Direct Tax Alert: CBDT notifies e-Assessment of Income Escaping Assessment Scheme, 2022
31 March 2022
To bring transparency to assessment proceedings, the Faceless Assessment Scheme, 2019 was introduced. Subsequently, the Taxation & Other Laws (Relaxation & Amendment of Certain Provisions) Act, 2020 codified this Scheme1 by introducing section 144B in the Income-tax Act, 1961 (IT Act). Section 151A of the IT Act grants powers to the Central Government to make a scheme for assessment, reassessment, or re-computation under section 1472 of the IT Act or issuance of notice under section 148 of the IT Act or sanction for the issue of such notice under section 151 of the IT Act. In this regard, recently the Central Board of Direct Taxes (CBDT) notified3 the e-Assessment of Income Escaping Assessment Scheme, 2022 (the Scheme). We, at BDO in India, have analyzed and summarized the said notification hereunder:
Scope of the Scheme
- The Scheme provides that-
- Assessment, reassessment, or re-computation under section 147 of the IT Act;
- Issuance of notice under section 148 of the IT Act
shall be through automated allocation, by risk management strategy formulated by the CBDT as referred to in section 148 of the IT Act for issuance of notice. Further, the aforesaid process shall be conducted in a faceless manner, to the extent provided under section 144B of the IT Act.
- The Scheme shall come into force from 29 March 2022.
The Finance Bill 2022 has proposed to bring reassessment proceedings within the ambit of faceless assessment. This Notification is in line with the amendment proposed by the Finance Bill 2022. While the Scheme has been notified, corresponding Rules are yet to be notified. However, they could be in line with the faceless assessment rules.
1Refer our tax alert- https://www.bdo.in/en-gb/insights/alerts-updates/direct-tax-alert-lok-sabha-passes-taxation-and-other-laws-(relaxation-and-amendment-of-certain-prov
2As per Section 147 of the IT Act, reassessment of concluded assessments in cases where the tax authority has ‘reason to believe’ that any income chargeable to income-tax has escaped assessment can be opened.
3Notification No.18/2022, dated 29 March 2022