Goods and Service Tax (GST) Acts came into force on July 1, 2017. Before these Acts were implemented in Maharashtra, there were a bunch of other tax laws in place. Some of those tax laws have been done away with and incorporated into GST. Now, there’s a whole bunch of cases pending that involve outstanding dues and legal disputes.
Now, in light of all this, the Government of Maharashtra came up with a cool scheme “Maharashtra State Tax on Professions, Trades, Callings and Employments Act, 1975”. They want to unlock the money that’s tied up in those outstanding dues and reduce the number of old pending legal battles. So, they’ve introduced this beneficial settlement scheme for dues under 11 Acts “relevant acts” which include MVAT Act and CST Act.
Pretty neat, right? Here, we will briefly take a look at:
- Who all can opt for this scheme.
- What are the benefits available under this scheme.
- When can one opt into the scheme.
I. Who all can opt for this scheme? [Section 4 of the Scheme]
- Any person whether or not registered under the relevant Acts.
- Any person whether or not he has filed an appeal under the relevant Acts.
[In case arrears are being disputed in appeal pending before the Appellate Authority/ Tribunal/ Court, it needs to be withdrawn fully and unconditionally by the applicant.]
- Any person who had earlier submitted an application for availment of benefits under any previous settlement schemes however so is not satisfied with the settlement order received may also opt for this scheme.
II. What are the benefits available under this scheme?
Benefits have been provided in the form of waiver of tax, interest, penalty and late fee “collectively referred to as arrears”, which have been determined in any statutory order under the relevant Acts. The waiver benefits have been summarised as below:
| Particulars | Arrears upto Rs 2 Lakhs | Arrears upto Rs 50 Lakhs | Arrears more than Rs 50 Lakhs | |||
| Arrears pertaining to period upto 30th June, 2017 | Arrears pertaining to period from 1st April, 2005 to 30th June, 2017 | Arrears pertaining to period upto 31st March, 2005 | ||||
| 100% Waiver2 | One Time Payment option3 | One Time Payment option | Instalment option | One Time Payment option | Instalment option | |
| Un-disputed Tax1 | NIL | |||||
| Disputed Tax | 100% | 80% | 50% | 44% | 70% | 66% |
| Interest | 85% | 90% | ||||
| Outstanding penalty as per any statutory order | 95% | |||||
| Post assessment interest and penalty leviable under the relevant Act but not levied upto date of application by the dealer | 100% | |||||
| Late fee payable in respect of any returns filed on or before October 31, 2023 | 95% | 0% | ||||
III. When can one opt into the scheme [Section 10 of the Scheme]?
| Particulars | One Time Payment option | Instalment option |
| Time window for submission of application | 1st May 2023 to 14th Nov 2023 | |
| Time window for payment of arrears for which waiver is not available4 | 1st May to 31st Oct 2023. | Atleast 25% to be paid during 1st May to 31st Oct 2023. Residual amount to be paid within 9 months from application date, in 3 equal quarterly instalments. |
The scheme is expected to benefit small dealers and medium dealers in about 1.80 lakh cases. This step by the Government has come across as a significant relief to the dealers.
Footnotes:
1 As per Section 2(q) of the Scheme, “un-disputed tax” means:
(a) the taxes collected separately under the Relevant Act; or
(b) the taxes shown payable in the return or the revised return under the Relevant Act; or
(c) an amount claimed by the dealer as deductions or allowed by the designated authority as per rule 57 of the Value Added
Tax Rules or similar rules under other Relevant Act; or
(d) an amount forfeited under the statutory order or excess tax collection shown in the return, revised return or audit report,
as the case may be, submitted under the Relevant Act; or
(e) any amount of tax determined and recommended to be payable by the auditor, in the audit report submitted as per section 61 of the Value Added Tax Act, 2005 and accepted by the assessee, either wholly or partly; or
(f) the tax deducted at source (“TDS”) by the employer under the Value Added Tax Act; or
(g) the tax collection made under section 31A of the Value Added Tax Act; or
(h) the tax payable by the enrolment certificate holder under the Maharashtra State Tax on Professions, Trades, Callings and
Employments Act, 1975; or
(i) the tax deducted by the employer under the Maharashtra State Tax on Professions, Trades, Callings and Employments Act,
1975; or
(j) the amount of set-off disallowed under rule 52A or 52B of the Value Added Tax Rules, which is eligible to be claimed in
the subsequent period.
2 Any post assessment interest and penalty is waived completely if:
i. the tax due is discharged prior to April 30, 2023, and
ii. no order levying interest or penalty has been passed.
3 100% waiver is available only under one-time payment option. If instalment option is opted, then the waiver % available for arrears more than Rs 50 lakhs shall apply.
4In case less than the requisite amount is paid, waiver is available proportionately.
