GST Amnesty Scheme 2026: Who Qualifies for Interest & Penalty Waiver Under Section 128A (And Why the Window May Already Be Closed)

Search "GST Amnesty Scheme 2026" long enough and you'll find a mix of confusing answers, some sites make it sound like a fresh scheme just opened, others barely mention that the main application deadline has already passed. Here's the honest picture: Section 128A of the CGST Act gave taxpayers a one-time shot at wiping out interest and penalty on old GST demands, but the main filing window closed back in mid-2025. If you're reading about it now, in most cases what matters is whether you already applied, whether your case falls into one of the special redetermination situations still open, or whether you're trying to understand what happened so you don't repeat the same mistake going forward.

Quick Answer: Section 128A offers a 100% waiver of interest and penalty (not the tax itself) on GST demands raised under Section 73 for FY 2017-18, 2018-19, and 2019-20, but only if the full tax was paid by 31 March 2025 and the waiver application was filed by 30 June 2025. New, fresh applications outside these specific timelines are generally no longer accepted, except in a few redetermination scenarios tied to a later order.

What Is Section 128A of the CGST Act?

Section 128A was inserted into the CGST Act through the Finance (No. 2) Act, 2024, on the recommendation of the 53rd GST Council meeting, and it came into force from 1st November 2024. In plain terms, it gave taxpayers with old, non-fraud GST demand notices a way out of the interest and penalty attached to those demands, provided they paid the actual tax amount in full.

Key Point: This was never a scheme to wipe out your tax dues. You still had to pay every rupee of tax owed. What got waived was the interest that had piled up over the years and any penalty slapped on top.

Who Was Eligible for the GST Amnesty Scheme Waiver?

Eligibility under Section 128A was fairly narrow and specific, not every GST dispute qualified.

A demand originally raised under Section 74 for alleged fraud wouldn't qualify unless an appellate or revisional authority later re-determined it as a straightforward Section 73 demand. That redetermination route is  one of the few doors still open in 2026, and we'll get to that.

GST Amnesty Scheme Rates and Waiver Coverage
 

Featured Snippet Answer: Section 128A waives interest and penalty tied to a specific Section 73 demand: it does not touch late fees, self-assessed interest, or refund your past payments.

Why "GST Amnesty Scheme 2026" Is Still Being Searched

Three genuine reasons this topic keeps trending even though the main window shut in June 2025:

Pending applications: thousands of SPL-01/SPL-02 filings from 2025 are still being processed, and taxpayers want to know what happens next.

Redetermination cases: when an appellate authority converts a Section 74 fraud demand into a plain Section 73 demand and communicates a fresh order, a new, separate window opens tied to that communication date, not the original 2025 deadline.

Rejected applications: anyone whose SPL-01/SPL-02 was rejected has the right to appeal within three months under Section 107(1), and that process is still actively running through 2026.

Quick Tip: If your situation matches point 2 above, don't assume you've missed the bus. Check the date your redetermined order was communicated , your clock starts from there, not from the original 2025 cut-off.

How the Application Process Worked (Useful If Yours Is Still Pending)
 

Before filing SPL-01 or SPL-02, any pending appeal linked to that demand had to be withdrawn, with proof of withdrawal attached. Payment could be made using either the electronic cash ledger or Input Tax Credit from the electronic credit ledger , a detail many taxpayers weren't aware of.

Common Reasons Applications Got Rejected

Based on how CBIC's own circulars flagged recurring errors, most rejections traced back to a handful of avoidable mistakes:

1.) Paying only part of the disputed tax, which broke the "full payment" condition outright

2.) Treating a Section 47 late fee as something the waiver would cover, it never did

3.) Filing SPL-01 for an order-stage case (should've been SPL-02), or the reverse

4.) Assuming a straight Section 74 fraud demand qualified, when only a redetermined one does

5.) Simply missing either the 31 March 2025 tax deadline or the 30 June 2025 filing deadline

Section 128A vs Other GST Amnesty Waivers : Quick Comparison
 

Each of these was a distinct, time-bound relief measure, none of them are recurring annual schemes, which is exactly why relying on "the next amnesty" as a strategy tends to backfire. Interest keeps compounding at 18% a year while you wait for something that may not come.

Frequently Asked Questions

Q1. Is the GST Amnesty Scheme under Section 128A still open in 2026? 

Not for fresh, general applications. The tax payment deadline was 31 March 2025 and the application deadline was 30 June 2025. It remains relevant only for pending applications, appeals against rejection, and specific redetermination cases.

Q2. Does Section 128A waive the GST tax amount itself? 

No. Only interest and penalty are waived ; the principal tax has to be paid in full.

Q3. Can I still apply if my Section 74 fraud notice was later redetermined as a Section 73 demand? 

Yes. In this specific situation, a fresh window opens linked to the date the new order was communicated to you.

Q4. What happens if my SPL-01 or SPL-02 application was rejected? 

You can appeal the rejection within three months under Section 107(1) of the CGST Act.

Q5. Can I pay the tax dues using Input Tax Credit to qualify for the waiver? 

Yes, payment could be made from the electronic cash ledger, the electronic credit ledger, or a combination of both.

Q6. Will I get a refund if I already paid interest or penalty before applying? 

No. The scheme does not refund amounts already paid, it only waives what's still outstanding.

Q7. Does this scheme cover late fees for delayed return filing? 

No. Late fees under Section 47 are separate and were never part of the Section 128A waiver.

Bottom Line

If you have an old Section 73 demand from FY 2017-20 sitting unresolved and you haven't touched it yet, the honest answer is that the general window has passed, your best move now is to talk to a GST practitioner about whether your case fits one of the narrow exceptions still available, like the redetermination route or a rejection appeal. And if you're dealing with a fresh demand from a more recent year, don't bank on a future amnesty bailing you out, interest keeps running at 18% annually regardless of what scheme might show up next.

This article is based on Section 128A of the CGST Act, 2017, Rule 164 of the CGST Rules, and CBIC Circular No. 238/32/2024-GST, cross-checked against notifications available on the GST Portal and CBIC's official site. GST provisions and deadlines change frequently, please verify your specific case timeline with a qualified tax professional before taking any action.

Author Bio

Harshita Saini is an SEO Executive at LegalDev, where she leads SEO and content strategy for gstfilling.co. She researches the latest GST notifications, tax reforms, and compliance updates to create accurate, search-driven content for businesses across India.
Her expertise lies in simplifying complex GST laws into easy-to-understand guides, helping entrepreneurs, startups, and taxpayers stay compliant, avoid penalties, and make informed tax decisions with confidence.