What is faceless tax assessment or e assessments In Income Tax?

A Modern Generation of TRUST, TRANSPARENCY and TAX

“A lot of things would depend on the discretion of assessing officer in manual assessment. We have completely revamped it. Instead of territorial jurisdiction, we have brought in dynamic jurisdiction,” Prime Minister Narendra Modi said.

Wondering if what we’re doing is really making an impact. But, it’s important that we’re always moving forward, India will perhaps be the first country to implement such a system that taxpayers will no longer be tied to a specific jurisdiction or office for assessments because now the Central Board of Direct Taxes has launched a faceless, randomized and fully electronic assessment system, removing all human interfaces.

Now, that income Tax Department would increase the amount of faceless scrutiny, and the algorithm for allocating such scrutiny would adjust occasionally. Owing to such faceless scrutiny, further transition of Income Tax officer will be less.

So here’s the three big announcements that were made by Prime Minister Narendra Modi on Thursday launching a “Transparent Taxation — Honouring the Honest” platform:

1. Faceless appeal scheme– to be implemented from 25^th September, 2020.

 Elements to this scheme are:

1. 1. 1. Appeals to be randomly allotted to any officer.
      2. The identity of officers deciding appeal will remain unknown
      3. No need to visit the officer/office
      4. The appellate decision will be Team Based & reviewed

Exceptions for the situations concerning:

2. 1. 1. Serious fraud, Major Tax Evasion, Sensitive & Search matters
      2. International tax
      3. Black Money Act & Benami Property

2. Faceless e assessment scheme

Elements to this scheme are:

1. 1. 1. Selection only through system using data analytics & AI
      2. Abolition of territorial jurisdiction
      3. Automated random allocation of cases
      4. Central issuance of notices with Document Identification No. (DIN)
      5. No physical interface, No need to visit income tax office
      6. Team-based assessments and Team-based review
      7. Draft assessment order in one city, review in another city & finalization in third city

Exceptions for the situations concerning:

3. 1. 1. Serious fraud, Major Tax Evasion, Sensitive & Search matters
      2. International tax
      3. Black Money Act & Benami Property

3. Taxpayers’ Charter

       The income tax department has dedicated itself to:

1. 1. 1. Provide fair, courteous, and professional assistance in all dealings with the taxpayer.
      2. Treat taxpayer as honest unless there is a reason to believe otherwise.
      3. Provide fair and impartial appeal and review mechanism.
      4. Provide complete and accurate information for fulfilling compliance obligations under the law.
      5. Mean to provide timely decisions in every income- tax proceeding within the time prescribed.
      6. Shall collect the correct amount of tax.
      7. Respect the privacy of the taxpayer and be no more intrusive than necessary in any inquiry, examination, or enforcement action.
      8. Maintain confidentiality and shall not report to the department any information received by the taxpayer, unless approved by law.
      9. Authorities shall keep accountable for their actions.
      10. Every taxpayer can choose an authorized representative of his / her choice.
      11. Provide the mechanism to lodge complaint and prompt disposal thereof.
      12. The Department shall have a fair and unbiased framework and address tax problems in a time-limited manner
      13. Intend to update the service quality standards periodically.
      14. Reduce cost of compliance when administering tax legislation.

Expectations from taxpayers:

1. 1. 1. Be honest and fulfill his compliance obligations.
      2. Remain aware of their obligations to comply.
      3. Hold accurate records.
      4. Know what the representative does on his behalf.
      5. Respond in due course.
      6. Pay in Time.

The PM focused on the fact that the honest taxpayers contributed immensely to the national development. When the taxpayers’ life became simple, they progressed and so did the nation. The new facilities were in consonance with, and further strengthened, the government’s motto of ‘minimum government’, ‘maximum governance’. The government had adopted people-centric approach towards making laws, rules and policies. “This is an experiment of the New India’s new governance model and the country is getting positive results. Everyone has now realized that short-cuts are not acceptable, and it is not wise to adopt wrong means,” he said, adding that sense of duty was now the most appreciated approach.

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