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CMA Final · Direct Tax Laws and International Taxation · Assessment Procedure including Dispute Resolution Process

Regarding the powers of the Dispute Resolution Panel under section 275 of the Income-tax Act, 2025, which statement is correct?

The Panel may confirm, reduce or enhance the variations proposed in the draft order. It cannot set aside a variation or issue a direction for further enquiry and passing of the assessment order. Its enhancement power extends to matters the assessee did not raise.

  1. AIt may confirm, reduce or enhance the proposed variations but cannot set aside a variation or direct further enquiry and fresh assessmentCorrect
  2. BIt may set aside any variation and send the matter back to the Assessing Officer for fresh enquiry
  3. CIt may only reduce the variations and has no power to enhance them
  4. DIt may enhance variations only on points raised by the assessee in objections

Explanation

Section 275(8) allows the Panel to confirm, reduce or enhance variations but bars setting aside any variation or directing further enquiry and passing of the assessment order. Section 275(9) lets enhancement cover matters not raised by the assessee, which rules out the last option.

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