Transfer Pricing DRP — Section 144C Objections | Savlana Init

Transfer Pricing · Dispute Resolution Panel

Dispute Resolution Panel — Thirty Days to Choose.

A draft assessment order starts a thirty-day clock. Objecting before the Panel or waiting to appeal is a one-time, irreversible decision, and it should be made on the issues.

Section 144C creates a specialised pre-assessment dispute mechanism for eligible assessees — any person in whose case a variation arises from an order of the Transfer Pricing Officer, and any non-resident or foreign company. Where such a case is proposed to be varied to the prejudice of the assessee, the assessing officer must first pass a draft assessment order rather than a final one. That draft cannot be enforced; no demand arises from it. What it does is start a thirty-day period in which the assessee must either accept the variation or file objections with the Dispute Resolution Panel in Form 35A.

The Panel is a collegium of three Principal Commissioners or Commissioners of Income Tax constituted by the Board. It considers the objections, the draft order, the evidence on record, any evidence collected on its own direction and any further enquiry it causes to be made, and issues directions to the assessing officer. Those directions are binding on the assessing officer, and the Panel must issue them within nine months from the end of the month in which the draft order is forwarded. The assessing officer then completes the assessment in conformity with the directions within one month from the end of the month in which they are received.

The strategic point is that the choice is one-time and cannot be revisited. Choosing the Panel means a fixed statutory timeline, a collegium hearing, binding directions and no demand in the interim, but a compressed record-building window. Choosing to let the assessment be completed and appeal to the Commissioner (Appeals) means a longer process with demand outstanding, but a fuller opportunity to develop the factual record. Note also that the Panel cannot set aside a matter for fresh consideration and may enhance the variation, and that the department may itself appeal against an order passed in conformity with the Panel’s directions. We advise on the choice and represent through whichever route is taken.

Our DRP Services

Draft Order Analysis

Issue-by-issue analysis of the draft assessment order and the underlying Transfer Pricing Officer order, separating factual, legal and computational grounds.

Route Recommendation

A reasoned recommendation on whether to object before the Panel or to allow the final order and appeal, given the issues and the record available.

Form 35A Objections

Preparation and filing of objections within the thirty-day period, with detailed grounds, statement of facts and supporting evidence.

Panel Representation

Representation through the Panel hearings, responses to queries and directions for further enquiry, and additional submissions as the matter develops.

Additional Evidence Filing

Preparation and filing of additional evidence and expert material where the Panel permits it, since the Panel may consider evidence beyond the draft record.

Directions Implementation

Review of the Panel’s directions and follow-through on the final assessment order to ensure it conforms, with rectification where it does not.

Post-Direction Appeal

Appeal to the Tribunal against the final order, and defence where the department appeals against an order passed on the Panel’s directions.

Timeline and Limitation Management

Management of the thirty-day, nine-month and one-month statutory periods, including limitation arguments where a period has been breached.

Our Process

Immediate Triage

On receipt of the draft order we triage the issues quickly, because the thirty-day period for filing objections runs from the date of receipt and cannot be extended.

Route Decision

We assess whether the Panel or the ordinary appellate route suits the issues, and record the reasoning so the decision is deliberate.

Objection Preparation

Form 35A is prepared with detailed grounds, statement of facts and supporting evidence, and filed with both the Panel and the assessing officer.

Hearing and Submissions

The matter is represented before the Panel, with additional submissions and evidence filed as the hearings and any directed enquiry progress.

Directions and Final Order

The directions are analysed, the final assessment order is checked for conformity, and appeal or rectification is pursued where required.

Why It Matters

✓The thirty-day window used deliberately rather than lost to indecision

✓Route chosen on the issues, since the choice cannot be reversed

✓No demand enforceable while the objections are pending

✓A statutory nine-month outer limit on the Panel’s directions

✓Directions binding on the assessing officer, not merely persuasive

✓Additional evidence filed where the Panel is willing to consider it

✓Final order checked for conformity with the directions actually issued

✓Limitation breaches identified and taken as a ground where they arise

Frequently Asked Questions

Any person in whose case a variation arises as a consequence of an order of the Transfer Pricing Officer under Section 92CA, and any non-resident not being a company or any foreign company. For such assessees, the assessing officer must pass a draft assessment order before any final order where the proposed variation is prejudicial to the assessee.

Thirty days from the date of receipt of the draft assessment order. Objections are filed in Form 35A with the Dispute Resolution Panel and simultaneously with the assessing officer. The period is not extendable. If no objections are filed and the variation is not accepted in writing, the assessing officer proceeds to pass the final order after the thirty days expire.

Yes. Directions issued by the Panel are binding on the assessing officer, who must complete the assessment in conformity with them within one month from the end of the month in which the directions are received. The Panel must issue its directions within nine months from the end of the month in which the draft order is forwarded to the assessee.

It can. The Panel has power to confirm, reduce or enhance the variations proposed in the draft order, so an objection can result in a larger adjustment than the draft proposed. It cannot, however, set the matter aside for fresh consideration by the assessing officer. This possibility of enhancement is one of the factors in choosing between the Panel and the ordinary appellate route.

The assessing officer passes the final assessment order in conformity with the directions, and the demand arising from it becomes enforceable. The assessee may appeal that order to the Income Tax Appellate Tribunal. The department may also appeal against an order passed in conformity with the Panel’s directions, so a favourable direction does not always end the matter.

Considerably. The statutory outer limit of nine months for directions, plus one month for the final order, gives a defined timeline that an appeal before the Commissioner (Appeals) rarely matches. Speed comes at the cost of a compressed record-building window and the risk of enhancement, which is why the decision should turn on the nature of the issues rather than on timeline alone.

Received a draft assessment order?

Send it to us immediately — the thirty-day clock has already started. We will analyse the issues, recommend the route, and prepare and file the objections within the period.