CBDT has issued instruction dated 12th February 2018 to conduct assessment proceedings in scrutiny cases electronically, saying that except for search-related assessments, proceedings in other pending scrutiny assessment cases shall be conducted only through the ‘E-proceeding’ functionality in ITBA/e-filing. Therefore, this article is focusing on New E- Assessment Scheme, 2019. The detailed procedure of E- Assessment is discussed here in simple words for better understanding.
Salient features of ‘E – proceedings’ – As stated in letter dated 23rd June 2017 following are the salient features of e-proceedings
The Central Government has been clear on one concept – of using technology in every department, and every facet of Governance, and is also clear on another concept – that machine dependency (use of technology) will reduce corruption.
E-assessment scheme, 2019 would almost eliminate person-to-person contact in the Tax Department for greater transparency in assessment procedures. In a departure from the old procedures, the Central Board of Direct Taxes has stipulated that the e-assessment of a taxpayer will now be handled by two officers, instead of the current system involving a single assessing officer.
Deputation of two officials for one assessment case will aid in increased level of monitoring. It is expected that this scheme will be launched in all cities where the department has an officer of the rank of principal commissioner. Further expansion in future to other cities is also in line. In the pilot project launched in 2016, 60,000 limited scrutiny cases and a few full scrutiny cases have been successfully conducted.
Procedural aspects of the new scheme of e-assessment have been elucidated. A summarised explanation is as follows:
1. the National e-Assessment Centre shall serve a notice on the assessee under sub-section (2) of section 143
2. the assessee may, within fifteen days from the date of receipt of notice file his response to the National e-assessment Centre;
3. the National e-assessment Centre shall assign the case selected for the purposes of e assessment under this Scheme to a specific assessment unit in any one Regional e-assessment Centre through an automated allocation system;
4. where a case is assigned to the assessment unit, it may make a request to the National e-assessment Centre for
a) obtaining such further information, documents or evidence from the assesse or any other person, as it may specify;
b) conducting of certain enquiry or verification by verification unit; and
c) seeking technical assistance from the technical unit;
5. where a request for obtaining further information, documents or evidence from the assessee or any other person has been made by the assessment unit, the National e-assessment Centre shall issue appropriate notice or requisition to the assessee or any other person for obtaining the information, documents or evidence requisitioned by the assessment unit;
6. where a request for conducting of certain enquiry or verification by the verification unit has been made by the assessment unit, the request shall be assigned by the National e-assessment Centre to a verification unit through an automated allocation system;
7. where a request for seeking technical assistance from the technical unit has been made by the assessment unit, the request shall be assigned by the National e-assessment Centre to a technical unit in any one Regional e-assessment Centres through an automated allocation system;
8. the assessment unit shall, after taking into account all the relevant material available on the record, make in writing, a draft assessment order either accepting the returned income of the assessee or modifying the returned income of the assesse, as the case may be, and send a copy of such order to the National e-assessment Centre;
9. the assessment unit shall, while making draft assessment order, provide details of the penalty proceedings to be initiated therein, if any;
10. the National e-assessment Centre shall examine the draft assessment order in accordance with the risk management strategy specified by the Board, including by way of an automated examination tool, whereupon it may decide to –
(a) finalise the assessment as per the draft assessment order and serve a copy of such order and notice for initiating penalty proceedings, if any, to the assessee, alongwith the demand notice, specifying the sum payable by, or refund of any amount due to, the assessee on the basis of such assessment; or
(b) provide an opportunity to the assessee, in case a modification is proposed, by serving a notice calling upon him to show cause as to why the assessment should not be completed as per the draft assessment order; or
(c) assign the draft assessment order to a review unit in any one Regional e-assessment Centre, through an automated allocation system, for conducting review of such order;
11. the review unit shall conduct review of the draft assessment order, referred to it by the National e-assessment Centre whereupon it may decide to:
(a) concur with the draft assessment order and intimate the National e-assessment Centre about such concurrence; or
(b) suggest such modification, as it may deem fit, to the draft assessment order and send its suggestions to the National e-assessment Centre;
12. the National e-assessment Centre shall, upon receiving concurrence of the review unit, follow the procedure stated above in point 10
13. the National e-assessment Centre shall, upon receiving suggestions for modifications from the review unit, communicate the same to the Assessment unit;
14. the assessment unit shall, after considering the modifications suggested by the Review unit, send the final draft assessment order to the National e-assessment Centre;
15. The National e-assessment Centre shall, upon receiving final draft assessment order, follow the procedure stated above in point 10
16. The assessee may, in a case where show-cause notice has been served upon him, furnish his response to the National e-assessment Centre on or before the date and time specified in the notice
17. The National e-assessment Centre shall,-
(a) in a case where no response to the show-cause notice is received, finalise the assessment as per the draft assessment order or
(b) in any other case, send the response received from the assessee to the assessment unit;
18. The assessment unit shall, after taking into account the response furnished by the assessee, make a revised draft assessment order and send it to the National e-assessment Centre
19. The National e-assessment Centre shall, upon receiving the revised draft assessment order:
(a) in case no modification prejudicial to the interest of the assessee is proposed with reference to the draft assessment order, finalise the assessment or
(b) in case a modification prejudicial to the interest of the assessee is proposed with reference to the draft assessment order,provide an opportunity to the assessee
(c) the response furnished by the assessee shall be dealt with as per the procedure mentioned above
20. The National e-assessment Centre shall, after completion of assessment, transfer all the electronic records of the case to the 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) submission of remand report, or any other report to be furnished, or any representation to be made, or any record to be produced before the Commissioner (Appeals), Appellate Tribunal or Courts, as the case may be;
(f) proposal seeking sanction for launch of prosecution and filing of complaint before the Court;
21. The National e-assessment Centre may at any stage of the assessment, if considered necessary, transfer the case to the Assessing Officer having jurisdiction over such case.
Some pertinent aspects while conducting assessment proceedings through ‘E-Proceeding’ are as under:
23. Assessment proceedings under ‘E-Proceeding’ facility may take place manually in situation(s) as mentioned below:
24. For cases assessed under E-Proceeding, the case records and note sheet of proceedings shall now be maintained electronically.
This new scheme for the purpose of making assessments so as to impart greater transparency and accountability, by eliminating the interface between the AO and the taxpayer, optimal utilisation of the resources, and introduction of team-based assessment. However, there are few issues where clarity is required, e.g. the, term ‘team based assessment’ is not defined. Further, a jurisdiction-free assessment implies that a taxpayer residing in one part of a country could be assessed by a tax officer located in another part of the country. These issues may create significant difficulties, and therefore it would be helpful if these issues will be addressed appropriately in the new scheme.
(Author can be reached at firstname.lastname@example.org or on 9990999281)
(Republished with Amendments carried out by Taxguru Team)