written by | June 7, 2022

Know About Faceless Income Assessment for Taxpayers

×

Table of Content


The collection of taxes is essential for a country’s smooth functioning. Taxes that the government collects from the country's citizens form a revenue the government uses for the welfare of the nation's citizens. However, sometimes the task of collection of revenue can prove to be very tedious for the government either because of the unwilling attitude of the citizens to file their income tax in India or because of the colonial attitude adopted by the tax collection authorities that instilled fear in the minds of the citizens to go and pay their taxes physically. To evade this problem, the Government of India has introduced the Faceless Assessment scheme to make filing their income returns easily online without going to the office and paying it physically. This reform in the taxation system of a country is a landmark that seeks to promote transparency and accountability and hold the tax authorities accountable to the people.

Did you know?

The faceless assessment instrument was introduced to enhance transparency as earlier taxpayers had to visit the department for scrutiny purposes which led to rampant corruption.

Also Read: Tax Audits in India - Learn About Income Tax Auditing And It's Types

Structure for Faceless Assessment

To make the Faceless Assessment scheme smooth, the Central Board of Direct Taxes is responsible for setting up a few centres and units, determining their authority to make the process citizens-friendly, transparent and accountable.

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.

Also Read: Taxable Income - What Is Taxable Income & Learn How Tax Is Calculated on Income

Assessment Collection and Recovery of Tax

The next step is that the national e-assessment centre shall send the report to the designated unit. If the taxpayer cannot file a response to the notice, the centre shall send a notice to the concerned defaulter under section 144. The defaulter taxpayer can then file a response to the notice issued to him by the centre under section 144. The designated assessment unit then can draft an assessment order keeping in mind all the relevant material thus gathered and either accept the taxpayer's returned income or reverse the taxpayer's return income and send a copy of such an order to the designated centre.

The authorised income tax faceless assessment unit shall also draft an assessment order that includes the details of the implementation of penalty perpetrations. The authorised review unit shall also investigate the draft assessment order referred to by the national e-Assessment centre. The national e-assessment Center then, upon receiving the approval of the review unit, can approve a draft assessment order or allow the taxpayer at the scene of a revamp being recommended.

In the following step, after considering the recommendations put forward by the review unit, the assessment unit will send the final draft assessment order to the designated centre. After finishing the assessment process, the national faceless income tax Center shall send forth all the electronic records of the investigation to the assessing officer, who has safe custody over all such actions and penalties as the law suggests. The catch here is that the international essence centre at any level of the assessment can transfer the investigation case to the assessing officer who has the save over such inquiry with the board's approval from backdating.

Faceless Approval or Registration

The central government has the power to design a scheme to give approvals by the income-tax authority under any clause of the act. This provision is made under section 293D. The regulations of face assessment will also apply to section 253 and section 279, which would be placed at the instance of a principal chief commissioner or Chief Commissioner Principal Commissioner to be sanctioned sub-section(1) or under sub-section (2).

The Government of India, in this case, may give orders that any clause of this act shall not apply or will be applied with exceptions, changes and conversions, which will then be exclusively mentioned in the notification which will be required to be issued in the official gazette. No such orders will be issued after the 31st of March 2022, and every notification stated above will have to be laid before both the houses of the parliament.

Conclusion

Tax evasion has always been a matter of concern for the government of India. Lately, a few laws and regulations have been attempted to be brought in by the government of India to tackle the concerns of tax evasion by taxpayers. This provided an impetus for lawmakers to implement the faceless assessment procedure in 2019. Most of the tax evasion has been done either willingly or due to the fear of the tax authorities. In this regard, faceless assessment is a landmark reform in the taxation system of the country to prevent the taxpayers from physically engaging with the tax authorities; in other words, the faceless assessment does not require a taxpayer to go physically into an office to file income tax returns instead it is an electronics system that facilitates the online paying of taxes without physically engaging with the tax authorities.
After reading the entire article, you must now know what faceless assessment is. Follow Khatabook for the latest updates, news blogs, and articles related to micro, small and medium businesses (MSMEs), business tips, income tax, GST, salary, and accounting.

FAQs

Q: What is the process of the Faceless Assessment?

Ans:

The following procedure is followed for faceless assessment:

  • The National e- assessment centre issues a Notice, and the assessee receiving the notice is supposed to reply within 15 days.
  • Next, the centre assigns an official case to the assessment unit, which is Regional Electronic Assessment Center.
  • The National e-assessment Center then communicates with the assessee, verification unit, and technical unit.

Q: Is the faceless assessment procedure compulsory?

Ans:

The revenue authority opines on this matter by saying that the faceless assessment procedure is not compulsory in every case.

Q: What should a taxpayer do in a scene of dissatisfaction with the faceless assessment in the income tax process?

Ans:

Upon completing the assessment process, the electronic records of the process are sent to the assessing officer. They are in charge of the proceedings post-assessment. The taxpayer can then apply corrections to the assessment officer. The taxpayer can submit an appeal using the e-appeal portal of the National Faceless tax assessment Appeal Center in counteraction to the punishment order issued to them.

Q: How will the taxpayers know whether they are being selected for the income tax faceless assessment or not?

Ans:

The assessment centre will send the taxpayer an income tax notice by section 143 (2) of the income tax act, which a designated officer would sign. The draft notice is sent to the taxpayer's registered e-filing tax account, and a warning is sent to the specific taxpayer's registered mobile number and email ID. The notice mentions that the notice is for taking forward an income tax faceless assessment.

Q: What is the procedure of a faceless income tax assessment?

Ans:

The sole designated authority for faceless tax assessment is the National e-Assessment Center. The regional centres of this organisation are Kolkata, Chennai, Ahmedabad, Hyderabad, Mumbai, Bengaluru, and Pune.

Disclaimer :
The information, product and services provided on this website are provided on an “as is” and “as available” basis without any warranty or representation, express or implied. Khatabook Blogs are meant purely for educational discussion of financial products and services. Khatabook does not make a guarantee that the service will meet your requirements, or that it will be uninterrupted, timely and secure, and that errors, if any, will be corrected. The material and information contained herein is for general information purposes only. Consult a professional before relying on the information to make any legal, financial or business decisions. Use this information strictly at your own risk. Khatabook will not be liable for any false, inaccurate or incomplete information present on the website. Although every effort is made to ensure that the information contained in this website is updated, relevant and accurate, Khatabook makes no guarantees about the completeness, reliability, accuracy, suitability or availability with respect to the website or the information, product, services or related graphics contained on the website for any purpose. Khatabook will not be liable for the website being temporarily unavailable, due to any technical issues or otherwise, beyond its control and for any loss or damage suffered as a result of the use of or access to, or inability to use or access to this website whatsoever.
×
Disclaimer :
The information, product and services provided on this website are provided on an “as is” and “as available” basis without any warranty or representation, express or implied. Khatabook Blogs are meant purely for educational discussion of financial products and services. Khatabook does not make a guarantee that the service will meet your requirements, or that it will be uninterrupted, timely and secure, and that errors, if any, will be corrected. The material and information contained herein is for general information purposes only. Consult a professional before relying on the information to make any legal, financial or business decisions. Use this information strictly at your own risk. Khatabook will not be liable for any false, inaccurate or incomplete information present on the website. Although every effort is made to ensure that the information contained in this website is updated, relevant and accurate, Khatabook makes no guarantees about the completeness, reliability, accuracy, suitability or availability with respect to the website or the information, product, services or related graphics contained on the website for any purpose. Khatabook will not be liable for the website being temporarily unavailable, due to any technical issues or otherwise, beyond its control and for any loss or damage suffered as a result of the use of or access to, or inability to use or access to this website whatsoever.