The whole world is transforming itself to digital world. India is no exception to this. Our Government is taking significant steps to transform India into Digital India. In this digital march, Income Tax Department has made a way forward by making amendments in the act and starting facility of e-proceedings Such steps will certainly prove boon to transform traditional taxation system in the country. Initiatives of income tax department are elaborated below.

CBDT Has issued instruction dated 12th February 2018 to conduct assessment proceedings in scrutiny cases electronically.

Section 2 (23C) of ITA provides that “hearing” includes communication of data and documents through electronic mode ( applicable from 01.06.2016 ).

Board vide letter issued on 23rd June 2017, revised format of notices u/s 143(2) of ITA. Para 3 of these notices provided that assessment proceedings in cases selected for scrutiny would be conducted electronically in `E-Proceeding’ facility through assessee’s account in E-filing website of Income-tax Department.

Now by issuing this instruction, CBDT directed that that except for search related assessments, proceedings in other pending scrutiny assessment cases shall be conducted only through the `E-Proceeding’ functionality. However, in cases where the concerned assessee objects to conduct of assessment proceedings electronically through the ‘E-Proceeding’ facility, such cases, for the time-being, may be kept on hold.

Pr. DGIT(Systems) will specify the list of stations with limited bandwidth. For these stations assessment may be completed manually till 31.03.2018.

Important procedural aspects while conducting assessment proceedings through ‘E-Proceeding’

  • Enquiry before assessment in e-mode – Notices u/s 142(1)(ii) shall be issued & delivered electronically to e-filing account of assesse. While replying to these notices assessee shall verify details as prescribed under Rule 14.

Rule 14 prescribes the information furnished by assessee shall be verified in following manner

“I declare that to the best of my knowledge and belief, the information furnished in the statement / statements is correct and complete and other particulars shown therein are truly stated”

  • Use of digital signature by AO- Orders, notices & communications from AO will be digitally signed
  • Time for compliance: Online submissions may be filed till the office hours on the date stipulated for compliance.
  • Availability of facility for electronic submission of documents in time barring situation or where case has been finally heard by the Assessing Officer – Electronic submission facility shall automatically close 7 days before time barring date. In other situations, upon completion of proceedings, before passing the final order, concerned AO, on his volition, shall close the e-submission facility after mentioning in electronic order sheet that ‘hearing has been concluded’.

However, if required, in exceptional circumstances, the concerned AO may enable further filing of submissions electronically under intimation to the Range Head in ITBA.

  • In assessment proceedings being carried out through the ‘E-Proceeding’ facility, a particular proceeding may take place manually in following situation(s):
    • where manual books of accounts or original documents have to be examined
    • where AO invokes provisions of section 131 of ITA or a notice is issued for carrying out third party enquiries/investigations
    • where examination of witness is required to be made by the concerned assessee or the department
    • where a show-cause notice contemplating any adverse view is issued by the AO and assesse requests for personal hearing to explain the matter

Salient features of ‘E – proceedings’ – As stated in letter dated 23rd June 2017 following are the salient features of e-proceedings

  • Income tax department has launched e-proceeding facility to as e-governance initiative to facilitate conduct of assessment proceedings
  • Simple way of communication without visits to department
  • Taxpayer friendly measure would substantially reduce compliance burden for assessee
  • E-proceeding will facilitate seamless flow of communication between AO and Assessee
  • Assessee would be able to submit the response along with attachments by uploading the same on e-filing portal
  • AO would view submissions electronically through Income Tax Business Application (ITBA)
  • E – proceeding will save time of assessee as well as department
  • Complete information of all e-submissions made will be available on efiling portal
  • Environment friendly as assessment will be paperless

E assessment proceeding – Call of digital era

The whole world is transforming itself to digital world. India is no exception to this. Our Government is taking significant steps to transform India into Digital India. In this digital march, Income Tax Department has made a way forward by making amendments in the act and starting facility of e-proceedings Such steps will certainly prove boon to transform traditional taxation system in the country. Initiatives of income tax department are elaborated below.

CBDT Has issued instruction dated 12th February 2018 to conduct assessment proceedings in scrutiny cases electronically.

Section 2 (23C)of ITA provides that “hearing” includes communication of data and documents through electronic mode ( applicable from 01.06.2016 ).

Board vide letter issued on 23rd June 2017, revised format of notices u/s 143(2) of ITA. Para 3 of these notices provided that assessment proceedings in cases selected for scrutiny would be conducted electronically in `E-Proceeding’ facility through assessee’s account in E-filing website of Income-tax Department.

Now by issuing this instruction, CBDT directed that that except for search related assessments, proceedings in other pending scrutiny assessment cases shall be conducted only through the `E-Proceeding’ functionality. However, in cases where the concerned assessee objects to conduct of assessment proceedings electronically through the ‘E-Proceeding’ facility, such cases, for the time-being, may be kept on hold.

Pr. DGIT(Systems) will specify the list of stations with limited bandwidth. For these stations assessment may be completed manually till 31.03.2018.

Important procedural aspects while conducting assessment proceedings through ‘E-Proceeding’

  • Enquiry before assessment in e-mode – Notices u/s 142(1)(ii) shall be issued & delivered electronically to e-filing account of assesse. While replying to these notices assessee shall verify details as prescribed under Rule 14.

Rule 14 prescribes the information furnished by assessee shall be verified in following manner

“I declare that to the best of my knowledge and belief, the information furnished in the statement / statements is correct and complete and other particulars shown therein are truly stated”

  • Use of digital signature by AO- Orders, notices & communications from AO will be digitally signed
  • Time for compliance: Online submissions may be filed till the office hours on the date stipulated for compliance.
  • Availability of facility for electronic submission of documents in time barring situation or where case has been finally heard by the Assessing Officer – Electronic submission facility shall automatically close 7 days before time barring date. In other situations, upon completion of proceedings, before passing the final order, concerned AO, on his volition, shall close the e-submission facility after mentioning in electronic order sheet that ‘hearing has been concluded’.

However, if required, in exceptional circumstances, the concerned AO may enable further filing of submissions electronically under intimation to the Range Head in ITBA.

  • In assessment proceedings being carried out through the ‘E-Proceeding’ facility, a particular proceeding may take place manually in following situation(s):
    • where manual books of accounts or original documents have to be examined
    • where AO invokes provisions of section 131 of ITA or a notice is issued for carrying out third party enquiries/investigations
    • where examination of witness is required to be made by the concerned assessee or the department
    • where a show-cause notice contemplating any adverse view is issued by the AO and assesse requests for personal hearing to explain the matter

Salient features of ‘E – proceedings’ – As stated in letter dated 23rd June 2017 following are the salient features of e-proceedings

  • Income tax department has launched e-proceeding facility to as e-governance initiative to facilitate conduct of assessment proceedings
  • Simple way of communication without visits to department
  • Taxpayer friendly measure would substantially reduce compliance burden for assessee
  • E-proceeding will facilitate seamless flow of communication between AO and Assessee
  • Assessee would be able to submit the response along with attachments by uploading the same on e-filing portal
  • AO would view submissions electronically through Income Tax Business Application (ITBA)
  • E – proceeding will save time of assessee as well as department
  • Complete information of all e-submissions made will be available on efiling portal
  • Environment friendly as assessment will be paperless
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