CBDT rolls out Dispute Resolution Scheme (e-DRS), 2022, to minimise litigation - PIB

Context 

In pursuance of section 245MA in the Income-tax Act, 1961 (hereinafter referred to as “the Act”), the Central Board of Direct Taxes (CBDT) had notified the e-Dispute Resolution Scheme, 2022 (e-DRS).

Dispute Resolution Scheme

• Aim: To reduce litigation and provide a faster and more cost-effective resolution for taxpayers.
• Establishment: Established under section 245MA of the Income-tax Act, 1961.
• Provision: It will allow taxpayers to resolve disputes electronically through Dispute Resolution Committees (DRCs).
• Eligibility: Taxpayers who meet certain conditions specified in section 245MA can apply for dispute resolution which includes cases where the disputed amount does not exceed 10 lakh and the taxpayer's income is below Rs. 50 lakh.
• Elimination: The dispute must not involve information from searches or international agreements.

DRC: Established in all 18 regions across the country, they can modify orders, reduce penalties, or waive prosecution & are required to decide within six months of receiving the application.