1 / 4 of all direct case disputes have opted for decision below the Vivad se Vishwas scheme which includes Rs 97,000 crore in tax calls for, sources within the division of income mentioned on Friday. They added that the scheme is an amazing success in contrast with comparable affords launched in 1998 and 2016.
Though the quantum of the ultimate income proceeds to the federal government shouldn’t be clear, the Centre won’t obtain your complete quantity because the scheme supplied engaging reductions. In addition to, part of tax calls for is required to be deposited with the federal government when an assessee challenges the decision in larger appellate discussion board and this quantity would have already got been accounted for in varied years prior to now.
“Vivad se Vishwas was introduced by the federal government in March final yr simply earlier than the Covid-19 outbreak and has obtained an amazing response in distinction to comparable schemes introduced in 1998 and in 2016,” a supply mentioned.
Over 1.25 lakh circumstances have opted for the scheme, which is 24.5% of the greater than 5.10 lakh disputes pending in numerous boards. The response to the scheme is 15 instances greater than the 2016 scheme known as Direct Tax Dispute Decision Scheme. “The 1998 scheme may solely mop up Rs 739 crore with just some thousand circumstances whereas the one in 2016 managed to resolve simply 8,600 circumstances involving a tax demand of Rs 631 crore,” one other supply mentioned.
The big variety of circumstances allowed to take part within the scheme has contributed to its success which included all appeals or SLPs pending in Supreme Courtroom until January 31, 2020. In addition to, it coated circumstances pending earlier than Dispute Decision Panel (DRP), and people the place instructions have been issued however order not handed by DRP.
The decision scheme is in pressure until February 28 after the deadline was prolonged a number of instances owing to pandemic-related restrictions.
The scheme launched within the Price range final yr mentioned that if the enchantment is filed by the revenue tax division or the division has misplaced on a problem, then the assessee has to pay 50% of the disputed tax whereas the penalty and curiosity could be waived off.
In these circumstances, if the dispute is expounded to solely penalty and curiosity then taxpayer has to pay solely 12.5% of the disputed quantity.
For case filed by the assessee within the larger discussion board, they should pay 100% of the disputed tax (125% of disputed tax in case of search circumstances) whereas penalty and curiosity could be waived off. If the dispute is just about penalty and curiosity then 25% of the disputed penalty and curiosity is payable.