Government extends payment deadline of tax amnesty scheme
The Central government on Saturday extended the deadline for making payments under tax dispute settlement scheme ‘Vivad se Vishwas’ (from dispute to trust) from April 30 to June 30 to provide relief to taxpayers facing a health crisis due to the second wave of the Covid-19 pandemic, a Central Board of Direct Taxes (CBDT) order said.
“The deadlines have been extended in view of the severe Covid-19 pandemic raging unabated across the country affecting the lives of our people, and in view of requests received from taxpayers, tax consultants and other stakeholders that various time barring dates, which were earlier extended to April 30, 2021, by various notifications may be further extended,” a finance ministry spokesperson said.
The earlier deadlines of April 30 for various other compliances such as income-tax assessment or reassessment orders and notice for reopening of cases where income has escaped assessment have also been extended by two months, the CBDT order stated.
The extended time limit will also be applicable for passing an order related to any directive of the Dispute Resolution Panel (DRP) and for sending intimation to the process of equalisation levy (EL), the spokesperson added. EL is imposed on non-resident e-commerce firms that mop up revenue from the Indian market without paying any taxes.
It has also been decided that the time for payment of the amount payable under ‘Vivad se Vishwas’ scheme without any additional amount shall be further extended June 30, 2021, he said.
Tax amnesty scheme ‘Vivad se Vishwas’ is one of the most successful direct tax dispute resolution schemes, which settled more than 1.48 lakh vexed cases and recovered 54% of about ₹1 lakh crore amount under litigation. The scheme that was enacted on March 17, 2020, closed on March 31 this year. However, taxpayers who had already made declarations within the stipulated deadline of March 31 can make payment without any additional amount or penalty up to June 30.
According to official data, the government received a total of 1,33,837 applications under the scheme that involved 1,48,690 disputes – 1,45,237 related to appeals by assesses and 3,453 related to appeals by the income-tax department. While the total disputed amount was ₹1,00,437 crore, the government received ₹54,005 crore payments against the disputed tax.
The ‘Vivad se Vishwas’ scheme provides for settlement of disputed tax, disputed interest, disputed penalty or disputed fees in relation to an assessment or reassessment order. It grants immunity to taxpayers from levy of interest, penalty and institution of any proceeding for prosecution for any offence under the Income-Tax Act in respect of matters covered in the declaration.
Finance minister Nirmala Sitharaman announced the scheme in the Union budget presented on February 1, 2020. It aimed to resolve legacy disputes involving direct taxes. Under the scheme, penalty and interest would be waived if the disputed amount is paid before the stipulated date. As of January 31, 2020, over 5.10 lakh litigations were pending in various forums worth over ₹19.5 lakh crore.