GST Circular No 238/2024
The circular provides detailed clarification and guidelines related to Section 128A of the Central Goods and Services Tax (CGST) Act, 2017, which came into effect on 01.11.2024. Section 128A offers taxpayers the benefit of waiving interest, penalty, or both in certain cases concerning demands raised under Section 73 for the financial years (FY) 2017-18, 2018-19, and 2019-20. Below is a summarized breakdown of the key aspects discussed in the circular:
- Scope of Section 128A:
Section 128A applies to demands under Section 73 for the financial years 2017-18, 2018-19, and 2019-20 in the following situations:
(a) Where no order has been issued after a notice or statement under Section 73.
(b) Where an order has been issued under Section 73 but no order has been passed by the Appellate or Revisional Authority.
- (c) Where an order has been passed by the Appellate or Revisional Authority, but no order has been passed by the Appellate Tribunal.
First Proviso to Section 128A: Applies when a notice was initially issued under Section 74, and an order is passed under Section 73 following directions from Appellate Authorities or the court. - Filing of Application:
Taxpayers must file applications electronically through the common portal using specific forms based on their case:
FORM GST SPL-01 for cases where no order has been issued under Section 73.
FORM GST SPL-02 for cases with orders issued under Section 73 or involving appeals/revision.
Applications must be filed within three months from 31.03.2025 (deadline for waiver).
If the order is redetermined by the officer under Section 73, an application can be filed within six months from the communication of that order. - Payment of Tax:
Tax demands should be paid via FORM GST DRC-03 (for notices or statements not yet adjudicated).
For other demands under Section 73 or appeals, the payment must be made using the Electronic Liability Register (ELR).
Payments must be completed by 31.03.2025 (or within six months if predetermined). - Conditions for Waiver:
If the demand includes taxes relating to contraventions of Section 16(4), the taxpayer should deduct such amounts as they are no longer payable due to retrospective amendments (Section 16(5) and 16(6)).
Waiver only applies to the period specified (2017-2020) and demand related to erroneous refunds. - Processing of Applications:
The concerned tax officer will process the applications and issue notices in FORM GST SPL-03 if the application is found to be liable for rejection. The taxpayer must file a reply in FORM GST SPL-04.
If the application is accepted, an order in FORM GST SPL-05 will be issued, and if rejected, the order in FORM GST SPL-07 will be issued. - Appeals and Withdrawals:
If the taxpayer has filed any appeal or writ petition related to the demand or order, it must be withdrawn before applying for the waiver. The withdrawal order must be uploaded along with the application. - Final Decision:
If the application is approved, no further action is required, and the demand will be adjusted. If additional taxes are found to be due based on the final order, the waiver becomes void if unpaid within three months. - General Notes:
Tax officers must ensure that the taxpayer has paid all dues (including erroneous refunds or non-eligible periods) before processing the waiver application.
If any amount remains due for periods outside the specified years or due to erroneous refunds, the application will be subject to further scrutiny.
Conclusion:
The circular provides detailed instructions on the procedural aspects of applying for and processing the waiver of interest, penalty, or both under Section 128A of the CGST Act. It clarifies the deadlines, conditions, and responsibilities of both taxpayers and tax officers to ensure smooth implementation.
