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How will disputed tax be calculated in a case where disputed demand including interest has been paid by the assessee while being in an appeal under Vivad se Vishwas scheme?

Uday
Answered on March 20,2020

To illustrate, consider a non-search case where an assessee is In appeal before COlmnissioner(Appeals). The tax on returned income (including surcharge and cess) comes to INR 30,000 and interest under section 234B of INR 1000. The assessee has paid this amount of INR 31,000 at the time of filing his tax return. During the assessment, an addition is made and additional demand of INR16,000 has been raised, which comprises of disputed tax (including surcharge and cess) of INR10,000 and interest on such disputed tax of INR 6000. Penalty has been initiated separately. The assessee has paid the demand of INR14,000 during the pendency of the appeal; however interest under section 220 of the Act is yet to be calculated. Assessee files a declaration, which is accepted and certificate is issued by the designated authority (DA). The disputed tax of INR 10,000 (at 100%) is to be paid on or before 31" March 2020. Since he has already paid INR 14,000, he would be entitled to a refund of INR 4,000 (without section 244A interest). Further, the interest leviable under section 220 and penalty leviable shall also be waived.

How will disputed tax be calculated in a case where disputed demand including interest has been paid by the assessee while being in an appeal under Vivad se Vishwas scheme?

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