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ISSUE 1: Assessee has paid 100% Tax before enactment of VCES, 2013 but failed to file the ST return. Query – Whether the assesse can file a declaration under VCES, 2013 and get the benefit of immunity from Interest & Penalty?

Our View: No, in this case the assessee cannot file a declaration under VCES. Under VCES a declaration can be made only in respect of “tax dues”. A case where no tax is pending, but return has not been filed, does not come under the ambit of the Scheme. However, rule 7C of the Service Tax Rules provides for waiver of penalty in deserving cases where return has not been filed and, in such cases, the assessee may seek relief under rule 7C.

ISSUE 2: Assessee has made part payment of his ‘tax dues’ on any issue before the scheme was notified and makes the declaration under VCES for the remaining part of the tax dues.

Query – Will he be entitled to the benefit of non-payment of interest/penalty on the tax dues paid by him outside the VCES, i.e. amount paid prior to VCES?

Our ViewNo, the assessee will not get immunity from the levy of interest & penalty on the amount paid prior to VCES, 2013. The immunity from interest and penalty is only for “tax dues” declared under VCES. If any “tax dues” have been paid prior to the enactment of the scheme, any liability of interest or penalty thereon shall be adjudicated as per the provisions of Chapter V of the Finance Act, 1994 and paid accordingly. However, in our view – once a declaration under VCES, 2013 for any period has been filled the penalty for non-filling / late filling of the return should not be levied for that period.

QUERY: WHAT IS THE DATE OF ENACTMENT OF THE SCHEME?

The scheme is enacted from the date of acceptance of the Finance Bill, 2013 by the President of India i.e. 10-05-2013.

CA Ritul Patwa is a partner of M/s. Ritul Patwa & Co, Chartered Accountants, Jaipur and can be contacted through www.ritulpatwa.com or e-mail at rp@ritulpatwa.com


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Category Service Tax, Other Articles by - CA RITUL PATWA 



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