Sabka Vishwas Scheme, an Official Farewell to Pre-GST Era

Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 (the “Scheme”), introduced vide
Finance (No. 2) Bill , 2019, is a revenue mobilization drive by the Finance Ministry and an
attempt to provide quick and formal farewell to pending litigations pertaining to pre-GST
era.
An estimated Rs.3.75 trillion that is locked up in litigations under the pre-GST regime is
attempted by the Scheme to recover the same speedily and painlessly.
The Scheme covers Central Excise and Service Tax Acts of the pre-GST era along with 26
minor acts, which are provided in the below diagram.

Central
Excise Act,
1944

Any other Act Central

as may be Excise Tariff
notified
Sabka Act, 1985

Vishwas
Scheme

26 other Acts
Service Tax
for levy of
(Chapter V of
cesses or
Finance Act
additional
1994)
duties

Eligiblility:
Status as on 30th June 2019 Eligibility
SCN received and final hearing not completed Yes
SCN received and final hearing completed No
Demand Order for SCN received, appeal pending. final hearing not Yes
completed
Demand Order for SCN received, appeal pending and final hearing No
completed
Demand Order for SCN received and limitation for filing appeal expired Yes
Order against any appeal attaining finality, next higher appeal not filed Yes
Return filed showing duty payable but not paid Yes
Enquiry, investigation or audit where amount is quantified Yes
Enquiry, investigation or audit where amount is not quantified No
Voluntary Disclosure Yes
SCN relatable to late fee and/or penalty where amount of duty is paid or is Yes
NIL
The Scheme operates in 8 steps as stated below:

Declaration in
E-form

Discharge
Certificate to be
issued within 30
days Designated
Committee (DC)
to verify

Pending csses
up to Tribunal
will be
withdrawn
Sabka DC to indicate
Vishwas amount payable
within 60 days

Scheme

Amount to be DC to isssue an
paid within 30 estimate in 30
days days where the
amount payable
is hogher than
declareation
Indicate
amount payable
within 60 days
after resolving
with applicant

The Scheme provides relief from various tax obligations based on eligibility criteria as below
Relief (% of Relief (% of
Declaration is in relation to Tax dues) Tax dues)
Dues <= INR 5 Dues > INR 5
million million
SCN or Appeal 70 50
SCN for late fee/penalty where duty is paid or is 100 100
NIL
Amount in arrears or declared in returns but unpaid 60 40
Amount quantified before June 30, 2019 in enquiry, 70 50
audit or investigation
Voluntary Disclosure NIL NIL

Government intends to rinse pending litigations in one go, the Scheme would prevail over a
period of two years from the date it is notified in the official gazette within which all eligible
taxpayers have to apply and obtain the relief from on-going litigations covered under the
Scheme. This scheme is yet to be notified in the official gazette.
Speakers:

Sundeep Gupta, Partner- ASA & Associates

Subroto Bose, Executive Partner- ASA & Associates