In a move aimed at reducing tax disputes and providing significant relief to taxpayers, the GST Council, in its 53rd meeting held on 22nd June 2024, recommended a waiver of interest and penalties on demand notices or orders issued under Section 73 of the CGST Act, 2017. This applies specifically to cases not involving fraud, suppression, or willful misstatement for the financial years 2017-18, 2018-19, and 2019-20. To avail of this waiver, the full tax demanded must be paid by 31st March 2025.
Introduction of Rule 164: Procedural Guidelines for Waiver Scheme
To facilitate this waiver, Rule 164 of the CGST Rules, 2017, was notified through Notification No. 20/2024 on 8th October 2024, and became effective from 1st November 2024. This rule provides the procedural guidelines for the waiver scheme. Taxpayers receiving a notice or order under Section 73 for the specified financial years are required to file an application in FORM GST SPL-01 or FORM GST SPL-02 on the common portal within three months from the notified date, i.e., by 31st March 2025.
Availability of Forms and Payment Guidelines
As the forms GST SPL-01 and GST SPL-02 are still under development, they are expected to be made available on the common portal in the first week of January 2025. In the meantime, taxpayers are encouraged to pay the demanded tax amount by 31st March 2025 to ensure they qualify for the waiver benefits.
Taxpayers can make the payment through the “payment towards demand” facility in the case of demand orders and through Form GST DRC-03 for notices. If payment has already been made through Form GST DRC-03 for any demand order, taxpayers must link the said Form GST DRC-03 with the demand order using Form GST DRC-03A, which is now available on the common portal.
Steps to Avail the Waiver
- File Application: Submit FORM GST SPL-01 or GST SPL-02 on the common portal within three months from the notified date.
- Pay Full Tax Amount: Ensure the full tax demanded is paid by 31st March 2025.
- Use Correct Forms: Use the “payment towards demand” facility for demand orders and Form GST DRC-03 for notices. Link payments made through Form GST DRC-03 with demand orders using Form GST DRC-03A.
Conclusion
This waiver scheme by the GST Council is a significant step towards resolving tax disputes and easing the burden on taxpayers. By adhering to the outlined procedures and meeting the specified deadlines, taxpayers can benefit from the waiver of interest and penalties, ensuring smoother compliance and reduced financial stress.
Do you have any questions or need further clarification on this waiver scheme?
