Vivad Se Vishwas Act, 2024 under Direct Tax Regime (Detailed)

Vivad Se Vishwas Act, 2024 under Direct Tax Program: In the Budget Plan 2024-2024 Hon’ ble Financing Minister Nirmala Sitharaman has announced a New Scheme in Direct Tax “Vivad Se Vishwas” similarly “Sabka Viswas-Legacy Disagreement Resolution Scheme 2019” under Indirect Tax.

Vivad Se Vishwas Act

” Sabka Vishwas- Legacy Dispute Resolution Scheme 2019″ was introduced with a go for resolution and settlement of pending cases of Central Excise, Service Tax. Similarly, in Direct Tax regime ” Vivad Se Vishwas” Scheme has been introduced so that taxpayers whose tax demands and disputes related to Earnings Tax pending in numerous online forums as on 31 st January, 2024 [irrespective of whether the demand is pending or has been paid], can pay that taxes and settle conflicts by 31 st March, 2024, and get a total waiver of interest and charge. In case of failure to pay tax within 31 st March 2024, that defaulter taxpayer will be allowed to pay his taxes till 30 th June 2024, but with 10% more on the tax. The appeals and contested matters might be related to any evaluation years, even challenged matters may be associated with the appeal versus the tax identified on defaults in regard of TDS or TCS.

Amount payable for arrear tax need or resolution of disputes under this plan

Quantity paid on or before 31.032024

Type of Tax	Quantity payable on or prior to 31 March 2024	Relief
Tax financial obligations consist of disputed tax, challenged interest and disputed penalty	Quantity of the disputed tax	100% relief from contested Interest & Penalty
Tax defaults associates with just disputed interest or contested penalty or disputed cost [Not include disputed tax]	25% of disputed interest or contested charge or contested charge	75% of the contested Interest, charge and Costs

Amount paid after 31.2024

Type of Tax	Quantity payable after 31 March 2024, however before 30 th June 2024	Relief
Tax financial obligations consist of challenged tax, contested interest and disputed penalty	Quantity of disputed tax 10% thereof. The additional 10% will be restricted to the quantity of interest and charge	100% relief from challenged Interest & Charge
Tax financial obligations relates to just disputed interest or disputed charge or challenged cost[Not include disputed tax]	30% of disputed interest or contested charge or contested charge	70% of the contested Interest, penalty and Charges.

Meaning of Appellant under this scheme

According to this Plan, the earnings tax authority, or the person, or both, whose appeal is pending before any appellate online forum as on 31 st January, 2024 will be dealt with as appellant.

Meaning of Appellate Forums under this plan

Supreme Court, the High Courts, the Income Tax Appellate Tribunals, and the Commissioner (Appeals) will be dealt with as appellate forum under this scheme.

Meaning of Designated Authority under this scheme

The Principal Chief Commissioner will designate an officer, not listed below the rank of a Commissioner of Income Tax, as the designated authority to handle and fix the challenged matters in Direct Tax period under this scheme

Advantages of the Scheme

• Federal government will produce prompt profits
• Taxpayers will be able to utilize the time, energy and resources saved by deciding this conflict resolution plan towards their business activities.
• When a conflict is dealt with as per this plan, the designated authority can not levy interest or penalty in relation to that conflict.
• No appellate forum can decide in relation to that dispute which has been solved currently. Such matters can not be reopened in any proceeding under any law, consisting of the IT Act.

Time and Way of payment of Disputed Tax

Appellant will submit declaration under this scheme

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The designated authority will determine the quantity payable by the declarant within 15 days from the date of invoice of the declaration

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The designated authority will give a certificate to the declarant consisting of particulars of the tax arrear and the quantity payable after such determination, in such form as might be prescribed.

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The declarant will pay the amount identified within 15 days of the date of receipt of the certificate and intimate the information of payment to the designated authority

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The designated authority shall pass an order specifying that the declarant has actually paid the amount

Revival of disagreements and claims

• If details submitted by the appellant are discovered to be false,
• The appellant breaks any of the conditions described in the IT Act
• The appellant looks for any solution or claim in relation to that conflict.

Therefore all proceedings and claims withdrawn based upon the declaration of appellant will be considered to have been revived.

Exclusion of conflicts from this Scheme

• Challenged tax arising out of search or seizure procedures;-LRB-
• The prosecution has actually been initiated prior to filing of the statement;-LRB-
• Tax defaults is in relation to undisclosed foreign source income
• Where an addition is based on the details received from a foreign nation as part of an exchange of details u/s 90 or 90 A;-LRB-
• Where improvement proposed by the CIT( A);-LRB-
• Where any person who has been apprehended under The Preservation of Foreign Exchange and Prevention Of Smuggling Activities Act, 1974, before the filing of a declaration;-LRB-
• Where, Any person, in whose case the prosecution has actually been initiated prior to the filing of a statement under any of the specified acts
• Anyone informed under Unique Court (Trial of Offences Relating to Securities) Act, 1992, prior to the filing of a statement

For many years, the number of pending appeals submitted by taxpayers in addition to Federal government were increasing day by day considering that variety of filed appeals is much greater than the number of disposed appeals. As a result, big amount of disputed tax financial obligations is locked-up in these appeals. As on the 30 th November, 2019, the amount of contested direct tax financial obligations is Rs. 9.32 lakh crores. There is an immediate requirement to offer such type of dispute resolution scheme as one time service for long time pending conflicts.

To enjoy the benefit of this Plan to solve conflicts in Direct Tax, the appellant will have to furnish an endeavor waiving his rights to look for any solution or claim in relation to that disagreement under any law, consisting of the Income Tax Act, 1961 (IT Act). Any claims already submitted in relation to the conflict must be withdrawn before submitting the statement.

The proposed Expense shall come into the force on the date it gets the assent of the President and statement might be made thereafter as much as the date to be notified by the Government.

Recommended

• Tax Calendar
• Electronic Verification Code (EVC)
• Belated Return
• History of Earnings Tax in India
• Self Assessment Tax