The Central Board of Direct Taxes ( CBDT ) has rolled out the e-Dispute Resolution Scheme (e-DRS), 2022. This scheme is designed to offer eligible taxpayers a streamlined, electronic mechanism for resolving disputes under the Income-tax Act, 1961, specifically under section 245MA.
The initiative is part of the broader “Azadi Ka Amrit Mahotsav” initiative of the Central Government.
The e-DRS allows taxpayers to file an application for dispute resolution electronically through the Income Tax Department’s e-filing portal. To facilitate this, Dispute Resolution Committees ( DRCs ) have been constituted in all 18 jurisdictional Principal Chief Commissioner of Income-tax (Pr. CCIT) regions across the country.
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These DRCs will handle cases where the aggregate sum of variations in a specified order does not exceed Rs. 10 lakh and where the taxpayer’s returned income for the relevant assessment year does not exceed Rs. 50 lakh. However, the order should not be based on searches, surveys, or information received under international agreements.
A significant feature of the e-DRS is the flexibility it offers to taxpayers. For instance, if an appeal is already pending before the Commissioner of Income-tax (Appeals), the taxpayer can still opt for e-Dispute Resolution by filing an application on or before 30th September 2024. The application must be filed using Form No. 34BC, as specified in rule 44DAB of the Income-tax Rules, 1962.
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Once an application is admitted, the DRC is mandated to pass its order within six months from the end of the month in which the application was received. The DRC has the authority to modify variations in the specified order and decide on the reduction or waiver of penalties and prosecution, offering much-needed relief to taxpayers.
The process for filing the e-DRS application is straightforward. Taxpayers need to log in to the Income Tax Department’s e-filing portal using their PAN or TAN as their user ID, navigate to the appropriate section under the ‘Persons not dependent on any source of Income’ tab, and submit Form No. 34BC. The form must be e-verified using Aadhaar OTP, EVC, or DSC.
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This initiative is expected to significantly reduce the burden of litigation on taxpayers and the Income Tax Department.
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