TMI Blog2024 (1) TMI 117X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Authority. The plain reading of Sub-section (9) of Section 144B further provides that notwithstanding anything contained in any order provision of the Act, assessment made under Section 144(3) or Section 144 of the Act, shall be treated non-est, if such assessment is not made in accordance with the procedure laid down u/s 144B of the Act. Strict adherence of the aforesaid provision has been examined by this Court in the case of Sardar Co.Op. Credit Society Ltd. [ 2022 (4) TMI 1184 - GUJARAT HIGH COURT] as held that final assessment order is not made in accordance with the procedure envisaged u/s 144 (xvi) (b) of the act as inspite of the variation being prejudicial to the assessee, no opportunity has been given to the assessee by serving show cause notice along with draft assessment order calling upon him to show cause as to why the proposed variation should not be made. Thus, we have no doubt in holding that the impugned order of assessment is invalid and nonest, passed in gross violation of principles of natural justice as well as mandatory provision in the form of section 144B. Thus impugned final assessment order issued by the respondent authorities is hereby ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion undertaken by the Department under Section 132 of the Act on 11.04.2017 in the case of Navratna Group. During the course of search, an excel file was unearthed containing various details of KBG such as Unit No., area of Unit, selling price of land, construction cost, amount received from purchaser etc. 3.2 The writ applicant had submitted his objections against the aforesaid reasons recorded. Such objections were tendered before the Department on 20.07.2021. The competent authority rejected the aforesaid objections, while responding to the issue of lack of jurisdiction of the Assessing Officer in issuing notice under Section 148 of the Act. Reliance was placed on the entry in the name of the writ applicant reflected in the list of various issues / purchasers, who had entered into the transaction with M/s. Navratna Group. It was held that since the assessee case was not selected in regular scrutiny for A.Y. 2016-17 and since the Department intends to verify the genuineness of information collected and to arrive the income escaped, it was further directed to furnish the documents and other evidence in support of the transactions entered into by him during the course of assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, has been passed without providing a copy of draft assessment order as required under Section 144B(xxi). According to the learned advocate for the writ applicant, as per Section 144B(xvi), upon receipt of the income or loss determination proposal, the National Faceless Assessment Centre may on the basis of guidelines issued by the Board, convey to the assessment unit to prepare draft order in accordance with the income and loss determination proposal after which the assessment unit shall prepare a draft assessment order. According to the learned advocate, as per Section 144B(xix), the assessment unit shall thereafter, accept or reject some or all modifications proposed therein. The same shall be followed with the reasons assigned. As per Section 144B(xx), the assessment unit shall thereafter send the draft order prepared under Sub-clause (a) of Clause (xvi) or under Clause (xix) to the National Faceless Assessment Centre. As per Section 144B(xxi), where there is proposal to make any variation which is prejudicial to the interest of such assessee, the National Faceless Assessment Centre shall serve the draft order referred to Clause (xx) on the assessee. He, therefore, submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ub-section (9) of Section 144B further provides that notwithstanding anything contained in any order provision of the Act, assessment made under Section 144(3) or Section 144 of the Act, shall be treated non-est, if such assessment is not made in accordance with the procedure laid down under Section 144B of the Act. The strict adherence of the aforesaid provision has been examined by this Court in the case of Sar dar Co.Op. Credit Society Ltd. (Supra), which reads as under: 8. At this stage, it would be apt to reproduce Section 144B of the Income Tax Act, which reads as under: 144B. (1) Notwithstanding anything to the contrary contained in any other provisions of this Act, the assessment under sub-section (3) of section 143 or under section 144, in the cases referred to in sub-section (2), shall be made in a faceless manner as per the following procedure, namely: (i) the National Faceless Assessment Centre shall serve a notice on the assessee under sub-section (2) of section 143; (ii) the assessee may, within fifteen days from the date of receipt of notice referred to in clause (i), file his response to the National Faceless Assessment Centre; (iii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n any one Regional Faceless Assessment Centre through an automated allocation system; (ix) where a request for seeking technical assistance from the technical unit has been made by the assessment unit, the request shall be assigned by the National Faceless Assessment Centre to a technical unit in any one Regional Faceless Assessment Centre through an automated allocation system; (x) the National Faceless Assessment Centre shall send the report received from the verification unit or the technical unit, based on the request referred to in clause (viii) or clause (ix) to the concerned assessment unit; (xi) where the assessee fails to comply with the notice referred to in clause (vi) or notice issued under sub-section (1) of section 142 or with a direction issued under subsection (2A) of section 142, the National Faceless Assessment Centre shall serve upon such assessee a notice under section 144 giving him an opportunity to show-cause, on a date and time to be specified in the notice, why the assessment in his case should not be completed to the best of its judgment; (xii) the assessee shall, within the time specified in the notice referred to in clause (xi) or suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... less Assessment Centre about such concurrence; or (b) suggest such variation, as it may deem fit, in the draft assessment order and send its suggestions to the National Faceless Assessment Centre; (xviii) the National Faceless Assessment Centre shall, upon receiving concurrence of the review unit, follow the procedure laid down in (a) sub-clause (a) of clause (xvi); or (b) sub-clause (b) of clause (xvi); (xix) the National Faceless Assessment Centre shall, upon receiving suggestions for variation from the review unit, assign the case to an assessment unit, other than the assessment unit which has made the draft assessment order, through an automated allocation system; (xx) the assessment unit shall, after considering the variations suggested by the review unit, send the final draft assessment order to the National Faceless Assessment Centre; (xxi) the National Faceless Assessment Centre shall, upon receiving final draft assessment order follow the procedure laid down in (a) sub-clause (a) of clause (xvi); or (b) sub-clause (b) of clause (xvi); (xxii) the assessee may, in a case where show-cause notice has been served upon him as p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est of the assessee in comparison to the draft assessment order or the final draft assessment order, provide an opportunity to the assessee, by serving a notice calling upon him to show-cause as to why the proposed variation should not be made; (xxvi) the procedure laid down in clauses (xxiii), (xxiv) and (xxv) shall apply mutatis mutandis to the notice referred to in sub-clause (b) of clause (xxv); (xxvii) where the draft assessment order or final draft assessment order or revised draft assessment order is forwarded to the eligible assessee as per item (A) of sub-clause (a) of clause (xxiii) or item (A) of sub-clause (a) of clause (xxv), such assessee shall, within the period specified in sub-section (2) of section 144C, file his acceptance of the variations to the National Faceless Assessment Centre; (xxviii) the National Faceless Assessment Centre shall, (a) upon receipt of acceptance as per clause (xxvii); or (b) if no objections are received from the eligible assessee within the period specified in sub-section (2) of section 144C, finalise the assessment within the time allowed under sub-section (4) of section 144C and serve a copy of such order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; (iii) assessment units, as it may deem necessary to facilitate the conduct of faceless assessment, to perform the function of making assessment, which includes identification of points or issues material for the determination of any liability (including refund) under the Act, seeking information or clarification on points or issues so identified, analysis of the material furnished by the assessee or any other person, and such other functions as may be required for the purposes of making faceless assessment; (iv) verification units, as it may deem necessary to facilitate the conduct of faceless assessment, to perform the function of verification, which includes enquiry, cross verification, examination of books of accounts, examination of witnesses and recording of statements, and such other functions as may be required for the purposes of verification; (v) technical units, as it may deem necessary to facilitate the conduct of faceless assessment, to perform the function of providing technical assistance which includes any assistance or advice on legal, accounting, forensic, information technology, valuation, transfer pricing, data analytics, management or any other ..... 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National Faceless Assessment Centre by affixing its digital signature; (b) assessee or any other person, by affixing his digital signature if he is required to furnish his return of income under digital signature, and in any other case, by affixing his digital signature or under electronic verification code in the prescribed manner; (ii) every notice or order or any other electronic communication shall be delivered to the addressee, being the assessee, by way of (a) placing an authenticated copy thereof in the assessee s registered account; or (b) sending an authenticated copy thereof to the registered email address of the assessee or his authorised representative; or (c) uploading an authenticated copy on the assessee s Mobile App, and followed by a real time alert; (iii) every notice or order or any other electronic communication shall be delivered to the addressee, being any other person, by sending an authenticated copy thereof to the registered email address of such person, followed by a real time alert; (iv) the assessee shall file his response to any notice or order or any other electronic communication, through his registered account, an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of any telecommunication application software which supports video conferencing or video telephony in accordance with the procedure laid down by the Board; (xi) the Board shall establish suitable facilities for videoconferencing or video telephony including telecommunication application software which supports video conferencing or video telephony at such locations as may be necessary, so as to ensure that the assessee, or his authorised representative, or any other person is not denied the benefit of faceless assessment merely on the consideration that such assessee or his authorised representative, or any other person does not have access to video conferencing or video telephony at his end; (xii) the Principal Chief Commissioner or the Principal Director General, in charge of the National Faceless Assessment Centre shall, with the prior approval of the Board, lay down the standards, procedures and processes for effective functioning of the National Faceless Assessment Centre, Regional Faceless Assessment Centres and the unit set up, in an automated and mechanised environment, including format, mode, procedure and processes in respect of the following, namely: (a) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of draft orders, by using suitable technological tools, including artificial intelligence and machine learning, with a view to reduce the scope of discretion; (e) computer resource shall have the same meaning as assigned to it in clause (k) of sub-section (1) of section 2 of the Information Technology Act, 2000 (21 of 2000); (f) computer system shall have the same meaning as assigned to it in clause (l) of sub-section (1) of section 2 of the Information Technology Act, 2000 (21 of 2000); (g) computer resource of assessee shall include assessee s registered account in designated portal of the Income-tax Department, the Mobile App linked to the registered mobile number of the assessee, or the registered e-mail address of the assessee with his email service provider; (h) digital signature shall have the same meaning as assigned to it in clause (p) of sub-section (1) of section 2 of the Information Technology Act, 2000 (21 of 2000); (i) designated portal means the web portal designated as such by the Principal Chief Commissioner or Principal Director General, in charge of the National Faceless Assessment Centre; (j) Dispute Resolution Panel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e; or (iv) in the case of addressee being an individual who possesses the Aadhaar number, the e-mail address of addressee available in the database of Unique Identification Authority of India; or (v) in the case of addressee being a company, the email address of the company as available on the official website of Ministry of Corporate Affairs; or (vi) any e-mail address made available by the addressee to the income-tax authority or any person authorised by such authority. (u) registered mobile number of the assessee means the mobile number of the assessee, or his authorised representative, appearing in the user profile of the electronic filing account registered by the assessee in designated portal; (v) video conferencing or video telephony means the technological solutions for the reception and transmission of audio-video signals by users at different locations, for communication between people in real-time. 8. In light of aforesaid provision, we note that the Faceless Scheme, 2019 was modified by Notification No. 60/2020 dated 13.08.2020 wherein it had prescribed procedure for making Faceless Assessment. In fact, the intention of Legislation as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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