DTVSV 2024: Clear Tax Litigations Without Penalties Or Prosecution

The taxpayers shall file a declaration in Form 1 undertaking that he/she is interested in settling the pending litigation that was pending as of the cut-off date, i.e., July 22, 2024. It may be noted that a separate Form-1 shall have to be filed for each of the pending litigations

Meghna Maiti

Updated on: 25 April 2025 2:03 pm

DTVSV 2024 Photo: Shutterstock

Vivad se Vishwas Scheme, 2024 (DTVSV 2024) is mainly a conflict-solving scheme with the income tax department set up by the government in a move to settle these issues, reduce litigation, and improve tax compliance in the process.

The scheme is based on the earlier Vivad se Vishwas Act, 2020 (VSV 2020). It introduces updated features and timelines. DTVSV was introduced in Budget 2024. The idea was to resolve any pending direct act issue in an efficient manner. The idea is that taxpayers will be allowed to pay the disputed tax amount and interest, penalties, and persecution would be waived off, thereby doing away with the need for prolonged litigation.

“This scheme came into existence from October 1, 2024, onwards. It was applicable for all unresolved disputes as of July 22, 2024. On 20 September 2024, the Central Board of Direct Taxes (CBDT) issued Vivad Se Vishwas Rules (VsV Rules, 2024) and forms for enabling the Scheme,” says SR Patnaik, Partner (head-taxation), Cyril Amarchand Mangaldas.

The taxpayers shall file a declaration in Form 1, undertaking that he/she is interested in settling the pending litigation that was pending as of the Cut-off date, i.e., July 22, 2024. It may be noted that a separate Form-1 shall have to be filed for each of the pending litigations.

After understanding the amount a taxpayer needs to pay, the tax department will issue Form 2 within a period of 15 days from the date of receipt of Form 1.

“The taxpayer will have to pay the amount decided by the taxpayer and submit an intimation of payment declaration in Form 3, along with proof of withdrawal of pending litigations from the appropriate authority or court, from the date of receipt of Form 2. The tax department shall then pass an order in Form 4 for full and final settlement of tax arrears,” says Patnaik.

As per the DTVSV 2024, the last date for filing the declaration in Form 1 was December 30, 2024. Thereafter, it was subsequently extended. Recently, the last date for filing the declaration has now been extended to April 30, 2025, by virtue of Notification S.No. 1650(E) dated April 08, 2025.