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IT Dept asks companies, individuals to end disputes under Vivaad Se Vishwas scheme

Tax authorities have reportedly asked companies and individuals to opt for the government’s amnesty scheme —Vivad Se Vishwas—announced in the Union Budget even though Parliament is yet to pass the relevant law. Finance Minister Nirmala Sitharaman
in her second Budget had proposed the amnesty scheme to settle more direct tax disputes in a bid to reduce taxpayers’ grievances and raise revenue collection.

Experts are of the view that the income tax department is pushing taxpayers, including those based abroad, to resolve cases but the finance ministry maintains that it’s only “encouraging” them to do so. “It is seen from records that (there is) litigation pending between you and the department,” according to a report in the ET which cites the tax department letter. It has asked the firm concerned to get in touch with the relevant officers in case it has decided to opt for the scheme.

Rebate on settlement before March 31

It has been reported that field officers reached out to taxpayers, asking them to choose the scheme that provides interest and penalty rebates if a settlement is reached before March 31.

Amit Maheswari, partner, Ashok Maheshwary & Associates LLP, told the financial daily: “The tax department has become quite aggressive in pursuing revenues in wake of shortfall. Enforcing pending tax demands by attaching bank accounts coupled with the drive to settle cases under the Vivaad Se Vishwas scheme is making life difficult for taxpayers.” He went to add that appeals commissioners are asking taxpayers to resolve cases under the proposed scheme.

'No appraisals'

The Central Board of Direct Taxes (CBDT) has told field officials the amnesty scheme will have a direct bearing on their annual appraisals and postings.

Earlier, revenue secretary Ajay Bhushan Pandey had clarified that the I-T department asked field offices to explain the modalities of the scheme to taxpayers so that they can make an informed decision. “We are not forcing anyone… they have been asked to reach out to (taxpayers) explain them pros and cons of the scheme,” he had said.

The business daily quoted Mumbai-based tax consultant Dilip Lakhani as saying, "The frantic attempt by Central Board of Direct Taxes to collect Rs 50,000 crore by March 31 under the Vivaad Se Vishwas scheme may find a hurdle as the corporates are facing heavy cash crunch and those matters which are pending before first appellate authority are already stayed on making the prescribed payment of 15-20% of disputed tax.” 

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