GST Amnesty Scheme: GST Department of Kerala issues Instructions on Waiver of Interest or Penalty related to Demand raised under Sec 73

The Kerala Goods and Services Tax (GST) Department has issued the instructions regarding implementation of Amnesty Scheme under Section 128A of the KSGST Act in respect of waiver of interest or penalty or both relating to demands raised under section 73 of the KGST Act for Financial Years 2017-18, 2018-19, and 2019-20.

The GST Council’s 53rd meeting recommended facilitating the GST Act for the financial years 2017-18, 2018-19, and 2019-20, subject to certain restrictions. Amendments to the KSGST Act 2017 have been made based on the council’s recommendations to include a provision for such a waiver, with effect from November 1, 2024. Rule 164 of the KGST Rules, 2017, describes the procedures for benefiting from the scheme as well as the process flow by the proper officer.

In order to benefit from the scheme, any eligible individual must pay the tax demanded under Section 73 of the GST Act and file an application in Form GST SPL-01 at the common portal if the adjudication is pending.

To take advantage of the scheme after receiving a demand order, the application must be filed in FORM GST SPL-02, after crediting the tax amount in the electronic liability register against the debit entry generated by the order.

If payments have already been made in DRC-03 against a demand order, taxpayers must file an application in FORM GST DRC-03A, as prescribed in sub-rule (2B) of rule 142, before submitting an application in FORM GST SPL 02 to adjust the payments made through FORM GST DRC 03 against the outstanding demand in the electronic liability ledger.

According to the provisions of the Act, applications filed in FORM GST SPL-01 and FORM GST SPL-02 must be verified and processed by the proper officer within the time frame specified in the law.

The field formations are raising concerns and requesting clarity on the processing of the application received in this respect. In order to shorten the process and maintain uniformity across the field formation, instructions for strict compliance are issued in exercise of the powers provided by Section 168 of the Act.

The Model-2 back office system is structured such that applications made under Section 128A of the Act, in FORM GST SPL-01, are assigned to officers who are already handling such ARN, Case ID, or Demand ID, i.e. in the seat where the adjudication is pending.

However, the time limit for adjudicating orders under Section 73 of the Act for financial years ending in 2019-20 has already expired, and such applications are unlikely to emerge.

Cases where demand orders have already been issued and the taxpayer has not filed any statutory appeals within the appropriate time limit are now eligible for recovery under Section 97 of the Act and have been assigned to the Recovery Cell for further action.

The system will assign the amnesty applications filed against such orders to officers in the Recovery Cell to settle the demand for interest and penalty. Because these applications require extensive verification of payments, documents relating to the demand, and demands to be fulfilled in accordance with the provisions of sub-sections (5) and (6) of section 16, it will be inappropriate to process such cases in the Recovery Cell.

Consequently, the Deputy Commissioners/Assistant Commissioner/State Tax Officers in the Recovery Cell are instructed to re-assign such applications (FORM GST SPL – 02) to the relevant taxpayer Service Circle for processing such applications.

The proper officers in the taxpayer service vertical shall process the applications received under Section 128A of the Act, including those received as a result of such re-assignment, in the manner prescribed in Rule 164 of the KGST Rules, while adhering to the pecuniary limit instruction issued by the State GST Department in Circular No. 05/2023 dated 08.01.2023.

The State Back Office Administrator or the District Back Office Administrator shall provide the officers in the Recovery Cell with the necessary guidance or help in reassigning such cases to the proper officers in the Taxpayer Service Vertical.

For Official Instructions Download PDF Given Below: