Clarifications on provisions of the direct tax vivad se vishwas act 2020
Circular No. 21/2020 was issued by the Central Board of Direct Taxes on 4 December 2020. Its subject is Clarifications on provisions of the direct tax vivad se vishwas act 2020.
This is a clarification. The Board is stating how it reads a provision. That reading binds the department; it does not bind a court, and where the section says otherwise the section wins.
A further set of 34 answers, numbered 56 to 89, on the Direct Tax Vivad se Vishwas Act, 2020, issued under sections 10 and 11 of that Act in continuation of the 55 answers given by Circular No. 9/2020 dated 22 April 2020. The opening paragraphs set out where the Scheme stood by then: the Act was enacted on 17 March 2020 and later amended by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 to give relaxations for the pandemic and to let the Central Government notify dates; by notification dated 27 October 2020 the date for payment without the additional amount was carried from 31 December 2020 to 31 March 2021 and the last date for filing a declaration was notified as 31 December 2020; and Circular No. 18/2020 dated 28 October 2020 relaxed the 15-day limit in section 5(1) for paying the amount determined in the Designated Authority's certificate.
Several representations came in after the first set of answers, seeking further relaxation and clarification; some had already been met by the October 2020 notification and circular, and the rest are answered here.
F. No. IT(A)/1/2020-TPL
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
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Circular No. 21 /2020
Dated: 4th December, 2020
Sub.: Clarifications on provisions of the Direct Tax Vivad se Vishwas Act, 2020 - reg.
With the objective to reduce pending income tax litigation, generate timely revenue for the
Goverrunent and benefit taxpayers by providing them peace of mind, certainty and savings on
account of time and resources that would otberwise be spent on the long-drawn and vexatious
litigation process, the Direct Tax Vivad se Vishwas Act, 2020 (hereinafter referred to as 'Vivad se
Vishwas') was enacted on 17th March, 2020. The provisions of Vivad se Vishwas were amended by
tbe Taxation and Otber Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 to
provide certain relaxations in view of the COVID-19 pandemic and also to empower the Central
Government to notify certain dates. Towards this end, vide notification dated 27'" October, 2020 tbe
date for payment without additional amount under Vivad se Vishwas was extended from 31"
December, 2020 to 31st March, 2021. The last date for filing declaration under Vivad se Vishwas
was also notified as 31 ,t December, 2020. Subsequently, tbe Central Board of Direct Taxes issued a
circular no. 18/2020 dated 28th October, 2020 relaxing tbe time limit of 15 days prescribed in
section 5(1) of Vivad se Vishwas for making payment of amount payable, as detennined in a
certificate issued by the Designated Autbority.
2. In order to facilitate the taxpayers, the Board had vide circular no. 9/2020 dated nnd April,
2020 issued clarifications in form of answers to 55 frequently asked questions (FAQs) on issues
related to eligibility, computation of amount payable, procedure and consequences under Vivad se
Vishwas. Several representations have been received thereafter seeking further relaxation and
clarifications with respect to such issues. Some of these representations have already been
addressed through the aforesaid notification dated 27th October, 2020 and circular dated 28th
October, 2020.
3. Section 10 and 11 of the Vivad se Vishwas empowers the Board / Central Goverrnnent to
issue directions or orders in public interest or to remove difficulties. This circular is being issued in
continuation of circular dated 22nd April, 2020 (which covered Q. no. I - 55) under section 10 and
11 of the Vivad se Vishwas to provide answers to 34 more FAQs (Q. no. 56 - 89). It may be noted
that in the FAQs, Income Tax Act, 1961 has been referred to as the Act, Designated Authority
(under Vivad se Vishwas) has been referred to as the DA, Assessing Officer has been referred to as
the AO, Commissioner (Appeals) has been referred to as CIT(A), and the Income Tax Department
has been referred to as the Department.
In any surviving dispute over a declaration filed under the Scheme — the amount determined, the certificate, or the effect of the settlement on a related year.
It mentions. Circular No. 18/2020, Circular No. 21/2020, Circular No. 9/2020
Source: the Income Tax Department’s own published text — its page for this instrument.
