New E-Assessment Scheme in Income Tax
As per the CBDT notification dated 12th September, 2019, new faceless income tax scrutiny Assessment Scheme has been announced. The said scheme will be rolled out from 8th October,2019 on the occasion of “Vijayadashmi – a festival of good over evil”, signifying the end of older- time consuming and often frustrating scheme where the assessee used to visit the department, and marking a new beginning in which all the communication would be made online.
The scheme has been launched with the motive of greater transparency and online communication contributing towards digital India.
After the introduction of this scheme, many of you might be having some questions in your mind. So, I have tried to answer some of these questions by way of FAQs.
Q. What is this E-assessment Scheme ?
Ans : A scheme introduced by the Ministry of Finance in the budget 2019, notified on 12 Sep, 2019 for conducting faceless scrutiny assessment of income tax returns through online process.
Q. What is the objective of E-Assessment Scheme?
Ans : The main objective of this e-assessment scheme is to ensure greater transparency and to eliminate tax terror, which the taxpayers usually have in their mind- as they have to be physically present at the department either in their individual capacity or through their authorized representatives. Some other objectives are as follows :
To facilitate exchange of communication between the tax authorities and the taxpayers exclusively by electronic mode for ensuring greater transparency and accountability.To design a platform for complete anonymous online process.Also, to remove any form of human interference for the income tax assessment procedure and will be time saving for taxpayers and their authorized representatives as they don’t have to commute to the department and wait for the officers to deal with their matter.
Q. When will the e-assessment scheme commence from and when will it be applicable from?
Ans : As announced by Our Finance Minister Nirmala Sitharaman the scheme will be rolled out from 8th October, 2019 on the occasion of Vijayadashmi and will be applicable for all notices issued on or after 1st October, 2019.
Q. Will this scheme make life of professionals easy or difficult?
Ans : It will actually make it easy as now they don’t have to visit the department and the communication will be done through online portal which in turn will be time saving for them.
Q. What is the procedure of E-assessment?
Ans : The process under e-assessment scheme is as follows :-
- The first and the foremost step in the process is that the notice of scrutiny will be issued to the taxpayer by the central system. The notice issued will be sent electronically on the taxpayer’s account on the E-filing website, to the registered email address of the assessee.
- After the receipt of the notice assessee has to submit its reply within 15 days from the date of receipt of notice to National E-Assessment Center through his registered account.
- Now the assessee will no longer have to visit the department with regard to submission of documents in response to the notice. And all the communication between the assessee and the department would be done electronically through online portal.
- The NEC (National E-assessment center) can assign scrutiny case to any assessment unit regional centers through an automated allotment system.
- Assessment Unit will then, on the basis of the information and inputs, will prepare the draft assessment order and send to NEC for review and suggest the changes if any.
- And if the order is prejudicial to the assessee, an opportunity will be provided to the assessee to respond. If the response is made by the assessee then it will be forwarded to Assessment Unit and if no response is received from the assessee then the draft order would be finalized and the records would be sent to Assessing Officer and the Assessee.
Q. Who will conduct e-assessment proceedings?
Ans : The following centers will be established to conduct e-assessment proceedings which are as follows :
National E-assessment center (NEC) : It will act as a regulatory committee to execute rules and regulations and monitor regional centers. Also, if required it may assess, verify, modify and send show cause notice to the assessee.Regional E-assessment Centers : This center is established with the aim to execute the actions as informed by the NEC. And the division will be monitored by the Principal Chief Commissioner to assess the regulation and process.
Q. What will be the organizational structure of E-assessment?
Ans : With the aim of easing the process of assessment for taxpayers, along with the multiple nodal bodies such as national e-assessment center and regional centers, four units have been established to facilitate e-assessment. Such units are as follows:-
Assessment Unit : The functions of this unit will be to request or to provide information for the issues raised and will also scrutinize the information provided by the assessee.Verification Unit : This unit will examine books of accounts, statements and will send enquiry to assessment or technical units for clarification on documents.Technical Unit : This unit is set up to assist with legal, forensic, data analytics, valuation or any other related technical requirements.Review Unit : The role of this unit will be to assess all the documents sent by the assessee, reviewing the draft assessment order and will also review the relevant points added as per the guidelines of NEC.