CBDT revises 55 Frequently Asked Questions (FAQs) on Vivad se Vishwas Scheme.
CBDT revises 55 FAQs on Vivad se Vishwas Scheme
During the Union Budget, 2020 presentation, the ‘Vivad se Yishwas‘ Scheme was announced to provide for dispute resolution in respect of pending income tax litigation. Pursuant to Budget announcement, the Direct Tax Vivad se Vishwas Bill , 2020 (the Bill) was introduced in the Lok Sabha on 5th Feb, 2020. Subsequently, based on the representations received from the stakeholders regarding its various provisions, official amendments to tlte Bill were proposed. These amendments sought to widen the scope of the bill and reduce the compliance burden on taxpayears.
After introduction of the bill in Lok Sabha, several queries were received from the stakeholders seeking clarifications in respect of various provisions contained therein. Government had considered these queries and had decided to clarify the same in form of answers to frequently asked questions (FAQs) vide circular no 7 of 2020 dated 41 March 2020. These clarifications were, however, subject to approval and passing of the bill by the Parliament and receiving assent of the Hon’ble President of India.
The Bill has since been passed by the Parliament and has also received the assent of the Hon’ble President of India and has now been enacted as The Direct Tax Vivad Se Yishwas Act, 2020 (Vivad se Viswas). The objective of Vivad se Vishwas is to inter alia reduce pen ding 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.
Revised FAQ on Vivad se Vishwas Scheme
The 55 questions contained in the CBDT circular no 7 of 2020, have been modified vide Circular No. 9 of 2020 dated 22.04.2020 as under:
1. Vivad se Vishwas refened to Direct Tax Vivad se Vishwas Bill , 2020 in circular no However, in this circular it refers to The Direct Tax Vivad Se Vishwas Act, 2020;
2. Since clauses of the Bill have now become sections in the Vivad Se Vishwas, the reference to ”clause” in circular no 7 has been replaced with “section”;
3. Reference to declaration form in circular no 7 has been replaced with referencing of relevant form, since rules and forms have now been notified ; and
4. Answer to question no 22 has been modified to reflect the correct intent of the law. It has now been clarified that where only notice for initiation of prosecution has been issued without prosecution being instituted, the assessee is eligible to file declaration under Vivad se Vishwas. However, where the prosecution has been instituted with respect to an assessment year, the assessee is not eligible to file declaration for that assessment year under Vivad se Vishwas, unless the prosecution is compounded before filing the declaration
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CBDT further issued a Corrigenda dated 27.04.2020 to Circular No. 9/2020 as under:
“In the Circular No. 9/2020 of the Government of India, Ministry of Finance, Department of Revenue (Central Board of Direct taxes), issued on the 22nd April, 2020,-
(i) in the answer to question number I, for the word ” Bill” read the word “Act”; and
(ii) in the answer to question numbers 26,28, 29 and 41 for the figures, letters and word “31” March, 2020″, wherever they occur, read the figures, letters and word “30’h June, 2020”.
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