01 January, 2014

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Success of VCES? ... Way Forward!!

The Last Date for VCES Scheme was 31.12.2013.
Indeed if you believe by the recent press release of Ministry of Finance, VCES has been a mega success. Upto 29-12-2013 the revenue had received over 40,000 declarations involving over Rs 5500 crores. Further, from period of 26th December, 2013 to 29th December, 2013 itself revenue had received 16,000 applications involving Rs. 1500 crores of service tax dues.
The Statistics on one side are very impressive and connotes the success of scheme but when the number of declarations is compared with the number of service tax defaulters the things might not look that fascinating. Nonetheless the scheme has made significant contribution for both the revenue as well as service tax defaulters who can now take a sigh of relief and continue the normal compliance as other assessees.

The efforts have been remarkable on the government’s end to facilitate the declarations. Leaving few cases of disputes and disruptions, most of applications have been swiftly handled and processed. The VCES -02 dispatching have also been dealt with unprecedented swift.

At this juncture it is very important to note a categorical statement as mentioned in the above said press-release which has hinted on severe procedures to be undertaken by the department against the defaulters who have not envisaged themselves in the ambit of VCES scheme.

“I would like to advise that from 1st January, 2014, stern action will be taken against service tax evaders and the provisions in the Finance Act relating to arrest and prosecution will be enforced in right earnest.” – Finance Secretary on VCES

Henceforth, it has to be seen how the revenue approaches the cases of service tax defaulters who have not declared under VCES. Prosecution pipelines shall soon soar in most expected anticipation!!
Source :- http://pib.nic.in/newsite/erelease.aspx?relid=102197
About the Author:
CA Ankit Gulgulia (Jain)
Author is Practicing Chartered Accountant in New Delhi/NCR and specialising in Indirect Taxes, Corporate Laws and Transfer Pricing. He can be reached at ankitgulgulia@gmail.com.
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