The Government of Punjab has notified the Punjab One Time Settlement Scheme for Recovery of Outstanding Dues, 2025, effective from October 15, 2025, and applicable across the state. The scheme aims to resolve pending tax liabilities under several laws, including the Punjab General Sales Tax Act, 1948; the Central Sales Tax Act, 1956; the Punjab Infrastructure (Development and Regulation) Act, 2002; the Punjab Value Added Tax Act, 2005; the Punjab Entertainment Duty Act, 1955; and the Punjab Entertainments Tax (Cinematograph Shows) Act, 1954.
The scheme covers cases where assessment, rectification, revision, or amendment orders have been made up to September 30, 2025, as well as penalty orders under Section 14-B of the PGST Act or Section 51 of the PVAT Act. However, it specifically excludes government food grain agencies such as FCI, Markfed, PUNSUP, PSWC, Punjab Agro, and PUNGRAIN. Applications must be filed by December 31, 2025, using prescribed Form OTS-1, accompanied by proof of full payment of the self-assessed determined amount.
Upon submission, applications will be verified by the designated officer, who may either issue an order of settlement or reject the application if deficiencies are not rectified. Applicants in appeal before courts or tribunals can also opt for the scheme but must withdraw their appeals within one month of settlement. No refunds will be granted for excess amounts already paid, and no appeal lies against the order of settlement.
The scheme also provides that settlements obtained by suppression of facts or false information will be void, with dues recoverable under the respective laws. Applications are order-specific, and compliance with all conditions is mandatory for the settlement to remain valid.
GOVERNMENT OF PUNJAB
DEPARTMENT OF EXCISE AND TAXATION
NOTIFICATION
The 30th September, 2025
No.S.O.305/P.A.46/1948/S.11/P.A.8/2005/S.29A/C.A.74/1956/ S.9/P.A.8/2002/S.25/P.A. 16/1955/S.3/P.A.8/1954/S.8/P.A.5/2017/S.174/ 2025.-Whereas,the State Government on being satisfied that it is necessary, so to do in public interest and in order to ensure compliance and transparency, to notify a Scheme for settlement of unpaid tax liabilities.
SCHEME
1. Short title, extent, commencement and applicability.- (1) This Scheme may be called the Punjab One Time Settlement Scheme for Recovery of Outstanding Dues, 2025.
(2) It shall extend to the whole of the State of Punjab.
(3) It shall come into force on and with effect from the 15` day of October, 2025.
(4) (i) It shall only be applicable to the cases,-
(a) under the relevant Act(s) where the assessment or rectification or revision or amendment of assessment has been made till the 30th day of September, 2025; and
(b) where penalty order under section 14-B of the Punjab General Sales Tax Act, 1948 (Punjab Act No. 46 of 1948) or section 51 of the Punjab Value Added Tax Act, 2005 (Punjab Act No. 8 of 2005) has been passed till the 30″ day of September, 2025.
(ii) It shall not be applicable to the cases of Government Food Grain Agencies, such as Food Corporation of India (FCI), Punjab State Co-op Supply and Marketing Federation Limited (Markfed), Punjab State Civil Supplies Corporation Limited (PUNSUP), Punjab State Warehousing Corporation (PSWC), Punjab Agro Industries Corporation Limited (Punjab Agro), and Punjab State Grains Procurement Corporation Limited (PUNGRAIN).
(iii) No application for settlement of outstanding dues under this Scheme for cases mentioned at (i) above shall be entertained after the 3181 day of December, 2025.
2. Definitions.- (1) In this Scheme, unless the context otherwise requires,-
(a) “applicant” means a person who is liable to pay outstanding dues under the relevant Act(s) and has opted for settlement under this Scheme;
(b) “total additional demand” means the demand created on the basis of the assessment or rectification or revision or amendment of assessment order including interest and penalty;
(c) “determined amount” means the amount payable by the applicant as a result of settlement under the Scheme, after availing waiver, as specified in the Schedule;
(d) “net demand” means reduced demand after submission of statutory declaration forms as applicable in the Central Sales Tax Act, 1956 (Central Act No. 74 of 1956);
(e) “order of settlement” means an order issued under this Scheme for settlement of outstanding dues under the relevant Act(s);
(f) “relevant Act(s)” means the following Acts, namely: –
i. the Punjab General Sales Tax Act, 1948;
ii. the Central Sales Tax Act, 1956;
iii. the Punjab Infrastructure (Development and Regulation) Act, 2002;
iv. the Punjab Value Added Tax Act, 2005;
v. the Punjab Entertainment Duty Act, 1955, and
vi. the Punjab Entertainments Tax (Cinematograph Shows) Act, 1954; and
(g)”demand” means-
i. tax or duty assessed as per the order, other than interest and penalty; and
ii. penalty and tax (if any) imposed under section 14-B of the Punjab General Sales Tax Act, 1948 or under section 51 of the Punjab VAT Act, 2005.
Explanation.-
i. For the purposes of this Scheme, an order shall include any assessment, rectification, revisional and/or amendment order.
ii. For the purposes of availing this Scheme, the slab in which an applicant may opt for the Scheme—as specified in the Schedule appended to this Scheme shall be determined based on the demand as defined in clause 2(1)(g).
(2) The words and expressions used in the Scheme, but not defined, shall have the same meaning as assigned to them under the relevant Act(s).
3. Settlement of outstanding dues.- (1) Any person (except Government Food Grain Agencies) whose assessment or rectification or revision or amendment of assessment has been made under the relevant Act(s) up to the 30th day of September, 2025 shall be eligible to apply and avail the settlement under this Scheme, subject to the terms and conditions specified in this Scheme.
2. Any person against whom a penalty order is passed under section 14-B of the Punjab General Sales Tax Act, 1948 or under section 51 of the Punjab Value Added Tax Act, 2005 shall be eligible to apply and avail the settlement under this Scheme, subject to the terms and conditions specified in this Scheme.
3. The applicant shall be required to make an application in FORM OTS-1 along with additional original statutory forms, if any, to the concerned Assistant Commissioner of State Tax/Assistant Excise and Taxation Commissioner/State Tax Officer/Excise and Taxation Officer (hereinafter referred to as the officer”). The application shall be accompanied with the proof of full payment of the self-assessed determined amount under the relevant Act(s).
4. On receipt of application, an acknowledgment in FORM OTS-2 shall be issued by the concerned officer.
5. On examination of the application,-
a. if there is any deficiency in the application, the concerned officer shall serve a deficiency memo in FORM OTS-3 on the applicant with the directions to remove the deficiencies within fifteen working days from the date of service of deficiency memo. Where the applicant fails to submit a reply to the said deficiency memo within fifteen working days, his application shall be deemed to have been rejected;
b. where the concerned officer is satisfied with the self-assessed determined amount along with proof of payment of the amount thereof and other particulars mentioned in the application or the applicant removes the deficiencies pointed out in deficiency memo in FORM OTS-3 within the specified time period to the satisfaction of the concerned officer, an order of settlement in FORM OTS-4 under the relevant Act(s) shall be passed by such officer and the same shall be communicated to the applicant; and
c. where the concerned officer is not satisfied with the self-assessed determined amount along with proof of payment of the amount thereof and other particulars mentioned in the application, or the applicant has not removed the deficiencies pointed out in deficiency memo in FORM OTS-3 within the specified period to the satisfaction of the concerned officer, an order of rejection of application in FORM OTS-5 under the relevant Act(s) shall be passed by such officer and the same shall be communicated to the applicant.
6. Where the application is rejected, the self-assessed determined amount paid by the applicant along with FORM OTS-1 shall be adjusted against the total additional demand or net demand payable by him prior to the filing of application in FORM OTS-1. The balance of the total additional demand after adjustment shall be recoverable as per the provisions of the relevant Act(s).
4. Terms and Conditions.- (1) Any person, whether or not in appeal before any of the Appellate Authorities i.e. the Deputy Excise and Taxation Commissioner (Appeals) or the Punjab Value Added Tax Tribunal or the Hon’ble Punjab and Haryana High Court or the Hon’ble Supreme Court or any other court(s), shall be eligible to apply and avail settlement under this Scheme:-
Provided that the applicant who is in appeal, shall submit a declaration along with Indemnity Bond that once the dues are settled under this Scheme, the said applicant shall withdraw such an appeal within a period of one month from the date of communication of order of settlement and shall submit the proof thereof to the concerned officer.
Explanation.- The term ‘appeal’ also includes any legal proceedings related to the order or the penalty order passed under the relevant Act(s) that is pending before the Hon’ble Supreme Court or the Hon’ble Punjab and Haryana High court or any other Court(s).
(2)Where the applicant does not comply with the aforesaid condition of withdrawal of appeal, the order of settlement shall be null and void ab-initio and the amount deposited along with the application in FORM OTS-1 shall be adjusted against the total additional demand payable by him prior to the filing of application in FORM OTS-1. The balance total additional demand after adjustment shall be recoverable as per the provisions of the relevant Act(s).
3. Where the applicant has deposited certain percentage of total additional demand as pre-requisite for the filing of an appeal or otherwise under the relevant Act(s), the amount so deposited shall be adjusted towards the payment of determined amount.
4. Where any amount already deposited is in excess of the determined amount, the same shall not be refunded to the applicant.
5. The FORM OTS-1 shall be filed separately for each order under the relevant Act(s) and accordingly an order of settlement shall be issued separately for each order or penalty orderunder the relevant Act(s).
6. No appeal against an order of settlement shall lie before any of the Appellate Authorities i.e. the Deputy Excise and Taxation Commissioner (Appeals) or the Punjab Value Added Tax Tribunal or the Hon’ble Punjab and Haryana High Court or the Hon’ble Suprerre Court or any other Court(s).
7. Where any amount shown as paid in the order or with the application in FORM OTS-1 is later found to be actually unpaid, then the settlement order to the extent of amount found unpaid shall stand cancelled and the said amount shall be recoverable as per the provisions of the relevant Act(s), notwithstanding the said settlement order.
8. Where the applicant fails to comply with any of the terms and conditions of the Scheme, the settlement order so issued shall stand cancelled and any amount deposited by the applicant shall not be refunded but shall be adjusted against the total additional demand payable prior to the filing of application in FORM OTS-1. The balance amount after such adjustment shall be recoverable as per the provisions of the relevant Act(s).
9. Any amount paid or deposited by the applicant in relation to any order under any of the relevant Act(s) before the implementation of this Scheme shall not be refunded.
10. The cases settled under this Scheme can be revoked only in case where the settlement is done by suppression of facts or by providing false information. The order of settlement shall be null and void ab-initio and the amount deposited along with the application in FORM OTS-1 shall be adjusted against the total additional demand payable by him prior to the filing of application in FORM OTS-1. The balance total additional demand after adjustment shall be recoverable as per the provisions of the relevant Act(s).
(11) No additional statutory declaration forms shall be accepted after the submission of the application in FORM OTS-1.
5. Power to remove difficulties.– If any difficulty arises in giving effect to any provision of the Scheme, the Commissioner, may, by a general or a special order, published in the Official Gazette, make such provisions not inconsistent with the provisions of this Scheme, as may be necessary or expedient for the purpose of removing the said difficulty.
