The Central Board of Direct Taxes ( CBDT ) has clarified Consequences under clause 6 that, there will be immunity from prosecution to a declarant in relation to a tax arrears for which declaration is filed under Vivad se Vishwas and in whose case an order is passed by the DA that the amount payable under Vivad se Vishwas has been paid by the declarant.
The CBDT has explained the Consequences under Vivad se Vishwas Scheme through FAQs.
The CBDT said that the result of this Vivad se Vishwas will not be applied to the same issues pending before AO. Only the issues covered in the declaration are settled in the dispute without any prejudice to the same issues pending in other cases.
It has been clarified that making a declaration under this Act shall not amount to conceding the tax position and it shall not be lawful for the income-tax authority or the declarant being a part in appeal or writ or in SLP to contend that the declarant or the income-tax authority, as the case may be, has acquiesced in the decision on the disputed issue by settling the dispute.
As per the amendment proposed in Vivad se Vishwas, in a case where the dispute in relation to an assessment year relates to the reduction of Minimum Alternate Tax (MAT) credit or reduction of loss or depreciation, the appellant shall have only two options.
The appellant shall have options either to include the amount of tax-related to such MAT credit or loss or depreciation in the amount of disputed tax and carry forward the MAT credit or loss or deprecation or to carry forward the reduced tax credit or loss or depreciation.
The CBDT said that the secondary adjustment under section 92CE will be applicable and the provision of secondary adjustment as contained in the Act is not applicable for primary adjustment made in respect of an assessment year commencing on or before the 1st day of April 2016 means primary adjustment for the assessment year 2016-17 or earlier assessment year, will not subject to secondary adjustment under section 92CE of the Act.
It has been clarified in Explanation to clause 5 that making a declaration under Vivad se Vishwas shall not amount to conceding the tax position and it shall not be lawful for the income-tax authority or the declarant being a part in appeal or writ or in SLP to contend that the declarant or the income tax authority, as the case may be, has acquiesced in the decision on the disputed issue by settling the dispute.
