Big relief to taxpayers! I-T Dept makes big announcement on Vivad Se Vishwas scheme

New Delhi: Entities submitting declaration below the direct tax dispute decision scheme ‘Vivad Se Vishwas’ can revise them until the time tax authorities challenge certificates mentioning particulars of tax arrear and the quantity payable, the Income Tax Department has mentioned.

Issuing a set of FAQs on ‘Vivad Se Vishwas’ scheme, the Central Board of Direct Taxes (CBDT) additionally mentioned the scheme can’t be availed in a case the place proceedings are pending earlier than Income Tax Settlement Commission (ITSC) or the place writ has been filed towards the order of ITSC.

The CBDT additionally clarified that in a case the place Mutual Agreement Procedure (MAP) decision is pending or the assessee has not accepted MAP resolution, the associated attraction shall be eligible below ‘Vivad se Vishwas’.?

“In such case, the declarant will be required to withdraw both MAP application and appeal,” it added.

The I-T division additionally clarified {that a} taxpayer can be eligible for making declarations in instances the place the Authority for Advance Ruling (AAR) has dominated in favour of the taxpayer and the division has filed attraction earlier than the High Court/Supreme Court and the overall earnings of the taxpayer was quantified earlier than AAR.

“Yes, the taxpayer is eligible since the income is quantifiable. In such case, since the issue is covered in favour of taxpayer, only 50 per cent of the disputed tax is payable,” the CBDT mentioned.

The authorities had in October prolonged for the third time the deadline for making cost below the direct tax dispute settlement scheme ‘Vivad Se Vishwas’ by three months to March 31, 2021, in view of the continuing COVID-19 pandemic. However, declarations need to be filed by December 31, 2020.

Nangia Andersen LLP Partner Sandeep Jhunjhunwala mentioned the availability of revision would allow the taxpayer to revise the appliance filed in case the matter is revisited on account of any errors or factual clarifications.?

“The authorities are making certain that the scheme is utilised by most variety of taxpayers and because the scheme is new, this provision enabling revision earlier than the certificates is issued would equip the applicant to revise the appliance in case any errors are found or any clarification is subsequently obtained from the Authorities itself,? he added.?

Till November 17, the federal government had garnered Rs 72,480 crore tax by the scheme.

A complete of 45,855 declarations have been filed below the scheme, involving disputed tax demand of Rs 31,734 crore until November 17 .

Besides, central public sector firms are additionally settling their dispute totalling Rs 1 lakh crore below the scheme.

The scheme supplies for settlement of disputed tax, disputed curiosity, disputed penalty or disputed charges in relation to an evaluation or reassessment order on cost of 100 per cent of the disputed tax and 25 per cent of the disputed penalty or curiosity or payment.

The taxpayer is granted Immunity from levy of curiosity, penalty and establishment of any continuing for prosecution for any offence below the Income-tax Act in respect of issues lined within the declaration.

The Direct Tax Vivad se Vishwas Act, 2020 was enacted on March 17, 2020 to settle direct tax disputes locked up in varied appellate discussion board.

In order to supply extra time to taxpayers to settle disputes, earlier the date for submitting declaration and making cost with out further quantity below Vivad se Vishwas was prolonged from March 31, 2020 to June 30, 2020.?

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Later once more, this date was prolonged additional to December 31, 2020. Therefore, earlier each the declaration and the cost with out further quantity below the Vivad se Vishwas have been required to be made by December 31, 2020.

The cost date has since being prolonged to March 2021.