What is Form SPL-01 and
SPL-02? Waiver of Interest and Penalty Under Section 128A by Filing for Relief
Using SPL Forms
By Yogesh Verma (CS/LLB) / 2 min read / GST Article
Introduction: In its effort to reduce tax-related disputes and ease the
burden on taxpayers, the GST Council, in its 53rd meeting on June 22, 2024,
recommended the introduction of a waiver scheme under Section 128A of the
Central Goods and Services Tax (CGST) Act, 2017. This scheme enables taxpayers
to obtain waivers for interest and penalties on certain tax demands from past
financial years. The scheme specifically targets demands raised under Section
73 of the CGST Act, covering Financial Years 2017-18, 2018-19, and 2019-20.
The government’s recent advisories and Circular No.
238/32/2024-GST, issued on October 15, 2024, clarify procedures for obtaining
this waiver and detail the steps taxpayers must take, including the use of SPL
forms.
1. Overview of Section 128A and
Waiver Scheme
Section 128A was introduced to offer tax relief by waiving
interest and penalties associated with certain tax demands that fall under
Section 73 of the CGST Act, 2017. These are typically cases not involving
fraud, suppression of facts, or willful misstatements. To take advantage of the
waiver scheme, taxpayers must fully pay the tax demanded by March 31, 2025.
In addition, Rule 164 was introduced to guide the
implementation of Section 128A and outline the use of specific forms, including
FORM GST SPL-01 and FORM GST SPL-02. Taxpayers must submit these
forms electronically through the GST portal to apply for the waiver.
2. Key Points from Circular No.
238/32/2024-GST
The October 15, 2024 circular offers essential
clarifications regarding Section 128A’s implementation. Here are the main
highlights:
- Applicability
of Section 128A:
- The waiver applies to tax demands raised under Section
73 for FYs 2017-18, 2018-19, and 2019-20. The circular also specifies
that even if a tax notice was initially issued under Section 74 but was
later redetermined under Section 73, it qualifies for the waiver.
- Deadlines
and Forms:
- The circular mandates that applications for waivers
must be filed within three months of March 31, 2025. For cases
requiring tax redetermination, the deadline extends to six months
from the redetermination order’s issuance.
- Taxpayers who have received demand notices that are
not yet adjudicated must use FORM GST SPL-01. Meanwhile,
adjudicated cases, or those under appeal, require FORM GST SPL-02.
- Conditions
and Procedural Clarifications:
- Taxpayers are required to fully pay the tax due by the
notified date. If any amount was previously paid through Form GST
DRC-03, they must link it to the demand order using Form GST
DRC-03A.
- In cases where the taxpayer has filed an appeal or
writ petition, the appeal must be withdrawn before the waiver application
can proceed. Proof of withdrawal must accompany the SPL form.
3. Advisory of November 8, 2024:
Procedural Updates for SPL Forms and New Deadlines
On November 8, 2024, an advisory was issued with further
instructions and updates related to Section 128A waivers:
- Availability
of Forms on GST Portal:
- FORM GST SPL-01
and FORM GST SPL-02 are scheduled for release on the GST portal in
January 2025. In the meantime, taxpayers are advised to ensure
that the full tax amount is paid by March 31, 2025, even if the forms are
not yet available.
- Guidance
for Making Payments:
- For unadjudicated demands, payments should be made
through Form GST DRC-03.
- For adjudicated demands linked to a demand order,
payment should be processed by debiting the Electronic Liability
Register (ELR). If previous payments were made using DRC-03,
adjustments should be made via Form GST DRC-03A.
- Eligibility
for the Waiver:
- The waiver applies only if the full tax amount, as per
the notice, statement, or order, is paid by the specified deadline.
- For cases that include demands for tax periods outside
the scope of Section 128A, taxpayers must pay the full demand amount, but
the waiver will only apply to the covered periods.
4. Detailed Breakdown of SPL Forms
and Filing Scenarios
The two primary forms, FORM GST SPL-01 and FORM
GST SPL-02, must be filed depending on the demand stage:
- FORM
GST SPL-01:
- Used when a notice under Section 73 has been issued,
but the tax demand has not yet been adjudicated.
- Applicable when the taxpayer has received a demand
notice or statement without a final demand order.
- FORM
GST SPL-02:
- Relevant for adjudicated cases where demand orders
have already been issued.
- Required for cases that have been appealed but no
final decision has been reached by the Appellate Tribunal or the
Appellate Authority.
Taxpayers must file separate SPL forms for each demand
notice or order.
5. Additional Clarifications from
the Circular
The circular provides answers to several frequently raised
issues, including:
- Eligibility
of Transitional Credit:
Transitional credit demands within the covered period qualify for waivers,
as long as they were issued under Section 73.
- Partial
Waivers Not Permitted: The
scheme only grants waivers for full tax payments, not for partial payments
aimed at securing a waiver on some issues while contesting others.
- Waiver
Exclusions: Penalties unrelated to
Section 128A, such as late fees or redemption fines, are not eligible for
waivers. Additionally, IGST payments under the Customs Act are excluded
from the scheme.
6. Processing and Decision-Making on
Waiver Applications
The circular outlines the responsibilities of GST officers
who will process the SPL applications:
- Approval
or Rejection: The proper officer will
evaluate applications and can reject those that do not meet requirements,
issuing a notice in FORM GST SPL-03. Taxpayers can respond using FORM
GST SPL-04 within one month of the notice.
- Automatic
Approval: If no decision is made within
the specified timeframe, applications will be automatically approved as
deemed granted.
- Appeals: Taxpayers can appeal rejection orders, although
appeals on approved waivers are not permitted.
7. Importance of Timely Compliance
Taxpayers should ensure that all payments and applications
are submitted by the deadlines provided to avoid forfeiture of waiver benefits.
The new advisory and Circular No. 238/32/2024-GST collectively offer a
streamlined process for reducing the financial impact of past tax demands while
helping the government to resolve outstanding cases.
Conclusion
The SPL form procedure provides a crucial opportunity for
taxpayers to resolve tax disputes from previous years without the burden of
penalties and interest, promoting a smoother compliance process. As the
government further develops this waiver scheme, taxpayers are encouraged to
stay updated and complete required payments and filings to benefit from this
relief.
Disclaimer: All the Information is based on the notification, circular and order issued by the Govt. authority and judgement delivered by the court or the authority information is strictly for educational purposes and on the basis of our best understanding of laws & not binding on anyone.
Click here
