CBDT Procedure on ‘Cases transferred out of Faceless Assessment/ Penalty Proceedings’

CBDT prescribes procedure for handling of assessment/ penalties by Jurisdictional Assessing Officers in cases transferred out of Faceless Assessment/ Faceless Penalty proceedings under the Income-tax Act, 1961. Also CBDT prescribes the Scope/ Cases to be handled under or excluded from the Faceless Assessment Scheme.

CBDT Income Tax Order dt. 06/09/2021: Procedure for handling cases transferred out of Faceless Assessment/ Penalty Proceedings under Income-tax Act, 1961

Procedure for handling of assessment by Jurisdictional Assessing Officers in respect of assessments/ penalties transferred out of Faceless Assessment u/s 144B(8) of the Income-tax Act, 1961/ Faceless Penalty Scheme, 2021 respectively

1. The Central Board of Direct Taxes (CBDT) has accorded approval for transfer of assessments/ penalties to Jurisdictional Assessing Officers (PAN based), as found necessary, on case-to-case basis in terms of Section 144B(8) of the Income-tax Act, 1961 (Act)/ clause 5(2) of Faceless Penalty Scheme, 2021.

2. The Jurisdictional Assessing Officer (JAO) shall complete the assessments/ penalties in such cases as per the following broad contours to the extent technically feasible:-

A) All processes in cases transferred u/s 144B(8) of the Act/ clause 5(2) of Faceless Penalty Scheme, 2021 may be conducted electronically to the extent technically feasible, except in those cases where the assessee does not have e-filing account/ registered e-mail to communicate electronically with JAO. For cases without digital foot print, the JAO shall endeavor to get the e-filing account of the assessee registered and then conduct the proceedings in an electronic manner.

B) The request for personal hearings shall generally be allowed to the assessee with the approval of Range Head, mainly after the assessee has filed written submission to the show cause notice. Personal hearing may be allowed to the assessee preferably through Video Conference. If Video Conference is not technically feasible, personal hearings may be conducted in a designated area in Income Tax Offices. The hearing proceedings may be recorded.

C) Use of Faceless processes such as VU for online verification, TU for Technical inputs etc. may also be considered for non-faceless regime to the extent technically feasible.

D) In order to have consistency with the unit concept in faceless regime, the Range Head may compulsorily be involved in the finalization of assessment of such cases transferred to JAO, for which the provisions of Section 144A of the Act may suitably be invoked. In penalties, the approval of Range Head is already embedded in Section 274(2) of the Act, over a specific monetary ceiling of ‘penalty imposable’. Same may be adhered to.

3. It is also clarified that in respect of such cases transferred, the JAO shall take into account the proceedings conducted so far under the faceless regime and proceed further as per the provisions of the Act and broad contours of modalities as indicated above.

CBDT Income Tax Order dt. 06/09/2021: Scope/ Cases to be handled under Faceless Assessment Scheme prescribed by CBDT

Order under sub-section (2) of Section 144B of the Income-tax Act, 1961 (the Act) for specifying the scope/ cases to be done under the Act

1. The Faceless Assessment Scheme, 2019 (the Scheme) has been incorporated in the Act vide the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. Section 144B of the Act pertaining to Faceless Assessment has been inserted by the said amendment w.e.f. 01/04/2021.

2. The Central Board of Direct Taxes vide Order under sub-section (2) of Section 144B of the Act for specifying the scope/ cases to be done under the Act, F. No. 187/3/2020-ITA-I dated 31/03/2021 (the Order) specified that all the assessment proceedings pending as on 31/03/2021 and the assessment proceedings initiated on or after 01/04/2021 (other than those in the Central Charges and International Taxation Charges) which fall under the “class of cases” as defined in the said Order shall be completed under section 144B of the Act.

3. In partial modification of the said Order, the Central Board of Direct Taxes hereby directs that in addition to the cases in the Central Charges and International Taxation Charges, cases where pendency could not be created on ITBA because of technical reasons or cases not having a PAN, as the case may be, shall also be excluded from the purview of section 144B of the Act.

4. This order comes into effect immediately.

CBDT Income Tax Order dt. 06/09/2021: Cases excluded from Faceless Assessment Scheme

Order under section 119 of the Income-tax Act. 1961 (the Act) providing exclusions to section 144B of the Act

1. The Faceless Assessment Scheme, 2019 (the Scheme) has been incorporated in the Act vide the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. Section 144B of the Act pertaining to Faceless Assessment has been inserted by the said amendment w.e.f. 01/04/2021.

2. The Central Board of Direct Taxes vide Order F. No. 187/3/2020-ITA-I dated 13/08/2020 (the Order) read with order under section 119 of the Act regarding mutatis mutandis application of Orders, Circulars etc. issued in order to implement the Scheme to Faceless Assessment u/s 144B of the Act, F. No. 187/3/2020-ITA-I dated 31/03/2021 directed that all the Assessment Orders shall be passed by the National Faceless Assessment Centre (NaFAC) u/s 144B of the Act except as under:-

i) Assessment orders in cases assigned to Central Charges.

ii) Assessment orders in cases assigned to International Tax Charges.

3. In partial modification of the said Order, the Central Board of Direct Taxes in exercise of powers under section 119 of the Act, hereby directs that in addition to exceptions (i) & (ii) provided in Para 2 of the Order, the following exception is also hereby added as under:-

iii) Assessment Orders in cases where pendency could not be created on ITBA because of technical reasons or cases not having a PAN, as the case may be.

4. Further, the Central Board of Direct Taxes clarifies that assessment in cases transferred by the Principal Chief Commissioner or the Principal Director General in charge of National Faceless Assessment Centre (NaFAC) u/s 144B(8) of the Act shall be handled as per the procedure specified in the letter F. No. 225/97/2021/ITA-II dated 06/09/2021.

5. This order comes into effect immediately.

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