The Act came in to effect on 17th March 2020 .The Act is is in the direction of bringing tax dispute to an end and bringing the disputed money in various appellate forum in the mainstream of the economy .
What is Act ?
The Act aims in unlocking the disputed tax arrears which are pending against various appellate forum .The arrears of tax i.e INR 9.2 Lacs Crore can be bring in development of the nation .
The tax payer can pay the disputed tax by 31st March 2020 without paying any interest and penalty .
In case the tax payer is not able to pay by 31st March ,he can pay by 30th June but he ends up paying 10% more taxes .
Is this Act applicable for interest and penalty amount under appeal ?
Yes, the Act is applicable where there are arrears of penalty and interest as well .
In that case 25% of disputed interest or penalty or fees is payable by 31st March 2020 and beyond that but up to 30th June 2020 payable amount is 30 % .
Is there some eligibility criteria for the Act ?
This scheme is applicable to the following set of taxpayers .The detail of the same is enumerated below –
• Case pending before Dispute Resolution Panel (DRP)
• Orders for which time for filing appeal has not elapsed on 31st March 2020
• Dispute for which payment is already made are also eligible
• Appeals filed on or before 31st Jan 2020
• Assessee filed revision application under Section 264 on or before 31st Jan 2020
Under what circumstances the scheme is not applicable?
The circumstances in which scheme is not applicable is spelled as under –
• Assessment year for which prosecution has been initiated
• Search Cases where disputed amount of tax is more than Rs 5 Crores
• Undisclosed income or undisclosed assets outside India
• Order of detention under FEMA, IPC, unlawful and smuggling activities
What is the process of settlement of disputed arrears of tax ?
The taxpayer has to file a declaration in Form 1 as per the undertaking in Form 2 referred to in section 4(5).
The designated authority shall within 15 days of receiving the declaration will determine the tax, interest or penalty demand under this scheme and will issue a certificate containing particulars of the tax arrears and amount payable after such determination as per Section 140 of the Act.
The certificate will be granted in Form -3 electronically
In how much time the taxpayer has to pay the arrears of demand ?
The taxpayer has to pay the arrears as determined by the designated authority within 15 days of receipt of the certificate in Form 3 and shall communicate about the payment to the designated authority.
The detail of the payments made pursuant to the certificate in Form 3 shall be furnished along with proof of withdrawal of appeal in Form 4
The designate authority shall pass an order stating that the declarant has paid the amount in Form 5 .