Arjun (Fictional Character): Krishna, the Maharashtra Government has introduced Maharashtra settlement of arrears of Tax, Interest, Penalty, or late fees scheme 2022 in the L.A. BILL No. IX of 2022 to settle old disputes. Considering the same, the government has introduced an disputes between Maharashtra government and taxpayers.

Krishna(Fictional Character): Arjuna, Maharashtra govt. has introduced a separate scheme on 16th March,2022 named as “Maharashtra Settlement of Arrears of Tax, Interest, Penalty, or Late fees 2022”. This scheme is applicable regarding concessions on various taxes levied by Sales Tax Department before introduction of GST Act i.e., for the periods up to 30th June 2017.It means the Govt. is in full endeavour to complete pending disputes of MVAT, etc. Due to which, disputes that are carried forward from years will be settled as well as Govt. will collect tax. Also, expenditure on disputes will be cut down. But how the taxpayers respond to this scheme, this has to be seen.

Arjun (Fictional Character): Krishna, what is meant by disputed amount?

Krishna (Fictional Character): Arjun, Disputed amount means Tax, Interest, penalty, late fees payable as per any Statutory order under the relevant act before GST i.e., MVAT, or notice, litigation, etc. Even if any amount is payable as per other disputes, this scheme shall be applicable.

Arjun (Fictional Character): Krishna, is there any specific condition to avail the benefit of this scheme?

Maharashtra settlement of arrears of Tax, Interest, Penalty, or late fees scheme

Krishna (Fictional Character): To avail benefit of this scheme, the appeal filed by the dealer needs to be withdrawn unconditionally

Arjun (Fictional Character): Krishna, what is the duration to pay required amount?

Krishna (Fictional Character): The duration of this Amnesty Scheme will be from April 1, 2022, to September 30, 2022. The dealer has to pay the required amount at one time within the stipulated period. However, the dealers having arrears of more than Rs. 50 lakhs have been provided an option to pay the required amount in instalments.

Annexure A

(for the period commencing on or after the 1st April 2005 and ending on or before the 30th June 2017)

Sr.

No.

Particulars One Time Payment

Option

Instalment Option
Amount Payment Waiver Payment Waiver
1 Undisputed Tax 100% 0% 100% 0%
2 Disputed Tax 50% 50% 56% 44%
3 Interest 15% 85% 15% 85%
4 Penalty 5% 95% 5% 95%
5 Post assessment
penalty or interest
0% 100% 0% 100%
6 Late fees 5% 95% 5% 95%
Or
7 Where amount of
arrears is less than or equal to 10,00,000
20% 80% NA NA

Annexure B

(for the period ending on or before the 31st March 2005)

Sr.
No.
Particulars Onetime payment
option
Instalment option
Amount Payment Waiver Payment Waiver
1 Undisputed Tax 100% 0% 100% 0%
2 Disputed Tax 30% 70% 34% 66%
3 Interest 10% 90% 10% 90%
4 Penalty 5% 95% 5% 95%
5 Post assessment
penalty or interest
0% 100% 0% 100%
6 Or
7 Where amount of
arrears is less than or equal to 10,00,000
20% 80% NA NA

Arjun (Fictional Character): Krishna, how to calculate amount payable under the scheme?

Krishna (Fictional Character): Arjun, Let’s take an example.

A disputed tax liability of Rs 2,50,000 dated 1st April 2017.

As per 1-5 point of Table As per 7th Point of Table
As per Statutory
Order
Amount Rate of

Amount to be paid

Amount to be Paid Rate of
Amount to
be paid
Amount to be Paid
Disputed Tax 2,50,000 50% 1,25,000 20% 50,000
Interest @ 18% 2,25,000 50% 1,25,000 20% 45,000
Penalty 2,50,000 5% 12,500 20% 50,000
Total 7,25,000 2,62,500 1,45,000
Conclusion: Thus, the assess shall opt for Point No.7.

Arjun (Fictional Character): Krishna, what should the taxpayer learn from this?

Krishna (Fictional Character): Arjun, in life, everything does not happen as we want it to happen. Everyone has to compromise somewhere or the other. Same goes with Tax regulations. This scheme is introduced so that MVAT taxpayers will not have to visit department for ages. We expect Central government to introduce same ordinances for Excise as well as service tax and other central tax laws

 

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Qualification: CA in Practice
Company: R.B. Sharma and Co
Location: Aurangabad, Maharashtra, India
Member Since: 27 Jan 2018 | Total Posts: 359
1. Vice-Chairmen of WIRC of ICAI for the year 2015-2021. 2. Youngest Chairman of Aurangabad Branch of WIRC of ICAI in 2002. 3. Author of Popular Tax articles series based on Krishna and Arjuna conversation i.e “KARNITI” published in Lokmat on every Monday. Till date 335+ weekly articles ha View Full Profile

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