MCA, DoR In The Midst Of Working Out Legal Framework To Allow Companies Under IBC Process To Get GST Relief
By : Legal Era
Update: 2019-12-23 13:22 GMT
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By Bobby Anthony The Ministry of Corporate Affairs (MCA) and Department of Revenue (DoR) officials have begun talks to allow companies undergoing resolution under the Insolvency and Bankruptcy Code (IBC) to pay current levies of goods and services tax (GST) without the mandatory payment of past dues.A legal framework is being worked out and officials are expected to meet shortly to finalize its...
The Ministry of Corporate Affairs (MCA) and Department of Revenue (DoR) officials have begun talks to allow companies undergoing resolution under the Insolvency and Bankruptcy Code (IBC) to pay current levies of goods and services tax (GST) without the mandatory payment of past dues.
A legal framework is being worked out and officials are expected to meet shortly to finalize its contours.
According to present norms, tax authorities are treated on a par with operational creditors and eligible to receive payments with others.
However, present GST norms do not allow a firm to file current tax dues if it has past dues and this factor is known to be a hurdle in the way of efforts to revive companies under the IBC process.
The development has come about after industry organizations lobbied the government on the issue, asking it to accept current GST dues while giving a moratorium on past ones.