The e-Dispute Resolution Scheme (e-DRS) enables the taxpayer to file an application electronically for dispute resolution to the Dispute Resolution Committees (DRC) designated for the region of Principal Chief Commissioner of Income Tax having jurisdiction over the taxpayer.
The Central Board of Direct Taxes (CBDT) has rolled out the e-Dispute Resolution Scheme (e-DRS) with an aim to reduce litigation and provide relief to eligible taxpayers. Section 245MA of the Income Tax Act also provides for the constitution of Dispute Resolution Committees (DRC).
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What is e-DRS?
The e-DRS enables the taxpayer, who fulfils certain specified conditions as stipulated in section 245MA of the Income Tax Act, to file an application electronically for dispute resolution to the Dispute Resolution Committees (DRC) designated for the region of Principal Chief Commissioner of Income Tax having jurisdiction over the taxpayer. To this end, DRCs have been constituted in all 18 jurisdictional Pr. CCIT regions across the country.
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How will e-DRS function?
As per e-DRS, a taxpayer can opt for e-Dispute Resolution against the ‘specified order’ as defined in clause (b) of the explanation to section 245MA of the Act, which includes an order in which the aggregate sum of variations proposed or made does not exceed Rs 10 lakh and returned income for the relevant assessment year does not exceed Rs 50 lakh. Further, such order should not be based on search/surveys or information received under an agreement referred to under section 90 or 90A of the Act.
According to e-DRS, a DRC may make modification to the variations in the specified order and decide to grant reduction/waiver of penalty and prosecution in accordance with the provision of rule 44DAC of the Income-tax Rules, 1962. The DRC is mandated to pass its order within six months from the end of month in which application for dispute resolution is admitted by it.
How can taxpayers file application for e-DRS?
The application for e-DRS is to be filed in Form No. 34BC referred in rule 44DAB of the Rules, on the e-filing portal of the Income Tax Department, within one month from the date of receipt of specified order. In cases where appeal has already been filed and is pending before the Commissioner of Income-tax (Appeals), the application for e-DRS, is to be filed on or before September 30, 2024. In cases where the specified order has been passed on or before August 31, 2024 and the time for filing appeal against such order before CIT (Appeals) has not lapsed, the application for dispute resolution can be filed on or before September 30, 2024.
