The Government of India has introduced the Direct Tax Vivad Se Vishwas (DTVSV) Scheme, 2024 under the Finance (No. 2) Act, 2024. This scheme aims to resolve pending income tax litigation, helping taxpayers settle disputes while generating timely revenue for the government. By offering peace of mind, savings on time and resources, and certainty in outcomes, the DTVSV Scheme 2024 is an excellent initiative for those looking to close long-standing tax disputes.
Key Highlights of the Direct Tax Vivad Se Vishwas Scheme 2024
- Objective of the Scheme: The primary objective of the DTVSV Scheme 2024 is to reduce the backlog of pending income tax litigation and provide a mechanism for taxpayers to resolve disputes efficiently. The scheme offers a chance to settle litigation without going through time-consuming court processes.
- Eligibility for the Scheme: The scheme covers various appeals and objections filed by taxpayers before appellate forums such as the Commissioner (Appeals), the Income Tax Appellate Tribunal (ITAT), and even the High Court or Supreme Court, provided that the appeal was pending as of July 22, 2024. The scheme also applies to cases where taxpayers have filed objections before the Dispute Resolution Panel (DRP) under section 144C of the Income Tax Act(circular-12-2024).
- Exclusions from the Scheme: Certain cases are not eligible for settlement under this scheme. These include cases involving undisclosed foreign income or assets, cases related to the Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS), and cases where prosecution has already been initiated(circular-12-2024).
- Rates Payable Under the Scheme: The DTVSV Scheme specifies different rates based on the timing of the declaration. For example, taxpayers who file their declarations by December 31, 2024, will pay 100% of the disputed tax amount. However, those filing after January 1, 2025, will face an additional 10-20% on the disputed tax, depending on their appellant status(circular-12-2024).
Case Laws Supporting the Scheme
Several court cases have set a precedent for resolving tax disputes under the Vivad Se Vishwas Scheme, including rulings that emphasize the government’s intent to reduce litigation and encourage early resolution. In one landmark case, the Delhi High Court supported a taxpayer’s claim under the scheme, stating that the initiative promotes transparency and fairness in dispute settlement. Similar rulings have strengthened the scheme’s legal standing, ensuring that taxpayers can trust the process.
How to Apply for the Scheme
To benefit from the DTVSV Scheme 2024, eligible taxpayers must complete the following steps:
- Filing the Declaration: Submit Form-1 to the designated authority by December 31, 2024, to take advantage of lower rates.
- Processing by the Authority: The designated authority will issue Form-2 within 15 days of receiving the declaration, determining the amount payable.
- Final Payment and Proof: Taxpayers must make the payment within 15 days of receiving the Form-2 certificate and provide proof via Form-3(circular-12-2024).
The Impact of the Scheme
The DTVSV Scheme 2024 is a game-changer for both the government and taxpayers. By settling disputes early, taxpayers avoid lengthy litigation and potential penalties. For the government, it results in a quicker flow of revenue. The scheme promotes a win-win situation, streamlining the process for resolving disputes that have been delayed for years.
Conclusion
The Direct Tax Vivad Se Vishwas Scheme 2024 offers a clear path for taxpayers seeking to resolve pending income tax litigation. With its structured approach and clear timelines, the scheme ensures transparency, timely resolution, and peace of mind. Taxpayers are encouraged to take full advantage of the scheme before the deadline and close their long-standing tax disputes.