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CA Final · Direct Tax Laws & International Taxation · Dispute Resolution

Gamma Tech Ltd, an Indian company, is a domestic company with no transfer pricing variation proposed in its case. The Assessing Officer proposes a prejudicial variation in its assessment. Under section 275 of the Income-tax Act, 2025, can the AO forward a draft order to Gamma Tech Ltd so that it may approach the Dispute Resolution Panel?

Gamma Tech Ltd cannot use the Dispute Resolution Panel. The Panel is open only to eligible assessees, meaning those whose variation arises from a Transfer Pricing Officer's order, non-residents other than companies, and foreign companies. A domestic company without a transfer pricing variation does not qualify.

  1. AYes, every assessee receiving a prejudicial variation can go to the Panel
  2. BNo, because Gamma Tech is not an eligible assessee: it has no variation arising from a Transfer Pricing Officer's order and is not a non-resident or foreign companyCorrect
  3. CYes, but only if the income variation exceeds Rs 10 lakh
  4. DNo, because the Panel only hears cases of individuals

Explanation

An eligible assessee under section 275(17)(b) is a person whose variation arises from a Transfer Pricing Officer's order, or a non-resident (not being a company) or a foreign company. Gamma Tech is a domestic company with no TPO-based variation, so it does not qualify. The Rs 10 lakh limit belongs to the Dispute Resolution Committee provisions, not the Panel.

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