Settle Tax Disputes Efficiently with Direct Tax Vivaad se Vishwas Scheme, 2024

Applicability: The scheme shall come into force from 01.10.2024.

Definitions:

Appellant: means

(i) a person in whose case an appeal or a writ petition or special leave petition has been filed either by him or by the income-tax authority or by both, before an appellate forum and such appeal or petition is pending as on the specified date; or

(ii) a person who has filed his objections before the Dispute Resolution Panel under section 144C of the Income-tax Act and the Dispute Resolution Panel has not issued any direction on or before the specified date; or

(iii) a person in whose case the Dispute Resolution Panel has issued direction under sub-section (5) of section 144C of the Income-tax Act and the Assessing Officer has not completed the assessment under sub-section (13) of that section on or before the specified date; or

(iv) a person who has filed an application for revision under section 264 of the Income-tax Act and such application is pending as on the specified date;

Appellate Forum: means the Supreme Court or the High Court or the Income Tax Appellate Tribunal or the Commissioner (Appeals) or Joint Commissioner (Appeals), as the case may be;
Specified Date: means the 07.2024;
Disputed Tax: Definition and Calculation of Disputed Tax: (Important)
“Disputed tax” refers to the total income tax, including any applicable surcharge and cess, that the appellant is obligated to pay under the Income-tax Act for a specific assessment or financial year.
Tax Arrear: means –

the aggregate amount of disputed tax, interest chargeable or charged on such disputed tax, and penalty leviable or levied on such disputed tax; or
disputed interest; or
disputed penalty; or
disputed fee.

Payment Structure for Tax Arrears under the Vivad Se Vishwas Scheme:- for settling the tax disputes, payment of tax arrears can be made in following manner:

S. No.	Nature of Tax Arrear	Amount Payable by 31st Dec 2024	Amount Payable from 1st Jan 2025 to Last Date
(a)	Tax arrear comprising disputed tax, interest, and penalty, for appellants after 31st Jan 2020 but before the specified date.	Amount of the disputed tax.	Aggregate of the amount of disputed tax + 10% of disputed tax.
(b)	Tax arrear comprising disputed tax, interest, and penalty, for appellants on or before 31st Jan 2020 at the same appellate forum.	Aggregate of the amount of disputed tax + 10% of disputed tax.	Aggregate of the amount of disputed tax + 20% of disputed tax.
(c)	Tax arrear related to disputed interest or penalty or fee, for appellants after 31st Jan 2020 but before the specified date.	25% of disputed interest or penalty or fee.	30% of disputed interest or penalty or fee.
(d)	Tax arrear related to disputed interest or penalty or fee, for appellants on or before 31st Jan 2020 at the same appellate forum.	30% of disputed interest or penalty or fee.	35% of disputed interest or penalty or fee.

Filing and Effects of the Tax Declaration:

1. Filing Requirements:

Declarations related to tax disputes must be submitted to the designated authority using the specified form and verification process by CA Services.

2. Impact on Pending Appeals:

Any ongoing appeals at the Income Tax Appellate Tribunal, Commissioner (Appeals), or Joint Commissioner (Appeals) concerning disputed taxes, interests, penalties, fees, or tax arrears are considered withdrawn upon issuance of a certificate by the designated authority under Section 92(1).

3. Withdrawal of Pending Appeals:

Post-certification, the declarant must withdraw any pending appeals or writs at appellate forums or the Supreme or High Courts related to tax arrears. This withdrawal should be sanctioned by the court if necessary, and proof of withdrawal must be provided along with the payment intimation to the designated authority as required by Section 92(2).

4. Undertaking by the Declarant:

Declarants must submit an undertaking to relinquish any rights to pursue remedies or claims concerning the tax arrears under any applicable laws. The format and procedure for this undertaking will be prescribed.

5. Conditions for Declaration Invalidity:

A declaration may be considered invalid if: a. Any significant detail in the declaration is later found to be incorrect. b. The declarant fails to adhere to the scheme’s conditions. c. The declarant behaves contrary to the commitments made in the undertaking.

Invalid declarations result in the revival of any previously withdrawn proceedings and associated legal consequences under the Income Tax Act.

6. Restrictions on Appellate Forums:

Appellate bodies are prohibited from deciding on issues related to tax arrears that have been addressed by the designated authority under an order made pursuant to Section 92(1) or concerning the payment determined under the same section

Procedure and Consequences of Making a Tax Declaration:

Determination of Payable Amount: The designated authority is required to evaluate the declaration and determine the payable amount within 15 days from its receipt. A certificate outlining the tax arrears and the determined amount will be issued to the declarant in a prescribed format.
Payment Obligations: The declarant must pay the amount specified in the certificate within 15 days from its receipt. Following payment, the declarant must notify the designated authority of the payment details using a prescribed form. The designated authority will then confirm that the payment has been made.
Finality of Order: Orders issued under the scheme that determine the payable amount are final and binding regarding the matters they cover. Such matters cannot be revisited in any subsequent proceedings under the Income Tax Act or any other law.
Tax Position and Legal Implications: Participation in this scheme does not imply an admission of the tax positions by the declarant. It is prohibited for both the income tax authority and the declarant involved in any related appeal, writ petition, or special leave petition to argue that the act of settling the dispute through this scheme constitutes an agreement to the tax authority’s or declarant’s positions on the disputed issues.

Non-Refundability of Paid Amounts: Amounts remitted following a declaration under section 91 are strictly non-refundable under any circumstances.

Taxcellent assist you in settling dispute under Vivad se Vishwas Scheme, 2024.