Faceless Assessments  under Income Tax Act

Faceless Assessment Scheme is one of the biggest Direct Tax reform in India which aims to provide Efficiency, Transparency and Accountability. Important feature of this scheme is No human interface and no need to visit the Income Tax Office. All reply/responses to be submitted electronically.

Faceless assessment means the assessment proceedings conducted electronically in “e-proceeding” facility through assessee’s registered account in the designated portal. Designated portal means the web portal designated as such by the Principal Chief Commissioner or Principal Director General, in charge of the National Faceless Assessment Centre. The CBDT had issued the instructions, guidelines and notice formats for conducting scrutiny assessments electronically

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The provision provides that the assessment, re-assessment or recomputation under Section
143(3), Section 144, or Section 147 shall be made in a faceless manner in respect of the specified territorial areas, persons, income or class of case

The Faceless Assessments have been implemented from August 13, 2020 whereas Faceless Appeal shall be allowed from September 25, 2020.

Given below are a few bodies that are responsible for making this process easy and smooth-:

1) National e-Assessment Center: The role of this body is to control the electronic assessment process at the Central level.

2) Regional e-Assessment Centers: These centres work to make assessments under the authority of the Chief Commissioner of the regional Principal.

3) Verification units: This unit of assessment helps in enquiring, counter verification, analysis of books of accounts, recording of witness statements and many other such functions.

4) Technical Unit: This particular unit of Faceless Assessment includes advice on legal, forensic, IT, accounting and audit procedures and such other technical know-how.

5) Assessment Unit: This facilitates identifying matters, determining the material of a liability that could also encompass a refund, and helps analyse facts and other functions.

6) Review Unit: This unit is to analyse other information, such as whether the evidence, facts and other essential things are considered in the draft or not.

(Note: National e-Assessment Center is the coordinator among all the Centers and units.)

Procedure in Faceless Assessment

The National Faceless Assessment income tax Centre gives a notice to the taxpayer telling him why their case is taken up. In return, the taxpayer has to reply within 15 days.

Only the National e-Assessment is the designated authority to entertain the case of a taxpayer when they fail to file an income tax return willingly. Or, the centre can consider cases about a notice provided to the taxpayer to file a tax return. These cases may be assigned to a specific faceless Assessment income tax Unit to entertain the National e-Assessment Center, particularly ReAC.The NeAC must collect documents and information from taxpayers and give it to AU at its request.

After this step, proper notice is provided to the taxpayer by the NeAC to procure the information that AU demands. In case of failure on tha taxpayers’ part to furnish information, the NeAC may take action under section 144 of the Faceless Assessment of the act for the income tax filing. The taxpayer must submit their response to the notice within the prescribed time. The national e-assessment centre alerts a request for a specific inquiry to an investigation unit through a mechanical assignment system.