

We have highlighted some important aspect from scheme for your quick reference:

√     Coverage:

This scheme shall cover dues under following Acts which are subsumed, sub-merged or abolished on account of GST implementation:

• The Gujarat Sales Tax Act
• The Gujarat Value added Tax Act
• Central Sales Tax Act, 1956
• The Gujarat Tax on Entry of specified goods into local areas Act, 2001
• The Bombay Sales of Motor Spirits Taxation Act, 1958; and
• The Gujarat Purchase Tax on Sugar cane Act, 1989

√     Cut-off:

Cust-off date for the scheme shall be 30 June 2017. That means, dues arising pursuant to audit assessment, re-assessment, revision, appeal, etc. for the transactions undertaken by the said date shall be covered under the scheme.

√     In-eligibility :

• Aggregate dues (tax, interest and penalty) under all specified laws for all past years is Rs 100 crores or more.
• Cases of bogus billing
• Firms of the fugitive criminals declared under the Extradition Act, 1962.
• Cases where only penalty has been imposed

√     Quantification of Remission (Given at Table 1 below):

√     Application filing (general provision):

• Application to be made to be made in specified form alongwith requisite order/notice for which dues are declared between 15 September 2019 to 15 November 2019.
• After receipt of application, dealer shall be informed by officer on pending dues by 30 November 2019.
• Remission order to be given under the scheme by the officer (date for passing the order is not specified).

√     Issue wise Application filing:

• In case of Appeal cases, Issue wise application and withdrawal is permitted.
• Application cannot be made for certain transactions and appeal be continued for the balance transactions in single issue.

√    Order wise Application filing:

Not mandatory to apply in the scheme for all orders. That means, application for only a particular assessment order is possible.

 √     Payment under the scheme:

• 10% of the amount confirmed : to be paid as a down payment by 15 January 2020.
• Balance 90% : To be paid by way of 11 equal monthly instalment from February 2020 to December 2020.
• Monthly instalment to be paid before the end of the respective month.
• Failure to pay instalment in time will result in denial of benefit under the scheme and amount paid till such failure will be adjusted from the Total dues as per the legal provisions.

√     Voluntary application :

Benefit of Voluntary disclosure is also permitted under the scheme with undertaking that the dealer would be liable for payment of dues not declared as per the normal provisions.  Remission to be granted in such cases would be that of a regular dealer category (as specified above).

 √     Departmental appeal Cases: 

• Where department has filed appeals before Tribunal or the Court is also covered under the scheme.
• In such cases, demands disputed by the department has to be accepted in the scheme and application to be filed accordingly.

√     Adjustment of amount paid before the scheme: Amount paid before the date of scheme shall be adjusted against interest, penalty and tax in sequential order.

√     Other conditions:

• Refund shall not be granted under the scheme; and
• Appeal cannot be filed against the decisions taken by the authorities under the scheme.

Happy to serve!!

Table – 1

Type of dealer	Remission from tax	Remission from interest	Remission from penalty	Other conditions
Regular Dealer	No Remission	100%	100%	– Part of the tax paid, before the implementation of the scheme) shall be deducted (by way of remission) from the tax payable. – Provided, such deduction would be restricted to 50% of the tax payable under the scheme
Proceedings where penalty has been imposed u/s 34(7) OR Enforcement proceedings	No Remission	– Interest to be paid @ 20% of the interest payable. – Provided, this amount should not exceed 50% of tax payable.  (That means, interest in excess of 50% of Tax shall be remitted)	100%	– Part of the tax paid, before the implementation of the scheme shall be deducted (by way of remission) from the tax payable. – Provided, such deduction would be restricted to 25% of the tax payable under the scheme
Cases involving Entry tax and Motor Spirits tax	No Remission	Not Applicable	80%	Nil