The Income Tax Department has launched Faceless Income Tax Appeals. Under faceless appeals, all Income Tax appeals will be adjudicated in a faceless manner with the exception of appeals relating to serious frauds, major tax evasion, sensitive and search matters, International tax and Black Money Act.
To understand the importance of this move and to know how it honours honest taxpayers, one need to revisit the headlines from the past.
What Was the Problem Earlier?
A report from July 2011 said “An Income Tax (Appeal) Commissioner, Ramphool P Meena, has been arrested on charges of taking a bribe of ₹2.20 lakh to expedite an Income Tax Scrutiny closure report of a salaried employee from a corporate firm.”
Another report from September 2012 said that “A widow from the city has slapped a harassment charge against a top official of the income tax department based in Bhopal for threatening them in support of his friend.”
A report from 2013 narrated the story of some 5,000 taxpayers from Gujarat protesting against the alleged harassment by tax officials.
How This is Going to Change Now?
Under the Faceless Appeals, henceforth in income tax appeals, everything from e-allocation of appeal, e-communication of notice/questionnaire, e-verification/e-enquiry to e-hearing and finally e-communication of the appellate order, the entire process of appeals will be online, dispensing with the need for any physical interface between the appellant and the Department.
Appeal Review in Another City
Any official can seek bribes mostly in a situation where a certain rapport builds with taxpayer. Now, there is no room for this.
The Faceless Appeals system will include allocation of cases through Data Analytics and Artificial Intelligence under the dynamic jurisdiction norm, with central issuance of notices which would be having Document Identification Number (DIN). As part of dynamic jurisdiction, the draft appellate order will be prepared in one city and will be reviewed in some other city resulting in an objective, fair and just order.
Relief to Pending Cases
There is a pendency of almost 4.6 lakh appeals at the level of the Commissioner (Appeals) in the Department. Out of this, about 4.05 lakh appeals, i.e., about 88 per cent of the total appeals will be handled under the Faceless Appeal mechanism, while almost 85 per cent of the present strength of Commissioners (Appeals) shall be utilised for disposing off the cases under the Faceless Appeal mechanism.