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September 23, 2020

Differences between Current and Faceless Assessment scheme

Differences between Current and Faceless Assessment scheme

Article explains differences between current scheme & Faceless Assessment scheme, in case of Income Tax Scrutiny and Assessments, Constitution of ReACS, Consequences of No Response by Taxpayer and Functions of each of Assessment Unit, Verification Unit, Review Unit & Technical Unit which are approved by respective Range Heads.

CURRENT Vs FACELESS ASSESSMENT

Present Assessment SystemFaceless Assessment System
1. Case Selection through
a) System
b) Manual
c) Tax evasion information
1. No discretion to any officer in selection
2. No Selection except through system alerts
3. No Selection other than information-based
2. Cases were permanently assigned to a territorial jurisdiction1. Automated random allocation of cases
2. Dynamic jurisdiction to any faceless anywhere in the country — 95 AUs, 35 20 RUs and 4TUs
3. Issue of notices both manually and on System1. No discretion in issue of notices
2. System generated notices triggered by alert
3. Notices without DIN are invalid
4. Notices to be issued electronically and centrally from the NEACin Delhi.
5. The NeACis the single point of faceles contact between the taxpayer and Department.

Constitution of ReACS

  • Each PCIT Assessment Unit controls four Range Head each with One ACIT/ DOT and Five ITOs
  • Each PCIT Verification Unit controls 3 Range Heads each with One ACIT/ DCIT and Five ITOs
  • Each PCIT Review Unit Controls 3 Range Head each with 2 ACIT / DCIT and 3 ITOs
  • Each PCIT Technical Unit Controls 3 range head 2 ACIT / DCIT and 3 ITOs

Consequences of No Response by Taxpayer

  • Non-compliance to appropriate notice or requisition, notice u/s 142(1) or directions u/s 142(2A)
  • After exhausting Service of Notice opportunities through electronic means including to email IDs of the Assessee with the department
  • NeAC shall serve notice under section 144 giving an opportunity to show-cause, why best judgement order should not be passed
  • In case Assessee fails to respond NeAC to intimate the failure to the AU
  • The AU shall, prepare DAO to the best of its judgment, either accepting the or modifying the income or sum payable, and send DAO to the NeAC along
  • The DAO shall be examined under RMS as in the case of other orders as mentioned above.

Functions of each of Assessment Unit, Verification Unit, Review Unit & Technical Unit which are approved by respective Range Heads

Assessment Unit – Identify issues, seek information and analyse material to frame draft assessment orders

Verification Unit –

  • Conduct E-verification u/s 133C
  • Conduct enquiry, examination of books of account, examination of witnesses and recording of statement
  • Conduct Physical Enquiry only in instances covered by Pr.CCIT NeACs order 12(vi) of the scheme

Review Unit – Review of Draft Assessment Order – Whether material evidence brought on record, points of facts and law incorporated, application of judicial decisions considered, arithmetic correctness etc.

All actions of AU, VU, RU Et TU Officers are approved by the respective Rang Heads.

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