Dispute Resolution Panel (DRP)

Dispute Resolution Panel (DRP) – The DRP is a specialized panel constituted by the Income Tax Department to provide a quick and expert-based mechanism for resolving tax disputes, particularly those involving transfer pricing and international taxation. It examines draft assessment orders issued to eligible taxpayers and has the authority to modify, confirm, or completely annul the proposed adjustments before the final order is passed. The DRP acts as an alternative to the traditional appeal route at the initial stage, ensuring fairness and faster resolution.

Example: A foreign company receives a draft assessment order from the tax authorities with additional tax demands arising from transfer pricing adjustments. The company can file objections with the DRP, which will review the case and direct necessary changes before the final assessment order is issued.