1. ICAI- EASTERN INDIA REGIONAL COUNCIL’S 15-10-2019

2. Scheme Open from to

3. Nirmala Sitharaman ( Minister of Finance) Budget Speech
“GST has just completed two years. An area that concerns me is that we have huge pending litigations from pre-GST regime. More than lakh crore is blocked in litigations in service tax and excise. There is a need to unload this baggage and allow business to move on. I, therefore, propose, a Legacy Dispute Resolution Scheme that will allow quick closure of these litigations. I would urge the trade and business to avail this opportunity and be free from legacy litigations.”

4. Legal Background The Finance Act, (No.2 ) 2019 Section 120 to 135
Rules
9 rules (Sabka Vishwas (LDRS) Rules, 2019
Forms
6 Forms (SVLDRS 1, 2, 2A, 2B, 3 & 4)
Notifications
2 Notifications
1 . N.No. 4/2019-CE (NT) Dtd (Scheme from 1st Sept 2019 to 31st Dec 2019)
2. N.No. 5/2019-CE (NT) Dtd (Rules & Forms Notified)
Circular
2 Circular
1 . No. 1071/4/2019/-CX-8 Dt
2. No. 1072/05/2019/-CX Dt

5. Taxes/Cesses covered under the Scheme
The Central Excise Act, 1944 or the Central Excise Tariff Act, 1985 or Chapter V of the Finance Act, 1994 and the rules made there under. i.e(Service Tax)
▪26 types of Cess which are subsumed under GST which are covered by variouOther Acts

6. Taxes/Cesses covered under the Scheme
Other Acts covered

7. Cases 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 refunds or erroneous refunds
Cases pending before the Settlement Commission

8. Cases covered under the Scheme…
A show cause notice (Adjudication) or appeals arising out of a show cause notice pending as on the 30th day of June, 2019 (Pending Litigation)
An amount in arrears (Pending Arrears)
An enquiry, investigation or audit where the amount is quantified on or before the 30th day of June, (Confirmed EIA)
A voluntary disclosure (VDS)

9. Cumulative case study for SCN and Appeal
Final Hearing
takes Place
response to
SCN
Order Passed
against SCN
Due date of
appeal in
Higher
Appellate
forum
Appeal filed in Higher
Appellate forum
Eligible or
ineligible
under
Scheme
Tax Dues
which
category 1
1st Jan, 2019
2nd Jan, 2019
2nd March, 2019
Pending
Appeal 2
12th April, 2019 (but appeal admitted) 3
Appeal Not filed
Amount in
Arrears 4
1st May, 2019
2nd May, 2019
2nd July, 2019
29th June, 2019 5
Appeal filed on 15th July, 2019 (admitted
with extension) 6
Appeal not filed till date 7
1st April, 2019
2nd April, 2019
2nd June, 2019

10. Enquiry , Investigation or Audit
Enquiry or Investigation– under any of the indirect tax enactment, shall include the following actions, namely:-
(i) Search of premises;
(ii) Issuance of summons;
(iii) Requiring the production of accounts, documents or other evidence;
(iv) Record of statements;
Audit– means
any scrutiny, verification and checks carried out under the indirect tax enactment, other than an enquiry or investigation, and will commence when a written intimation from the central excise officer regarding conducting of audit is received

11. Disclosed in Return Filed
Waiver of Tax Dues
On Account of Show cause notice
>50,00,000 50%
<= 50,00,000 70%
Where Dues
are DISPUTED
On Account of Pending Appeal
On Account of Enquiry, Investigation or Audit
On Account of AMOUNT IN
ARREARS
Where Dues
are FINAL
>50,00,000 40%
<= 50,00,000 60%
Disclosed in Return Filed
Other than above

12. Waiver of Tax Dues On Account of SCN for LATE FEE, PENALTY 100%
No Relief
On Account of Voluntary Disclosure

13. Tax Dues In Case of Appeal
Total Amount of Dispute in appeal, (Sum total of Disputed amount by Declarant and Department)
In Case of Show Cause
Amount of duty stated to be payable in SCN
Cumulatively
In case of Enquiry Investigation or Audit
Duty which is Quantified
Amount in Arrears
-Duty where no appeal is filed before expiry of time,
-An order in appeal attaining finality,
-Amount disclosed in returns filed before
Voluntary Disclosure
-Amount quantified by declarant

14. “TAX DUES”
Q1. A SCN has been issued to me for an amount of duty of Rs.1000 and an amount of penalty of Rs.100. In the Order in Original (OIO) the duty confirmed is of Rs.1000 and an amount of Rs.100 has been imposed as penalty. I have filed an appeal against this order before the Appellate Authority. What will be the tax dues for me?
Ans. The amount of duty which is being disputed is Rs.1000 and hence the tax dues will be Rs.1000.
Q2. A SCN has been issued to me for an amount of duty of Rs.1000 and an amount of penalty of Rs.100. In the OIO the duty confirmed is of Rs.900 and penalty imposed is Rs.90. I have filed an appeal against this order. The department has not filed any appeal in the matter. What would be the tax dues?
Ans. The amount of duty which is being disputed is Rs.900 and hence the tax dues are Rs.900.

15. “TAX DUES”
Q3. A SCN has been issued for an amount of duty of Rs.1000 and an amount of penalty of Rs.100. In the OIO the duty confirmed is of Rs.900 and penalty imposed is Rs.90. I have filed an appeal against this order before the Appellate Authority. Further, Department has also filed an appeal before the Appellate Authority for an amount of duty of Rs.100 and penalty of Rs.10. What would be the tax dues? Ans. The amount of duty which is being disputed is Rs.900 plus Rs.100 i.e. Rs.1000 and hence tax dues are Rs Q4. A SCN has been issued for an amount of duty of Rs The Adjudicating Authority confirmed the duty of Rs I have filed an appeal against this order. The first appellate authority Commissioner Appeals/CESTAT reduced the amount of duty to Rs.900. I have filed a second appeal (before CESTAT/High Court. The department has not filed any appeal. What will be the tax dues for me? Ans. The amount of duty which is being disputed is Rs.900 and hence the tax dues are Rs.900.

16. Benefits under the Scheme…
100% amnesty from Interest, Late Fee and Penalty
Immunity from prosecution
Handsome waiver of Tax dues in specified cases
Bringing pending litigations to an ultimate end
Almost all the cases can be covered
Option of Voluntary Disclosure if case is not Specified
In cases of voluntary disclosure, the declarant will have to pay full amount of disclosed duty.

17. Other features of the Scheme…
Facility for adjustment of any deposits of duty already made (even if made through ITC)
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.
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 ( gst.gov.in)
Separate declaration shall be filed for each case.
SCN covers multiple matters- Declarant cannot opt irt selected matters

18. How to Apply for SVLDRS, 2019…
The taxpayer can apply for this scheme from
The taxpayer already registered under CE / ST can login and fill Part-B of SVLDRS Form-1.
The unregistered taxpayer can register himself by filling Part-A of SVLDRS Form -1.

19. Dashboard of the registered taxpayer

20. Taxpayer select the scheme

21. The answer to first four question should be “No” in order to apply for this scheme.

22. Different categories available under this scheme
Different categories available under this scheme. The taxpayer will select category , subcategory and duty type.

23. There are sub-categories based on the category selected and the taxpayer has to select Duty type also i.e. CE/ST. For e.g. Litigation category has 3 sub-categories.

24. For Arrears category, 2 sub-categories are there.

25. For Investigation category , 3 sub- categories i. e
For Investigation category , 3 sub- categories i.e. Investigation by DGGI/ Commissionerate /Audit are there.

26. By using “+” button of the Action column , the taxpayer can add row for entering the details of other duty details which were not covered in upper rows.

27. According to selection , table for entering data will appear

29. If the taxpayer doesn’t agree with the computer generated amount then the taxpayer can enter amount as per his calculation.

30. By clicking the submit button,
Form SVLDRS-1 will be submitted
to concerned Committee.
ARN will generated and
the taxpayer will be informed via and SMS.

32. The tax officer will be shown options to issue SVLDRS 2 and SVLDRS 3
The tax officer will be shown options to issue SVLDRS 2 and SVLDRS 3. SVLDRS-2 in case the tax officer doesn’t agree with the amount estimated by taxpayer/system generated. SVLDRS-3 in case the tax officer agree with the amount estimated by taxpayer/system generated.

33. In SVLDRS-2 , a PH date is also issued to the taxpayer along with the amount of estimated amount of tax dues .

34. Form SVLDRS-2A--If the taxpayer doesn’t agree with SVLDRS-2 form and in case want adjournment of PH.

35. Adjournment of PH by the tax officer.

36. SVLDRS-3 form is issued for final amount of tax dues to be paid by the taxpayer.

37. Form SVLDRS-3 issued to the taxpayer for final amount of “Tax dues less tax relief “ .

38. Challan generation and gateway to make payment window.

39. SVLDRS-4 form is the discharge certificate to be issued by the officer after payment of Duty/Tax/ Cess and submission of proof of withdrawal of appeal.

40. Important Definition Appellate forum, means QUANTIFIED
• the Supreme Court or
• the High Court or
• the Customs, Excise and Service Tax Appellate Tribunal or
• the Commissioner (Appeals)
QUANTIFIED
With its cognate expression, means a WRITTEN COMMUNICATION of the amount of duty payable under the indirect tax enactment
DESIGNATED COMMITTEE (Rule -5)
Principal Commissioner or Commissioner of Central Excise and Service Tax
Additional Commissioner or Joint Commissioner of Central Excise and Service Tax,
Deputy Commissioner or Assistant Commissioner of Central Excise and Service Tax,
Principal Additional Director General (Adjudication) or Additional Director General (Adjudication), Directorate General of Goods and Services Tax Intelligence (DGGI), and Additional Director or Joint Director, Directorate General of Goods and Services Tax Intelligence(DGGI), Delhi.
And Member Nominated by above.

41. Summary chart of Section 123, 124 and 125

42. Process flowchart for Declaration

43. Effect of Discharge Certificate

44. Disclaimer: Above is for the education purposes only, and is not intended to be treated or used as legal advice or opinion
THANKS
CA. PRADEEP MODI