The Karasamadhana Scheme was introduced on February 17, 2023, to help taxpayers resolve old tax disputes from before the Goods and Services Tax (GST) was introduced. This scheme aims to help people pay any outstanding tax without going to court. It covers several different tax laws.
Key Features of the Karnataka Karasamadhana Scheme, 2023:
1. Waiver of Penalty and Interest: For the Karnataka Sales Tax Act and Central Sales Tax Act, the scheme waives all penalties and interest on outstanding taxes if these taxes are paid by December 31, 2023. This applies to assessments completed or to be completed by October 31, 2023.
2. Partial Waiver for KVAT Act and CST Act: For the Karnataka Value Added Tax Act and Central Sales Tax Act, the scheme waives all penalties (except in specific cases) and interest on outstanding taxes if these taxes are paid by December 31, 2023. This applies to assessments completed or to be completed by October 31, 2023.
3. Specific Waivers under KVAT Act: The scheme also waives specific penalties under Section 72 (related to returns and assessments) and Section 74(4) (for not submitting the audited statement of accounts in FORM VAT 240) of the KVAT Act, as long as the admitted tax liability is paid in full.
4. Extension to Other Acts:
The Karasamadhana Scheme also waives all penalties and interest for the following Acts:
i) Karnataka Tax on Entry of Goods Act;
ii) Karnataka Tax on Professions, Trades, Callings and Employments Act;
iii) Karnataka Tax on Luxuries Act;
iv) Karnataka Agricultural Income Tax Act; and
v) Karnataka Entertainment Tax Act.
This applies to assessments completed or to be completed by October 31, 2023.
5. Waiver for Revision of Orders: The scheme waives all interest and penalties (except in specific cases) for revision orders completed or initiated before the government order was issued and to be completed by October 31, 2023. This applies to all the Acts mentioned.
Conditions for Using the Scheme:
To use the Karasamadhana Scheme, you must meet certain conditions:
i) Timely Payment: You must pay all outstanding taxes by December 31, 2023, to have all penalties and interest waived.
ii) Arrears of Penalty and Interest: If you have no outstanding taxes but have penalties and interest related to assessments completed or to be completed by October 31, 2023, those penalties and interest will be waived.
iii) Withdrawal of Appeals/Applications: If you have filed an appeal or application related to outstanding taxes, penalties, and interest, you must withdraw it before using the scheme.
iv) Disallowance of New Appeals/Applications: You cannot file new appeals or applications after applying for or using the scheme.
v) Exclusion of Certain Cases: The scheme does not apply to cases where the State has filed appeals before certain authorities or courts, where revision proceedings have been initiated by October 31, 2023, or where any rectification is made after this date.
Procedure for Availing the Scheme:
The procedure for availing the benefits of the Karasamadhana Scheme, 2023 is as follows:
i) Submission of Applications: Submit separate applications for each assessment year electronically through the specified websites by December 31, 2023.
ii) Scrutiny and Discrepancies: The authorities will verify your application. Any discrepancies will be communicated to you within 15 days.
iii) Payment: If there are discrepancies, you can make the balance payment within 15 days of receiving the information or by January 15, 2024, whichever is earlier.
iv) Withdrawal of Appeals/Applications: You must file a declaration supporting the withdrawal of appeals or applications.
v) Order of Waiver: Once you meet all the requirements, the authorities will waive the remaining penalties and interest.
Special Provisions of the Scheme:
The Karnataka Karasamadhana Scheme, 2023 also includes specific provisions:
i) Unregistered Dealers: Assessments related to unregistered dealers are eligible for the scheme under certain conditions.
ii) Remanded Cases: Cases that have been remanded by authorities or courts are also eligible.
Conclusion:
The Karasamadhana Scheme offers taxpayers a chance to resolve old tax disputes and settle outstanding amounts without penalties and interest. By understanding the conditions and procedures, taxpayers can take advantage of this opportunity for smoother tax compliance.
https://gst.kar.nic.in/latestupdates/karasamadhana202319723.pdf