As per the announcement made by the Finance minister in Budget speech on 1st February 2020 regarding the resolution of Income Tax disputes pending in Court and appellate jurisdiction, the Vivad se Vishwas scheme was tabled on 5th February 2020 in Lok sabha. After discussion in both houses of parliament, the bill was passed by both houses of parliament and received the assent of President of India on 17th March 2020 and was accordingly published in the official gazette of India on 17th March 2020 making the same as “Vivad se Vishwas Act, 2020”
Benefit to Assessees – It would help the tax payer to settle their pending tax disputes with the Income Tax department by paying the Disputed tax and get waiver of interest, penalty and prosecution.
Benefit to Government – It would help the government to generate revenues which were pending due to litigations.
Benefit to Society – It would help to eliminate the various litigations pending in society.
Who can apply under the scheme?
Appeals, writs, SLPs, arbitration filed on or before 31st January 2020. (filed by Department or taxpayer as the case may be)
Assessment Orders passes by applicable authority as per Income tax Act for which time for filing appeal has not expired on 31st January 2020.
Income tax Cases pending before Dispute Resolution Panel (DRP). Income tax Cases where Dispute Resolution Panel issued direction on or before 31st January 2020 but order has not yet been passed.
Income tax Cases where Assessee filed revision application under section 264 on or before 31st January 2020.
Dispute, where payment has already been made, shall also be eligible. The pending appeal, writ, SLP, arbitration could be against.
Disputed tax (including interest or penalty on such disputed tax) which are related to an assessment or reassessment order.
Disputed interest, disputed penalty or disputed fees where there is no disputed tax in this regard.
The tax determined on default in respect of tax deducted at source (TDS) or tax collected at source (TCS) shall be included in disputed tax.
Who cannot apply under the Scheme?
Income tax Search cases if disputed tax in a year is more than Rs.5 crore.
Income tax Cases in which prosecution proceedings are initiated by the department under Income-tax Act or under Indian Penal Code.
Income tax Cases involving foreign income and assets which are un-disclosed.
Income tax Cases completed on the basis of information received from foreign countries/ jurisdictions.
Income tax Cases where person is notified under Special courts (Trial of Offences Relating to Transactions in Securities) Act, 1992 or detained under Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974.
Income tax Cases covered under Narcotic Drugs and Psychotropic Substances Act, Unlawful Activities (Prevention) Act, Prevention of Corruption Act, Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, Prevention of Money Laundering Act, Prohibition of Benami Property Transactions Act.
To conclude, a person may opt for settlement of pending disputed with Income tax Authorities.
At AJSH, we are assisting our clients with filing of necessary forms with income Tax department under Vivad Se Vishwas Scheme. If you would like to know more about Vivad Se Vishwas Scheme, please click here.
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