The Central Board of Direct Taxes (CBDT) has brought all the dispute resolution panels (DRP) under the supervision of the Director-General of Income-Tax (International Taxation). Budget 2009-10 had introduced the concept of DRPs to provide an alternate dispute resolution mechanism to facilitate expeditious resolution of disputes on a fast track basis. This facility was made available only to foreign companies. Official sources said that the latest move to “subordinate” the 10 DRPs (Delhi - 2, Mumbai - 2, one each in Pune, Hyderabad, Chennai, Kolkata, Bangalore and Ahmedabad) to the Director-General of Income Tax (International Taxation) should be seen as a step for administrative purposes only. Meanwhile, Mr Aseem Chawla, Partner, Amarchand & Mangaldas, told Business Line that the foreign investor community was looking forward to this mechanism as a speedier, efficacious platform of resolution of tax cases. “Therefore, the larger objective of independence and functioning of the panel as a dispute resolution body need to be subserved. Hence, the day-to-day functioning of the panel should not be subordinated to a meticulous scrutiny of an administrative authority,” he said. Mr Prashant Khatore, Partner, Tax and Regulatory Services, Ernst & Young, said that the latest CBDT move is just for administrative supervision and control of activities of DRP and does not in any way impact the taxpayers or independence of the panel.
