It is expected that the forthcoming budget i.e. Budget 2021 may unveil a unique and continuous framework for the speedy resolution of all the disputes concerned to direct taxes.
As per online sources, a person familiar with pre-budget discussions revealed that The government is thinking on all the available options which include arbitration or a permanent dispute resolution system with pre-specified benchmarks on the lines of the ‘Vivad Se Vishwas scheme 
The government is finding the option to prevent disputes and also reduce litigation. According to the data of the Financial Year 21 budget, the total amount of over Rs 8 lakh crore is stuck in these direct tax disputes.
It is being realized that along with faceless valuation an alternative settlement mechanism is also required. It can be very effective in keeping the inherent disputes and will also be welcomed positively by global investors.
A settlement mechanism is an option currently available, but it only provides one-time opportunities to resolve disputes. There is also a limitation of types of cases that can be processed for resolution under this settlement mechanism.
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A taxpayer can fill and submit an application only if his/her case is pending before the Assessing Officer (AO) and the concerned assessment is not under any time-barrier. Additionally, the disposal of settlement applications gets significantly delayed normally. An alternative dispute mechanism that is under examination will try to resolve such disputes at an earlier stage.
Sudhir Kapadia – EY India National Leader – Tax, responded in this matter that “This is especially topical in today’s times when many potential international tax disputes are likely to revolve around facts and apportionment of global income in the light of legislative changes and principles inspired by OECD’s (Organisation for Economic Cooperation and Development) Base Erosion and Profit Shift (BEPS) project.”.
