Haryana One Time Settlement Scheme for Recovery of Outstanding Dues, 2023

Introduction: Haryana’s Chief Minister, Sh. Manohar Lal, has addressed a longstanding request from traders and businesses by launching the One Time Settlement-2023 (OTS) Scheme, aimed at settling pending tax payments predating the GST implementation. Operational from January 1, 2024, to March 30, 2024, this scheme offers relief and introduces significant developments in the state’s taxation landscape.

Detailed Analysis: The OTS-2023 Scheme is a comprehensive initiative, categorizing taxes into four groups, each with distinct relief measures. The first category covers undisputed taxes, with taxpayers required to pay 100% of the amount without penalties or interest. For disputed taxes, varying percentages apply based on the outstanding amount, offering flexibility for businesses to settle their dues. The scheme also addresses concerns related to seven VAT-related acts, providing relief from penalties and interest in specific cases.

Notably, the Chief Minister announced the establishment of a GST Training Institute in collaboration with HIPA, Gurugram, emphasizing the importance of skill development and compliance in the evolving tax landscape.

The article further delves into the installment options available under the scheme, detailing how taxpayers with outstanding amounts below Rs 10 lakh must pay the entire sum before March 30th. The installment plans for higher amounts are also outlined, reflecting the government’s effort to facilitate smoother settlements for businesses of varying sizes.

Additionally, the article highlights the expansion of the Urban Ownership Scheme, providing ownership rights to shopkeepers, showcasing the government’s commitment to supporting honest taxpayers and boosting state revenue.

Conclusion: In conclusion, Haryana’s One Time Settlement-2023 Scheme stands as a progressive step towards resolving long-standing tax issues and fostering a conducive environment for businesses. The benefits provided across different tax categories, coupled with flexible installment options, aim to ease the financial burden on traders and industrialists. The government’s commitment to welfare programs and skill development initiatives, as reflected in the establishment of the GST Training Institute, underlines the holistic approach towards addressing the needs of the business community. As businesses embrace this opportunity to settle outstanding dues, Haryana aims to achieve significant revenue growth and strengthen its position as a leader in tax infrastructure in the country.

RELEVANT NOTIFICATION IS AS FOLLOWS:

HARYANA GOVERNMENT
EXCISE AND TAXATION DEPARTMENT
Notification
The 30th December, 2023

No. 71/ST-1.— Whereas, it is expedient for the recovery of outstanding dues under the Haryana Settlement of Outstanding Dues Act, 2017, therefore, in exercise of powers conferred under section 3 of the Haryana Settlement of Outstanding Dues Act, 2017 (35 of 2017), the Governor of Haryana hereby notifies the following scheme namely The Haryana One Time Settlement Scheme for Recovery of Outstanding Dues, 2023, for the period as prescribed in the Act, subject to the following conditions and restrictions, namely:-

1. Short title and commencement.

(1) This scheme may be called ‘The Haryana One Time Settlement Scheme for

(2) It shall come into force on such date, as the Government may, by notification in the Official Gazette, appoint.

Recovery of Outstanding Dues, 2023’.

2. Definition

For the purposes of this scheme, unless the context otherwise requires,-

(a) “admitted tax” means any amount of tax as admitted in return but not paid or short paid;

(b) “applicant” means any assesse or any person who is liable to pay any outstanding dues, whether registered or not, and who desires to avail the benefit of the scheme by complying with the conditions under this scheme;

(c) “appointed day” means the date on which the provisions of this scheme shall come into force;

(d) “differential tax” means the difference between the full rate of tax applicable under the relevant Act and the concessional rate applicable on submission of declaration forms as specified as Form ‘C’ and ‘F’ under rule 12 of the Central Sales Tax Rules, 1957:

Provided that where the concessional rate of tax has not been paid alongwith the return, then such cases shall not be covered under differential tax and shall be covered under the admitted, disputed or undisputed tax, as the case may be;

(e) “disputed tax” means any amount of tax other than admitted tax, differential tax or undisputed tax;

(f) “undisputed tax” means any amount of tax, other than the admitted tax or differential tax, as quantified by the taxing authority wherein no appeal is pending on the appointed day in relation to such amount before the appellate authority under the relevant Act, High Court or Supreme Court;

(g) “jurisdictional authority” means the appropriate assessing authority under whose jurisdiction the particular applicant falls;

(h) “relevant Act” means the Acts as mentioned in clause 3(1) of this scheme;

(i) “settlement amount” means the amount to be paid by the applicant for the settlement of his outstanding dues;

(2) Words and expressions used in this scheme, but not defined shall have the same meaning as assigned to them in the relevant Act.

3. Scope and application of the scheme.

(1) The scheme shall be applicable to the following Acts, namely :-

(i) The Haryana Value Added Tax Act, 2003 (6 of 2003);

(ii) The Central Sales Tax Act, 1956 (Central Act 74 of 1956) ;

(iii) The Haryana Local Area Development Tax Act, 2000 (13 of 2000);

(iv) The Haryana Tax on Entry of Goods in to Local Areas Act, 2008 (8 of 2008) ;

(v) The Haryana Tax on Luxuries Act, 2007 (23 of 2007) ;

(vi) The Punjab Entertainment Duty Act, 1955 (Punjab Act 16 of 1955) ;

(vii) The Haryana General Sales Tax Act, 1973 (20 of 1973)

(2) An applicant may opt for the Scheme under any of the relevant Act.

(3) Any amount paid under the Scheme shall be deposited under the Treasury Head of the relevant Act for which the scheme is being opted for.

(4) The applicant shall make a separate application for each assessment year under each relevant Act in Form OTS-1 for which he intends to settle his outstanding dues.

Example:- Mr. X is in receipt of a demand which contains liability for the Haryana Value Added Tax Act and the Central Sales Tax Act also for the Financial Year 2013-14. In this case, if Mr. X wishes to settle his dues, he shall make separate application under the Haryana Value Added Tax Act and the Central Sales Tax Act for Financial Year 2013-14. Both his applications shall be considered as unique and shall be processed accordingly.

4. Settlement of outstanding dues

(1) An applicant opting for settlement of outstanding dues under this scheme shall have to pay, by way of settlement, an amount in lieu of his outstanding dues as mentioned in Schedule-I.

(2) The applicant may opt to make payment for settlement of his outstanding dues in lumpsum or in installments as per the option available in Schedule-II.

(3) The applicant may make the payment for the second installment by the last date of the third installment on payment of additional interest of eighteen percent per annum for the period of delay.

(4) If payment is not made within the period specified in Schedule-II or such period as provided in sub-clause (3) above, the provisional order of acceptance shall be deemed to be withdrawn and it shall be presumed as if the application was never made and proceedings under the applicable relevant Act shall be instituted against the applicant and the jurisdictional authority shall issue the order of rejection in FORM OTS-5 accordingly.

5. Application procedure

(1) The applicant may opt for the scheme within ninety days from the appointed day.

(2) The applicant shall apply online in FORM OTS-1 along with proof of payment of the settlement amount or the first installment, whichever is applicable.

(3) On receipt of FORM OTS-1, a system generated acknowledgement shall be issued electronically to the applicant in FORM OTS-2.

6. Verification of form and extension of time limit

The procedure for processing of applications shall be in the following manner, namely:-

(a) The jurisdictional authority shall examine FORM OTS-1 within thirty days from the date of acknowledgement and send the application along with his comments for the recommendations to the Deputy Excise and Taxation Commissioner (hereinafter referred as “DETC”) concerned.

(b) In case the jurisdictional authority has reasons to believe that a particular application does not pertain to his ward, then he may transfer such application to DETC. The DETC shall then transfer such application to the concerned jurisdictional authority for processing of the application. In such cases, the timeline specified in para (a) above shall be from the date of such transfer of application.

(c) The DETC shall further examine the application within fifteen days and send the case back to the jurisdictional authority for either issuing deficiency notice in FORM OTS 3 or provisional settlement order in FORM OTS 4A (where the applicant has opted for installments or is supposed to submit proof of withdrawal of appeal) or a final order of settlement in FORM OTS 4.

(d) On receipt of communication from the DETC, the jurisdictional authority shall issue within fifteen days a deficiency notice in FORM OTS 3 or provisional settlement order in FORM OTS 4A or a final order of settlement in FORM OTS 4, as the case may be.

(e) The applicant shall submit his reply in FORM OTS-3A electronically within fifteen days of the date of issuance of deficiency notice in FORM OTS-3 along with requisite documents or proof of payment as required.

(f) On receipt of the reply of the applicant in FORM OTS-3A, the jurisdictional authority shall examine and send the case to the DETC with his recommendations within fifteen days from the date of FORM OTS-3A. The DETC shall examine the case within fifteen days and direct the jurisdictional authority either to issue provisional settlement order in FORM OTS 4A or a final order of settlement in FORM OTS 4 or an order of rejection in FORM OTS-5.

(g) On receipt of the directions issued by the DETC, the jurisdictional authority, shall within fifteen days from the receipt of such communication issue a provisional settlement order in FORM OTS 4A or a final order of settlement in FORM OTS 4 or an order of rejection in FORM OTS-5.

(h) Any applicant interested to opt for the scheme shall withdraw the appeal, if any, pending before the appellate authority under the relevant Act, High Court or Supreme Court in respect of any statutory order, fully and un-conditionally and submit proof of such withdrawal of appeal in FORM OTS-6 within one hundred eighty days from the receipt of FORM OTS 4A electronically to the jurisdictional authority before the final order of settlement.

(i) In case FORM OTS-6 is not furnished within one hundred eighty days from the receipt of FORM OTS 4A, it shall be presumed as if the application was never made and pending proceedings under the applicable relevant Act shall continue against the applicant.

(j) Any proceeding pending before any appellate authority under the relevant Act, High Court or Supreme Court shall be kept in abeyance till the final order of settlement in FORM OTS-4 or order of rejection in FORM OTS-5 is passed under this scheme, for those applicants who are opting this scheme.

(l) Where order of rejection of settlement in FORM OTS-5 is issued, the amount paid, if any, by the applicant shall be adjusted against his liabilities under the relevant Act and such amount shall not be refunded in any case.

7. Provisions under Section 142 of the Haryana Goods and Services Tax Act, 2017 for recovery of outstanding dues of existing law

(1) The applicants whose outstanding dues have been uploaded by the jurisdictional authority in FORM GST DRC-07A of the Haryana Goods and Services Tax Rules, 2017 for recovery of such dues under the Haryana Goods and Services Tax Act, 2017 (19 of 2017) shall also be eligible to take the benefit of the scheme.

(2) The jurisdictional authority shall after successful issuance of FORM OTS-4 modify the demand created through FORM GST DRC-07A and issue FORM GST DRC 08A of the Haryana Goods and Services Tax Rules, 2017.

8. Privileges emanating from the final order settlement.

(1) The final order of settlement passed under this scheme with respect to the amount payable under this scheme shall be conclusive as to the matter and time stated therein and the applicant shall not be liable, –

(i) to pay any further tax, interest or penalty with respect to the matter and time period covered in the final order of settlement;

(ii) to be prosecuted under the relevant Act with respect to the matter and time period covered in the order;

(2) All matters and time period covered by such order shall not be re-opened in any other proceedings under the relevant Act:

Provided that in case where any material particular furnished in the application is subsequently found to be false, within a period of two years from the date of order of settlement, it shall be presumed as if the application was never made and proceedings under the applicable relevant Act shall be instituted against the applicant.

9. No refund of amount already paid as tax, interest or penalty.

Any amount of tax, interest or penalty or any other sum payable or paid before the appointed day shall not be refunded or adjusted under this scheme.

10. Rectification of errors.

The authority who has passed the final order under this scheme, may rectify any error which is apparent on the face of record in such order, either on his own motion or where such error is brought to his notice by the affected person within a period of 30 days from the date of issuance of such order.

11. Removal of difficulty.

If any difficulty arises in giving effect to any provisions of this scheme, the Government may, by a general or a special order, make such provisions including amendment in forms not inconsistent with the provisions of this Scheme, as may be necessary or expedient for the purpose of removing the said difficulty.

12. Removal of doubt.

In case of any doubt arising out of this scheme, the decision of the Excise and Taxation Commissioner, Haryana thereon shall be final.

13. Applicants not eligible to opt scheme.

The following applicants shall not be eligible to opt for the scheme in case,-

(a) criminal proceedings have been initiated against the applicant for any reason(s) under the relevant Acts;

(b) the demand relates to erroneous refund(s) under the relevant Act.

14. Restrictions with regard to settlement.

Any amount paid under this scheme shall neither be paid through Input tax nor shall be allowed to be claimed as Input tax by any person under the relevant Act or any other Act.

15. No Appeal against the final order of settlement.

No appeal shall lie before any appellate authority under the relevant Act, High Court or Supreme Court against the final orders passed by the jurisdictional authority under this scheme.

16. Extension of time period.

(1) The Government, either on its own motion or on representation from stake holders may extend the time period for applying to this scheme.

(2) The Joint Excise and Taxation Commissioner (Range) on case to case basis may extend time period for issuance of any notice or order or any recommendations issued under this scheme by the DETC or the jurisdictional authority for a further period of not more than thirty days for reasons to be recorded in writing.

17. Indemnity.

(1) No suit, prosecution or other legal proceeding shall lie against the Government or any official /officer of the Government for anything which is done or intended to be done in good faith, in pursuance of this scheme.

(2) No proceeding shall be commenced against any official /officer merely on the ground of subsequent detection of an error in calculating the amount of outstanding dues payable by the applicant, unless there is evidence of misconduct.

Schedule –I: Settlement amount to be paid in lieu of outstanding dues
[see clause 4(1)].

Schedule-II: Option to pay in installments