Direct Tax Vivad Se Vishwas Scheme 2024 -DTVSVS 2024

Basic understanding of DTVSV Scheme- Direct Tax Vivad Se Vishwas Scheme 2024.

1. Direct Tax Vivad Se Vishwas Scheme, 2024 CA Dr Prithvi Ranjan Parhi Chartered Accountant I Social Auditor I Registered Valuer CA Dr Prithvi Ranjan Parhi 1

2. DTVSV The Direct Tax Vivad Se Vishwas Scheme, 2024 (hereinafter referred as DTVSV Scheme, 2024) has been enacted vide Chapter IV of Finance (No.2) Act, 2024 to provide for dispute resolution in respect of pending Income tax litigation. 20-10-2024 CA Dr Prithvi Ranjan Parji 2

3. Objective The objective of the Scheme is to, inter alia , reduce pending income tax litigation , generate timely revenue for the Government and benefit taxpayers by providing them peace of mind , certainty and savings on account of time and resources that would otherwise be spent on the long-drawn and vexatious litigation process. 20-10-2024 CA Dr Prithvi Ranjan Parji 3 Reduce Litigation Timely Revenue Peace of Mind Certainty Time Saving Resource Saving Objective Business Decisions For Value Maximization

4. Status Announced on 22-07-2024 The commencement date of the said Scheme is notified on 1.10.2024 . Further, Rules and Forms for enabling the Scheme have also been notified on 20.09.2024 . After enactment of the DTVSV Scheme, 2024, FAQ s are released by CBDT 20-10-2024 CA Dr Prithvi Ranjan Parji 4

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7. Appellant “Appellant" means — ( i ) a person in whose case an appeal or a writ petition or special leave petition has been filed either by him or by the income-tax authority or by both , before an appellate forum and such appeal or petition is pending as on the specified date ; or (ii) a person who has filed his objections before the Dispute Resolution Panel under section 144C of the Income-tax Act and the Dispute Resolution Panel has not issued any direction on or before the specified date ; or (iii)a person in whose case the Dispute Resolution Panel has issued direction under sub-section (5) of section 144C of the Income-tax Act and the Assessing Officer has not completed the assessment under sub-section (13) of that section on or before the specified date; or (iv)a person who has filed an application for revision under section 264 of the Income-tax Act and such application is pending as on the specified date ; 20-10-2024 CA Dr Prithvi Ranjan Parji 7

8. Appellant Appeal or a writ petition or special leave petition DRP has not issued direction DRP has issued direction but AO has not passed order Filed Revision Application Pending -Before Appellate Forum 22-07-2024 (Specified Date) 20-10-2024 CA Dr Prithvi Ranjan Parji 8

9. Which appeals are covered ? Please refer to section 89 of the Direct Tax Vivad Se Vishwas Scheme, 2024 ('the DlVSV Scheme, 2024' or 'the Scheme’) [contained in Chapter IV of the Finance (No.2) Act, 20241. Section 89 of the Scheme provides for the definition of "appellant" which is - a person in whose case an appeal or a writ petition (WP) or special leave petition (SI.P) has been filed either by him or by the income-tax authority or by both , before an appellate forum and such appeal or petition is pending as on the specified date i.e. 22.7.2024 ; or a person who has filed his objections before the Dispute Resolution Panel (DRP) under section 144C of the Income-tax Act, 1961 ('the Act') and the DR? has not issued any direction on or before 22.7.2024 ; or a person in whose case the DRP has issued direction under sect ion 144C(5) of the Act and the AO has not completed the assessment under section 1 44C(I3) on or before 22-07-2024 ; a person who has filed an application for revision under section 264 of the Act and such application is pending as on 22.7.2024 . 20-10-2024 CA Dr Prithvi Ranjan Parji 9

10. Appellate Forum “Appellate forum" means the Supreme Court or the High Court or the Income-tax Appellate Tribunal or the Commissioner (Appeals) or Joint Commissioner (Appeals), as the case may be; 20-10-2024 CA Dr Prithvi Ranjan Parji 10 Supreme Court High Court ITAT Commissioner (Appeals) Joint Commissioner (Appeals)

11. Designated authority “Designated authority" means an officer not below the rank of a Commissioner of Income-tax notified by the Principal Chief Commissioner for the purposes of this Scheme; 20-10-2024 CA Dr Prithvi Ranjan Parji 11

12. Section 90: Amount Payable 20-10-2024 CA Dr Prithvi Ranjan Parji 12

13. Amount payable on the tax arrears Sl Nature of tax Arrear Amount payable where declaration made on before 31.12.2024 Amount payable Where declaration made on after 1.1.2025 and before the last Date 01 Tax arrears include disputed tax, interest , penalty ( New Appellant -after 31-01-2020) . 100% of disputed Tax 110% of disputed Tax 02 Tax arrears include disputed tax, interest , penalty ( Old Appellant-Before 31-01-2020) . 110% of disputed Tax 120% of disputed Tax 03 Tax arrears relates to disputed interest , Penalty / fee ( New Appellant-after 31-01-2020). 25% of disputed interest, Penalty / fee 30% of disputed interest , Penalty / fee 04 Tax arrears relates to disputed interest , Penalty / fee ( Old Appellant-Before 31-01-2020) . 30% of disputed interest , Penalty / fee 35% of disputed interest , Penalty / fee 20-10-2024 CA Dr Prithvi Ranjan Parji 13

14. New Case : After 31-01- 2020 but up to 22-07-2024 20-10-2024 CA Dr Prithvi Ranjan Parji 14 Disputed tax, Interest , Penalty Filed up to 31-12-2024 Filed after 31-12-2024 100% of Disputed Tax 110% of Disputed Tax Disputed , Interest , Penalty, Fee Filed up to 31-12-2024 Filed after 31-12-2024 25% of Disputed Interest, Penalty, Fee 30 % of Disputed Interest, Penalty, Fee Pending Appeal

15. Old Case : On or before 31-01- 2020 20-10-2024 CA Dr Prithvi Ranjan Parji 15 Disputed tax, Interest , Penalty Filed up to 31-12-2024 Filed after 31-12-2024 110% of Disputed Tax 120% of Disputed Tax Disputed , Interest , Penalty, Fee Filed up to 31-12-2024 Filed after 31-12-2024 30% of Disputed Interest, Penalty, Fee 35 % of Disputed Interest, Penalty, Fee Pending Appeal

16. Special Point #1 Where an appeal/writ petition/SLP is filed by the income tax authority on any disputed issue, the amount payable shall be 50% of the amount payable specified in the Table above. 20-10-2024 CA Dr Prithvi Ranjan Parji 16 Filed by Income Tax Authority 50%

17. Special Point #2 Where an appeal is filed by the appellant before the Commissioner (Appeals)/Joint Commissioner (Appeals) or objections are filed before the Dispute Resolution Panel on any issue on which he has already got a decision in his favour from the ITAT (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 50% of the amount payable specified in the Table above . 20-10-2024 CA Dr Prithvi Ranjan Parji 17 Filed by Appellant Before Comm(A), JC(A),DRP 50% Favorable Decision from ITAT

18. Special Point #3 Where an appeal is filed by the appellant on any issue before the ITAT on which he has already got a decision in his favour from the High Court (where the decision on such issue is not reversed by the Supreme Court), the amount payable shall be 50% of the amount payable specified in the Table above. 20-10-2024 CA Dr Prithvi Ranjan Parji 18 Filed by Appellant Before ITAT 50% Favorable Decision from HC

19. Non-eligible cases : Sec 96 The Scheme shall not, inter alia , apply in respect of tax arrear,- relating to an assessment year in respect of which an assessment has been made under section 143(3)/ I44/147 / 153A/ 153C of the Act on the basis of search initiated under section 132/132A of the Act; relating to an assessment year in respect of which prosecution has been instituted on or before the date of filing of declaration; relating to any undisclosed income from a source located outside India or undisclosed asset located outside India; relating to an assessment or reassessment made on the basis of information received under an agreement referred to in section 90 or section 90A of the Act , if it relates to any tax arrear . There are certain other cases where provisions of COFEPOSA Act , 1974; UAPA Act , 1967; NDPS Act 1985; PBPT Act , 1988; PC Act , 1988; PMLA 2002 etc. may apply. Such cases are also not covered in the Scheme. For further details, refer section 96 of the Scheme. 20-10-2024 CA Dr Prithvi Ranjan Parji 19

20. Section 91: Filing of declaration and particulars to be furnished. 91. (1) The declaration referred to in section 90 shall be filed by the declarant before the designated authority in such form and verified in such manner, as may be prescribed. (2) Upon filing the declaration, any appeal pending before the Income-tax Appellate Tribunal or Commissioner (Appeals) or Joint Commissioner (Appeals) , in respect of the disputed income or disputed interest or disputed penalty or disputed fee and tax arrear, shall be deemed to have been withdrawn from the date on which certificate under sub-section (1) of section 92 is issued by the designated authority . (3) Where the declarant has filed any appeal before the appellate forum or a ny writ petition before the High Court or the Supreme Court against any order in respect of tax arrear, he shall withdraw such appeal or writ petition with the leave of the Court wherever required after issuance of certificate under sub-section (1) of section 92 and furnish proof of such withdrawal along with the intimation of payment to the designated authority under sub-section (2) of that section. 20-10-2024 CA Dr Prithvi Ranjan Parji 20

21. Section 91: Filing of declaration and particulars to be furnished. (4) Without prejudice to the provisions of sub-section (2) and sub-section (3), the declarant shall furnish an undertaking waiving his right , whether direct or indirect, to seek or pursue any remedy or any claim in relation to the tax arrear which may otherwise be available to him under any law for the time being in force and the undertaking shall be made in such form and manner, as may be prescribed. 20-10-2024 CA Dr Prithvi Ranjan Parji 21

22. Void Declaration (5) The declaration under sub-section (1) shall be deemed not to have been made if,— (a)any material particular furnished in the declaration is found to be false at any stage; or (b)the declarant violates any of the conditions referred to in this Scheme; or (c) the declarant acts in any manner which is not in accordance with the undertaking given by him under sub-section (4), and in such cases, all the proceedings and claims which were withdrawn under this section and all the consequences under the Income-tax Act against the declarant shall be deemed to have been revived. 20-10-2024 CA Dr Prithvi Ranjan Parji 22

23. Appellate Forum not to Proceed (6) No appellate forum shall proceed to decide any issue relating to the tax arrear mentioned in the declaration in respect of which an order has been made under sub-section (1) of section 92 by the designated authority or in respect of payment of sum determined under that section. 20-10-2024 CA Dr Prithvi Ranjan Parji 23

24. The F orms Four separate forms have been notified for the purposes of this scheme. Form-1 : Form for filing declaration and undertaking by the declarant Form-2 : Form for a certificate to be issued by the designated authority Form-3 : Form for intimation of payment by the declarant Form-4 : Order for full and final settlement of tax arrears by the designated authority 20-10-2024 CA Dr Prithvi Ranjan Parji 24

25. Procedure to be followed The taxpayer would have to file a declaration before the Designated Authority (DA) in Form-1. The DA would issue a certificate (Form-2) determining the amount payable within 15 days from the date of receipt of the declaration. Proceedings before the CIT(A) and the Tribunal would be deemed to have been withdrawn from the date of issuance of such certificate. The taxpayer would have to pay the amount so determined within 15 days from the receipt of such certificate. The taxpayer will have to withdraw the respective appeal, writ or SLP . The taxpayer, vide Form-3 , is then required to intimate the details of payment of the amount determined and proof of withdrawal of appeal to the DA. The taxpayer will have to also furnish an undertaking waiving the right to seek any remedy or claim with respect to the matters involved in the declaration and payments made in pursuance thereof. The DA will pass an order (i.e. Form-4) stating that the payment has been made and that the taxpayer will be granted immunity from prosecution or imposition of penalty under the Act. 20-10-2024 CA Dr Prithvi Ranjan Parji 25

26. Declaration to be void The declaration will be presumed to have never been made, and all the proceedings and the claims, which were withdrawn, will be deemed to have been revived, in the following cases: Any material furnished in the declaration is found to be false at any stage. Conditions referred to in the scheme are violated . The taxpayer acts in any manner not in accordance with the undertaking for not seeking any other remedy. 20-10-2024 CA Dr Prithvi Ranjan Parji 26

27. Time and manner of payment. 92.  (1) The designated authority shall, within a period of fifteen days from the date of receipt of the declaration, by order, determine the amount payable by the declarant in accordance with the provisions of this Scheme and grant a certificate to the declarant containing particulars of the tax arrear and the amount payable after such determination, in such form as may be prescribed. (2) The declarant shall pay the amount determined under sub-section (1) within a period of fifteen days of the date of receipt of the certificate and intimate the details of such payment to the designated authority in the prescribed form and thereupon the designated authority shall pass an order stating that the declarant has paid the amount. (3) Every order passed under sub-section (1), determining the amount payable under this Scheme, shall be conclusive as to the matters stated therein and no matter covered by such order shall be reopened in any other proceeding under the Income-tax Act or under any other law for the time being in force. (4) Making a declaration under this Scheme shall not amount to conceding the tax position and it shall not be lawful for the income-tax authority or the declarant being a party in appeal or writ petition or special leave petition to contend that the declarant or the income-tax authority, as the case may be, has acquiesced in the decision on the disputed issue by settling the dispute 20-10-2024 CA Dr Prithvi Ranjan Parji 27 15 days To Determine & Certify 15 days To Pay and Intimate Conclusive Order

28. Immunity Immunity from initiation of proceedings in respect of offence and imposition of penalty in certain cases. 93. Subject to the provisions of section 92, the designated authority shall not institute any proceeding in respect of an offence; or impose or levy any penalty ; or charge any interest under the Income-tax Act in respect of tax arrear. 20-10-2024 CA Dr Prithvi Ranjan Parji 28

29. No refund of amount paid. No refund of amount paid. 94. (1) Any amount paid in pursuance of a declaration made under section 91 shall not be refundable under any circumstances . (2) Where the declarant had, before filing the declaration under sub-section (1) of section 91, paid any amount under the Income-tax Act in respect of his tax arrear which exceeds the amount payable under section 90 , he shall be entitled to a refund of such excess amount, but shall not be entitled to interest on such excess amount under section 244A of the Income-tax Act. 20-10-2024 CA Dr Prithvi Ranjan Parji 29 No Refund Excess paid Earlier shall be Refunded No Interest

30. Separate Form for Each Dispute The Scheme also provides that Form-1 shall be filed separately for each dispute , provided that where appellant and the income-tax authority, both have filed an appeal in respect of the same order, single Form-1 shall be filed in such a case. The intimation of payment is to be made in Form-3 and is to be furnished to the Designated Authority along with proof of withdrawal of appeal, objection, application , writ petition , special leave petition or claim . 20-10-2024 CA Dr Prithvi Ranjan Parji 30

31. Timelines Various timelines specified in the Scheme are as follows: ( i ) Declaration and Undertaking shall be filed by tax payer in Form-1 on or before 31.12.2024 to keep the amount payable on the lower threshold. In case of filing the declaration and undertaking beyond 31.12.2024 , amount payable will increase as specified in rates Table- I above. The Designated Authority shall issue Form-2 within a period of fifteen days from the date of receipt of the declaration to determine the amount payable by the taxpayer. The tax -payer shall pay the amount as determined in Form-2 within a period of fifteen days from the date of receipt of the certificate, and shall intimate the details of such payment in Form-3. Upon receipt of Form-3, Designated Authority shall pass an order in Form- 4 stating that the taxpayer has paid the full and final amount. 20-10-2024 CA Dr Prithvi Ranjan Parji 31

32. Appeal disposed off Suppose a taxpayer is eligible to apply for DTVSV Scheme, 2024 as his appeal is pending as on 22-07-2024 but not pending on the date of making declaration : The assessee is Not Eligible. However, in cases where a taxpayer files declaration under the section 90 of the Scheme and intimates the same to the appellate authority, the concerned appellate authority may consider not disposing the appeal of the taxpayer. 20-10-2024 CA Dr Prithvi Ranjan Parji 32

33. Time limit to file appeal not expired on 22.7.24 The Scheme does not provide for eligibility of those cases where an appeal is not pending as on 22.7.2024 except where DRP has issued direction but AO has not passed the order. 20-10-2024 CA Dr Prithvi Ranjan Parji 33

34. Settling penalty appeal while quantum appeal is pending. It provides that the disputed penalty is such penalty which is not levied or leviable in respect of disputed income or disputed tax. Thus, it would not be possible for the appellant to apply for settlement of penalty appeal only, when the appeal on disputed tax related to such penalty is still pending. If both quantum appeal covering disputed tax and appeal against penalty levied on such disputed tax for an assessment year are pending, the declarant is required to file a declaration form giving details of both disputed tax appeal and penalty appeal. However, he would be required to pay relevant percentage of disputed tax only. 20-10-2024 CA Dr Prithvi Ranjan Parji 34

35. Disputes relating to other direct-taxes Only disputes relating to income-tax are covered. 20-10-2024 CA Dr Prithvi Ranjan Parji 35

36. Where Request for withdrawal of appeal is made but under process. If withdrawal is under process, the proof of request made shall be enclosed. 20-10-2024 CA Dr Prithvi Ranjan Parji 36

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49. Part A : General Information 20-10-2024 CA Dr Prithvi Ranjan Parji 49

50. PART B – INFORMATION RELATING TO DISPUTE: (SEPARATE FORM-1 DECLARATION FOR EACH DISPUTE) 20-10-2024 CA Dr Prithvi Ranjan Parji 50

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56. Thank You 20-10-2024 CA Dr Prithvi Ranjan Parji 56