Union Budget 2019-20

Author:Khaitan & Co. Indirect Tax Team
Profession:Khaitan & Co
 
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INDIRECT TAX

Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019

The budget proposes a dispute resolution-cum-amnesty scheme titled 'The Sabka Vishwas Legacy Dispute Resolution Scheme, 2019' (Scheme) for faster settlement of litigation pending inter alia under the erstwhile Central Excise and Service Tax regime. Depending on the amount of tax dues involved, the relief under the Scheme varies from 40% to 70% of the tax dues. The Scheme provides relief from payment of interest and penalty and the person discharged under the Scheme shall not be liable for prosecution. The amount under the Scheme has to be mandatorily paid in cash and the amount paid shall not be refundable under any circumstances. The table below captures the relief available to a declarant under the Scheme:

Persons shall not be eligible for making a declaration under the Scheme, if they have:

filed an appeal before the appellate forum and such appeal has been heard finally on or before 30 June 2019; been convicted for any offence punishable under any provision of the indirect tax enactment for the matter for which they intend to file a declaration; been issued a show cause notice, under any provision of the indirect tax enactment and the final hearing has taken place on or before 30 June 2019; been issued a show cause notice under any provision of the indirect tax enactment for an erroneous refund or refund; been subjected to an enquiry / investigation / audit and the amount of duty involved in the said enquiry / investigation / audit has not been quantified on or before 30 June 2019; made a voluntary disclosure: after being subjected to any enquiry or investigation or audit; or having filed a return under the indirect tax enactment, wherein he has indicated an amount of duty as payable, but has not paid it; filed an application in the Settlement Commission for settlement of a case; or are seeking to make declarations with respect to excisable goods set forth in the Fourth Schedule to the Central Excise Act, 1944. Central Excise Law

The change in excise duties pertain primarily to the tobacco and petroleum sector.

Rate Changes in Tobacco Products

The Government has increased the effective rate of Basic Excise Duty on tobacco products such as cigarettes, hookah tobacco, smoking and pipe mixtures, chewing tobacco, jarda etc. classified under Chapter 24 of the Fourth Schedule to the Central Excise Tariff Act, 1985, as follows: Rate Changes in Petroleum Products

The Government has increased the effective rate of Special Additional Excise Duty and the Road and Infrastructure Cess imposed under the provisions of the Finance Act, 2002 and the Finance Act, 2018, respectively, for petroleum and diesel products. The Government has further introduced Basic Excise Duty of INR 1 per ton on manufacture of petroleum...

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