Faceless Assessments Issues under Income Tax being decided - Portal cannot be Closed without accepting or rejecting adjournment application; Revision u/s 263 can not normally be invoked

The Faceless assessments regime is evolving and there are multiple issues which are now being taken up by Courts. Many of us have faced situations that adjournments are not granted during faceless assessments and the portal closes leaving assessees remediless. However, cases where adjournment petitions are not reverted to, post further hardship as the whole position becomes uncertain. This is notwithstanding that Section 144B(1)(xii)(b) of The Income Tax Act indicates for faceless assessments that after the show cause notice is issued stating the variations prejudicial to the interest of the assessee, which are proposed to be made to the income of the assessee, he has to be called upon to submit as to why the proposed variation should not be made. Such show cause notice shall be served on the assessee through the National Faceless Assessment Centre. Clause (xiii) of Section 144B(1) mandates the Assessee to file his reply to the show cause notice on the date and time as specified therein or such time as may be extended on the basis of the application made in this regard to the NFAC, which shall forward the reply to the Assessment Unit.

Hence, it was held in the case of Shri Venkatesh Refineries Limited Through Its Managing Director Prasad Dinesh Kabre Versus Deputy Commissioner Of Income Tax Circle 1 And Others - 2023 (7) TMI 284 - BOMBAY HIGH COURT that incase an adjournment petition is made, then the same has to atleast be rejected by The Authorities before closing the portal. This judgement shall be quite useful in similar cases.

Again, another issue is whether Assessment in the faceless cases can be re-opened where it is a fact that any faceless assessment is carried out through a teamwork of assessment unit, technical unit, review unit, verification unit etc. In this regard it was held in the case of M/s. Agrani Buildestate Versus The Pr. CIT-1 Jaipur - 2023 (7) TMI 237 - ITAT JAIPUR  that since different units are headed by Principal Commissioner of Income Tax, therefore, in a faceless regime, normally there cannot be a case of prejudice of lack of enquiry for the reason that there is application of mind by multiple officers of Department and not by a single officer and thus incase the assessee had furnished the requisite information and the NFAC has completed the assessment after considering all the facts, the order passed by the AO cannot be termed as erroneous.