VOLUNTARY COMPLIANCE ENCOURAGEMENT SCHEME (VCES), 2013 - Service Tax Amnesty Scheme
Service tax being a new emerging law lack of clarity on the applicability of the service tax has always been there, among the trade, departmental officer and also among the consultants, this would have left lot of assesse not being compliant although has no intention to evade the payment of service tax. For all those who have wanted to voluntarily comply under service tax had to face interest and penalty with an added harassment of some of the corrupt department officials. In such state of affair amnesty scheme is undoubtedly will have a long way and if properly utilized can be very beneficial to the assesses.
This scheme is for all those assessees who have neither paid the service tax, neither filed any returns nor have not been served any notice or order. The salient feature of this scheme is as under:
1. VCES scheme is applicable in respect of tax dues for the period 01.10.2007 to 31.12.2012. For the period from 01.01.2013, the regular provisions of the Act shall be applicable and no amnesty under this scheme would be provided.
2. The option of claiming amnesty under this scheme has to be exercised by the eligible assessee by filing a declaration to designated authority. Such declaration shall be filed on or before 31st December 2013. (Designated Authority and Prescribed form to be notified).
3. VCES scheme shall not be available to the following categories of the person:
i. Any person to whom any notice or order has been issued before 01st March 2013.
ii. Any person who has filed the returns disclosing his true liability and not discharged the service tax amount shown in the same.
iii. Amount unpaid pertains to subsequent period of the same issue for which a notice is service or an order is passed for the previous period.
4. Designated authority will reject the declaration by any person if it is found that there was some enquiry or investigation pending as on 01.03.2013. Such investigation may be due to search of premises or by issuing summons or by calling for information/documents or by an audit.
5. 50% of tax due has to be paid on or before 31st December 2013 and the balance of tax dues has to be paid by 30th June 2014 for availing the amnesty of interest and penalty. However if the balance amount is defaulted either in part or full then such person has the option of payment on or before 31st December 2014 for claiming the amnesty of penalty alone. Interest is payable from 1st July 2013 till the date of payment before 31st December 2014 for claiming the amnesty of penalty. In case there is default either in part of full even after 31st December 2014 then the amount so declared shall be received along with the interest.
6. The proceeding under this scheme is final and cannot be reopened by any forum. The amount so paid in non-refundable. However if the Commissioner has reasons to believe that the declaration made by a declarant under this Scheme was substantially false then he may serve Show Cause Notice within one year from the date of declaration.