ADR

296. Definition -

Authorized representative refers to the representative mentioned in section 327(2).

Bench means Bench of Tax Appellate Tribunal.

Representative of the Commissioner- is an officer chosen from Income-tax authorities under section 4,
authorized by the Commissioner of Taxes to represent in the ADR process.

Court - to the Supreme Court

A "dispute" is a taxpayer's complaint about the income tax assessment when it exceeds their declared
income than the income of the concerned year; or when the Appellate Authority assesses more than the
amount assessed by the taxpayer in the return..

297. ADR- (ADR) allows for settling tax assessment disputes pending before Income-tax authority, Tax
Appellate Tribunal, or Court and subject to the qualifications, conditions and limits prescribed by the
Board, by notification in the Official Gazette, of the ADR process can be settled through..

298. Application of Alternative Dispute Resolution- Taxpayers can apply for ADR to resolve disputes
pending before the Appellate Income-tax Authority, Tax Appellate Tribunal, or any Division of Supreme
Court, but court approval shall needed if the dispute is already in any Division of the Supreme Court.
However, disputes brought to a writ cannot use the ADR process.

Alternative Dispute Resolution (ADR) Application:

- ADR applications shall be filed in the prescribed form, time and with the fee and shall be certified.

- Application shall be filed in the Income Tax Authority or the Tax Appellate Tribunal or in the Registrar
of the Supreme Court.

- The applicant must also provide relevant documents, statement containing the legal basis and facts on
application.

- If a taxpayer has filed a return for a specific income year, they cannot apply for ADR unless they've paid
the tax due under section 173 for that year.
299. Representative of the Commissioner-

The Commissioner of Taxes can appoint an Income-tax Representative, not below the rank of Deputy
Commissioner of Taxes, to mediate with taxpayers seeking ADR.

This Income-tax Representative will be part of the ADR proceedings and sign the memorandum if an
agreement is reached.

300. Mediator in Alternative Dispute Resolution Process-

- ADR involves mediation between the taxpayer and the Commissioner's representative, through a
mediator appointed by the Board.

- The mediator carries out specific duties, responsibilities, and receives a prescribed fee.

301. Taxpayer's Rights and Duties for Alternative Dispute Resolution-

The taxpayer can participate in mediation either personally or through an authorized representative.

In mediation, the taxpayer shall be limited to presenting legal documents, factual evidence, and arguments
related to the disputed issues.

If an agreement is reached, the taxpayer must pay the agreed-upon tax within the specified period.

302. Method of Tax Dispute Resolution through Alternative Dispute Resolution-

When an application for ADR is received, the Facilitator shall send a copy of the application and seek
opinion of the relevant Deputy Commissioner of Tax and confirms compliance of the conditions of
Section 298.

If the Deputy Commissioner of Tax fails to provide an opinion within 5 working days, the application's
conditions are considered met.

The Facilitator notify the applicant and the Commissioner of Taxes or the representative in writing to
attend the settlement meeting

The Facilitator - schedules meetings, requests documents or evidence, may seek inquiries by Income-tax
authorities and can adjourn meetings from time to time to settle the dispute.

The Facilitator shall assist the taxpayer and Commissioner's representative in reaching a settlement
through discussions and meetings.

303. Temporary suspension of proceedings relating to appeals or references pending before the
Appellate Tribunal or High Court Division-
If a taxpayer applies for ADR in an income year, and the Deputy Commissioner of Tax files an appeal to
the Appellate Tribunal or the Commissioner of Taxes refers a reference to the High Court Division for
that income year, the proceedings of such appeal or reference shall be hold until the ADR application is
disposed of.

304. Decision of ADR Process –

- If both parties agree on any legally disputed matter under this Act, such matter shall be resolved partially
or fully through ADR.

- If there is a partial or complete agreement between the taxpayer and the Commissioner's representative,
the facilitator shall record the details of the agreement in the prescribed manner..

- The agreement shall include terms of the agreement, any taxes payable or refundable and other
necessary and appropriate matters specify the manner of payment of the dues.

- If fraud or misrepresentation is discovered, the agreement will be canceled.

- The taxpayer, Commissioner's representative, and helper will sign the agreement.

- If no agreement can be reached due to non-cooperation or disagreement, the facilitator will inform the
applicant, Board, the concerned Court, Tribunal, Appellate Authority and Income Tax Authority within 15
days of the disagreement.

- If an agreement is reached on collection and return of dues, the facilitator will notify the parties and
Deputy Commissioner accordingly.

- If no agreement is reached within 3 months after the end of the month in which the application was
made, it shall be considered unsuccessful.

- Successful agreements - Facilitator shall send copies of the agreement to all the parties within 15 days.

305. Consensus result-

Agreements under section 304(9) shall be binding and shall not be challenged by the taxpayer or any
income-tax authority to any any authority, tribunal or court. Matters within the agreement are final, but
those outside it can be revisited in other proceedings under this Act.

306. Limitation of appeal in case of disagreement-

If there's no partial or complete agreement, taxpayers can appeal as follows:

a) Disputes from order of Deputy Commissioner go to Commissioner of Taxes or Additional

Commissioner of Taxes (Appeals) or the Commissioner of Taxes (Appeals);
b) Disputes from order of Additional Commissioner of Taxes (Appeals) or Commissioner of Taxes
(Appeals) go to Tax Appellate Tribunal.

c) where the taxpayer receives permission to appeal from the relevant appellate authority or court for
ADR, he can file an appeal with the said authority.

- calculating the time limit for filing an appeal, time spent in the resolution process shall exclude in appeal
time limits.

307. Affirmation of truth after agreement-

- The Board shall monitor ADR progress and ensure necessary support and coordination services

- Facilitator shall forward all agreement/disagreement details to Commissioner and the Board for
verification and determination of legal or factual accuracy.

- If an agreement appears to the Board that will harm revenue by fraud, it shall considered void and
referred to the appropriate authority, tribunal, or court for action.

308. Bar to Civil or Criminal Proceedings-

Actions or agreements made in good faith by any person during ADR, shall not be brought before any
court, tribunal, or authority in a civil or criminal manner.