Vivad se Vishwas scheme – 2020 with all proposed changes.

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Vivad se Vishwas scheme – 2020 with all proposed changes.

10 points of Vivad se Vishwas scheme – 2020 with all proposed changes
Vivad se Vishwas scheme – 2020 has gone lot of changes even before it’s implementation. with all proposed changes , the key features of the scheme is as under :
i. Widening of the  Eligibility for the scheme
Originally, the Bill has proposed to cover appeals pending before CIT(A), ITAT, HC and SC.  It is proposed to expand the scope of the Scheme by covering the following matters :
Orders where time limit for filing appeal has not expired as on 31.01.2020
Case pending before DRP as on 31.01.2020 as well as cases where DRP had issued directions on or before 31.01.2020 but no order has been passed
Revision petitions pending before CIT u/s 264 on 31.01.2020
Search cases where the disputed demand is less than Rs. 5 Crore – The limit of of Rs. 5 crore will be computed year wise.
ii. Mode of Payment under the Scheme
Where payment made up to  31.03.2020
Where payment made after 31.03.2020
Appeals filed by the assessee
Search cases involving dispute relating to tax, interest, penalty, etc.
125% of the disputed tax. Penalty and interest would be waived
135% of disputed tax, penalty and interest would be waived
Other than search cases where dispute involves tax, interest, penalty, etc.
100% of the disputed tax, penalty and interest would be waived
110% of disputed tax, penalty and interest would be waived
Where dispute relates to only interest, penalty or levy
25% of disputed interest, penalty or fee – balance 75% would be waived
30% of disputed interest, penalty or fee – balance 70% would be waived
Appeals filed by Department or the Department has lost an issue
Search cases involving dispute relating to tax, interest, penalty, etc.
62.5% of the disputed tax. Penalty and interest would be waived
67.5% of disputed tax, penalty and interest would be waived
Other than search cases where dispute involves tax, interest, penalty, etc.
50% of the disputed tax, penalty and interest would be waived
55% of disputed tax, penalty and interest would be waived
Where dispute relates to only interest, penalty or levy
12.5% of disputed interest, penalty or fee – balance 87.5% would be waived
15% of disputed interest, penalty or fee – balance 85% would be waived
iii.    Who cannot opt for   the Scheme
The search cases where disputed tax is more than Rs. 5Cr, prosecution cases, cases involving undisclosed foreign income/ assets and the cases completed on the basis of information received from other countries would not be covered under the scheme.  Further, cases covered under certain laws such as Benami law, PMLA, Narcotic Drugs and Psychotropic Substances Act, Special Courts Act, the Unlawful Activities (Prevention) Act, 1967, the Prevention of Corruption Act, the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974 would continue to remain out of the scope of the scheme.
iv.         The amended Scheme now proposes to provide for refund of excess tax paid by taxpayer before filing declaration over the amount payable under the Scheme
v.        The revised Scheme now provides that filing of declaration will not set any precedence and it cannot be claimed in any other proceedings that the taxpayer or the Department has conceded its tax position by settling the dispute.
vi.         Though the revised Scheme doesn’t allow filing declaration issue-wise [i.e. its not possible for declarant to file declaration for some issues and litigate the balance issues], it provides that in a case where the taxpayer has got a favourable decision on an issue at higher forum, he would be required to pay only 50% of disputed tax on that issue even in the cases in which he has filed appeal.
7lvii.           On withdrawal of appeal, the amended Scheme proposes to provide that the taxpayer would be required to submit the proof of withdrawal of appeal/writ with the intimation of payment i.e. before the issuance of final certificate for settling dispute and not with the declaration as originally proposed in the Bill.
viii. Scheme now proposes to provide for withdrawal of appeals by Department, whereby “the department would also withdraw the appeal/writ before the issuance of final certificate for settling dispute.”
ix. The revised Scheme also proposes a mechanism for carry forward / set-off of losses. It provides that in case where the AO has reduced the returned loss by making addition, the taxpayer shall have an option to either pay the notional tax on amount by which the loss has been reduced and carry forward the claimed loss without reduction or by accepting the reduced carry forward of loss without making any payment under the Scheme. Same mechanism would apply for reduction in MAT credit.
x.        On the transfer pricing aspect, the revised scheme proposes to provide that the settling of dispute regarding transfer pricing adjustment would not have any effect on the secondary adjustment,  and the taxpayer would be required to repatriate fund to India in respect of settled transfer pricing adjustment.

 

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