Faceless assessment means carrying out of income tax assessment procedure without human interface with the use of technology wherein, a centralized NeAC (National Electronic Assessment Centre) shall be the medium of communication with the assesses and department with the use of Artificial intelligence, algorithms. The Cases shall be assigned to the department through automated allocation system. There will be no direct contact of A.O with assessee.
Faceless assessment applies to Scrutiny assessment and Best judgement assessment.
Birth of Faceless assessment (Brief History):-
√ In 2016, the government had introduced e-assessment on a pilot basis and extended it to 102 cities in 2017 with the aim to cut down the interface between the I-T department and the taxpayers.
√ “With the experience gained so far, we are now ready to roll out the E-assessment across the country,” Finance Minister Arun Jaitely said in his Budget speech for 2018-19 tabled in Parliament.
On 1St February,2018 Former FM Mr. Arun jaitely in Finance act,2018 came up with insertion of three sub clauses 143(3A), 143(3B)&143(3C) to section 143(3) of IT Act,1961.
Sec.143(3A) gave power to CG to make a scheme for e-assessment by notification in the official Gazette.
√ On 5th july 2019, former FM Mrs. Nirmala sitharaman had announced the e-assessment scheme in her budget speech.
√ On 12th September 2019, CG in exercise of its power conferred u/s 143(3A) came up with e-assessment scheme wide notification no.61/2019 & 62/2019 in the official gazette.
√ On 13th August 2020, PM Mr. Modi Launched “Transparent Taxation-Honoring the Honest” that rolled out a faceless assessment scheme, appeal and right’s charter for taxpayers.
√ So,The Faceless assessment scheme is nothing but e-assessment scheme itself.
Need for faceless assessment:-
“The vision of Prime Minister is to empower the taxpayers, to provide a transparent system and to honour the honest taxpayer,” the FM Nirmala sitharaman said, after PM Modi launched the “Transparent Taxation – Honoring the Honest” platform
The faceless assessment has been devised for greater transparency, greater efficiency and accountability to the assessment process by:-
Exclusions to scheme:-
Faceless assessment scheme framework:-
♦ National E-Assessment Centre(NeAC):-
♦ Regional e-assessment Centres(ReAC):-
♦ Assessment Unit(AU):-
♦ Verification Unit(VU):-
♦ Technical Unit(TU):-
♦ Review Units(RU):-
Procedure for Faceless assessment:-
1) Serving notice to assessee:-
2) NeAC shall assign the case to AU & AU shall make draft assessment order:-
Further documents, evidences, etc. for case as needed, | Conduct of enquiry or verification by VU as needed, | Seeking technical assistance from TU as needed. |
Request assessee for documents, evidences, etc. as requested by AU. | Request VU to conduct enquiry or verification as requested by AU. | Request TU of ReAC for the needed technical assistance. |
NOTE– Request shall be made by NeAC to VU or TU or RU etc. of one of the ReAC through automated allocation system with the use of Artificial intelligence. It will be devoid of any human interference hence making it faceless.
3) Sending the draft assessment order to NeAC:–
i. Finalise the draft assessment order
ii. Provide an opportunity to assessee in case of any modification
iii. Assign draft order to RU for the conduct of review
4) NeAC shall Provide Opportunity to assessee in case of modification:–
Then assessee may either:-
Issue response to NeAC within time:- | May not issue response to NeAC within time:- |
1. NeAC shall send the assessee’s response to AU
2. AU after taking assessee’s response into consideration send the revised asst. order to NeAC 3. NeAC on receiving the revised draft order shall either; i. Finalize the draft assessment order ii. Provide an opportunity to assessee in case of any modification iii. Assign draft order to RU for the conduct of review |
1. NeAC shall finalise the draft asst. order. |
This process shall continue unless the draft asst. order is finalized.
5) NeAC may assign the draft order to RU for the conduct of review:-
RU shall after doing the review of draft asst. order it may either:-
Concur with the draft asst. order & intimate to NeAC, or |
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Upon receiving the above respective intimation, NeAC shall either:-
i. Finalise the draft assessment order or, ii. Provide an opportunity to assessee in case of any modification or, iii. Assign draft order to RU for the conduct of review. |
The above process shall continue unless the revised draft order is finalized.
6). After Finalization of assessment:-
The NeAC shall after completion of assessment, transfer all the electronic records of the case to Assessing Officer having jurisdiction over such case for: –
a) Imposition of Penalty
b) Collection and recovery of demand
c) Rectification of mistake
d) Giving effect to appellate orders
e) Submitting reports to be produced before Commissioner (Appeals)/Tribunal/courts as the case may be
f) Proposal seeking sanction for launch of prosecution and filing of complaint before the court
NOTE:-With the overriding power, NeAC if considered necessary, at any stage of assessment proceedings can transfer the case to A.O. having jurisdiction over such case. Thereby meaning,such case shall proceed with normal assessment procedure & not with faceless assessment scheme.
Issues concerning Faceless assessment scheme:-
Employees working at Income tax department fears that they will be made redundant and might lose their work to computers and automation of work.
Very nicely drafted. Keep up.
The scheme is excellent; however, one wonders whether all relevant points can be explained properly in a written reply (which unfortunately programmers tend to curtail to a a few topics only.
Great Knowledge Article
Dear Bharti….. Keep it UP…..
Informative article..
Keep it up bharti👍