Taxmann's Faceless Assessment Appeals & Penalty Ready Reckoner with Real-Time Case Studies

About the Author

Preface to Sixth Edition

This thoroughly revised, updated and very special, sixth edition of my Book, proudly treasures, each and everything, which one may wish to know, understand and learn about the new ‘Faceless Regime’ in Income Tax Act, 1961.

This Book has been curated and crafted with acute precision and incorporates all the practicalities and nuances of the three limbs of the new ‘Faceless Taxation Regime’, , ‘Faceless Assessments’ under the newly substituted section 144B of the Income Tax Act, by the Finance Act, 2022, the newly substituted ‘Faceless Appeal Scheme, 2021’ legislated w.e.f. 28.12.2021 and the ‘Faceless Penalty Scheme 2021’ incorporated w.e.f. 12.1.2021 and as substituted with the Faceless Penalty (Amendment) Scheme, 2022.

The newly inserted legislative faceless schemes like ‘e-Assessment of Income Escaping Assessment Scheme, 2022, u/s 151A’, ‘Faceless Jurisdiction of Income-tax Authorities Scheme, 2022’ u/s 130, e-Verification Scheme, 2021 u/s 135A, e-Advance Rulings Scheme, 2022 and e-Settlement Scheme, 2021 u/s 245D of the Income Tax Act, have been lucidly explained.

All Important and Relevant CBDT’s Legislative Schemes, Circulars, Notifications and Press Releases on the ‘Faceless Taxation Regime’ updated till 15.4.2023, have been included in this Book.

All the significant and crucial litigative issues which every assessee or tax professional is bound to encounter in the present statutory framework of the faceless direct taxation regime i.e., faceless assessments/reassessments, faceless appeal and faceless penalty proceedings, have been lucidly explained and practically demonstrated with the help of real-time practical case studies.

Qualitative suggestive e-submissions/replies, incorporating all the relevant and updated legal jurisprudence, for almost all the important and crucial assessments, re-assessments and appeal issues like Disallowance on account of Related Party Transactions, Addition on account of variation between IND AS Adjustments in Computation of

Income & ICDS, Disallowance in respect of Exempt Income u/s 14A and Rule 8D, New Reassessment Regime in Faceless Assessments, Case Studies of Section 143(1) Intimations, Disallowance of Foreign Tax Credit to Residents on account of Non/Delayed Filing of Form 67, Disallowance of Unexplained Expenditure, Disallowance of Deduction to Export Oriented Units in Special Economic Zones, Disallowance of Bad Debts, Additions Made on Estimated Income Basis, Additions made in the hands of Group Housing Societies, Doctrine of Mutuality, Addition on account of Existence of Undisclosed HSBC Foreign Bank account, Additions based on AIR information, Cash Deposits during Demonetisation, Share Valuation u/s 56(2)( ), Admission of Additional Evidence under Rule 46A, appeal before ITAT against Revisionary Order u/s 263, appeal against Rectification Order u/s 154, Addition on account of considering Rental Business Income as Income from House Property, Addition of Share Capital and Share Premium u/ss 68 & 56(2)(x), LTCG on Penny Stocks, Bogus Purchases, Seizure of Loose papers/diary, Revenue recognition and expenditure booking in Real-estate sector, Appeal against 201/201(1A) Order, Disallowance of pre-commencement business expenditure, taxability of compensation received for non-agricultural land, Reply in response to Penalty Notice, etc. included in this Book, are surely going to act as a ‘ready referencer’ and benchmark e-submissions for the assessees and the tax professionals in their tax practice. This Book characterizes a ‘natural blend of law and practice’ concerning the New Faceless Taxation Regime, and as such serves as an effective, efficient, robust and deadly weapon in the armory of the assessees and tax practitioners to combat ‘Faceless Assessments’, ‘Faceless Appeals’, ‘Faceless Penalty’ proceedings, and all other Faceless Schemes, incorporated in Income Tax Act, 1961.

‘Learning and improving is a continuous process’ and so honest and valuable suggestions and feedback are invited and solicited from the ‘worthy readers’, at my email id mayankmohanka@gmail.com for further improvement.

Knowledge multiplies manifold by sharing. It is a supreme form of wealth.

With Warm Regards

Mayank Mohanka

Acknowledgement

Friends,

About the Book

‘READY RECKONER’ ‘Go-TO-GUIDE’ each and everything Know, Understand & Learn New ‘Faceless Taxation Regime’.

Crafted with acute precision, this Special & Exclusive Edition of the Book, faceless assessments, faceless appeals, faceless penalty and all other faceless proceedings,

‘Threadbare Analysis of the Amended Faceless Regime by the Finance Act, 2022 and Finance Act, 2023

Faceless Taxation Regime’

‘step-by-step-manner’ ‘real-time practical case studies’ new e-Proceedings utility new e-Filing portal

Key Highlights:

The newly substituted section 144B containing amended provisions for ‘Faceless Assessments’ and the Amended Legislative Scheme of ‘Faceless Appeal Scheme, 2021’ and ‘Faceless Penalty Scheme, 2021’, have been explained lucidly with illustrative tables, infographics, visuals & real-time scrutiny windows.

Threadbare Analysis of the New Reassessment Regime in Faceless Assessments.

‘Real-time Practical Case Studies’ on ‘Faceless Assessments/ Reassessments/Appeal/Penalty Proceedings’ on issues of:

Disallowance on account of Related Party Transactions

Additions on account of Variation between IND AS Adjustments & ICDS

Disallowance in respect of Exempt Income u/s 14A & Rule

8D

Case Study on Reply to New Reassessment Regime Notice

Case Studies on Section 143(1) Intimations

Disallowance of Foreign Tax Credit to Residents on account of Non/Delayed Filing of Form 67

Disallowance of Unexplained Expenditure

Disallowance of Deduction to Export Oriented Units in Special Economic Zones

Disallowance of Bad Debts

Additions Made on Estimated Income Basis

Additions made in the hands of Group Housing Societies

Addition on account of HSBC Foreign Bank Account

Reassessment on account of Information from another IT Authority

Admission of Additional Evidence under Rule 46A

Cash Deposits out of Earlier Cash Withdrawals

Addition on account of considering Rental Business Income as Income from House Property

Appeal against

Revisionary Order u/s 263

Appeal against TDS Order u/s 201/201(1A)

Appeal against Rectification Order u/s 154

Cash Deposits during Demonetisation

Valuation of Shares u/s 56(2)(x)

Share Capital u/s 68

Share Premium u/s 56(2)(viib)

LTCG on Penny Stocks

Disallowance of Pre-commencement Business Expenditure

Taxability of Compensation received under RFCTLAAR Act, 2013

Revenue Recognition & Expenditure Booking in Real Estate Business

Bogus Purchases

Seized Diary

AIR/STR information

Reply to Penalty Notice

Specimens of Suggestive Qualitative & Meritorious ‘e-Responses/ Submissions’ on all above critical and recurring issues, which one encounters in tax practice.

Practicalities & Nuances of Differences between the Conventional Assessments, Appeals and Penalty Proceedings & the New Faceless Assessments, Appeals and Penalty Proceedings.

Practical Guide to ‘Faceless Assessments’, ‘Faceless Appeals’ & ‘Faceless Penalty’ Proceedings, demonstrating their actual conduct in a ‘Step-by-Step-Manner’ through ‘Real-time’ ‘e-Proceedings’ windows.

Practical Guide to ‘e-Filing of Rectification Applications u/s 154’ & ‘e-Responses to Outstanding Income Tax Demands’.

Practical Guide to Seeking & Utilising the Opportunity of Personal Hearing through Video Conferencing in new e-Proceedings Utility. Deciphering Critical & Litigative Issues in the Faceless Taxation Regime, like:

(i) What Would Constitute a Valid Issuance & Service of a Faceless Income Tax Notice;

(ii) Whether Omission of section 144B(9), Makes Faceless Assessments conducted in Violation of Principle of Natural Justice, Immune?

(iii) Whether NaFAC can be considered as a Lawful Substitute for Recording of Satisfaction by Jurisdictional AO?

(iv) Validity of Frequent Transfer of Faceless Assessments & Penalty Cases, from Faceless Hierarchy to Jurisdictional AO

(v) Legality of the fixing of the maximum time limit for filing all the ‘e-responses’ by the assessee under the ‘e-proceedings’ functionality under faceless assessments.

(vi) Validity of Exercise of Revisionary Powers by an Individual Jurisdictional CIT(Appeal) u/s 263/264, over an Order passed by a Dynamic Jurisdiction in Faceless Hierarchy.

(vii) What are adequate Safeguards for Avoiding High-Pitched Assessments in Faceless Regime?

FAQs on the ‘Faceless Taxation Regime’.

Lucid Explanation of the newly inserted legislative faceless schemes like ‘e-Assessment of Income Escaping Assessment Scheme, 2022, u/s 151A’, ‘Faceless Jurisdiction of Income-tax Authorities Scheme, 2022’ u/s 130, e-Verification Scheme, 2021 u/s 135A, e-Advance Rulings Scheme, 2022 and e-Settlement Scheme, 2021 u/s 245D of the Income Tax Act.

I-14

International Best Practices in Tax Administration & Indian Tax Administration

All Important and Relevant CBDT’s Circulars, Notifications & Press Releases on the ‘Faceless Taxation Regime’ updated till 15.4.2023.

Chapter-Heads

STANDARD OPERATING PROCEDURE (SOP) FOR FACELESS ASSESSMENT PROCEEDINGS U/S 144B OF THE INCOME TAX ACT

20

CHAPTER

Practical Case Study On Addition Based Upon Annual Information Return (AIR)

20.1 CASE STUDY ON ADDITIONS BASED UPON ANNUAL INFORMATION RETURN (AIR) -

The ideal suggested re-assessment submission incorporating all the relevant and updated legal precedents, in order to represent and tackle this dicey and litigative issue in an effective and efficient way, is being shared for the benefit and ready reference of readers.

S M MOHANKA & ASSOCIATES Chartered Accountants

Mohanka Chambers, 142, i-Thum, Tower B-1, Noida-201307, Tel.: 9999981515

E-mail: camayank@smmohanka.com

Dated: March 18, 2022

To

The Learned Assessing Authority National Faceless Assessment Centre New Delhi

In the Matter of: Smt. XYZ (hereinafter referred to as “the assessee”; PAN: ABCDE1234F; AY 2017-18.

Subject: Reply in Response to Show Cause Notice Cum Draft Assessment Order in Respect of Ongoing Income Escaping Assessment Proceedings for AY 2017-18.

Reference: Your Show Cause Notice bearing DIN ITBA/AST/F/143(3) (SCN)/2021-22/1234567890(1) dated 15.3.2022

Dear Assessing Authority,

Faceless Assessment Appeals & Penalty Ready Reckoner with Real-Time Case Studies

AUTHOR : MAYANK MOHANKA

PUBLISHER

: TAXMANN

DATE OF PUBLICATION : APRIL 2023

EDITION : 6th Edition

ISBN NO : 9789357780056

NO. OF PAGES : 686

BINDING TYPE : PAPERBACK

DESCRIPTION

This book is a ready reckoner & go-to-guide for the assessee and tax practitioners to understand the practicalities and nuances of the following in an effective, qualitative, and timely manner:

• Faceless Assessments u/s 144B of the Income-tax Act as amended by the Finance Acts 2022 & 2023

• Newly substituted Faceless Appeal Scheme, 2021 legislated w.e.f. 28.12.2021

• Faceless Penalty Scheme, 2021 incorporated w.e.f. 12.01.2021 & substituted with Faceless Penalty (Amendment) Scheme, 2022

• Newly Amended Reassessment Regime u/s 147-15, conducted in a faceless manner via faceless assessment

• The newly inserted legislative faceless schemes are also explained:

o e-Assessment of Income Escaping Assessment Scheme, 2022 u/s 151A

o Faceless Jurisdiction of Income-tax Authorities Scheme, 2022 u/s 130

o e-Verification Scheme, 2021 u/s 135A

o e-Advance Rulings Scheme, 2022 & e-Settlement Scheme, 2021 u/s 245D

The Present Publication is the 6th Edition and has been amended up to 8th April 2023. This book is authored by Mayank Mohanka with the following noteworthy features:

• Lucid Explanation with Illustrative Tables, Infographics, Visual & Real-time Scrutiny Windows

• 30+ Real-time Practical Case Studies

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Rs. 1595 | USD 51