Section 144B • Scrutiny u/s 143(2) • Best Judgment u/s 144 • Reassessment u/s 147 • E-Proceedings
Received a scrutiny notice from the National Faceless Assessment Centre (NFAC)? Don't panic. CA Alok Kumar's 110+ member team provides expert representation in all faceless assessment proceedings under Section 144B — from analysing the notice and preparing comprehensive responses to handling show cause notices, requesting personal hearings, objecting to draft assessment orders, and ensuring your rights under the principles of natural justice are fully protected. 22+ years of income tax litigation experience. Thousands of assessments handled. Pan-India service.
Understanding the faceless assessment process is crucial for an effective response. Here is the complete step-by-step flow from notice to final order — all conducted electronically through NFAC without any physical interaction with the Assessing Officer.
Your ITR is selected for scrutiny through CASS (Computer Aided Scrutiny Selection) based on risk parameters — AIS/TIS mismatches, high-value transactions, large deductions, cash deposits, or specific triggers. Cases are allocated for limited or complete scrutiny.
CASS SelectionRisk ParametersAI/Data AnalyticsNFAC issues e-notice under Section 143(2) informing you that your return has been selected for faceless assessment. The notice is digitally signed with NFAC logo, delivered to your registered e-filing portal account, with SMS and email alerts. This is the starting point — do not ignore it.
Section 143(2)E-Filing Portal15-Day ResponseNFAC assigns the case to a specific assessment unit within a Regional Faceless Assessment Centre (RFAC) through an automated allocation system. The assessment unit is anonymous — you never know which officer or city is handling your case. This ensures no bias or local influence.
Automated AllocationAnonymous OfficersDynamic JurisdictionThe assessment unit examines your return and may request additional information, documents, or books of accounts through NFAC via notice u/s 142(1). Common requests include bank statements, investment proofs, sale deeds, rental agreements, loan documents, and business records. All submissions must be made electronically.
Section 142(1)Document UploadPDF FormatIf needed, NFAC assigns verification tasks to a Verification Unit (for field enquiries, asset inspection, third-party confirmation) and technical queries to a Technical Unit (for legal, valuation, forensic, transfer pricing expertise). Reports are sent back to the assessment unit through NFAC.
Verification UnitTechnical UnitField EnquiryThe assessment unit prepares a draft order proposing additions or disallowances. If the proposed income is higher than your declared income, NFAC issues a show cause notice giving you an opportunity to respond. You can also request a personal hearing via video conferencing at this stage. This is the most critical phase — your response here determines the final outcome.
Show Cause NoticeDraft OrderPersonal HearingThe draft order is reviewed by a separate Review Unit to ensure factual correctness, legal soundness, and arithmetical accuracy. If the review unit finds deficiencies, it sends the case back to the assessment unit for revision. This multi-tier review is designed to ensure quality and fairness.
Quality CheckLegal ReviewAccuracy VerificationAfter incorporating your responses and the review unit's inputs, the final assessment order is passed — either accepting your returned income (no addition) or making additions/disallowances with a demand. The order is communicated electronically through the e-filing portal. If adverse, you can file an appeal before CIT(A).
Final OrderDemand (if any)Appeal RightsUnderstanding which notice you received is the first step. Each notice has a specific purpose, legal basis, and response timeline. Here are the key notices issued during faceless assessment proceedings.
The initial notice informing you that your return has been selected for scrutiny under the faceless assessment scheme. This is the most common starting point. The notice specifies the assessment year and issues to be examined (in limited scrutiny). All subsequent proceedings flow from this notice.
Response: Within 15 days of receipt (extendable on application)
Issued when the assessment unit needs specific information, documents, books of accounts, or evidence for completing the assessment. May request bank statements, investment proofs, sale agreements, rental income details, business accounts, or explanations for specific transactions flagged in AIS/TIS.
Response: Within time specified in notice (typically 7-15 days)
Issued with a draft assessment order proposing variations (additions to income or disallowance of deductions/expenses). This is your last opportunity to present your case before the final order is passed. You can submit written objections, additional evidence, and request a personal hearing via video conferencing. A well-drafted response at this stage can significantly reduce or eliminate proposed additions.
Response: Within time specified (typically 7-10 days — do NOT miss this)
Issued when you fail to respond to earlier notices. This is a warning that if you still don't respond, the Assessing Officer will complete the assessment based on available information (best judgment) — which almost always results in much higher additions and a large demand. This notice should be treated as the highest priority.
Response: Immediately — file response and explain reasons for earlier non-compliance
Issued when the Assessing Officer has reason to believe that income has escaped assessment (not declared in your return). Triggers a full reassessment of the relevant year. Requires recording of reasons and, in many cases, prior approval of higher authorities. You can challenge the validity of this notice if proper procedure was not followed.
Response: Within 30 days (or as specified) — also challenge validity if grounds exist
Under Section 144B(7)(viii), you can request a personal hearing via video conferencing when there are proposed variations in your income. NFAC may also suo motu offer a hearing. This is conducted by the assessment unit through the portal's video conferencing facility. Effective personal hearings can be decisive in complex cases.
Attend on scheduled date and time — prepare thoroughly with documents
From initial notice analysis and response drafting to show cause reply, personal hearing representation, and assessment order challenge — we handle every aspect of your faceless assessment proceedings.
Comprehensive analysis of your scrutiny notice — identifying the assessment year, issues flagged, scrutiny type (limited/complete), CASS parameters, and AIS/TIS/26AS mismatches. We develop a customized response strategy based on your specific facts, available documentation, and legal position.
Professional drafting of comprehensive responses to notices u/s 143(2) and 142(1) with supporting evidence. We prepare detailed submissions addressing each query raised by the assessment unit, with proper document indexing, cross-referencing, and legal citations. All responses formatted and filed electronically through the e-filing portal.
Expert drafting of detailed replies to show cause notices with proposed additions/disallowances. We analyse the draft assessment order, identify legal and factual weaknesses in the proposed additions, prepare point-by-point rebuttals with case law support, and file comprehensive objections. This is the most critical stage — our responses regularly achieve 60-80% reduction in proposed additions.
Preparation and representation in personal hearings via video conferencing before the assessment unit. We prepare detailed submissions, presentation materials, and legal arguments. Our team of FCA, LLM-qualified professionals ensures your case is presented effectively — addressing each query with evidence and legal authority.
Defence against reassessment notices for income escaping assessment. We verify whether proper procedure was followed — recording of reasons, prior approval, time limits, and validity of "reasons to believe." If grounds exist, we challenge the validity of the notice itself. Where valid, we prepare comprehensive responses to minimize additions.
Defence against penalty proceedings initiated during or after assessment — penalty u/s 270A (under-reporting of income), penalty u/s 271(1)(c) (concealment of income), and other penalties. We prepare detailed penalty replies, establish bonafide belief, and demonstrate that the case does not warrant penalty. Success rate in penalty deletion exceeds 70%.
Select the type of notice you received for a step-by-step action plan.
The Computer Aided Scrutiny Selection (CASS) system uses AI-driven risk parameters to flag returns for scrutiny. Understanding why you were selected helps in preparing an effective response.
Income declared in ITR doesn't match data in Annual Information Statement or Taxpayer Information Summary — interest, dividends, share transactions, property sales.
Significant cash deposits in bank accounts reported by banks via SFT — especially if not adequately explained by declared income sources.
Purchase of property, vehicles, jewellery, shares, or other high-value assets that appear disproportionate to declared income.
Unusually high deductions under Chapter VI-A (80C, 80D, 80G, etc.), business expenses, depreciation, or exempt income claims.
Significant decrease in income compared to previous years, sudden increase in expenses, or unusual income patterns flagged by AI analytics.
Substantial refund claims, especially in cases of TDS mismatch, advance tax excess, or repeated large refund patterns that trigger additional verification.
Property sale proceeds not matching stamp duty value, LTCG/STCG computation disputes, share transaction gains not declared, or Section 54/54F exemption claims.
Information received from other agencies — GST data, property registrars, stock exchanges, banks, or foreign jurisdiction reports under DTAA/CRS/FATCA.
Always respond within the timeline specified in the notice. If you need more time, formally apply for extension before the deadline — not after. Courts treat timely response as a key factor in natural justice compliance.
Maintain digital copies of all documents — bank statements, investment proofs, sale deeds, rental agreements, loan documents — in readable PDF format. Upload complete sets, not partial documents. Incomplete submissions invite further queries.
Respond to each point raised in the notice individually and specifically. Use a structured response format with serial numbers matching the notice queries. Cross-reference supporting documents clearly.
If you face portal glitches or technical issues preventing timely response, immediately screenshot the errors and file a grievance on the portal. Courts have accepted such evidence and ordered reassessments where technical failures denied fair hearing.
Never ignore a faceless assessment notice. Non-response leads to best judgment assessment with inflated additions, penalties, and a much weaker position in appeal. Even if you missed earlier deadlines, respond immediately with an explanation.
Don't dump hundreds of pages without organisation. Submit only relevant documents with a clear index. Excessive unorganised submissions can work against you — the assessment unit may overlook key evidence buried in bulk uploads.
Don't agree to additions or disallowances without professional review. Many proposed additions are legally unsustainable — a qualified CA can identify weaknesses in the assessment unit's position and draft effective rebuttals.
If granted a personal hearing via video conferencing, never miss it. Prepare thoroughly with documents and arguments. Courts have held that denial of hearing opportunity violates natural justice — but you must first avail the opportunity when offered.
Triple qualification (FCA, AICA, LLM from NLU Delhi) combines deep tax technical expertise with legal analytical skills — essential for drafting legally sound responses and challenging procedurally defective orders.
22+ years of income tax assessment experience spanning individual, business, corporate, and NRI cases. Deep familiarity with NFAC patterns, common queries, and effective response strategies.
Our show cause responses regularly achieve 60-80% reduction in proposed additions. Structured, evidence-based responses with case law support make the difference between a large demand and a manageable outcome.
Dedicated team experienced in navigating the e-filing portal, uploading responses, managing e-proceedings, and handling portal technical issues. We ensure no deadline is missed due to technical problems.
LLM expertise ensures your rights under principles of natural justice are fully protected. If the assessment procedure violates Section 144B requirements, we challenge the order through appropriate legal channels.
Proactive deadline tracking for every notice — response timelines, extension applications, personal hearing dates, and assessment order deadlines. We never let a timeline slip.
Since faceless assessment is entirely online, we serve clients across India. No physical office visit needed — everything is handled electronically.
From scrutiny notice analysis and e-proceeding response to show cause reply, personal hearing representation, and assessment order challenge — CA Alok Kumar's team ensures your faceless assessment is handled professionally. 22+ years. 1000+ assessments. Pan-India.
