Amnesty Scheme for Demand Issued u/s 73 of CGST Act for FY 2017-18 to 2019-20| Processing of Application and Manner of Filing Appeal

With respect to the Amnesty Scheme issued for waiver of interest and penalty for demand notices issued under section 73 of CGST Act, 2017, the CBIC has issued a detailed procedure for the manner of processing of application filed under Section 128A of CGST Act vide Circular No. 238/32/2024-GST dated 15th October 2024.

Further, the circular has also specified the procedure for filing an appeal against an order issued under Section 128A of the CGST Act.

A detailed analysis of the processing of the application and the manner of filing the appeal is discussed below:

1. Processing of application filed under Section 128A of CGST Act and issuance of the order

An application under Section 128A shall be filed in Form GST SLP-01 and GST SLP-02.
The officer who issued the order under Section 73 of the CGST Act shall be the proper officer for an application filed under Section 128A.

1.1 Processing of application

The proper officer shall take the following action:

Where the proper officer is of the view that the application is liable for rejection then he shall issue a notice within 3 months from the date of receipt of application in form FORM GST SPL-03.
Notice shall be issued on the GST common portal.
An opportunity for a personal hearing shall also be given to the applicant.
The applicant shall furnish the reply to such notice in FORM GST SPL-04, electronically on the common portal within 1 month from the date of receipt of the notice.
Accordingly, the proper officer shall issue the following orders:

Scenario	Order to be issued by proper officer
Order to be issued by the proper officer	Acceptance order in Form GST SLP-05
If as per the reply received from the applicant, the proper officer is of the view that the applicant is not eligible for waiver of interest or penalty	Rejection order in Form GST SLP-07

1.2 Time limit for issuance of order

The time limit for issuance of an order is given under Rule 164(13) of CGST Rules, 2017.
As per Sub-rule (13), the following shall be the time limit for issuance of an order by the proper officer:

Scenario	The reply is received in Form GST SLP-04
Notice is not issued in Form GST SLP-03	3 months from date of receipt of application in form GST SLP-01 and GST SLP-02
Notice is issued in Form GST SLP-03:
Reply is received in Form GST SLP-04	Time Limit for Issuance of Order
No reply is received in Form GST SLP-04	3 months from the date of receipt of reply in Form GST SLP-04

If no order is issued within the time limit prescribed then the application shall be deemed to be approved and the order in FORM GST SPL-05 shall be made available on the common portal.

1.3 Modification of liability determined

In case the application is filed in FORM GST SPL-01 and an order approving such an application is issued in FORM GST SPL-05 then a summary of the order in FORM GST DRC-07 need not be issued on the common portal.

However, Where an application is filed in Form GST SLP-02 and the order is issued in FORM GST SPL-05 or in FORM GST SPL-06 then the liability earlier created in the ELR – Part II by the demand order or the appellate order shall stand modified accordingly.

1.4 Waiver under Section 128A shall be valid subject to payment of tax

If the following application is filed against an order referred to in Section 128A(1)(b) or (c) or against the directions of the Appellate Authority or the Appellate Tribunal or the court referred to in the first proviso:

Appeal under Section 107(3);
Appeal to appellate Tribunal under section 112(3);
Department Appeal is filed under Section 117(1) to High Court or under section 118(1) to Supreme Court;
Revisional proceedings are initiated under section 108(1),

Then the conclusion of proceedings under section 128A shall be subject to the condition that the said person pays the additional amount of tax payable, if any, determined.

Such additional amount of tax is required to be paid within 3 months from the date of the said order:
In case, such additional tax is not paid within the specified time limit then the waiver of interest or penalty or both provided under section 128A as per FORM GST SPL-05 or FORM GST SPL-06 shall become void.
While processing the application, the proper officer shall ensure that the applicant has paid the amount of tax demanded in the notice/ statement/ order referred to in Section 128A(1), if any,.
The demand is also required to be paid pertaining to a period other than the period mentioned in section 128A(1).
Further, waiver of interest and penalty under section 128A is available only in respect of demand on the period mentioned in section 128A(1).

1.5 Payment of demand for another period

Where any amount of interest and penalty is payable by the applicant on account of some demand of the period other than the period mentioned in section 128A(1), the detail of the same shall be mentioned in column no. 19 and column no. 20 of FORM GST SPL-05 or FORM GST SPL06.
Further, in such cases, an opportunity of a personal hearing may be granted to the applicant, before the issuance of an order in FORM GST SPL-05 or FORM GST SPL-06.
The applicant is required to pay such interest or penalty (as given in column no. 19 and column no. 20 of FORM GST SPL-05 or FORM GST SPL-06) within 3 months from the date of issuance order.
If such an amount is not paid within the prescribed time limit, the waiver of interest or penalty or both under section 128A shall become void.

2. Appeal against the orders issued under Rule 164:

2.1 Appeal against an order issued in Form GST SLP-05:

No appeal shall lie to Appellate Authority (under section 107) against an order issued in FORM GST SPL-05 concluding the proceedings under section 128A.

2.2 Appeal against an order issued in Form GST SLP-07

The appeal against the order issued in FORM GST SPL-07, rejecting the application for waiver, shall be appealable to the appellate Authority under section 107(1) of the CGST Act within 3 months from the date of communication of the order.
The appeal shall be filed in form GST APL-01.

2.3 Requirement of Pre-deposit

Generally, no pre-deposit shall be required to be paid by the taxpayer for filing such an appeal as the involved tax amount may already have been paid before applying FORM GST SPL-01 or FORM GST SPL-02.
However, in case the tax amount has not been paid or the amount of tax paid is less than than pre-deposit required for filing an appeal then the remaining amount will be required to be paid for filing the said appeal.

2.4 Matter of appeal

The subject matter of appeal will only be regarding the applicability of waiver of interest or penalty or both under Section 128A and not on the merits of the original notice/ statement/ order.

2.5 Order by Appellate Authority

The Appellate authority shall pass the following orders:

a. Where an appeal is file against the order in Form GST SLP-07

Where the appeal is filed against the order in FORM GST SPL-07 and The appellate authority holds that the proper officer has wrongly rejected the application, the Appellate Authority shall allow the benefit to the applicant and shall pass the order in Form GST SLP-06.
This form shall accordingly modify the liability created, if any, in the ELR-Part II

b. Where the Applicant has withdrawn the appeal before filing the application in form GST SLP-02 and such application is rejected by the issuance of an order in FORM GST SPL-07, the following shall be the consequences:

If Applicant files an appeal with Appellate Authority:
- If the appellate authority holds that the proper officer has rightly rejected the application and issued an order in FORM GST APL-04, then the applicant’s original appeal shall be restored. However, the applicant shall file an undertaking electronically on the portal in FORM GST SPL-08 that he has neither filed nor intends to file any appeal against such order of the Appellate Authority.
- If the appellate Authority holds that the proper officer wrongly rejected the application and issued an order in FORM GST SPL-06, then no appeal shall lie against the said order.
If no appeal is filed
- If the taxpayer does not prefer an appeal within the prescribed period, the applicant’s original appeal shall be restored.

Conclusion

Section 128A is a relief to the taxpayer that provides for waiver of interest and penalty for demand issued under section 73 of CGST Act for FY 2017-18 to 2019-20. The functionality for the same is yet to be made live on the GST portal.