The scheme, which came into effect on October 1, 2024, aims to provide taxpayers an opportunity to resolve pending tax disputes by paying a percentage of the disputed tax, thereby gaining immunity from further penalties and prosecution. However, PHDCCI pointed out several concerns that could hinder effective participation and sought CBDT’s intervention to address these issues.
One of the key challenges highlighted was regarding tax deduction at source (TDS). The chamber raised concerns about how the credit for TDS would be granted to deductees in cases where taxpayers opt for the scheme. It also sought clarification on whether interest levied on deductors for delayed TDS filings would be waived as part of the scheme’s benefits. Additionally, PHDCCI addressed the issue of adjusting reduced losses or unabsorbed depreciation against disputed taxes and requested clear guidelines on how these adjustments would impact subsequent financial years.
The chamber also brought attention to transfer pricing disputes, urging CBDT to waive secondary adjustment provisions under Section 92CE of the Income Tax Act. Currently, these provisions require taxpayers to repatriate funds within 90 days of settling primary transfer pricing adjustments, failing which additional tax and interest burdens apply. PHDCCI suggested that waiving these requirements would significantly reduce litigation and incentivize taxpayers to utilize the scheme, particularly for resolving complex transfer pricing cases.
PHDCCI emphasized that resolving these issues would enhance the scheme’s effectiveness and foster greater trust between taxpayers and the government.
(Edited by : Poonam Behura)
