Dedicated apps, structured questions for direct tax faceless assessment are being rolled out, says Finance Secretary

We have been continuously reviewing the overall performance of the Faceless Assessment Scheme and taking up necessary measures to achieve the excellence that we are yet to reach. The blueprint and the design of the scheme to obtain desired outcomes is in place, but teething problems in data consistency of information of SFTs (Statement of Financial Transactions) and manpower motivation remain.

In FAS, out of the 58,320 cases assigned in September 2019, till now, 22,606 have been finalised. As regards the 80,166 cases assigned to the scheme in November 2020, as yet, 634 cases have been finalised. In the Faceless Appeal Scheme, the system is in place and cases have been allotted; notices are being issued and a few orders, too, have been passed.

FAS started in September 2019 on the ‘as-is-where-is’ digital infrastructure of the Income Tax Department. The functionalities for various processes in faceless assessment were developed in the work-flow system ITBA (Income Tax Business Application), in (project) Insight (which used data analytics to identify individuals who present a high risk of tax evasion) and in the e-filing project (the taxpayer friendly interface), simultaneously, with the taking up of the cases for scrutiny assessment.

Despite the limitations caused by Covid-19, the lockdown and the bar on adversarial notices for a substantial period of time, FAS 2019 has achieved substantial progress.

How do you plan to make these schemes more effective?

As FAS is essentially a data-driven assessment process, the ReAC-AOs (Regional e Assessment Centre - Assessing Officer) are continuously being sensitised to restrict the enquiries within the mandate of the scheme. Also, a Quality Control Cell is being developed for monitoring the quality of the processes and outputs and for creating a learning loop.

The grievance redressal mechanism has been strengthened and a dedicated toll-free helpline number (1800-11-1961) has been started for addressing the taxpayers’ queries with respect to FAS. It is manned on all working days from 10 am to 5 pm by officers/officials of the department.

Two sets of dedicated email ids have been set up to receive taxpayers’ grievances. The emails are examined by senior officers of the NeAC (National e-Assessment Centre). Besides, there is a acheme for appreciation of ReAC officers for recognising and encouraging quality work. The capacity-building for departmental officers is being taken up on a priority basis.

Moreover, certain new measures have been taken to provide better services to the taxpayers. For example, enabling filing of electronic response by persons not having any digital footprint (DIN-based reply filing) and enabling response submission by persons not registered on the e-filing website.

A mobile app for facilitating taxpayer response is being developed. Also, some structured questions are being rolled out to obviate the need for submitting voluminous records online.

Physical verification is resorted only in the rarest situations, such as where the taxpayer is not responding despite repeated opportunities or has a fraud PAN. The work of assessment in the saceless acheme is with different units — assessment, verification, technical and review.

Verification may involve checking through data on the system or through online means and also physically in rare cases. Physical verification is to be marked to a designated verification unit (VU) mapped with PIN Codes. The Bengaluru VU may have got a verification request from an assessment unit which inter-alia would require a physical checking for which request can be made to a designated VU mapped to the PIN code with the area where physical enquiry is to be conducted.

Such complaints are baseless as far as FAS is concerned. Under FAS, all actions taken by the Assessing Officers in various units are approved by their respective unit heads (Joint or Additional Commissioners).

The NeAC only lays down processes, formats modes and procedures after approval from CBDT (Central Board of Direct Taxation). There is no process in the faceless scheme wherein a junior officer can issue instructions to a senior officer.

No personal hearing through video conference (VC) has been denied so far. As of now, there have been only five requests for VCs flagged to the NeAC.

As per FAS, personal hearing under VC is to be given in instances where a Draft Assessment Order that is prejudicial to the taxpayer is communicated to the taxpayer and the taxpayer disputes the facts underlying the proposed modification and makes a request for a personal hearing. In such cases, the CCIT (Chief Commissioner of Income Tax) ReAC allows personal hearing.

Read More: Faceless schemes of direct taxes creating more problems than resolutions

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