Karnataka Karsamadhana Scheme

GST By - Meghna Yadav

Complete the pre-GST legacy audit and clear tax arrears expeditiously

Key points under the Act:

1. K. Sales Tax Act
2. KVAT
3. CST
4. Karnataka P.TAX
5. K. Luxuries Tax
6. K. Agricultural Income Tax
7. K. Entertainment Tax
8. K. Entry Tax

Cut-Off Date:

The assessments/ re-assessments/ rectification orders already completed and to be completed should be on or before 31.07.2021.

Advantage:

1. General: waiver of 100% of arrears of penalty and interest payable
2. Special / Additional Waiver:
   1. Penalty and Interest for failure to furnish return under the KVAT Act [ u/s 72(1)(a) or 72(1)(b)]
   2. Penalty and Interest for failure to submit copy of the audited statement of accounts in FORM VAT 240 under the KVAT Act [ u/s 74(4)]
   3. PROVIDED, admitted tax as per the return / Form 240 is paid in full.
   4. Penalty levied by the Audit Officer for failure to submit copy of the audited statement of accounts [ u/s 72(3-B)]

Necessary Conditions:

1. Make full payment of arrears of tax on or before 31.10.2021. Non-eligibility: penalty levied by the Registering Authority under section 10-A of the CST Act.
2. If there are No arrears of tax but arrears of penalty and interest only, such arrears of penalty and interest shall be eligible for waiver.
3. Withdrawal of Appeal /any application against order or proceedings before any Appellate Authority or Court whose disposal is still pending – to be done before availing the benefit of waiver of arrears of penalty and interest under this Scheme by filing a declaration in Annexure – II (+) application for waiver of arrears of penalty and interest in Annexure – I.
4. Application and declaration shall be filed for each year separately.
5. Any amount of penalty and interest paid at the time of filing an appeal or other application shall be eligible for adjustment towards arrears of tax outstanding for the assessment year for which the benefit of waiver is claimed. Note: Refund of any amount that may become excess as a result of such adjustment under this scheme is Not Eligible.
6. In case Appeal or other application is not filed – No refund of any penalty or interest already paid either in full or part.
7. The dealer shall not file an appeal or shall not seek rectification of orders/proceedings, after filing application for availing the benefits of this Scheme or after availing the benefits of this Scheme.
8. Availability of benefit under this scheme is not available for order giving rise to arrears of tax, penalty and interest where:
   1. State has filed an appeal before the Karnataka Appellate Tribunal or the Central Sales Tax Appellate Authority; or
   2. State has filed an appeal or revision or any kind of application before the High Court or the Supreme Court; or
   3. any competent authority has initiated suomotu revision proceedings as on the date of this Government Order; or
   4. any rectification is made after 31.07.2021.

Procedure:

1. The dealer opting for this Scheme shall submit separate application in the format Annexure-I appended to this order under the KST and CST Acts for each year relating to the assessment electronically through the website http://ctax.kar.nic.in or http://gst.kar.nic.in on or before 31.10.2021 in the manner as specified in the website. Duly signed copy of the said application downloaded shall be submitted to the concerned Assessing Authority/ Recovery Officer as prescribed.
2. The dealer opting for this Scheme shall submit separate application in the format Annexure-IA appended to this order under KVAT Act and CST Acts relating to each assessment/reassessment order relating to the tax periods for the years commencing from 01.04.2005 which have been already completed and to be completed upto 31.07.2021, electronically through the website http://ctax.kar.nic.in or http://gst.kar.nic.in on or before 31.10.2021 in the manner as specified in the website. Duly signed copy of the said application downloaded shall be submitted to the concerned Assessing Authority/Prescribed Authority/ Recovery Officer as prescribed. http://gst.kar.nic.in on or before 31.10.2021 in the manner as specified in the website. Duly signed copy of the said application downloaded shall be submitted to the concerned Assessing Authority/ Recovery Officer/Prescribed Authority as prescribed.
3. The proprietor opting for this Scheme shall submit separate application in the format Annexure-IC appended to this order under the KET Act for each week or month as applicable relating to the assessment/reassessment for the years already completed and to be completed upto 31.07.2021 electronically through the website http://ctax.kar.nic.in or http://gst.kar.nic.in on or before 31.10.2021 in the manner as specified in the website. Duly signed copy of the said application downloaded shall be submitted to the concerned Assessing Authority/ Recovery Officer as prescribed.
4. The dealer opting for this Scheme shall submit separate application in Format Annexure-ID appended to this order under KVAT Act relating to penalty levied u/s 72(1)(a) / 72(1)(b)/ 72(3-B)/ 74(4) relating to the tax periods for the years commencing from 01.04.2005 to 30.06.2017, electronically through the website http://ctax.kar.nic.in or http://gst.kar.nic.in on or before 31.10.2021 in the manner as specified in the website. Duly signed copy of the said application downloaded shall be submitted to the Prescribed Authority.
5. Concerned Assessing Authority shall scrutinize the application and work out the actual arrears of tax, penalty and interest payable up to the date of filing of application and if any discrepancies are found he shall inform the dealer or person or proprietor within 15 days from the date of filing of application.
6. After receipt of information the dealer may pay the balance amount of tax to avail of the benefits of this Scheme. All payments should be made within 15 days from the date of receipt of information or on or before 15.11.2021 whichever is earlier.
7. The applicant shall become ineligible to avail this Scheme if any partial amount is still outstanding as arrears on the specified date.
8. The dealer shall file a declaration in support of withdrawal of appeal or other application as per Annexure-II along with application for waiver of ‘arrears of penalty and interest’ separately for each year.
9. If the dealer fails to do so, the Assessing Authority shall pass a speaking order rejecting the application.
10. On satisfaction Assessing Authority shall pass the order waiving the balance amount of arrears of penalty and interest payable as per Annexure-III separately for each assessment year / order.
11. Order of waiver shall be passed within 30 days from the date of making payment.

Special Provisions:

1. In respect of assessments/ re-assessments/ rectification orders passed in the case of unregistered dealers/ persons under any of the Acts mentioned in the preamble are eligible to avail the benefits under this scheme subject to fulfilment of conditions specified therein. In the absence of RC Number or Tax Payer’s Identification Number (TIN) or Enrolment Number, as the case may be, the four-digit number 2900 shall be entered in the applicable Annexure so as to consider the case for waiver of penalty and interest under the relevant act.
2. If the Assessment or Re-assessments or Rectification Orders or any other proceedings passed pursuant to remanding of the cases by First Appellate Authority or Karnataka Appellate Tribunal or Revisional Authority or High Court or Supreme Court, as the case may be, are eligible for availing the benefits under the Scheme.

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