Income Tax Update

 The CBDT has issued Circular No. 21/2020 dated 4.12.2020 containing FAQ’s & Clarifications on some crucial & vital issues in the Vivad se Vishwas Scheme, 2020.*

1. Appeals filed beyond the cut-off date of 31.1.2020 with Application for Condonation of Delay and the appeal is admitted before the date of filing declaration would be regarded as eligible applications. 

🔈 2. Enhancement Notice issued by CIT(Appeal) after the cut-off date of 31.1.2020, but before 4.12.2020, shall be required to be taken into account for determining the amount of disputed tax payable under the VsV Scheme.

🔈 3. Assessment Order which has been framed in the case of an assessee u/s 143(3)/144 based on the search executed in some other taxpayer case, shall be regarded as a search case. 

🔈 4. An appeal filed against intimation u/s 143(1) is eligible under the VsV Scheme if adjustment has been made under sub-clauses (iii) to (vi) of clause (a) of section 143(1) of the Act.

🔈 5. Appeals against the Orders denying Registration to Trusts u/s 12AA are not eligible to be settled under the VsV Scheme. 

🔈 6. Appeals or Writs against the Order u/s 263 is not eligible. 

🔈7. The Cross Objections filed and pending as on 31.1.2020 are also eligible to be settled under the Scheme.

🔈8. Proceedings pending before Income Tax Settlement Commission are not eligible. 

🔈9. Unsecured Loans/Share Capital/Share Premium, settled under the VsV Scheme, cannot be credited to the Capital Reserve. 

🔈10. Consequential relief will not be available in proceedings u/s 201 for settlement of disallowance u/s 40(a)(i)/(ia). 

🔈11. Once appeal against order u/s 201(1) is settled under VsV Scheme, there would be 100% waiver of corresponding interest levied u/s 201(1A) of the Act.

🔈12. if prepaid taxes (TDS/TCS/Advance Tax) are clearly identifiable with the source of income, these will be adjusted against tax liability. 

🔈 13. Declaration can be revised any number of times, before the PCCIT issues a Certificate of final tax amount payable. 

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