Answers to queries on Vivad Se Vishwas Scheme

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The Union Honourable Finance Minister, Mrs Nirmala Sitharaman during her budget speech on February 1, 2020 (2020) 420 ITR 115 (St) (146) proposed to introduce a scheme at para 126 of the speech for settlement of disputes. Subsequently, the Direct Tax Vivad Se Vishwas Act, 2020 (VSV Act) was introduced. The Scheme was extended from time to time and the last date for payment under the VSV Act, 2020 extended until October 31, 2021 by CBDT, vide Notification No. 75 of 2021 dated June 25, 2021 (2021) 435 ITR (St) 25. The said scheme has benefited the taxpayers to reduce the tax litigation. When the scheme was introduced the research team of the itatonline.org had anticipated that the taxpayers may require a number of clarifications. Itatonline.org had requested the panel of experts consisting of Dr. K. Shivaram Senior Advocate, CA Rajan Vora and CA Pradeep Kapasi to answer queries arising on Vivad Se Viswas Schme to assist the tax consultants and tax payers. The expert panel started answering the queries raised by the tax consultants on February 28, 2020 and till date the expert panel have answered more than 750 questions only on the Direct Tax Vivad Se Viswas Act, 2020. From May 15, 2021 on words the itatonline.org has introduced the new section on “Ask your questions” which answers questions regularly. It is proposed that this new panel will answer the questions pertaining to Direct Tax Vivad Se Viswas Act, 2020.
See also Vivad Se Vishwas Scheme: The Law, Procedure And Dilemma where a link to all necessary resources is given

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The answers given below are in response to queries asked by other people.
Query

Assessee has returned Rs. 10 crores as income and has not paid any taxes as on date of filing return and no computed thereof.

AO has made an addition of Rs. 2 crores and determinbed total income at Rs. 12 crores. AO has raised tax demand on entire 10 crores along with additional interest u/s 234A,B and C.

As per Section 2(j)(A), disputed tax means the total income tax (incl surcharge and cess) payable had such appeal be decided against the Assessee.

In the instant case, can the assessee file application under VSVS for payment of entire tax outstanding on Rs. 12 crores and claim full waiver of interest due (including on returned income). Essentially, the assessee is also getting the benefit of waiver of interest on self assessment taxes.
Answer One has to see what is the tax in dispute is pending in appeal .  The assessee has to settle the tax in dispute . The tax paid under section 140A will be  given credit to the assessee.  The assessee may have to pay only Tax  the interests  levied  will be waived , once the… (read more)
Query

Honorable ITAT has disposed Appeals for AYs 2008-09 and 2012-13 filed
by the Department (revenue) by a Common order dated 04.10.2019 partly
allowing the appeal of the Department by disallowing the relief given
by CIT(A).
The Appellant has received the consequential order of CIT(A) dated
11-02-2020 pertaining to the order of the ITAT dated 04-10-2019 on
17-02-2020.The Appellant has filed Miscellaneous Application before
the ITAT aggrieved by the ITAT order within the time limit allowed
under Rule 27 of ITAT rules after receiving the consequential order.
Also petition under Vivaad se vishwas scheme is filed only after the
consequential order is received from CIT Appeals ie) after 17.02.2020
. Had the CIT has released the consequential order of the ITAT before
31.01.2020 the Appellant could have filed the Miscellaneous
application before the ITAT and Petition under DTVSV before 31.01.2020
Vivaad se vishwas petition was rejected on the grounds that
Miscellaneous Application is not an Appeal and no appeal is pending as
on 31.01.2020 the Cut-off date.
Please let us know whether Miscellaneous application can be treated
as Appeal pending and how to proceed here as the hearing is still
pending before the ITAT on 12th February 2021.

Regards
P.V.Subba Rao
Answer As per the clarification given by the CBDT ,the MA can be settled under the Scheme only if the same is dismissed in limine i.e. at the beginning of the proceedings. This has been clarified at FAQ No. 61 of CBDT Circular No. 21 of 2020 dated December 4, 2020.  However  we are of the considered… (read more)
Query

DAETH CERTIFICATE OF ASSESSEE DIED ON 06.10.2020 IS AWAITED.BUT PAN OF DECASED IS ACTIVE.
SIMILARLY LEGAL HEIR DOCUMENT PROOF IS ALSO TAKING TIME. PLS ADVISE HOW TO OPT AND FILE VIVAD SE VISWAS SCHEME.

Answer The legal heir can file the application . Mentioning the date of application for PAN.   In case the application is rejected the assessee can approach the Designated Authority  . If the application is not entertained the asseessee may have to file Writ in High Court .   (read more)
Query

Assessment order under s. 144 was passed against assessee on 16.12.2019 by the A.O. Implying due date to file appeal to CIT(A) by 16.01.2020. However the said assessment order was served to assessee as late as 04.02.2020. Due to this reason, assessee couldn’t file appeal on time. Therefore, Form 1 under Vivad se Vishwas was rejected by the CIT. What to do?

Answer The assessee  can make an application to Designated Authority  to rectify  the order . Please refer Circular No 9 dt 22-4 -2020 ,  Q. No. 46 and Answer , wherein the  Board has clarified that  Designated Authority shall be able to amend his order under section 5 to rectify any apparent errors . The assesee… (read more)
Query

The Assessee is an Individual, for the AY the assessee was assessed u/s 143(3). After making disallowance/additions there was no demand u/s 156, but refund.

In filing form 1 Schedule A of VSV, we are not allowed to use negative sign or negative figure. Please guide

Also guide us how to take credit of Prepaid Taxes in such situation as case as the assessee was not required to pay tax post regular assessment.

Answer The assesee may write nil  . The assessee may also make an application for refund of excess paid by the assessee. (read more)
Query

We have an appeal in AY 2008-09
and demand of Rs 736320 .The document is lost in flood

How we can recover the appeal id
number

Answer The assessee can make an application before the Commissioner of Appeals to furnish the copy of the appeal memo filed . The Office of the CIT (A) is bound to furnish the same by taking necessary charges . If the office of the CIT (A) is refusing to furnish the same , the assessee can… (read more)
Query

Can son file it or it has to be filed with dsc of deceased

Answer If the son is the legal heir , he can file the  Declaration . If there are more than one legal heirs , they can authorise the Son to file the Declaration .   (read more)
Query

The AO has referred matter to DVO and passed the order (20-12-2018) mentioning that it is time barring and no option is left to take stamp duty value as sale consideration. The DVO Report was received on 10-02-2020 even after filing appeal to CIT(A) in which DVO has reduced 50C from 37 lacs to 21 lacs. The assessee want to avail vivad scheme and want to pay tax on basis of DVO Report since it is a matter of distress sale. whether we can excerise option of 154 and whether matter is covered under 155(15) so that assessee can pay revised tax on basis of DVO report in Vivad Scheme

Answer The assessee can make an application to the Assessing Officer to rectify the assessment as per the  Valuation Report of the DVO. The valuation report of the DVO is binding on the Assessing Officer.  In case the Assessing Officer is not passing the order the Assesee can approach the Jurisdictional Commissioner , who can direct… (read more)
Query

I have received certificate u/s 5(1) in Form No.3 under Vivad Scheme determining Refundable amount nearly Rs.1.00 lacs. Hence I am not required to pay tax. It is stated to submit proof for withdrawal of appeal. Now the appeal with CIT(A)is made faceless and there is no I dont know to whom to apply for withdrawal of appeal particularly when appeal with CIT(A) is made faceless. Kindly also guide what is the time limit for filing the proof of withdrawal of appeal.

My second query is that what is the time limit to file the form no 4 after receipt of certificate in form No. 3 As per my knowledge it should be filed within 15 days after receipt of form No.3. Under the circumstance how form no.4 can be filed within 15 days?
Answer Assessee  may write the forum as CIT (A)  and date of filing of appeal before CIT (A) . If  the assessee has received the notice of hearing it contains the appeal  No  .   . The assessee may also write to the Office of the CIT (A)  to permission to with draw the appeal and may… (read more)
Query

If the recovery letter is issued by AO and I have not filed any appeal against the outstanding demand then can I use Vivad Se Vishwas Scheme and wait for Form 3 before paying the dues ?
Answer  For availing the benefit of the VVS the appeal must be pending before the competent Authority as on 31 -1 -2020. ( Specified date ) . If the appeal is pending the assessee can avail the  benefit of the Scheme . If no appeal is filed the assessee cannot avail  the benefit of the  VVS… (read more)