The Direct Tax Vivad Se Vishwas Bill, 2020 tabled on lok sabha on Wednesday is introduced to provide complete waiver of interest and penalty to the taxpayers whose liabilities are in dispute.
On 12th February 2020 some amendments were approved by the Cabinet. But it is still subject to approval and presidential assent.
Highlights of key amendments are as follows:
Extending the scope of scheme to include the following under its ambit:
1. an order has been passed by the Assessing Officer or appellate forum and time limit for filing an appeal against such order has not expired on or before 31-01-2020.
2. an application for revision has been filled under section 264 and such application is pending on or before 31-01-2020.
3. objection with the Dispute Resolution Panel (DRP) under section 144C has been filled but no directions have been issued on or before 31-01-2020.
4. Directions have been issued by the DRP on or before 31-01-2020 but the AO is yet to pass an assessment order.
5. writ/special leave petition is pending before the High Court or the Supreme Court.
6. Search cases if the disputed tax is less than Rs. 5 Crore in a year. (The limit of Rs. 5 crores will be computed year wise.)
7. Cases in arbitration whether in India or abroad.
Payment terms:
1. Appeal relates to disputed tax:
· Payment on or before 31st March 2020 – 100% of the disputed tax. (125% in search cases)
· Payment on or before 30th June 2020 - 110% of the disputed tax (135% in search cases) such that it does not increase total demand.
2. Appeal relates only to disputed penalty or interest or fee:
· Payment on or before 31st March 2020 – 25% of the disputed penalty or interest or fee
· Payment on or before 30th June 2020 - 30% of the disputed penalty or interest or fee
If an issue in taxpayers pending appeal already decided in his favor by the appellate forum or if department has filled appeal on an issue, amount payable is 50% of the aforesaid amounts.
Amendment in exclusions of certain cases from the scheme.
1. Earlier, the provisions of this Act were not applicable in respect of tax arrears, relating to an assessment year in respect of which an assessment has been made under section 153A or section 153C (assessment in case of search or seizure).
However, now the cases, where disputed tax does not exceed Rs. 5 crores, shall be eligible for the benefit of this scheme.
2. Any person against whom enforcement of any civil liability has been instituted on or before the filing of the declaration
Disputes covered (Subject to some exclusions)
1. Disputed Tax
2. Disputed Penalty
3. Disputed Interest
4. Disputed Fee
5. Disputed Tax deducted at source (TDS) or tax collected at source (TCS)