CBIC has announced relief to taxpayers facing demands for short payments or non-payments, as long as they comply with the prescribed conditions, including full payment of the tax demanded by March 31, 2025, or within six months of redetermination by the proper officer in certain cases.
Scope and Applicability
The waiver of interest or penalty applies to specific cases:
- Pending Adjudication: Where a notice or statement has been issued under Section 73, but no order has been passed.
- After Adjudication but Before Appeal: Where an order has been issued under Section 73, but no decision has been made by the Appellate Authority or Revisional Authority.
- Post-Appeal Cases: Where an order has been passed by the Appellate or Revisional Authority, but the case has not been decided by the Appellate Tribunal.
- Additionally, cases where the initial notice was issued under Section 74 (fraudulent cases) but later redetermined under Section 73 are also eligible for the waiver.
Application Process and Time frames
Taxpayers must submit their applications in FORM GST SPL-01 (for pre-adjudication cases) or FORM GST SPL-02 (for post-adjudication cases) on the common portal within three months of March 31, 2025. For cases where the tax is redetermined, the application must be filed within six months from the issuance of the redetermined order. Importantly, taxpayers must ensure full payment of the tax as demanded before applying for the waiver.
Multiple Demands
In cases where multiple demands have been issued for the period between July 2017 and March 2020, separate applications must be filed for each demand notice or statement. Taxpayers must make the necessary payments using FORM GST DRC-03 for non-adjudicated cases or by paying through the Electronic Liability Register for adjudicated cases.
Withdrawal of Appeals
If a taxpayer has filed an appeal or writ petition against the demand notice or order, they are required to withdraw it before submitting an application for a waiver under Section 128A. Proof of withdrawal must be submitted along with the application, and the final order of withdrawal must be uploaded within one month of its issuance.
Clarifications on Waiver Calculation
In determining the amount of tax payable, deductions can be made for input tax credits (ITC) that were initially denied due to contraventions of Section 16(4), but which are now allowed due to the retrospective insertion of Sections 16(5) and 16(6). However, ITC denied on grounds other than Section 16(4) cannot be deducted.
