| Query | The ao added back to our income transactions they considered as hawala. They then deducted the full tax and penalty and interest there on against a refund we had owing to us. We appealed against the hawala decision. Matter has not been heard as of date. How do we deal with this matter under the vsv scheme. Thanks |
| Answer | Assessee can file the declaration ,however the assessee has to pay the tax in dispute . If the tax is paid , there will not be interest and penalty , the assessee will get the refund of the interest and penalty .
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| Query | Can order by the Hon’ble ITAT be considered as FAVOURABLE order as addition @ 8%/100% is reduced to 3 % which is less than 5% (for which VSV is being opted). Will answer be different if parties for which addition is made differs, but the addition is under purchases from Bhanwarlal Jain Group |
| Answer | As we understand, in a case if CIT adds 100 rupees, and subsequently the ITAT reduces it by 50 percent i.e. 50 rupees. It is a favourable order to the extent of 50 percent. Therefore, the assessee should be allowed to avail the scheme by settling the dispute at tax payable on 25 percent addition along with the upheld addition of 50 percent i.e. 75 percent. Applying the same principle, if 8 percent addition is reduced to 3 percent i.e. 5 percent relief is granted. The disputed tax amount should be computed at 5.5 percent. [3 percent + 50% of (5 percent)]. As per 2nd proviso to section 3 of VSVA, the favourable order should be of the assessee only and cannot be in case of any other assessee with similar/identical facts. Whether the purchases from Bhanwarlal Jain Group or other group it may not be any difference . We have to refer section 9 which deals with certain exceptions referred therein only .Facts of the querist is not covered under the exception.
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| Query | Respected Sir, |
| Answer | Yes, As per explanation to section 7 of VSVA, where the declarant had, before filing the declaration paid any amount under the Income-tax Act in respect of his tax arrears which exceeds the amount payable under section 3 of VSVA, he shall be entitled to a refund of such excess amount, but shall not be entitled to interest on such excess amount. |
| Query | Sir, |
| Answer | As we understand, there is no need to fill challan details in the event of a refund, and when the appeal is pending before the CIT(A) the same is deemed to have been withdrawn, therefore there is no question of filing a proof of withdrawal. In case there is a problem in submitting the form without the above-mentioned details, it is advisable to contact your Designated Authority under VSVA. |
| Query | Due to an error in Form 1 of VSV, instead of amount refundable to the assessee, the form shows amount payable by the assessee. Can the same be rectified by filing another Form 1 ? How many times the same can be refiled?Currently the status under VSV scheme is “Awaiting Form 3 from CIT”. |
| Answer | The assessee can once again file under VSVA and this time chose the filing type as “revised” for the same AY.
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| Query | In the facts of the given case, on the disputed issue (viz. Disallowance of Employees Contribution to PF & ESIC) in an earlier year viz.A.Y.2010-11, the Appeal of the assessee was allowed by the CIT(Appeals). Against the same, the Department went into appeal before the ITAT. The ITAT dismissed the appeal of the Department on the ground of low tax effect viz. monetary limits. In subsequent year viz. A.Y.2012-13, disallowance on the same issue was made by the A.O. The assessee has preferred an appeal before the CIT(Appeals) which was pending on the ‘specified date’. Now, the assessee wants to opt for the DTVSV Scheme. What would be the quantum of ‘disputed tax’ – 100% or 50% since, considering the fact that Appeal of the Department on ‘disputed issue’ was dismissed by ITAT (in view of 2nd Proviso to Section 3 of DTVSV Act)?? |
| Answer | The proviso reads as under “ Provided further that in a case where an appeal is filed before the Commissioner (Appeals) or objections is filed before the Dispute Resolution Panel by the appellant on any issue on which he has already got a decision in his favour from the Income Tax Appellate Tribunal (where the decision on such issue is not reversed by the High Court or the Supreme Court) or the High Court (where the decision on such issue is not reversed by the Supreme Court), the amount payable shall be one-half of the amount in the Table above calculated on such issue, in such manner as may be prescribed”
By reading the proviso it is clear that the dismissal of appeal by the Appellate Tribunal will also amount to order of the Appellate Tribunal hence the assesee is eligible for concessional rate of 50% of disputed tax .
From what we understand, the issue seems to be prima facie good on merits and there doesn’t seem to be a need to avail VSVA. |
| Query | In case of search assessment u/s 143(3) passed earlier with addition made of Rs 20,00,000/-. appeal filed and pending. Subsequently their was search and the relevant assessment year also falls in the Block. Assessment U/s 153A/143(3) passed on the same addition of Rs 20,00,000/-. If we file for VSV what will be the tax rate applicable 100% or 125% on the above income which was earlier assessed U/.s 143(3) and same repeate again in 153A. |
| Answer | We presume that there was search earlier and the assessment was finalised under section 143(3) of the Act and the appeal is pending . Mean time one more search and seizure action was initiated and the order was passed u/s 153A , read with section 143(3) of the Act. One the relevant assessment is covered under the search and seizure action the rate of tax applicable will be at 125% as per section 3 (b) of the VSV Act.
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| Query | ITAT order received on 29/12/2019. We have not filed any appeal before high court yet.can we still go for vivad se vishwas scheme even though there is delay in filing appeal before high court. |
| Answer | The assessee is eligible for VSVA. He has to settle the appeal which is pending against the order under section 263 of the Act. Once the order under section 263 is settled , consequential order passed by the AO giving effect to the order of under section 263 , which is pending before the CIT(A) will not survive .In ACIT v .Oscar Investment Ltd. (2020) 81 ITR 81 (SN) (Delhi) (Trib) the Tribunal held that when an order under section 263 had been quashed by the Tribunal, all resultant proceedings including the present appeals would not survive .
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