Background:
Taking note of the huge pendency of appeals before various appellate authorities and courts and considering the success of the Vivad se Vishwas Scheme, 2020 (VSV 2020), with a view to expeditiously dispose appeals and reduce litigation, the Government has proposed a new Vivad Se Vishwas Scheme, 2024 (VSV 2024).
Proposed scheme:
The scheme can be opted for by an appellant, which means:
- Whose appeal or writ petition or special leave petition is pending before the Appellate Forum on 22 July 2024
- When objections are filed before the Dispute Resolution Panel (DRP) but directions are pending to be given by the panel
- When directions are given by the DRP but assessment is yet to be completed.
However, the following persons/cases shall not be eligible to opt for declaration under VSV 2024:
- Where assessment or reassessment is carried out based on search. Unlike VSV 2020 which allowed applying for the scheme in search cases where disputed tax was upto Rs.5 crores, such search cases are completely made ineligible from opting this scheme.
- Relating to assessment year where prosecution is initiated
- Relating to undisclosed income or undisclosed asset outside India
- Relating to assessment or reassessment based on information received from foreign country
- Person in respect of whom order of detention passed or prosecution instituted under certain Acts such as Narcotics Act, PMLA etc
The amounts payable by a declarant under the said scheme shall be:
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Particulars
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Amount payable - Application filed before 31 December 2024
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Amount payable - Application filed on or after 1 January 2025
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Tax Disputes - Appeal filed after 31 January 2020
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Entire amount of disputed tax
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10% additional amount payable
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Tax Disputes - Appeal filed before 31 January 2020
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110% of amount of disputed tax
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10% additional amount payable
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Interest or Penalty Disputes - Appeal filed after 31 January 2020
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25% of disputed interest / penalty
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5% additional amount payable
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Interest or Penalty Disputes - Appeal filed before 31 January 2020
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30% of disputed interest / penalty
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5% additional amount payable
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* However, if a declaration is made in respect of an appeal filed by the Department, only half of the above amounts shall be payable.
Key differences – VSV 2020 v. VSV 2024:
Even though both the schemes are largely similar, there are certain differences between the two.
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Factor
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VSV 2020
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VSV 2024
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Search Cases
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Declaration could be made where disputed tax did not exceed INR 5 crore
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Benefit of VSV not applicable to search cases
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Appeals yet to be filed
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Benefit could be availed where though appeal not pending but period for filing appeal has not lapsed
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Benefit can be availed only in cases where appeal pending on 22 July 2024
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