GST Appeal Amnesty Scheme 2023

In its 52nd meeting, the GST Council introduced the concept of the GST Amnesty Scheme 2023, which would allow taxpayers to contest demand orders issued by tax inspectors until January 31, 2024.

GST Amnesty scheme for filing appeals on GST demand notices has several key points, as follows:

• Extended Filing Time for Appeals:
• Taxpayers are now granted an extended deadline until January 31, 2024, to file appeals against demand orders related to the GST.
• The extension comes in response to the outcome of the 52nd Goods and Services Tax Council meeting.
• Pre-Deposit Requirements:
  • Taxpayers are required to pay a pre-deposit amount of 12.5% of the tax under disputeto avail the benefits of the scheme.
  • At least 20% of the tax under dispute (equivalent to 2.5% of the tax amount) must be debited from the electronic cash ledger, which might impact the working capital positions of businesses.
• Coverage and Conditions:
  • The scheme covers cases where the appeal was not filed within the stipulated time frame under Section 107 of the CGST Act, 2017, for demand orders passed on or before March 31, 2023.
  • Appeals can be filed in instances involving tax liability along with interest and penalty, but not in cases related solely to interest, fines, and penalties.
• Scope of Sections 73 and 74:
  • Sections 73 and 74 apply to situations where the tax department identifies discrepancies such as tax shortfalls, non-payment, wrongful refund of input tax credit, or alleged misstatement or suppression of facts.
• Exclusions from the Amnesty Scheme:
• The amnesty scheme does not cover assessment ordersissued under Sections 62, 63, and 64, which primarily affect non-registered entities or non-filers of returns.
• The introduction of this scheme is expected to provide relief to taxpayers facing challenges related to the timely filing of appeals and promote smoother resolution of disputeswithin the GST framework.

GST Amnesty Scheme 2023:

• Amnesty Plan for Tax Appeals:
  • Taxpayers can contest demand orders issued by tax inspectors until January 31, 2024.
  • The deadline for filing appeals has been extended to provide taxpayers with more time to respond to assessment orders.
• Increased Pre-Deposit:
  • To avail of the extended appeal period, taxpayers are required to make an increased pre-deposit of 12.5%, up from the previous 10% of the tax demand.
  • A portion of the pre-deposit, at least 20% or 2.5% of the tax under dispute, must be debited from the Electronic Cash Ledger.
• Clarification on Property Attachments:
  • The validity of property attachments by tax authorities is now limited to one year, after which the attached property must be released.
  • This amendment ensures that temporary seizures of assets do not unduly affect businesses’ operations.
• Facilitating Taxpayers:
  • The GST Council’s decisions are aimed at making the GST system more taxpayer-friendly and providing relief to those facing challenges related to GST matters.
  • The extended deadline incentivizes adherence to tax regulations and encourages the expeditious resolution of disputes.
• Efficiency and Transparency:
  • The changes introduced by the GST Council contribute to enhancing transparency and fairness in the GST system.
  • The amendments streamline procedures related to appeals and property attachments, ultimately fostering a more efficient and taxpayer-friendly GST regime.