Rule 196: Constitution of the Dispute Resolution Committee
Rule 196 sets out how Dispute Resolution Committees under section 379 are constituted. The Central Government constitutes a Committee for every region of a Principal Chief Commissioner of Income-tax. Each Committee has three members: two retired Indian Revenue Service (Income-tax) officers with the stated experience and one serving ex-officio officer. Members are appointed for three years, decisions are by majority, and a member may be removed only with recorded reasons and after a reasonable opportunity of being heard.
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Rule 196 - Constitution of Dispute Resolution Committee under section 379
(1) The Central Government shall constitute a Dispute Resolution Committee for every region of Principal Chief Commissioner of Income-tax for dispute resolution, as provided under section 379.
(2) Each Dispute Resolution Committee shall consist of three members, as given under: — (a) two members shall be retired officers from the Indian Revenue Service (Income-tax), who have held the post of Commissioner of Income-tax or any equivalent or higher post for five years or more; and (b) one ex-officio member, who shall be an officer not below the rank of Principal Commissioner of Income-tax or Commissioner of Income-tax as specified by the Board.
(3) The members shall be appointed by the Central Government for a period of three years.
(4) The Central Government may fix a sum to be paid as fee to both members, specified in sub-rule (2)(a), on a per case basis, along with a sitting fee, so decided by the Board.
(5) The decision of the Dispute Resolution Committee shall be by majority.
(6) The Central Government may, for reasons to be recorded in writing and after giving a reasonable opportunity of being heard, remove any member from the Dispute Resolution Committee.
Rule breakdown
Constitution and membership
One Committee for every region of a Principal Chief Commissioner of Income-tax, constituted by the Central Government (sub-rule (1)).
Three members (sub-rule (2)): two retired IRS (Income-tax) officers who held the post of Commissioner of Income-tax or an equivalent or higher post for five years or more, and one ex-officio member not below the rank of Principal Commissioner or Commissioner of Income-tax, as specified by the Board.
Term, fees, decisions and removal
Term: members are appointed by the Central Government for three years (sub-rule (3)).
Fees: the Central Government may fix a per-case fee for the two retired members under sub-rule (2)(a), along with a sitting fee, as decided by the Board (sub-rule (4)). The rule does not state an amount.
Decisions: by majority (sub-rule (5)).
Removal: the Central Government may remove a member for reasons recorded in writing and after giving a reasonable opportunity of being heard (sub-rule (6)).
Application and exclusions
Rule 196 deals only with constitution and administration of the Committee. It does not set eligibility conditions for taxpayers, the application form or fee, or the Committee’s powers on penalty and prosecution.
For applying to the Committee see Rule 197 (Form No. 119 and a fee of ₹1,000), and for penalty reduction or waiver and immunity see Rule 198 and section 379(2). Who may opt for dispute resolution depends on section 379 and the specified conditions prescribed under it.
Practical steps for a taxpayer considering the Committee
Rule 196 itself imposes no filing on taxpayers, but it helps to:
Quick checklist
Points to verify:
Example
Hypothetical illustration only — not a real case, and not a prediction of how any authority will decide.
A small taxpayer in a particular Principal Chief Commissioner region receives a specified order with a variation it disputes. The region’s Committee consists of two retired Indian Revenue Service (Income-tax) officers who held the post of Commissioner of Income-tax or an equivalent or higher post for five years or more, and one ex-officio member not below the rank of Principal Commissioner or Commissioner of Income-tax, as specified by the Board. If two of the three members agree on the outcome, that is the Committee’s decision.
Key takeaways
Region-wise committees
One for every Principal Chief Commissioner region.
Three members
Two experienced retired IRS (Income-tax) officers and one ex-officio serving officer.
Three-year term; majority decisions
With fees fixed per case plus sitting fee for the retired members.
Removal safeguards
Written reasons and a reasonable opportunity of being heard.
Practical checklist
- Check section 379 eligibility before planning to use the Committee.
- Read Rules 197 and 198 alongside this rule.
Avoid
- Do not assume Rule 196 states any fee amount for members; it leaves this to the Central Government and the Board.
- Do not treat Rule 196 as the source of taxpayer eligibility.
FAQs
How many Dispute Resolution Committees are there?
Rule 196(1) provides for a Committee for every region of a Principal Chief Commissioner of Income-tax.
Who are the members?
Two retired IRS (Income-tax) officers who held the post of Commissioner or an equivalent or higher post for five years or more, and one ex-officio officer not below Principal Commissioner or Commissioner rank as specified by the Board.
How are decisions taken?
By majority, under Rule 196(5).
Does Rule 196 explain how to apply to the Committee?
No. The application is covered by Rule 197, which prescribes Form No. 119 and a fee of ₹1,000.
Glossary
- Dispute Resolution Committee
- The committee constituted under section 379 and Rule 196 for dispute resolution.
- Ex-officio member
- A serving officer who is a member because of the post held, not below Principal Commissioner or Commissioner rank, as specified by the Board.
- Principal Chief Commissioner region
- The administrative region of a Principal Chief Commissioner of Income-tax; a Committee is constituted for every such region.
- Sitting fee
- A fee for attending sittings, payable alongside a per-case fee to the retired members as decided by the Board.