GST was introduced in July 2017. It is a known fact that there were lots of anomalies, interpretational issues, system issues, etc., which have led to defaults by the industry. GST has been a roller-coaster ride for those involved. Time and again there have been numerous amendments, notifications and circulars issued by the authorities, some of which have been difficult for the industry to comply with.

The errors may be unintentional but they have led to heavy penal consequences which are detrimental to the trade. After the introduction of GST, all State VAT laws, excise, service tax, luxury tax, etc., had merged into one Act. The transition was bound to create issues. Further, in the initial period, neither the trade nor the authorities were fully aware of the law, which had led to errors.

The major issues under litigation today are rate classification, mismatch in input tax credit, blocked credit, taxability and valuation of gambling and betting, inter-branch billing for services, etc. Though trade over time has taken necessary steps to rectify the mistakes, errors in the initial periods remain an issue.

The situation has been further aggravated by the commencement of scrutiny, audit, anti-evasion proceedings by the department recently. Many matters are pending at the show-cause notice and CCE (A) levels. Further, once the Appellate Tribunal is formed, it will be flooded with appeals which have been decided by the CCE (A).

There will be a huge backlog at the Tribunal level as matters of around five years will be filed at one go.

Further, in the case of adverse order at the Tribunal level, there is no mechanism to reduce the interest burden for the period the Tribunal was not in existence.

For no fault of the trade, it will be saddled with huge interest for the period the Tribunal was not formed.

Considering the fact that GST is bound to remain, steps should be taken to reduce the pending litigations and also give a chance to the trade to declare their errors under a one-time amnesty scheme. It has been reported recently that the GST Council is seriously considering the introduction of such a scheme.

Hopefully, it will be brought up for discussion in the 48th GST Council meeting and the scheme will be introduced at the earliest. This will give a chance to all to settle the pending issues at all stages. It will also enable the trade to concentrate on business instead of litigation.

Further, considering the intricacies and complexities of the new law, it is imperative in the interest of all to introduce the one-time amnesty scheme with adequate safeguards.

The writer is Partner, Indirect Tax, NA Shah Associates. Views are personal