Faceless Assessment Scheme 2020

• Taxation
• ||
• August 29, 2020

On 13^th August, 2020, the Finance Minister of India, Nirmala Sitharaman, under the governance of PM Narendra Modi, spelled out some changes in tax by unveiling “Transparent Taxation-Honoring the Honest”, a platform that reformed and simplified the tax system in India. PM Modi added that, “the honest taxpayers play an important role in development of our nation”.

In view to empower the honest taxpayers and to provide a transparent tax system in India PM Modi introduced this platform, which comprises of many significant reforms like faceless assessment, faceless appeal, and taxpayers charter. To realize this vision, the Central Board of Direct Taxation prescribed a framework and put in place a system in form of this platform. A transparent, efficient and accountable tax administration is what this platform brings in.

Objective
The Faceless Assessment was introduced to remove the human interface between the taxpayer and the Income Tax Department. The primary reason for removing the human interface is to safeguard the taxpayers from exploitation by the Income Tax Department because of which a taxpayer would not visit the department. It was stated that the faceless assessment scheme would ease the compliance burden of taxpayers, bring in fair objective and a just system. Since there shall not be any physical interface between the department and a taxpayer it will definitely bring certainty of information.

The another intent to launch the faceless assessment scheme is to make tax system seamless, painless and faceless which will, in turn, increase the tax revenue of the government and contribute to nation building.

Effective date of the reform
It was disseminated that the faceless assessment and taxpayer charter would come in force from 13^th August, 2020 itself whereas the facility of faceless appeal are going to come in force from 25^Th September, 2020.

Features of the Faceless Assessment Scheme

• Use of Data Analytics and Artificial Intelligence to select a taxpayer: A taxpayershall be selected, completely on random basis, through a system using data analytics and artificial intelligence;
• Eradication of territorial jurisdiction: A taxpayer’s appeal shall not be only heard in the jurisdiction where he resides. The objective of eradicating territorial jurisdiction is that the appeal and case of a taxpayer can be heard anywhere in the country which shall be allocated through system;
• Automated allocation of cases: Notaxpayer would be aware of the jurisdiction where his case will be allocated and no authority would know whose case they are allocated to resolve. The benefit of such random allocation will bring more transparency;
• Central issuance of notices with Document Identification Number(DIN): It isexpected that the personal detail like name of the taxpayer shall not be used and cases will be allocated on the basis of document identification number;
• No physical interface, no need to visit income tax office: A taxpayer need not visit income tax office even for appeals. The taxpayer can execute many important activities online;
• Team-based assessment and team-based review: No individual person is given the authority to assess or review the case of a taxpayer. This team-based assessment and review will completely remove the problem of personal bias and harassment of taxpayers; and
• Draft assessment order in one city, review in another city and finalization in a third city: The  distribution of assessments, orders, cases and appeals in different cities will increase the transparency and induce the confidence of public on income tax departments.

Exceptions to the Faceless Assessment Scheme
The following cases have been kept out of the ambit of faceless assessment scheme:

• Cases related to serious frauds, major tax evasion, sensitive and search matters;
• Cases related to International Taxation; and
• Cases related to Benami Act and Benami Property

Here at AJSH, we assist our clients in all their tax matters including direct & indirect tax consultation, filing of income tax returns, representation before authorities in tax assessments, tax computations, filing of TDS returns etc. If you any questions or wish to know more about faceless assessments, kindly contact us.