Vivad se Vishwas Scheme 2024

What is the Direct Tax Vivad Se Vishwas Scheme?

The Direct Tax Vivad Se Vishwas Scheme was announced by the Union Finance Minister Mrs. Nirmala Sitharaman. This scheme provides a streamlined approach to resolving pending disputes of income tax. This scheme reduces the burden of litigation for the tax administration and taxpayers. The DTVSV scheme 2024 will be applicable from October 1, 2024. This scheme also offers a reduced settlement amount for the new appellants.

Under this scheme, the taxpayers will be allowed to resolve their pending disputes by paying a portion of their outstanding tax liabilities.

Vivad Se Vishwas Scheme Applicability

Vivad Se Vishwas Scheme 2024 will be applicable on disputes or appeals, including writs, filed by either the taxpayer or tax authorities that are pending as of July 22, 2024, in the following instances:

• Appeals pending with the Supreme Court, High Court, Income Tax Appellate Tribunal, or Commissioner/Joint Commissioner
• The Dispute Resolution Panel (DRP), or cases where the DRP has issued directions but the final assessment order is still pending.
• Revision applications filed under Section 264 of the Income-tax Act, 1961.

What are the Forms Under Vivad Se Vishwas Scheme?

The government has notified four separate forms for the Vivad Se Vishwas Scheme 2024. These are the four forms -

• Form 1 - Form for filing declaration and undertaking by the applicant
  This form can be used by the declarant to declare their intention to settle the tax dispute.
• Form 2 - Form for Certificate to be issued by the Designated Authority
  The designated authority issues form 2, which contains details of the tax arrears and the amount payable after such determination.
• Form 3 - Form for intimation of payment by the declarant
  The declarant can use Form 3 to inform the designated authority that the payment of the outstanding amount has been made successfully. This intimation should be accompanied by proof of any appeal, objection, writ petition, or special leave application.
• Form 4 - Order to full and final settlement of tax arrears by the designated authority.
  The final order should be issued by the designated authority in Form 4. This form confirms the full and final settlement of the tax dispute. It describes the terms of the settlement, including the amount paid by the taxpayer.

What is the Amount Payable Under Vivad Se Vishwas Scheme?

The taxpayers need to pay the following amount under the Vivad Se Vishwas scheme -

The amount payable can be reduced to 50% in the following cases -

• The tax authorities filed the appeal.
• The appeal was filed with an authority, and an order was issued in favor of the taxpayer, which a higher authority has not overturned.

What are the Procedures Under Vivad Se Vishwas Scheme?

Below are the detailed procedures of the Vivad Se Vishwas Scheme -

Declaration and withdrawal of appeals

• The declarant must submit a declaration to the "designated authority" in the required form and manner.
• Once the declaration is filed, any ongoing appeals regarding the disputed income, interest, penalty, or fee before the Income Tax Appellate Tribunal, Commissioner (Appeals), or Joint Commissioner (Appeals) will be considered withdrawn from the date the designated authority issues the certificate.
• If the taxpayer has appeals in higher courts (High Court or Supreme Court), they must withdraw those appeals with the court’s permission after receiving the certificate under sub-section (1) of section 92. Proof of this withdrawal must be provided to the designated authority.
• The taxpayer must also submit an undertaking confirming they will not pursue any further legal action or claims related to the tax arrear.

Determination and Payment of Amount Payable

• The designated authority will assess the amount payable by the declarant within fifteen days of receiving the declaration and issue a certificate detailing the tax arrear and the amount to be paid.
• The declarant must pay the specified amount within fifteen days of receiving the certificate and notify the designated authority of the payment.
• The order determining the payable amount is final, and the matters addressed cannot be revisited in any other proceeding.

Consequences of Non-compliance

• False Information: If any details provided in the declaration are found to be false or misleading, the declaration will be deemed invalid.
• Violation of Conditions: If the taxpayer does not adhere to the scheme’s terms or breaches their undertaking, the declaration will be invalidated.
• Revival of Proceedings: In both cases—false information or violation of conditions—any previously withdrawn legal proceedings or claims will be reinstated.

The direct tax Vivad se Vishwas scheme 2024 offers an opportunity for taxpayers to resolve their long-time pending tax disputes in an effective manner. This scheme aims to reduce the burden of litigation on both taxpayers and the tax administration with the help of reduced settlement amounts.

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