Direct Tax Alert - CBDT further extends time limit of payment (without additional amount) under Direct Tax Vivad se Vishwas Act, 2020

Background

In light of the ongoing COVID-19 pandemic, the Central Board of Direct Taxes (CBDT) had extended deadlines of certain Income-tax compliances^[1] by issuing circulars in the month of April, May^[2] and June^[3] 2021. While the impact of the second wave of COVID-19 has subsided and businesses are returning to normalcy, the taxpayers are still facing technical glitches in filing various forms on the new income-tax portal.  Due to such technical glitches on the income tax portal, recently, the CBDT extended timelines for electronic filing of several Forms under the provisions of the Income-tax Act, 1961 (IT Act). Certificate in Form No. 3 which is a pre-requisite for making payment by the declarant under Direct Tax Vivad se Vishwas Act, 2020 (VsV Act), is also dependent on the new income-tax portal. With the tax authorities facing difficulties in issuing and amending Form no. 3, the CBDT has recently issued a notification^[4] to further extend the last date for payment of the VsV amount.

We, at BDO in India, have analysed and summarised the said circular hereunder:

BDO Comments

While the Notification has not extended the deadline for payment (with additional amount), it is imperative to note that in the Press Release^[5] it has been clarified that there won’t be any change in the last date of 31 October 2021 for payment (with additional amount).