Section 144B — Faceless Assessment

Section 144B of the Income-tax Act, 1961, introduces the concept of faceless assessment, aimed at reducing human interface between the taxpayer and the income tax department. This section outlines the procedure for conducting assessments electronically, ensuring transparency and efficiency. The process involves the National Faceless Assessment Centre, which coordinates with various Regional Assessment Units, Verification Units, Technical Units, and Review Units to complete the assessment. The statutory test involves issuing a notice to the taxpayer, allowing them to respond and submit evidence electronically. The burden of proof lies with the taxpayer to substantiate their claims. This section is significant as it aims to eliminate corruption, reduce litigation, and streamline the assessment process, making it more taxpayer-friendly.

Common Litigation Flashpoints

1. Challenges in electronic communication and submission of documents
2. Disputes over procedural lapses in faceless assessment
3. Issues related to non-receipt of notices or responses
4. Concerns about lack of personal hearing opportunities

Judgments on Section 144B — Faceless Assessment

• Arya Roadways Company Pvt. Ltd. vs I.T.O., Ward-12(1), Kolkata — ITAT,
  The case was remanded to ensure a fair opportunity for the assessee to substantiate its claims regarding the expenditure.
• Commissioner of Income Tax, Karnataka vs M/S Bedi & Company Private Limited — SC,
  The High Court rightly held that the circumstances did not justify the conclusion that the amount was not received as a loan.
• Pawan Sachdeva vs Income-Tax Officer, Ward 19(3), Delhi & Anr. — HC,
  Issuance of notice within the limitation period is sufficient for jurisdiction, even if the service occurs later or with errors.
• T.K.S. Builders Pvt. Ltd. vs Income Tax Officer Ward 25(3) New Delhi — HC,
  Notices under Section 148 must be issued through automated allocation and in a faceless manner as per the Faceless Assessment Scheme.
• Nuvama Wealth Management Limited vs DCIT — ITAT,
  ESOP discount represents consideration for services rendered by employees and is therefore deductible as business expenditure.
• Union of India & Anr. vs M/s. Ganpati Dealcom Pvt. Ltd. — SC,
  The 2016 Amendment Act cannot be applied retrospectively as it creates new offences and substantive changes, which cannot be applied to past transactions.