Vivad Se Vishwas Scheme: New window to settle pending tax demands & litigations opens on Oct 1

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The Ministry of Finance has notified the Direct Tax Vivad Se Vishwas Scheme, 2024 which will come into effect from October 1, 2024. This scheme aims to reduce income tax litigation and allows taxpayers to settle income tax appeals, writs and petitions that are pending before various appellate authorities including the Supreme Court and high courts as of July 22, 2024.

“In exercise of the powers conferred by sub-section (2) of section 88 of the Finance (No. 2) Act, 2024 (15 of 2024), the Central Government hereby appoints the 1st day of October, 2024 as the date on which the Direct Tax Vivad Se Vishwas Scheme, 2024 shall come into force,” read the notification by the Ministry of Finance dated September 19, 2024.

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This much-anticipated relief was announced in Budget 2024 presented in July this year. The finance minister announced this scheme and said, “It is proposed to introduce a new scheme for settlement of pending appeals.” The scheme’s operational date has been announced, but the final date for the scheme is still pending announcement.
“The pendency of litigation at various levels has been on the rise due to a larger number of cases going for appeal than the number of disposals. Keeping in view the success of the previous Vivaad Se Vishwas Act, 2020 and the mounting pendency of appeals at CIT(A) level, introduction of a Direct Tax Vivad se Vishwas Scheme, 2024 is proposed with the objective of providing a mechanism of settlement of disputed issues, thereby reducing litigation without much cost to the exchequer,” as per the explanatory memorandum to Budget 2024.

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Details of the Direct Tax Vivad Se Vishwas Scheme, 2024

You can only use the Direct Tax Vivad Se Vishwas Scheme, 2024, if your appeals, writs and petitions are pending as of July 22, 2024.

Who will benefit from this scheme?

As per the Finance Act, 2024 the Direct Tax Vivad Se Vishwas Scheme, 2024 can be used by the following appellants:

  • A person in whose case an appeal or a writ petition or special leave petition has been filed either by him or by the income-tax authority or by both, before an appellate forum and such appeal or petition is pending as on the specified date; or
  • A person who has filed his objections before the Dispute Resolution Panel under section 144C of the Income-tax Act and the Dispute Resolution Panel has not issued any direction on or before the specified date; or
  • A person in whose case the Dispute Resolution Panel has issued direction under sub-section (5) of section 144C of the Income-tax Act and the Assessing Officer has not completed the assessment under sub-section (13) of that section on or before the specified date; or
  • A person who has filed an application for revision under section 264 of the Income-tax Act and such application is pending as on the specified date;
Read Also: CBDT launches online mechanism to address income tax disputes
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