Studycafe | Feb 1, 2021 |
Download Finance Bill 2021 & Memorandum Explaining Finance Bill 2021
Speech of Finance Minister on Budget 2021
Memorandum Explaining the provisions in the Finance Bill 2021
The object of the Bill is to give effect to the financial proposals of the Central Government for the financial year 2021-2022. The notes on clauses explain the various provisions contained in the Bill.
Part XIV of the Bill deals with amendments to the Direct Tax Vivad se Vishwas Act, 2020 (the Vivad se Vishwas Act). With the objective of reducing pending income tax litigation, generating timely revenue for the Government and giving benefit to taxpayers by providing them peace of mind, certainty and savings on account of time and resources, the Vivad se Vishwas Act was enacted on the 17th March, 2020.
The settlement provisions under the Income-tax Act, 1961 provide for an alternate mechanism to a taxpayer who chooses to exit the regular process of assessment which would have resulted in determination of tax liability and instead approached the Settlement Commission for settlement of his case under Chapter XIX-A of the Income-tax Act, 1961. As the Vivad se Vishwas Act was enacted for the resolution of disputed tax and not for the taxes covered by an order in pursuance to the settlement of a case under Chapter XIX-A of the Income-tax Act, 1961, such cases as are covered by Chapter XIX-A of the Income-tax Act, 1961 (whether they have attained finality or not) have always been, therefore, intended to be outside the purview of the Vivad se Vishwas Act.
4. With a view to remove any ambiguity, it is proposed to amend the provisions of the Vivad se Vishwas Act to clarify the original legislative intent for which the definitions of “appellant” in clause (a), “disputed tax” in clause (j) and “tax arrear” in clause (o) of subsection (1) of section 2 of the Vivad se Vishwas Act are proposed to be amended by way of removal of doubts by this Bill. The amendments relating to the Vivad se Vishwas Act are proposed to take effect retrospectively from the 17th March, 2020.
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