44% taxpayers come forward to settle pending dues

Vijay C Roy

Tribune News Service

Chandigarh, January 17

Almost 44% of eligible taxpayers in the northern region have applied for availing benefits under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS). Once their application is approved, their pending disputes relating to legacy service tax and central excise cases would be closed. The two taxes are now subsumed under GST.

According to sources, 6,981 taxpayers in the region, comprising Chandigarh, Punjab, Himachal Pradesh and the erstwhile Jammu & Kashmir, have submitted their applications and the amount involved is around Rs 3,168.30 crore. January 15 was the last date to avail benefits under the tax amnesty scheme.

“We will examine their applications within 60 days and if, found eligible, they would be entitled to benefits,” said a senior official.

The benefits under the scheme include complete waiver of interest and penalty and in some cases, relief of up to 70% of the tax liability. Around 16,000 taxpayers were eligible to avail the scheme, which was in operation since September 1, 2019.

According to tax experts, the scheme offered a great opportunity at a time when penalisation for non-compliance is stringent. In many cases, interest and penalty is higher than the principal tax amount due.

According to insiders, however, many of the taxpayers in the region did not opt for the scheme due to many reasons. One probable reason was the assessees might have thought the penalty imposed under the erstwhile law was not applicable to them and they could challenge it. Secondly, there could be a vast array of intermediaries, including tax consultants and lawyers whom they rely upon and they would have advised them not to avail of the scheme. For obvious reasons, the immediate settlement of these long- pending cases is not seen in the best interests of these intermediaries.

Nationally, according to the Central Board of Indirect Taxes and Customs (CBIC), 1.84 lakh taxpayers were eligible to avail of the scheme, as many as 1,33,661 taxpayers had submitted their applications by the morning of December 31, 2019. Their applications involve tax dues of Rs 69,550 crore and after availing various reliefs, the payable amount is Rs 30,627 crore. The data till January 15 could not be accessed.

The SVLDRS was introduced in the last Budget with an intention to focus on GST by clearing all litigations and cases pending at various platforms with respect to previous tax regime, especially central excise and service tax. The scheme was launched with a view to de-stress the courts by way of reduction in the long-pending disputes.

In addition to this, the government had also provided an opportunity for voluntary disclosure option to non-compliant taxpayers. Initially, the scheme was operational till December 31, 2019. However, it was extended to January 15 to facilitate the taxpayers.