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

Sir, we recieved form 5 in which there is refund but unfortunately my dad expire I add my mother as legal heir on income tax portal, please advice how to get/procedure for refund.

Answer Make an application to bring the legal heir on record  by filing the copy of the death certificate and an  affidavit  explaining  the facts . On the receipt of the application the designated authority will pass an appropriate order bringing legal heir on record and  the refund will be issued in the name of legal… (read more)
Query

Appeal to CIT Appeals filed with in time limit and was pending on 31.01.2020 for the assessment year 2013-14

263 order passed by CIT IT TP on 26.02.2020

Being my appeal is pending on 31.01.2020 I have opted for VVS and filed forms 1 and 2

The same is rejected by CIT IT TP
Is rejection is valid?
If not what is the further course of action

Please advise
Thanks in advance.
Answer One has to read the order of the revision order passed by the CIT . If  the  entire order of the Assessing Officer is set aside , Appeal before the CIT (A) may not survive ,  unless the order of the CIT is challenged before the ITAT . If the order of the revision is… (read more)
Query

For AY 2005-06, assessee has discharged tax at the rate of 10%. Subsequently, reassessment notice was issued in AY 2005-06 basis survey in subsequent year (AY 2009-10). Further, objections were filed against the reassessment initiation. The AO rejected the objections against which assessee filed writ petition in High Court. Writ petition is pending as on 31 Jan 2020.

For AY 2009-10, income of the assessee was taxed as PE and income was attributed at 50%, thereby leading to an effective tax rate of 15%.

Considering the fact that reassessment was initiated basis AY 2009-10, can it be argued that it is possible to determine tax liability for AY 2005-06 at 15% (basis assessment carried out in AY 2009-10) and assessee is eligible to opt under the Scheme for differential 5% of the taxes.

Answer Please refer Circular No 9 / 2020 dt 22-04 2002 ,  Q.12  .  If a writ has been filed against a notice issued under section 148 of the Act  and no assessment order has been passed consequent to that section 148 notice , will such case be eligible to file declaration under Vivad Se Viashwas… (read more)
Query

I filed form 1 calculating the tax payable under section 3 more of what actually payable by mistake.the department has issued form 5.Can I rectify the order now?
Answer Please refer Circular No 21 /2020 dt 4-12 ,2020 , as per Q.No 89  Ans ,it has been stated that the declaration  can be revised any number of times before DA issues  a certificate under section 5(1) of the Vivad Se Vishawas. . On the facts the certificate is already issued by the DA .… (read more)
Query

The assessee got partial relief in cit(A) . On 30.01 .2020 , both Department and assessee went to appeal.

Later on in nov. 2020 bother the appeals were dismissed by itat.

Now the assessee has filed vsvs on the issue sustained by cit(appeal).

My opinion is that the assessee should have filed vsvs on both the issues sustained/deleted because on 30.01.2020 , the both the issues were disputed before ITAT.
Answer Please refer Circular No 21 / 2020 dt 4-12 -2020 ,  Q.No.  56 and answer  . As per the benefit given in the Circular  if the appeal has been disposed of by the appellate Authority  can also avail the benefit of the Scheme .   On the facts of the case two appeals were pending before… (read more)
Query

How to withrwal online appeal
Answer The assesseee should write to the Concerned CIT (A) where the appeal is filed  after getting the certificate  from the Designated Authority . The concerned CIT (A) will pass the consequential order  . (read more)
Query

As per VsV Scheme a person in whose case time limit to file appeal has not expired on 31/1/2020 is eligible to opt for the scheme.
My query is whether it is necessary to file appeal after 31/1/2020 but before the expiry of the time limit to file appeal, to be eligible to avail the benefit of the scheme, or it would do even if appeal is not subsequently filed
Answer Assessee has deemed appeal pending on the specified date, thus assessee will be eligible under VSVA. Please refer Ans to Q.No 1   Clarification issued by Board F.NO IT (A) /2020 -TPL  Circular No 9/2020 dt 22 -04 -2020 . For availing the benefit of the Scheme it is not required to file an appeal .… (read more)
Query

As per my 26as, there was an amount of 66,50,000 with a TDS Deduction of Rs 3,50,000/- under section 194D. Can I offer my Income under 44AD now?
Whether the nature of the insurance commission mentioned in Section 44 and section 194D are same?
Answer Section 44AD is applicable to eligible business as per Explanation (b)  and  eligible assessee as per (a) .  S. 44AD (6 ) deals with the exceptions  . An Insurance Agent cannot adopt the presumptive taxation Scheme.  A person whose turnover or gross receipts exceeds Rs 2 Crore  is not eligible to adopt the benefit of… (read more)
Query

I went for VIVAD SE BISWAS SCHEME for my long lasting appeal before CIT(A) AND got Certificate no.5 after paying demanded tax set BY THE HONOURABLE PRINCIPAL CIT.I WITHDRAW MY APPEAL AND ALSO GOT ORDER U/S 250.MY QUERY: IS DEMAND AGAINST ME IS OVER OR I HAVE TO PAY FINE AND PENALTY?

THANKS IN ADVANCE DIR.

Answer Interest and penalty  will be waived . Section 6 of The  Direct Tax Vivad Se Vishwas Act , 2000  grants immunity from penalty as well as interest.  If penalty is initiated the same will be dropped .  It is the duty of the Assesssing Officer to pass the consequential order . (read more)
Query

When I filed the form and form 3 is received from the IT Department which does not contain the actual amount of refund adjusted by the department , even though I have correctly mentioned it in the declaration filed, is there any way to correct it ??
Answer Assseessee  may file an application for rectification application before the designated Authority . They have the power to rectify the mistake . If no action Is taken by the  Designated Authority ,  the Assessee may have to file Writ petition before High Court .   (read more)