The government has launched the “Vivad Se Vishwas” scheme 2.0, which will come into effect on October 1, according to a government notification.

The scheme is expected to resolve tax disputes, aiming to reduce litigation and boost revenue.

The scheme is open to taxpayers with pending income tax disputes before various courts and tribunals, including the Supreme Court, high courts, Income Tax Appellate Tribunal and Commissioner/Joint Commissioner (Appeals).

It also covers cases pending before the Dispute Resolution Panel (DRP) and revision petitions before the Commissioner of Income Tax.

The government expects the scheme to help resolve around 2.7 crore direct tax demands worth approximately ₹35 lakh crore.

Finance minister Nirmala Sitharaman said in her budget speech that the government is committed to simplifying taxes, improving taxpayer services and reducing litigation.

Tax experts say the scheme presents an opportunity for companies to settle disputes and avoid further legal costs. However, they advise businesses to carefully evaluate the scheme’s terms and conditions before making a decision.

Karishma R. Phatarphekar, partner, Deloitte India, said: “With tax payment rates set to increase by 10 per cent starting January 1, 2025, it is crucial for companies to evaluate their pending income tax litigations from both a cost-benefit standpoint and a broader non-tax perspective. Given the limited time window, an informed decision on opting for the scheme should be made promptly.”