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  1. Income Tax: E-assessment ensures greater efficiency in the taxation system

Income Tax: E-assessment ensures greater efficiency in the taxation system

Aimed at eliminating interface between income tax department and taxpayers, the Budget 2018 announced e-assessment of tax returns.

New Delhi | Published: March 20, 2018 1:51 AM
Income Tax, E-assessment, taxation system For the purpose of furnishing information/documents in response to the notices, the CCC may prescribe a machine readable structured format.

Aimed at eliminating interface between income tax department and taxpayers, the Budget 2018 announced e-assessment of tax returns. It was introduced on a pilot basis last year with the objective of reducing the interface between the department and the taxpayers.

The Central Board of Direct Taxes (CBDT) has notified the Centralised Communication Scheme, 2018, for centralised issuance of notices, under which all notices requiring an assessee to furnish any information or document shall be issued by the Centralised Communication Centre (CCC), under a digital signature, by sending an e-mail or by placing a copy in the registered account on the portal followed by an intimation via SMS.

For the purpose of furnishing information/documents in response to the notices, the CCC may prescribe a machine readable structured format. The department will prescribe the procedure, time and processes for effective functioning of the CCC. Taxpayers will not be required to appear personally or through authorised representative before the designated authority at the CCC in connection with the proceedings.

What remains to be done?

CBDT is in the process of making this scheme more robust and the tax department shall specify from time to time, procedures and processes for effective functioning of the CCC. Answers to some of the pertinent questions shall find their way in time to come. For instance: What will be the format and procedure for issue of notice? What will be the process for receipt of any information or document from the addressee in response to notice? What will be the mode and format for issue of acknowledgment of the response furnished by the addressee?

How e-assessment helps

Assessment proceedings are a daunting task for an assessee, not only entailing investment of time and cost but also a cause for worry owing to the possibility of harassment at the hands of the tax officer. Besides saving the precious time of the assessees, this anytime/anywhere facility will help the assessee to submit response to the departmental queries easily and retain important submissions. Also, the elimination of person-to-person contact will lead to greater efficiency and transparency in the Indian taxation system. Such initiatives convey the message that India is all in for improving its tax administration and make it simple.

What to do?

In the age of green governance, it is important that an assessee furnishes correct email-id and phone number in the income-tax return, since, any mistake in these details could mean non-receipt of notices, leading to interest, penalty and even prosecution in certain cases.

If you receive a notice, there is no need to panic. The notice should never be ignored, since ignorance may cost you a lot of time, money and peace of mind. A notice does not necessarily mean you have committed a crime. Even a minor error in tax return can invite a notice from the tax authorities.

You must furnish all the relevant documents, as directed in the notice and also file a rectified return and pay the tax due, if any, within the stipulated period. The purpose of a notice is to collate information and details to form an opinion, hence it is of utmost importance that a notice from tax authorities is duly replied under all circumstances.

Neha Malhotra is executive director, Nangia & Co LLP

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