#Faceless Assessment

The ITAT Kolkata has ruled that a faceless assessment under Section 151A is jurisdictionally void if the statutory notification empowering the National Faceless Assessment Centre was issued only after the assessment order was framed. This sets a critical precedent: procedural compliance with notification timelines is not optional but foundational to the validity of faceless assessments, affecting all taxpayers subject to centralized scrutiny under the Income Tax Act.

The ITAT Guwahati struck down a ₹29.14 lakh addition under Section 69C because the Assessing Officer failed to establish any connection between foreign remittances to China and the assessee’s purchases, especially where the funds were routed through a separate legal entity with a distinct PAN. This ruling reinforces that tax authorities cannot treat unrelated PAN-holding entities as a single unit for unexplained expenditure, protecting legitimate business structures from arbitrary aggregation.

ITAT Ahmedabad deleted a Rs. 52 lakh addition under Section 69A after the assessee proved the cash originated from pre-closed joint fixed deposits, ruling that mere bank transaction records cannot trigger income attribution without independent verification of fund origin. This sets a critical precedent for faceless assessments where bulk cash deposits are challenged without corroborating evidence of undisclosed income.

ITAT Hyderabad condoned a 419-day delay in filing an income tax appeal, holding that assessees must establish 'sufficient cause' with evidence under Section 249(3) of the Income Tax Act. The tribunal remanded the case to CIT(A) for merits consideration, emphasizing procedural compliance in faceless assessments and the assessee's duty to maintain updated contact details.

ITAT Ahmedabad quashed a reassessment notice under Section 147/148 of the Income Tax Act, ruling that the Assessing Officer’s satisfaction must be based on independent application of mind and tangible evidence linking the assessee to escaped income. The Tribunal emphasized that borrowed satisfaction or conjectural reasoning violates natural justice and renders the reassessment void.

ITAT Agra condoned delays of 342 and 513 days in filing income tax appeals, ruling that lack of digital access constitutes 'sufficient cause' under Section 249(3). The decision reinforces that substantial justice prevails over procedural defaults, particularly for assessees unable to receive electronic notices due to technological constraints.

ITAT Bangalore rules that duty drawback income is taxable only upon actual receipt, not mere accrual at export. The tribunal also quashed penalties under Section 270A, holding no misreporting occurred where the assessee followed the cash accounting method. A key precedent for exporters on taxability of export incentives.

Chhattisgarh High Court sets aside a reassessment order where the tax notice under Section 148 was digitally signed but not dispatched through the ITBA portal before the 31.03.2021 cutoff. The ruling mandates strict compliance with electronic dispatch protocols, impacting faceless assessment proceedings and limitation periods for reassessment notices.

ITAT Bangalore rules that email notices under faceless assessment proceedings are invalid unless the assessee expressly confirms receipt in Form 35. The tribunal set aside an appeal dismissal for non-prosecution, emphasizing strict compliance with procedural safeguards to uphold natural justice in tax litigation.

ITAT Bangalore rules that the one-month limitation under Section 144C(13) of the Income Tax Act begins from the date DRP directions are uploaded to the ITBA portal, not from the Assessing Officer's actual receipt. The tribunal quashed the assessment order for being time-barred, reinforcing procedural compliance in faceless assessments.

ITAT Mumbai rules that the issuance of a Section 143(2) notice by the Jurisdictional Assessing Officer does not invalidate a faceless assessment under Section 144B. The Tribunal remanded the case for fresh adjudication on merits, reinforcing that procedural compliance under faceless assessment regimes does not override jurisdictional authority. This ruling clarifies the interplay between jurisdictional notices and faceless assessment procedures, impacting tax assessees and revenue authorities alike.

ITAT Ahmedabad ruled that denying a taxpayer's request for a video hearing in faceless appeal proceedings violates principles of natural justice, setting aside the reassessment order. The decision reinforces that procedural fairness under Section 250 of the Income Tax Act requires adjudicating authorities to consider alternative hearing formats, impacting all faceless assessment appeals.

The High Court of Telangana stays penalty and recovery proceedings under Section 271DA pending adjudication of constitutional validity and procedural fairness in faceless assessments.

ITAT sets aside CIT(A) order for dismissing appeal on delay grounds, remands case for fresh consideration with opportunity to file condonation application.

Andhra Pradesh High Court rules that jurisdictional assessing officers lack authority to issue notices under Section 147 IT Act outside the faceless assessment mechanism prescribed under Section 144B read with Section 151A.