Inform appellants about tax settlement scheme: CBDT to officers

Aimed at reducing litigation, the CBDT has asked its officers to proactively encourage assessees to take advantage of the one-time tax dispute resolution scheme, which ends on December 31.

The move is aimed at improving awareness of the Direct Tax Dispute Resolution Scheme among the 

asssessees whose cases are pending before the Commissioner (Appeal). There are as many as 2.59 lakh cases pending adjudication before CIT (Appeal).

“It has been decided that CIT (A) under your jurisdiction may be directed to append the “Flyer” without signature as per Annexure enclosed while sending the notice for hearing to the assessee to familiarise him (assessees) with this scheme,” CBDT said in an order to all Principal Chief Commissioners of Income Tax.

As per I-T department data, there were 73,402 appeals with tax effect above Rs 10 lakh and 1,85,858 appeals with tax effect below Rs 10 lakh pending before CIT (Appeal) as on February 29. Thus, 2,59,260 appellants are eligible for the benefit of this scheme.

The Direct Tax Dispute Resolution Scheme, introduced from June 1, seeks to address the issue of pending litigation before Commissioner of I-T (Appeal). The scheme will remain open till December 31.

As per the scheme, a taxpayer who has an appeal pending before the CIT (Appeal) can settle his/her case by paying the disputed tax and interest up to the date of assessment.

No penalty in respect of cases with disputed tax up to Rs 10 lakh will be levied. 

For cases exceeding Rs 10 lakh, 25 per cent of penalty would be levied and any pending appeal against a penalty order can also be settled by paying 25 per cent of the minimum of the imposable penalty.

“Litigation is a scourge for a tax-friendly regime and creates an environment of distrust in addition to increasing the compliance cost of the taxpayers and administrative cost for the government,” Finance 

Minister Arun Jaitley had said in his Budget speech.

The Central Board of Direct Taxes (CBDT) has asked the officers to inform the appellants about the scheme through email to cut down on communication time.

It is estimated that each Commissioner of I-T (Appeal) would have about 400 litigations pending before them.