CDBI has implemented Income Tax E-Assessment Scheme this year itself. It is supposed to come into effect from 12th of September 2019. It concludes on the view Notification No. 61/2019 – Income Tax. The assessment submitted under this Scheme will be formulated in the relevance of the territorial area, people, class of persons, income or classes of income, cases or class of cases just might be specified by the Board.
As of the Ministry of Finance in the Department of Revenue, Central Board of Direct Taxes has presented with the Notification No 61/2019. It is known to be S.O 3264(E). It is mainly the implementation of the combining powers conferred by sub-section 3A of Section 143 of the Income-tax Act, 1961.
The Central Government has launched this scheme which has a Short title and commencement. It is known as the E-Assessment Scheme of 2019. It will come to function on the date of its publication issued by the Official Gazette.
To begin with, the Scheme, unless the context otherwise needs –
- “Act” which falls in the meaning of Income Tax Act of 1961.
- Again there is another sub-section meaning to “addressee”. It is mentioned in clause b of the sub-section of (1) of section 2 of the Information Technology Act of 2000.
- “Assessment” here means the total income or loss of the assessee under the Sub-section of (3) of section 142 of the Act
- “authorize Representative” has the same meaning mentioned to it in sub-section (2) of section 288 of the Act presented
- “automated allocation system” states the algorithm of the random allocation of cases. This is through the use of proper technology tools. This further involves artificial intelligence and machine learning. It with provide view for the optimization of the use of resources
- “automated examination tool” stands for the standard examination of the draft orders. It is done through the use of proper technology tools. This further involves artificial intelligence and machine learning for reducing the rate of discretion
- “Board” showcases the Central Board of Direct Taxes constituted under the Central Board of Revenue Act of 1963;
- “computer resource” concludes with the same meaning as assigned to them in clause (k) of sub-section (1) of section 2 of the Information Technology Act, 2000
- “computer system” also concludes to have the same meaning as assigned to them in clause (l) of sub-section (1) of section 2 of the Information Technology Act, 2000 ;
- While “computer resource of the assessee” involves assessee’s registered account in the designated portal of the Income-tax Department, the linked Mobile App which needs to have the registered mobile number of the assessee or the email account of the assessee with their email service provider;
- “digital signature” might have the same meaning assigned to the clause (p) of Sub-section (1) of Section 2 Of the Information Technology Act of 2000.
- “designated portal” states the designation of the web portal formulated by the Principal Chief Commissioner or Principal Director-General. They are mainly in charge of the National e-assessment Centre;
- Roughly, “e-assessment” holds the meaning of the assessment processes that are done electronically in ‘e-Proceeding’ facility. It is done through the assessee’s registered account in the designated portal;
- “electronic record” might hold the same meaning as assigned to it in clause (t) of sub-section (1) of section 2 of the Information Technology Act of 2000;
- Here “electronic signature” holds the same meaning mentioned in the clause (ta) of sub-section (1) of section 2 of the Information Technology Act of 2000
- You have different names for it. It can be “email” or “electronic mail” or even “electronic mail message”. It mainly is a message or information developed, transmitted or received on a computer, computer system, computer resource or communication device. This has got different attachments in the form of text, image, audio, video and any other electronic record.
- Now, we come to the segment of what is “hash function” and “hash result”? Again, it might have the same meaning and you will find the same in the Sub-section (2) of section 3 of the Information Technology Act of 2000.
- “Mobile app” stands for the meaning of application software of the Income-tax Department. It is developed for mobile devices which can be easily downloaded and installed on the registered mobile number of the assessee;
- “originator” will stand for the same meaning as assigned to it in clause (za) of sub-section (1) of section 2 of the Information Technology Act, 2000;
- “real-time alert” stands for any sort of communication sent to the assessee. It is another way of Short Messaging Service on his registered mobile number. You can also say it is an update on his Mobile App, or by way of an email at his registered email address. This is done so that he gets the alert related to the delivery of electronic communication;
- “registered account” of the assessee is the electronic filing account. It gets registered by the assessee in a designated portal;
- “registered email address” stands for the e-mail address. Here, an electronic communication may be delivered or transmitted to the addressee. This further includes –
- the email address mentioned in the electronic filing account of the addressee is registered in the designated portal, or
- the available email address in the last income tax return was furnished by the addressee
- the email address was there in the Permanent Account Number database linked to the addressee, or
- if the addressee is the person who has the Aadhaar number, the email address of the person is available in the database. Find the same through the Unique Identification Authority of India, or
- if addressee is a company, the email address of the organization can be available on the official site of the Ministry of Corporate Affairs, or
- any email address is available by the addressee to the income tax authority or any individual when authorised by the same authority.
- “registered mobile number” of the assessee is mainly the mobile number of the assessee. Or you can say it is his authorised representative. This is presented in the user profile of the electronic filing account which has been registered by the assessee in the designated portal;
- “video telephony”, on the other hand, is stated to be the technological solutions for the reception and transmission of audio-video signals. Perceived by users at different locations, it is mainly the method for communication between people in real-time.
So basically the words or the quotes statements used, some are defined while others are mentioned in the Act gain the meaning accordingly in the Act.
What information about the Scope of the Scheme?
The assessment made under this scheme will be formulated in relevance to such territorial area, person or class of people, income or class of incomes, cases or class of cases. It might be mentioned as per the specification by the Board.
Segments of the E-assessment Centres –
1. To incorporate the functionality of the Scheme, the Board may set up –
- A National e-assessment Center for the facilitation of conducting e-assessment processes in a centralised manner. It could be vested with the jurisdiction for assessing relevance with the provision of this Scheme;
- Regional e-assessment Centres acts for the facilitation for implementing e-assessment proceedings of the controlling region of a Principal Chief Commissioner. This will be further vested with the jurisdiction for assessing relevance with the provisions of this Scheme;
- assessment units act on conducting e-assessment. It is done for performing the function of making an assessment. This involves identification of points or issues material for determining any liability (including refund) under the Act, finding out the information or clarification on points. There could be issues identified, analysis of the material implemented by the assessee or any other person. These functions might be needed for making an assessment;
- verification units again aim at conducting e-assessment. It is for performing the functions of verification. Further, it includes enquiry, cross verification, the examination of books of accounts, the examination of witnesses and recording of statements, and relevant factors needed for meeting verification purposes.
- technical units facilitate curating an e-assessment. It helps in providing technical assistance including assistance on legal, accounting, forensics, information technology, valuation, transfer pricing, data analytics, management or any other technical matter. It might be needed for meeting the needs of a particular case or class of cases, under this Scheme;
- review units, facilitate of conducting e-assessment for reviewing the draft assessment order. This further meeting checking of the relevant and material evidence brought on record. It could be on the relevant points of fact and law which get duly incorporated in the draft order. Another fact could be the issues on which there will be addition or disallowance implemented discussed in the draft order. It could be whether the applicable judicial decisions is considered further dealt with in the draft order. Furthermore, there can be checked for arithmetical correctness of modifications proposed. If there is any if any, there is a requirement for review, specifying the respective jurisdiction
2. The other segment follows all the communication among the assessment unit, review unit, verification unit, technical unit or any other person or assessee. It could be following the information, documentation, evidence or any other details. This could be necessary for assessing the Scheme to pass through the National e-assessment Centre.
3. The third segment is referred to in the form of sub-paragraphs – (iii), (iv), (v) and (vi) of paragraph (1) might have the following functionalities, namely –
- Additional Commissioner or Additional Director or Joint Commissioner or Joint Director, as the case may be;
- Deputy Commissioner or Deputy Director or Assistant Commissioner or Assistant Director, or Income-tax Officer, as the case may be;
- such other income-tax authority, ministerial staff, executive or consultant, as found important by the Board.
What is the procedure for the assessment?
The assessment under this Scheme is made through the following process –
- National e-Assessment Centre serves a notice on the assessee under sub-section (2) of section 143. It specifies the issues for the selection of the case for assessment;
- the assessee may, within fifteen days starting from the date of receipt of notice objects to in sub-clause (i). The submission to file his response to the National e-assessment Centre ;
- the National e-assessment Centre shall seek forward the case selected for e-assessment. Mentioned under this Scheme for a specific assessment unit. It could be in any one Regional e-assessment Centre through an automated allocation system;
- where a case is forwarded to the assessment unit, it might seek for a request to the National e-assessment Centre for –
(a) acquiring further information, documents or evidence from the assessee or any other person, as it may require.
(b) formulating certain enquiry or verification by the verification unit, and
- understanding technical assistance from the technical unit;
- where a request for obtaining further information, documents or evidence from the assessee or any other person has been made by the assessment unit. It is the National e-assessment Centre issues appropriate notice or requisition to the assessee or any other person for gaining the information, documents or evidence requisitioned by the assessment unit;
- where a request for implying certain enquiry or verification, done by the verification unit, there is an assessment unit made. The request shall be assigned by the National e-assessment Centre to a verification unit with the help of an automated allocation system;
- technical assistance request is from the technical unit made through assessment unit. The request is assigned by the National e-assessment Centre to a technical unit in any one regional e-assessment Centres with the help of an automation allocation system;
- the assessment unit after taking into consideration all the relevant material available on the record, perform writing. It will be a draft assessment order either showcasing either acceptance of the returned income of the assessee or modification of the returned income of the assessee. Whatever the case may be, sending a copy of such order to the National e-assessment Centre;
- the assessment unit makes a draft assessment order. It further provides details of the penalty proceedings to be initiated therein, if any;
- there will be examination conducted by the National e-assessment Centre for the risk management strategy specified by the Board. This includes automated examination tool, –
- finalizing the assessment according to the draft assessment order. Serve a copy of the same and notice for initiating penalty process to the assessee, if any. Apart from the same, there is demand notice for the specification of the sum payable or refund of any due amount, the assessee based on such assessment; or
- allowing the assessee, if modification is approached, by serving a notice to showcase in understanding why the assessment should not be completed as per the draft assessment order; or
- assigning the draft assessment order for reviewing unit in any one Regional e-assessment Centre, conducted through an automated allocation system, for conducting a review of such order;
- the review unit will conduct a review of the draft assessment order, about the National e-assessment Center to lay the decision to –
- concurring the draft assessment order and intimating the National e-assessment Centre for such concurrence; or
- suggesting modification, as needed, to the draft assessment order and sending its suggestions to the National e-assessment Centre;
- the National e-assessment Centre, upon receiving the concurrence of the review unit, tend to follow the procedure laid down in subparagraph (a) or subparagraph (b) of paragraph (x), as the case may be;
- the National e-assessment Centre shall, upon receiving suggestions for modifications from the review unit, conduct communication to the Assessment unit;
- the assessment unit, after considering the modifications suggested by the Review unit, will forward the final draft assessment order to the National e-assessment Centre;
- The National e-assessment Centre, after receiving the final draft assessment order, they will follow the procedure laid down in subparagraph (a) or subparagraph (b) of paragraph (x);
- The assessee may, in a case where a show-cause notice under subparagraph (b) of paragraph (x) has been served upon him, furnish his response to the National e-assessment Centre on or before the date and time specified in the notice;
The National e-assessment Centre will further,-
- get no response to show the notice is received. Finalizing the assessment as per the draft assessment order. The procedure laid down in subparagraph (a) of paragraph (x); or
- other cases, sending the response received through the assessee to the assessment unit;
The assessment unit, after taking into account the response furnished by the assessee, formulate a revised draft assessment order and send it to the National e-assessment Centre;
National e-assessment Centre after receiving the draft assessment order –
if no modification prejudicial to the interest of the assessee is proposed about the draft assessment order. It is to finalize the assessment as per the procedure laid down in the subparagraph (a) of paragraph (x); or
if no modification prejudicial to the interest of the assessee is proposed about the draft assessment order get the opportunity to the assessee laid down in subparagraph (b) of paragraph (x);
the response finalized by the assessee is dealt with the procedure laid down in paragraphs (xvi),(xvii), and (xviii);
The National e-assessment Centre, after completing the assessment, transfers all the electronic records of the case to the Assessing Officer having jurisdiction over such case. This is mainly for —
(a) the imposition of penalty;
(b) collection and recovery of demand;
(c) rectification of any mistakes;
(d) giving effect to appellate orders;
(e) submission of remand report produced before the Commissioner (Appeals), Appellate Tribunal or Courts;
(f) proposal for finding sanction for the launch of prosecution. Filing of the complaint before the Court; Notwithstanding anything contained in paragraph (xx), the National e-assessment Centre may at any stage of the assessment, if considered necessary, transfer the case to the Assessing Officer having jurisdiction over such case.
What happens in Penalty processes for non-compliance?
1. During the assessment process, any unit might service for non-compliance of the order issued under this Scheme. It is the part of the assessee or any other person. They send a recommendation for initiating penalty process under Chapter XXI of the Act. Whatever may be the case, National e-assessment Centre gets the case.
2. National e-assessment Centre might serve a notice on the assessee if there is receipt of such recommendation. It will be like calling him to showcase on why the penalty should not be imposed on him under the relevant provisions of the Act.
3. The response to show-cause done by the assessee, if any, will be sent through National e-assessment Centre to the concerned unit that has made the recommendation for a penalty.
4. The main unit after looking into the response by the assessee will –
a. make a draft order of the penalty. Send the copy to the National e-assessment Centre
b. drop the penalty after recording reasons. This will be under intimation of the National e-assessment Centre
5. The National e-assessment Centre will levy the penalty on the mentioned draft order of penalty. They serve a copy of the assessee, as the case might be.
Mention about Appellate Proceedings
It is an appeal made against an assessment conducted by the National e-assessment Centre under this Scheme. It lies before the Commissioner who has jurisdiction over the jurisdictional Assessing Officer and any reference to the Commissioner (appeals) in any communication. This will be from the National e-assessment Centre.
Exchange of communication exclusively by electronic mode
For this Scheme conducted between the National e-assessment Centre, Regional e-assessment Centres and various units –
a. all communication should be exchanged by electronic mode
b. all internal communication also will be exchanged by electronic mode
Authentication of the electronic Record
Mainly an electronic record will be authenticated by the originator. It is implemented as per the subsection (2) of section 3 of the Information Technology Act of 2000.
If in case of the origination, the assessee can conduct authentication through electronic signature, electronic authentication technique as mentioned in subsection (2) of section 3A of the said Act.
Period of the delivery of the electronic record
1. Every order of electronic device used under this Scheme will be delivered to the addressee through –
a. placement of authenticated copy in the assessee’s registered account.
b. sending an authenticated copy to the register’s email id of the assessee
C. uploading that copy on the assessee’s mobile app followed by a real-time alert.
2. Every order of the electronic communication under this Scheme will be delivered to the addressee with an authenticated copy to the registered email address followed by the real-time alert.
3. The Assessee will file his response to any notice under the Scheme through the registered account. Once the acknowledgement is sent by the National e-assessment Center, the response will be deemed for authentication.
4. Time and place of dispatch and receipt of electronic record will be determined following the provisions of section 13 of the Information Technology Act, 2000
No personal appearance in the Centres or Units.—
1. A person cannot appear to the representative in connection with any process under this Scheme before the income-tax authority at the centre approves it.
2. If modification is proposed in the draft assessment order, an opportunity is given to the assessee through a notice to show cause as to why the assessment should not be completed as per such draft assessment order. The assessee will need a personal hearing to make his oral submissions before the income-tax department under this Scheme. It could be through video conferencing or any application software that supports video telephony.
3. Recording of the statement of the assessee will be done by the income tax department under this Scheme through video conferencing following the procedure mentioned by the Board.
What is the power for specification format, mode, procedure and processes?
1. The Principal Chief Commissioner, in charge of the National e-assessment Center, might lay down the standards, procedures and processes for the efficient functioning of the centres and the unit under the Scheme. It will be done in an automated manner including format, mode, procedure and processes in respect to
(i) service of the notice, order or any other communication;
(ii) receipt of any information or documents from the person in response to the notice, order or any other communication;
(iii) issue of acknowledgement of the response furnished by the person;
(iv) provision of “e-proceeding” facility including login account facility, tracking status of assessment, display of relevant details, and facility of download;
(v) accessing, verification and authentication of information and response including documents submitted during the assessment proceedings;
(vi) receipt, storage and retrieval of information or documents in a centralised manner;
(vii) general administration and grievance redressal mechanism in the respective Centres and units.
