New GST Amnesty Scheme: Complete Guide to Tax Waiver, Benefits & How to Apply Before Deadline

Table of Contents

Introduction: Unlocking Relief or a Missed Opportunity?

The GST Amnesty Scheme 2024, notified via Notification No. 17/2024 – Central Tax, is a game-changer for businesses struggling with past GST liabilities. The Indian government has launched this limited-time relief measure to help taxpayers clear their pending tax dues while waiving hefty interest and penalties on specific defaults under Section 73 of the CGST Act.

But is this amnesty scheme truly a lifeline for businesses, or does it come with hidden limitations that might not work for everyone? While it undoubtedly provides a golden opportunity for taxpayers to regularize compliance, businesses must carefully evaluate its advantages, challenges, and conditions to make the most of it.

In this article, we’ll break down everything about the GST Amnesty Scheme — its eligibility, application process, deadlines, benefits, and potential drawbacks — so you can make an informed decision before the scheme expires.

Key Features of the GST Amnesty Scheme 2024

1. Scope and Applicability

    • The scheme applies to tax demands raised under Section 73 of the CGST Act, which covers cases where tax was not paid or was short-paid without fraudulent intent.
    • It includes GST dues for the tax periods from July 1, 2017, to March 31, 2020.
    • Taxpayers who clear their full tax liability by March 31, 2025, will not be required to pay interest and penalties on the demand.
    • Cases involving erroneous refunds are not eligible for waiver benefits.

2. Eligibility Criteria

The scheme is available to taxpayers who have received:
    • Show Cause Notice (SCN) under Section 73(1) or a statement under Section 73(3) related to unpaid or short-paid GST.
    • Adjudication order under Section 73(9), where the GST officer has issued a demand order after due process.
    • Orders issued by the Appellate Authority or Revisionary Authority under Sections 107(11) or 108(1).

Note: If a taxpayer has already paid a part of the tax liability but still has an outstanding demand, they can avail of the scheme for the remaining unpaid amount.

Exclusions from the GST Amnesty Scheme

Certain taxpayers and cases are not eligible for the waiver benefits under this scheme:
    1. Erroneous Refunds: If a taxpayer received an incorrect GST refund, the scheme does not waive interest or penalties related to the recovery of that refund.
    2. Cases Under Section 74: If tax evasion, fraud, willful misstatement, or suppression of facts is involved, the case falls under Section 74 and is not covered under the scheme.
    3. Ongoing Litigation: If the taxpayer has filed an appeal or writ petition and has not withdrawn it, they cannot avail of the scheme. The taxpayer must withdraw pending litigation before applying.
    4. Cases With Existing Tax Payments: If the tax due for the specified period has already been fully paid along with interest and penalty, the taxpayer cannot claim a refund under the amnesty scheme.

Step-by-Step Process to Avail the GST Amnesty Scheme

Step 1: Review Tax Liabilities

    • Taxpayers should analyze their GST returns and tax records from July 1, 2017, to March 31, 2020, to check whether any demand notices were issued under Section 73.
    • If a demand exists and remains unpaid, they should calculate the total outstanding tax liability and compare the benefits of the scheme with the normal interest and penalty structure.

Step 2: Payment of Outstanding Tax

    • The taxpayer must pay the entire tax liability mentioned in the demand before March 31, 2025.
    • Payment should be made through the GST portal using the appropriate challan and payment options.

Step 3: Application Submission

    • Once the tax payment is completed, the taxpayer must submit an application for amnesty under the relevant form:
      1. For Show Cause Notices (SCN) under Section 73(1) or statements under Section 73(3): File Form GST SPL-01.
      2. For Adjudication Orders under Section 73(9), 107(11), or 108(1): File Form GST SPL-02.
    • These forms should be submitted via the GST portal along with proof of tax payment.

Step 4: Processing by GST Authorities

    • After submission, the GST department will verify the application and payment records.
    • If the application is correct, the officer will issue an order waiving interest and penalties using:
      • Form GST SPL-05 (for direct tax demands).
      • Form GST SPL-06 (for cases involving Appellate or Revisionary Orders).
    • In case of discrepancies, the officer may issue a clarification notice in Form GST SPL-04, and the taxpayer must respond accordingly.

Step 5: Closure of Proceedings

    • If everything is in order, the GST authorities will officially close the proceedings related to the waived interest and penalties.
    • The taxpayer receives a confirmation order, and no further legal action is taken for that demand period.

Important Deadlines to Remember

Event Deadline
Last date to pay tax dues March 31, 2025
Last date to apply for amnesty June 30, 2025
Deadline for re-determination cases (under Section 75(2)) 6 months from order date

Advantages of the GST Amnesty Scheme 2024

  1. Significant Cost Savings – Taxpayers can avoid hefty interest and penalties, making tax compliance financially manageable.
  2. Resolution of Pending Disputes – Helps businesses clear their past tax liabilities and avoid future legal complications.
  3. Improved GST Compliance – Encourages taxpayers to stay compliant and maintain a clean tax record.
  4. No Criminal or Legal Consequences – Reduces legal risks associated with non-payment of GST for the eligible tax periods.
  5. Simplified Process – The scheme provides a structured mechanism to regularize GST liabilities with minimal procedural hurdles.

Potential Challenges & Considerations

  1. No Refund for Previously Paid Interest or Penalties – If a taxpayer already paid interest or penalties, they cannot claim a refund.
  2. Excludes Section 74 (Fraud Cases) – Taxpayers with fraudulent or willful misstatements cannot benefit.
  3. Strict Deadline of March 31, 2025 – Partial payments are not allowed. The full tax amount must be paid before the deadline.
  4. No Relief for Post-2020 Defaults – Only covers tax periods before March 31, 2020.
  5. Appeals and Writ Petitions Must Be Withdrawn – Taxpayers challenging demands must withdraw their cases first.
  6. No Automatic GST Registration Reinstatement – Unlike previous schemes, this does not provide direct relief for canceled GST registrations.

Conclusion

The GST Amnesty Scheme is a golden opportunity for businesses and taxpayers to settle past GST liabilities without additional financial burden. By waiving interest and penalties, the government aims to encourage voluntary compliance and improve tax collection.

Taxpayers must act promptly, review their pending tax demands, make the necessary payments, and submit their applications before the deadlines to take full advantage of this beneficial scheme.

For expert guidance on GST compliance, tax litigation, and amnesty application filing, consult with a professional GST consultant or tax expert.

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