SVLDRS, 2019 - Why pick on me?
NOVEMBER 05, 2019
By S T Vishesh
THE CBIC in its third Circular on the subjecct matter, numbered 1073/06/2019-CX, Dated: October 29, 2019 on the SVLDRS, 2019 has clarified (reproduced below)-
2(vi) Representations have also been received that the cases where appeals were filed after 30.06.2019 should also be allowed relief under the Scheme. It is stated that such cases are not covered per se. However, if a taxpayer withdraws the appeal and furnishes the undertaking to the department in terms of Para 2(viii) of Circular No. 1072/05/2019-CX dated 25.09.2019, they can file a declaration under the Scheme.
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Emphasis supplied
Take a look at the September 2019 Circular, paragraph 2(viii) -
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(viii) Section 121(c) (i) and (ii) define "an amount in arrears" as the amount of duty which is recoverable, inter alia, on account of no appeal having been filed by the declarant against an order or order in appeal before the expiry of the period of time for filing of appeal or the order in appeal having attained finality. There may be situations where the taxpayer does not want to file an appeal even though the time period for filing of appeal is not over. It is clarified that in such cases, the taxpayer can file a declaration under the Scheme provided he gives in writing to the department that he will not file an appeal. This declaration shall be binding on the taxpayer.
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Incidentally, the Board does not want you to tell the minuses of this round about manner of becoming eligible for the SVLDRS.
And that is, in terms of s. 124(1)(c), the relief which such a declarant is entitled is -
(c) where the tax dues are relatable to an amount in arrears and,-
(i) the amount of duty is, rupees fifty lakhs or less, then, sixty per cent. of the tax dues;
(ii) the amount of duty is more than rupees fifty lakhs, then, forty per cent. of the tax dues;
Had the appeal been filed before 30.06.2019, the relief would have been in terms of s.124(1)(a) of the FA, 2019 and which is -
(a) where the tax dues are relatable to a show cause notice or one or more appeals arising out of such notice which is pending as on the 30th day of June, 2019, and if the amount of duty is,-
(i) rupees fifty lakhs or less, then, seventy per cent. of the tax dues;
(ii) more than rupees fifty lakhs, then, fifty per cent. of the tax dues;
Little mercies upon the hapless assessee by the CBIC.
But then, what if the Order was passed prior to 30.06.2019 and the aggrieved assessee had, as per law, time to file appeal within the period mandated as per section 35 or for that matter section 35B of the CEA, 1944.
Merely because he filed appeal after 30.06.2019, why should he be at a disadvantage by not allowing to claim the relief as per clause (a) and be relegated to clause (b) (supra). Moreso, since what is intended to be achieved is to take the clock back and that can very well be construed to mean that the appeal was deemed to be filed and pending as on 30.06.2019.
After all, the assessee did not have a premonition that on the Budget Day, 2019, on 5th July 2019, the Government would come out with the SVLDR Scheme with so many ifs and buts.
Be that as it may, assuming that the Board wishes to extend the largesse to this category of assessees who would have otherwise missed the SVLDRS caravan, notwithstanding that the law does not actually welcome them, what is the "undertaking" that the Board wants the declarant to make in terms of paragraph (viii) of the Circular dated 25.09.2019 when the fact of the matter is that the potential declarant is withdrawing the appeal itself.
Should we wait for another circular to clarify the clarification issued?
(The views expressed are strictly personal.)
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