Faceless Assessment and Taxpayer's Charter

Anil Soni Blog

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The focus of PM modi’s address was on three structural reforms namely:

  • Faceless assessment.
  • Faceless appeal.
  • Taxpayer’s Charter.

Directing the department to trust taxpayers and avoid treating them with suspicion without any evidence. While faceless assessments and taxpayer’s charter will become effective from Aug. 13, 2020 taxpayers can benefit from the faceless appeal mechanism starting Sept 25, 2020.


Faceless Assessment and Appeal:

Scrutiny assessments involve a high level of personal interaction between a taxpayer and the jurisdictional revenue department, which leads to certain undesirable practices on the part of tax officials and assessee.

To eliminate such instances, a scheme of faceless assessment in electronic mode involving no human interface is launched. In line with the prime minister’s announcements, the Central Board of Direct Taxes has directed that all assessment orders under the Income Tax Act will be passed by the National e-Assessment Centre.

Now, scrutiny as well as appeals against them will be randomly allocated to any tax officer throughout the country. For instance, a scrutiny case of a taxpayer in Mumbai can be allocated to an officer in Guwahati and an appeal against this decision will go to an officer in a third state. Similarly, a review of this decision will be done by officers in some other city. Taxpayers will not be required to visit tax offices and can reply to any notice.

There, however, are two exceptions to this, orders assigned to central as well as international tax charges have been excluded from its purview.
Any assessment order which does not confirm with the revised guidelines will be treated as non-existing, it will be deemed to have never been passed.

Taxpayers’ Charter:

The charter aims to provide a fair and reasonable treatment to taxpayers by treating them as honest and directs the department to collect the right amount of tax, Modi said.

The Ministry of Finance detailed the purpose of the charter in tweets following the prime minister’s announcement. It said:

  • The department must follow the due process of law and respect the privacy of taxpayers by maintaining confidentiality and not disclosing any information unless authorized by law.
  • Revenue department should provide complete and accurate information to taxpayers which will ensure timely decision-making.
  • The department must allow a taxpayer to chose an authorized representative of his choice, provide a fair system and reduce the cost of compliance for taxpayers.                          .