Due to the significant rise in number of appeals pending disposal under Income Tax, which is burdensome on the Government preventing them from timely collection of revenue as well as for tax payers who has to spend time and resources on such appeals, the Finance Minister in her recent Budget has proposed “The Direct Tax Vivad Se Vishwas (DTVV) Bill, 2020” thereby providing an option for fast track resolution of tax disputes.
a) This Scheme shall be applicable for all pending appeals before Commissioner (Appeals), Appellate Tribunal, High Court or Supreme Court as on 31-01-2020 irrespective of whether the demand is pending or paid.
b) This Scheme covers:
a) Tax Arrears assessed relating to
b) Any person to whom order of detention has been made under provisions of Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974, on or before date of declaration under Sec 4 of DTVV Bill.
c) Any Person to whom prosecution for any offence punishable under the following laws has been instituted on or before date of declaration under Sec 4 of DTVV Bill and has been convicted of such offence:
d) Any person notified under Sec 3 of Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992 on or before date of filing declaration.Declaration and Certificate of Tax Arrears and its effect on pending appeals
The Declarant (taxpayer) should file before the Designated authority (an officer ranking above Commissioner and as notified by Principal Chief Commissioner) a Declaration providing the details of Tax arrears (i.e. Tax + Interest + Penalty) as determined under Income tax provisions, along with an Undertaking for Waving the taxpayers right to seek or pursue any remedy to the tax Arrear declared under any law.
Once the declaration is filed, the Designated Authority shall issue a Certificate to the Declarant within 15 days from date of receipt of such declaration. The Certificate shall mention the amount of tax arrears and the amount payable by the Declarant.
W.e.f the date of the Certificate as mentioned above, all appeals pending before the ITAT, CIT(A) for the respective Assessment years for which declaration is filed shall be deemed withdrawn.
For any of the Appeals/Proceedings for Arbitration or Conciliation/Writs pending before the High Court, Supreme Court or Appellate Forum, the Declarant shall himself file for withdrawal of the same and submit the proof of withdrawal along with the Declaration form.
Having said that, Sec 5(2) of the Scheme states that, the payment as determined in the Certificate issued by the Designated Authority shall be made on or before 15 days from date of receipt of such certificate. So, there is some further clarification required on this matter. The amounts a paid as above is not refundable.
On intimation of payment as per Certificate issued by the Designated Authority, they shall pass an order stating that the Declarant has paid the amount. This order is conclusive ie no further proceeding shall be done for the respective Assessment year under the Income Tax Act or any other law with regard to the disputed amounts. However, no immunity shall be granted for the tax, interest or penalty not declared.