The guidelines, which include information on how the mechanism will work and how taxpayers can apply for it, were expected to be released at the beginning of October to coincide with its effective date.

However, this was pushed back to October 30 and now tax professionals believe this deadline is unlikely to be met.

“Once again, the date has changed. We now expect the guidelines at some point during the second or third week of November,” said one tax professional who asked not to be named.

The guidelines will outline the exact workings of the mechanism and will include details of where the dispute resolution panels will be based.

It is widely estimated that there will be five panels across the country operating out of Mumbai, Delhi, Bangalore, Chennai and Calcutta.

One tax professional is concerned by the lack of information and what the new mechanism will actually mean.

“What will be interesting is to see whether this will truly be an alternative so that taxpayers can opt out and go down the traditional route, or whether this is the only option available,” said Manisha Gupta, senior transfer pricing manager, Deloitte, India.

“But what I am hearing is that this will be the process and no alternative method will be offered,” she added.

It is anticipated that each of the five panels will be made up of city-specific tax commissioners rather than relying on a pool of commissioners.

The mechanism was formally introduced on October 1 and will consist of three income tax commissioners. The panels will hear evidence from the tax authorities and the taxpayer and will issue binding directions and then will pass an order in compliance with these directions.

Follow www.tpweek.com for updates on India’s new dispute mechanism.