VCES - Cases booked after 01.03.2013?
AS per the provisions of the Finance Act, 2013, the declaration under VCES shall be rejected in cases where action has been initiated by way of search or summons or where an audit has been initiated / pending as on 01.03.2013. So, if an assessee is searched by the officers of the department after 01.03.2013 and detects evasion of service tax, then is such assessee eligible for filing the declaration under VCES?
It appears a section of the officers believe that if the department books a case against an assessee after 01.03.2013, then such an assessee is not entitled to seek immunity from interest, penalty and other consequences under VCES. According to them, the scheme is applicable only if the assessee volunteers to disclose his liability without any action initiated by the department.
However, there is nothing in the Finance Act, 2013 or the Rules made thereunder to prohibit an assessee from filing declaration even if a case is booked after 01.03.2013. Even Sl No 8 of the FAQ released by the CBEC clarified the same as under:
Q8. Whether a party, against whom an inquiry, investigation or audit has been initiated after 1.3.2013 (the cutoff date) can make a declaration under the Scheme?
Yes. There is no bar from filing of declaration in such cases.
Perhaps for the cases booked after 01.03.2013, the Board should direct the officers to specifically allow the assessee to file declaration before resorting to coercive action under Section 87.