Atulbhai Kantilal Mehta v. The Additional /Joint/ Deputy/Assistant Commissioner Ofincome Tax/Income-Tax Officer

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 13158 of 2021 =============================================ATULBHAI KANTILAL MEHTA Versus THE ADDITIONAL /JOINT/ DEPUTY/ASSISTANT COMMISSIONER OFINCOME TAX/INCOME-TAX OFFICER ============================================= Appearance: HIREN J TRIVEDI(8808) for the Petitioner(s) No. 1 for the Respondent(s) No. 2MR.VARUN K.PATEL(3802) for the Respondent(s) No. 2NOTICE SERVED BY DS for the Respondent(s) No. 1============================================= CORAM:HONOURABLE MR. JUSTICE J.B.PARDIWALAandHONOURABLE MS. JUSTICE NISHA M. THAKORE Date : 18/01/2022ORAL ORDER (PER : HONOURABLE MS. JUSTICE NISHA M. THAKORE) 1.This writ application under Article 226 of the Constitutionof India is at the instance of an assessee under the Income TaxAct, 1961 (hereinafter referred to as ‘the Act’) and theassessee has challenged the assessment order dated12.08.2021 and has further prayed for direction to quash andset aside all the consequential proceedings includingimposition of penalty proposed under Section 270A of the Act.The writ applicant has also prayed for further directions toprohibit the collection of disputed demand raised by therespondent authorities. 2.The case made out by the writ applicant may besummarized thus: 2.1The writ applicant had filed its return of income on 27.10.2018 thereby declaring his total income ofRs.85,03,090/-. The case of the writ applicant was selected forscrutiny under Computer Assisted Scrutiny Selection(hereinafter referred to as ‘CASS’) in the limited scrutinycategory to verify the unsecured loans as well as the personalexpenditure made by the applicant during the relevantassessment year. Accordingly, notice under section 143(2) ofthe Act, came to be served upon the writ applicant on23.09.2019 followed by notices issued from time to time underSection 142(1) of the Act. 2.2On 06.04.2021, draft assessment order came to bepassed by the respondent authority under Section 144B(xiv)whereby show cause notice was also served as to why theassessment order should not be finalized in terms of draftassessment order. The writ applicant had submittedexhaustive reply against the aforesaid show cause notice on10.04.2021 thereby raising specific objections that theassessment cannot exceed beyond the scope of limitedscrutiny for the purpose of which it has been selected for theassessment. It was further submitted that the writ applicant isonly holding 8% share holding in the Chitra Insultec PrivateLimited, which is below 10% threshold specified under Section2(22)(e) of the Act. With these objections, the writ applicantfurther prayed for personal hearing through video conferencingby invoking Section 144B(vii) and clause (xii) sub-clause (h) ofthe Act. 2.3The respondent authority further issued intimation dated23.04.2021 thereby offering the writ applicant an opportunityof hearing through video conference which was scheduled on 26.04.2021. It is the case of the writ applicant that on the dateof hearing fixed i.e. 26.04.2021, due to technical issues andglitches, the writ applicant could not activate the videoconference option as there was no option available on the webpage to activate the video conference link. In suchcircumstances, the writ applicant could not joined the hearingscheduled on 26.04.2021. 2.4The writ applicant thereafter, received a show causenotice dated 03.08.2021 whereby the writ applicant was askedto refer to FAQ of video conference hearing and accordingly,follow the procedure envisaged therein. Alternatively, it wasstated that if the writ applicant does not opt for videoconference as per the FAQ procedure within the compliancedate as provided in the show cause notice, it will be presumedthat the writ applicant does not want to excercise the option ofvideo conferencing. 2.4The writ applicant thereafter, received a show causenotice dated 03.08.2021 whereby the writ applicant was askedto refer to FAQ of video conference hearing and accordingly,follow the procedure envisaged therein. Alternatively, it wasstated that if the writ applicant does not opt for videoconference as per the FAQ procedure within the compliancedate as provided in the show cause notice, it will be presumedthat the writ applicant does not want to excercise the option ofvideo conferencing. 2.5It is the case of the writ applicant that on 09.08.2021, thewrit applicant had submitted request to the respondentauthorities for video conference thereby requesting toscheduled hearing on 16.08.2021 at 10:00 a.m, however, tothe utter shock and surprise of the writ applicant, therespondent authority without paying any hid to the aforesaidrequest of the writ applicant, proceeded to passed the finalorder of assessment on 12.08.2021 thereby confirming thedraft assessment order dated 06.04.2021. 2.6 In such circumstances, the writ applicant has thusapproached this Court, praying for reliefs so sought for. 3.Mr. Hiren Trivedi, the learned advocate appearing for the writ applicant has submitted that the impugned order ofassessment dated 12.08.2021 passed by the respondentauthority is illegal and arbitrary as the same is passed in grossviolation of Section 144B of the Income Tax Act. It was furthersubmitted that the impugned order is passed without followingthe due procedure prescribed under Section 144B of the Act,which is famously known as National Faceless AssessmentCentre. The learned advocate appearing for the writ applicanthas drawn attention of this Court that the impugned order hasbeen passed without providing personal hearing through videoconference, more particularly, when the writ applicant videreply dated 23.04.2021 had specifically requested therespondent authority to provide an opportunity of personalhearing through video conference in terms of Section 144B(7)(vii) and section 144B(7) (xii) sub-clause (h) of the Act. 4.In response to the Notice dated 14.09.2021 issued by thisCourt, Mr. Varun K. Patel, the learned Standing Counsel hasappeared on behalf of the respondent authorities. An affidavit-in-reply affirmed by the Deputy Commissioner of Income Tax,Circle – 1(1)(1), Vadodara has been placed on record. At theoutset, the learned Standing Counsel for the department hasobjected on the maintainability of the writ application moreparticularly, when the final assessment order has beenchallenged which is appealable by way of efficacious remedy inthe form of statutory appeal provided under Section 246A ofthe Act. The respondent authority has also responded on themerits of the case and has prayed to not to entertain thereliefs as sought for by the writ applicant. 5.We have heard the learned counsels appearing for the respective parties and have carefully perused the record aswell as the decision of this Court relied upon by the learnedcounsel appearing for the writ applicant in the case of AgrawalJMC Joint Venture Vs. Assistant/Joint/Deputy/AssistantCommissioner of Income Tax/Income Tax Officer, dated11.10.2021 passed in the Special Civil Application No.7477 of2021. The only question which required to be answered by thisCourt is that whether the respondent authority have followedthe due procedure of law as envisaged under Section 144B(7)(vii) and section 144B(7)(xii) of the Act, while passing theimpugned final assessment order dated 12.08.2021. 6.Before going into the aforesaid issue, it would be apt toreproduce Section 144B of the Income Tax Act, which reads asunder: “Faceless Assessment. 144B. (1) Notwithstanding anything to the contrary contained in anyother provisions of this Act, the assessment under sub-section (3) ofsection 143 or under section 144, in the cases referred to in sub-section (2), shall be made in a faceless manner as per the followingprocedure, namely:— 6.Before going into the aforesaid issue, it would be apt toreproduce Section 144B of the Income Tax Act, which reads asunder: “Faceless Assessment. 144B. (1) Notwithstanding anything to the contrary contained in anyother provisions of this Act, the assessment under sub-section (3) ofsection 143 or under section 144, in the cases referred to in sub-section (2), shall be made in a faceless manner as per the followingprocedure, namely:— (i) the National Faceless Assessment Centre shall serve a notice on theassessee under sub-section (2) of section 143; (ii) the assessee may, within fifteen days from the date of receipt ofnotice referred to in clause (i), file his response to the National FacelessAssessment Centre; (iii) where the assessee— (a) has furnished his return of income under section 139 or inresponse to a notice issued under sub-section (1) of section 142under or sub-section (1) of section 148, and a notice under sub-section (2) of section 143 has been issued by the Assessing Officeror the prescribed income-tax authority, as the case may be; or (b) has not furnished his return of income in response to a noticeissued under sub-section (1) of section 142 by the AssessingOfficer; or (c) has not furnished his return of income under sub-section (1) ofsection 148 and a notice under sub-section (1) of section 142 hasbeenissuedbytheAssessingOfficer, the National Faceless Assessment Centre shall intimate the assessee that assessment in his case shall be completed inaccordance with the procedure laid down under this section; (iv) the National Faceless Assessment Centre shall assign the caseselected for the purposes of faceless assessment under this section toa specific assessment unit in any one Regional Faceless AssessmentCentre through an automated allocation system; (v) where a case is assigned to the assessment unit, it may make arequest to the National Faceless Assessment Centre for- (a) obtaining such further information, documents or evidencefrom the assessee or any other person, as it may specify; (b) conducting of certain enquiry or verification by verificationunit; and (c) seeking technical assistance from the technical unit; (vi) where a request for obtaining further information, documents orevidence from the assessee or any other person has been made by theassessment unit, the National Faceless Assessment Centre shall issueappropriate notice or requisition to the assessee or any other personfor obtaining the information, documents or evidence requisitioned bythe assessment unit; (vii) the assessee or any other person, as the case may be, shall file hisresponse to the notice referred to in clause (vi), within the timespecified therein or such time as may be extended on the basis of anapplication in this regard, to the National Faceless Assessment Centre; (viii) where a request for conducting of certain enquiry or verificationby the verification unit has been made by the assessment unit, therequest shall be assigned by the National Faceless Assessment Centreto a verification unit in any one Regional Faceless Assessment Centrethrough an automated allocation system; (ix) where a request for seeking technical assistance from the technicalunit has been made by the assessment unit, the request shall beassigned by the National Faceless Assessment Centre to a technicalunit in any one Regional Faceless Assessment Centre through anautomated allocation system; (x) the National Faceless Assessment Centre shall send the reportreceived from the verification unit or the technical unit, based on therequest referred to in clause (viii) or clause (ix) to the concernedassessment unit; (ix) where a request for seeking technical assistance from the technicalunit has been made by the assessment unit, the request shall beassigned by the National Faceless Assessment Centre to a technicalunit in any one Regional Faceless Assessment Centre through anautomated allocation system; (x) the National Faceless Assessment Centre shall send the reportreceived from the verification unit or the technical unit, based on therequest referred to in clause (viii) or clause (ix) to the concernedassessment unit; (xi) where the assessee fails to comply with the notice referred to inclause (vi) or notice issued under sub-section (1) of section 142 or witha direction issued under sub-section (2A) of section 142, the NationalFaceless Assessment Centre shall serve upon such assessee a noticeunder section 144 giving him an opportunity to show-cause, on a dateand time to be specified in the notice, why the assessment in his caseshould not be completed to the best of its judgment; (xii) the assessee shall, within the time specified in the notice referredto in clause (xi) or such time as may be extended on the basis of anapplication in this regard, file his response to the National FacelessAssessment Centre; (xiii) where the assessee fails to file response to the notice referred toin clause (xi) within the time specified therein or within the extended time, if any, the National Faceless Assessment Centre shall intimatesuch failure to the assessment unit; (xiv) the assessment unit shall, after taking into account all therelevant material available on the record make in writing, a draftassessment order or, in a case where intimation referred to in clause(xiii) is received from the National Faceless Assessment Centre, makein writing, a draft assessment order to the best of its judgment, eitheraccepting the income or sum payable by, or sum refundable to, theassessee as per his return or making variation to the said income orsum, and send a copy of such order to the National FacelessAssessment Centre; (xv) the assessment unit shall, while making draft assessment order,provide details of the penalty proceedings to be initiated therein, ifany; (xvi) the National Faceless Assessment Centre shall examine the draftassessment order in accordance with the risk management strategyspecified by the Board, including by way of an automated examinationtool, whereupon it may decide to— (a) finalise the assessment, in case no variation prejudicial to theinterest of assessee is proposed, as per the draft assessmentorder and serve a copy of such order and notice for initiatingpenalty proceedings, if any, to the assessee, along with thedemand notice, specifying the sum payable by, or refund of anyamount due to, the assessee on the basis of such assessment; or (b) provide an opportunity to the assessee, in case any variationprejudicial to the interest of assessee is proposed, by serving anotice calling upon him to show cause as to why the proposedvariation should not be made; or (c) assign the draft assessment order to a review unit in any oneRegional Faceless Assessment Centre, through an automatedallocation system, for conducting review of such order; (xvii) the review unit shall conduct review of the draft assessmentorder referred to it by the National Faceless Assessment Centrewhereupon it may decide to— (a) concur with the draft assessment order and intimate theNational Faceless Assessment Centre about such concurrence; or (b) suggest such variation, as it may deem fit, in the draftassessment order and send its suggestions to the NationalFaceless Assessment Centre; (xviii) the National Faceless Assessment Centre shall, upon receivingconcurrence of the review unit, follow the procedure laid down in— (a) sub-clause (a) of clause (xvi); or (b) sub-clause (b) of clause (xvi); (xvii) the review unit shall conduct review of the draft assessmentorder referred to it by the National Faceless Assessment Centrewhereupon it may decide to— (a) concur with the draft assessment order and intimate theNational Faceless Assessment Centre about such concurrence; or (b) suggest such variation, as it may deem fit, in the draftassessment order and send its suggestions to the NationalFaceless Assessment Centre; (xviii) the National Faceless Assessment Centre shall, upon receivingconcurrence of the review unit, follow the procedure laid down in— (a) sub-clause (a) of clause (xvi); or (b) sub-clause (b) of clause (xvi); (xix) the National Faceless Assessment Centre shall, upon receivingsuggestions for variation from the review unit, assign the case to anassessment unit, other than the assessment unit which has made thedraft assessment order, through an automated allocation system; (xx) the assessment unit shall, after considering the variationssuggested by the review unit, send the final draft assessment order tothe National Faceless Assessment Centre; (xxi) the National Faceless Assessment Centre shall, upon receivingfinal draft assessment order follow the procedure laid down in— (a) sub-clause (a) of clause (xvi); or (b) sub-clause (b) of clause (xvi); (xxii) the assessee may, in a case where show-cause notice has beenserved upon him as per the procedure laid down in sub-clause (b) ofclause (xvi), furnish his response to the National Faceless AssessmentCentre on or before the date and time specified in the notice or withinthe extended time, if any; (xxiii) the National Faceless Assessment Centre shall,— (a) where no response to the show-cause notice is received asper clause (xxii),— (A) in a case where the draft assessment order or the finaldraft assessment order is in respect of an eligible assesseeand proposes to make any variation which is prejudicial tothe interest of said assessee, forward the draft assessmentorder or final draft assessment order to such assessee; or (B) in any other case, finalise the assessment as per thedraft assessment order or the final draft assessment orderand serve a copy of such order and notice for initiatingpenalty proceedings, if any, to the assessee, alongwith thedemand notice, specifying the sum payable by, or refund ofany amount due to, the assessee on the basis of suchassessment; (b) in any other case, send the response received from theassessee to the assessment unit; (xxiv) the assessment unit shall, after taking into account the responsefurnished by the assessee, make a revised draft assessment order andsend it to the National Faceless Assessment Centre; (xxv) the National Faceless Assessment Centre shall, upon receivingthe revised draft assessment order,— (a) in case the variations proposed in the revised draftassessment order are not prejudicial to the interest of theassessee in comparison to the draft assessment order or thefinal draft assessment order, and— (A) in case the revised draft assessment order is in respectof an eligible assessee and there is any variation prejudicialto the interest of the assessee proposed in draft assessmentorder or the final draft assessment order, forward the saidrevised draft assessment order to such assessee; (B) in any other case, finalise the assessment as per therevised draft assessment order and serve a copy of suchorder and notice for initiating penalty proceedings, if any, tothe assessee, alongwith the demand notice, specifying thesum payable by, or refund of any amount due to, theassessee on the basis of such assessment; (b) in case the variations proposed in the revised draftassessment order are prejudicial to the interest of the assesseein comparison to the draft assessment order or the final draft assessment order, provide an opportunity to the assessee, byserving a notice calling upon him to show-cause as to why theproposed variation should not be made; (B) in any other case, finalise the assessment as per therevised draft assessment order and serve a copy of suchorder and notice for initiating penalty proceedings, if any, tothe assessee, alongwith the demand notice, specifying thesum payable by, or refund of any amount due to, theassessee on the basis of such assessment; (b) in case the variations proposed in the revised draftassessment order are prejudicial to the interest of the assesseein comparison to the draft assessment order or the final draft assessment order, provide an opportunity to the assessee, byserving a notice calling upon him to show-cause as to why theproposed variation should not be made; (xxvi) the procedure laid down in clauses (xxiii), (xxiv) and (xxv) shallapply mutatis mutandis to the notice referred to in sub-clause (b) ofclause (xxv); (xxvii) where the draft assessment order or final draft assessmentorder or revised draft assessment order is forwarded to the eligibleassessee as per item (A) of sub-clause (a) of clause (xxiii) or item (A) ofsub-clause (a) of clause (xxv), such assessee shall, within the periodspecified in sub-section (2) of section 144C, file his acceptance of thevariations to the National Faceless Assessment Centre; (xxviii) the National Faceless Assessment Centre shall,— (a) upon receipt of acceptance as per clause (xxvii); or (b) if no objections are received from the eligible assesseewithin the period specified in sub-section (2) of section 144C, finalise the assessment within the time allowed under sub-section (4) of section 144C and serve a copy of such order andnotice for initiating penalty proceedings, if any, to the assessee,alongwith the demand notice, specifying the sum payable by,or refund of any amount due to, the assessee on the basis ofsuch assessment; (xxix) where the eligible assessee files his objections with the DisputeResolution Panel, the National Faceless Assessment Centre shall uponreceipt of the directions issued by the Dispute Resolution Panel undersub-section (5) of section 144C, forward such directions to theconcerned assessment unit; (xxx) the assessment unit shall in conformity of the directions issued bythe Dispute Resolution Panel under sub-section (5) of section 144C,prepare a draft assessment order in accordance with sub-section (13)of section 144C and send a copy of such order to the National FacelessAssessment Centre; (xxxi) the National Faceless Assessment Centre shall, upon receipt ofdraft assessment order referred to in clause (xxx), finalise theassessment within the time allowed under sub-section (13) of section144C and serve a copy of such order and notice for initiating penaltyproceedings, if any, to the assessee, alongwith the demand notice,specifying the sum payable by, or refund of any amount due to, theassessee on the basis of such assessment; (xxxii) The National Faceless Assessment Centre shall, after completionof assessment, transfer all the electronic records of the case to theAssessing Officer having jurisdiction over the said case for such actionas may be required under the Act. (2) The faceless assessment under sub-section (1) shall be made inrespect of such territorial area, or persons or class of persons, orincomes or class of incomes, or cases or class of cases, as may bespecified by the Board. (3) The Board may, for the purposes of faceless assessment, set up thefollowing Centres and units and specify their respective jurisdiction,namely:— (i) a National Faceless Assessment Centre to facilitate theconduct of faceless assessment proceedings in a centralisedmanner, which shall be vested with the jurisdiction to makefaceless assessment; (ii) Regional Faceless Assessment Centres, as it may deemnecessary, to facilitate the conduct of faceless assessmentproceedings in the cadre controlling region of a Principal ChiefCommissioner, which shall be vested with the jurisdiction tomake faceless assessment; (3) The Board may, for the purposes of faceless assessment, set up thefollowing Centres and units and specify their respective jurisdiction,namely:— (i) a National Faceless Assessment Centre to facilitate theconduct of faceless assessment proceedings in a centralisedmanner, which shall be vested with the jurisdiction to makefaceless assessment; (ii) Regional Faceless Assessment Centres, as it may deemnecessary, to facilitate the conduct of faceless assessmentproceedings in the cadre controlling region of a Principal ChiefCommissioner, which shall be vested with the jurisdiction tomake faceless assessment; (iii) assessment units, as it may deem necessary to facilitatethe conduct of faceless assessment, to perform the function ofmaking assessment, which includes identification of points orissues material for the determination of any liability (includingrefund) under the Act, seeking information or clarification onpoints or issues so identified, analysis of the material furnishedby the assessee or any other person, and such other functionsas may be required for the purposes of making facelessassessment; (iv) verification units, as it may deem necessary to facilitate theconduct of faceless assessment, to perform the function ofverification, which includes enquiry, cross verification,examination of books of accounts, examination of witnessesand recording of statements, and such other functions as maybe required for the purposes of verification; (v) technical units, as it may deem necessary to facilitate theconduct of faceless assessment, to perform the function ofproviding technical assistance which includes any assistance oradvice on legal, accounting, forensic, information technology,valuation, transfer pricing, data analytics, management or anyother technical matter which may be required in a particularcase or a class of cases, under this section; and (vi) review units, as it may deem necessary to facilitate theconduct of faceless assessment, to perform the function ofreview of the draft assessment order, which includes checkingwhether the relevant and material evidence has been broughton record, whether the relevant points of fact and law havebeen duly incorporated in the draft order, whether the issues onwhich addition or disallowance should be made have beendiscussed in the draft order, whether the applicable judicialdecisions have been considered and dealt with in the draftorder, checking for arithmetical correctness of variationsproposed, if any, and such other functions as may be requiredfor the purposes of review. (4) The assessment unit, verification unit, technical unit and the reviewunit shall have the following authorities, namely:— (a) Additional Commissioner or Additional Director or JointCommissioner or Joint Director, as the case may be; (b) Deputy Commissioner or Deputy Director or AssistantCommissioner or Assistant Director, or Income-tax Officer, asthe case may be; (c) such other income-tax authority, ministerial staff, executiveor consultant, as considered necessary by the Board. (5) All communication among the assessment unit, review unit, verification unit or technical unit or with the assessee or any otherperson with respect to the information or documents or evidence orany other details, as may be necessary for the purposes of making afaceless assessment shall be through the National Faceless AssessmentCentre. (6) All communications between the National Faceless AssessmentCentre and the assessee, or his authorised representative, or any otherperson shall be exchanged exclusively by electronic mode; and allinternal communications between the National Faceless AssessmentCentre, Regional Faceless Assessment Centres and various units shallbe exchanged exclusively by electronic mode: (5) All communication among the assessment unit, review unit, verification unit or technical unit or with the assessee or any otherperson with respect to the information or documents or evidence orany other details, as may be necessary for the purposes of making afaceless assessment shall be through the National Faceless AssessmentCentre. (6) All communications between the National Faceless AssessmentCentre and the assessee, or his authorised representative, or any otherperson shall be exchanged exclusively by electronic mode; and allinternal communications between the National Faceless AssessmentCentre, Regional Faceless Assessment Centres and various units shallbe exchanged exclusively by electronic mode: Provided that the provisions of this sub-section shall not apply to theenquiry or verification conducted by the verification unit in thecircumstances referred to in sub-clause (g) of clause (xii) of sub-section(7). (7) For the purposes of faceless assessment— (i) an electronic record shall be authenticated by— (a) the National Faceless Assessment Centre by affixing itsdigital signature; (b) assessee or any other person, by affixing his digitalsignature if he is required to furnish his return of incomeunder digital signature, and in any other case, by affixinghis digital signature or under electronic verification code inthe prescribed manner; (ii) every notice or order or any other electroniccommunication shall be delivered to the addressee, being theassessee, by way of— (a) placing an authenticated copy thereof in the assessee’sregistered account; or (b) sending an authenticated copy thereof to the registeredemail address of the assessee or his authorisedrepresentative; or (c) uploading an authenticated copy on the assessee’sMobile App, and followed by a real time alert; (iii) every notice or order or any other electroniccommunication shall be delivered to the addressee, being anyother person, by sending an authenticated copy thereof to theregistered email address of such person, followed by a realtime alert; (iv) the assessee shall file his response to any notice or orderor any other electronic communication, through his registeredaccount, and once an acknowledgement is sent by theNational Faceless Assessment Centre containing the hashresult generated upon successful submission of response, theresponse shall be deemed to be authenticated; (v) the time and place of dispatch and receipt of electronicrecord shall be determined in accordance with the provisionsof section 13 of the Information Technology Act, 2000 (21 of2000); (vi) a person shall not be required to appear either personallyor through authorised representative in connection with anyproceedings before the income-tax authority at the NationalFaceless Assessment Centre or Regional Faceless AssessmentCentre or any unit set up under this sub-section; (vii) in a case where a variation is proposed in the draftassessment order or final draft assessment order or reviseddraft assessment order, and an opportunity is provided to theassessee by serving a notice calling upon him to show causeas to why the assessment should not be completed as per thesuch draft or final draft or revised draft assessment order, theassessee or his authorised representative, as the case maybe, may request for personal hearing so as to make his oralsubmissions or present his case before the income-taxauthority in any unit; (viii) the Chief Commissioner or the Director General, incharge of the Regional Faceless Assessment Centre, underwhich the concerned unit is set up, may approve the requestfor personal hearing referred to in clause (vii) if he is of theopinion that the request is covered by the circumstancesreferred to in sub-clause (h) of clause (xii); (viii) the Chief Commissioner or the Director General, incharge of the Regional Faceless Assessment Centre, underwhich the concerned unit is set up, may approve the requestfor personal hearing referred to in clause (vii) if he is of theopinion that the request is covered by the circumstancesreferred to in sub-clause (h) of clause (xii); (ix) where the request for personal hearing has beenapproved by the Chief Commissioner or the Director General,in charge of the Regional Faceless Assessment Centre, suchhearing shall be conducted exclusively through videoconferencing or video telephony, including use of anytelecommunication application software which supports videoconferencing or video telephony, in accordance with theprocedure laid down by the Board; (x) subject to the proviso to sub-section (6), any examinationor recording of the statement of the assessee or any otherperson (other than statement recorded in the course ofsurvey under section 133A of the Act) shall be conducted byan income-tax authority in any unit, exclusively through videoconferencing or video telephony, including use of anytelecommunication application software which supports videoconferencing or video telephony in accordance with theprocedure laid down by the Board; (xi) the Board shall establish suitable facilities for videoconferencing or video telephony including telecommunicationapplication software which supports video conferencing orvideo telephony at such locations as may be necessary, so asto ensure that the assessee, or his authorised representative,or any other person is not denied the benefit of facelessassessment merely on the consideration that such assesseeor his authorised representative, or any other person does nothave access to video conferencing or video telephony at hisend; (xii) the Principal Chief Commissioner or the Principal DirectorGeneral, in charge of the National Faceless AssessmentCentre shall, with the prior approval of the Board, lay downthe standards, procedures and processes for effectivefunctioning of the National Faceless Assessment Centre,Regional Faceless Assessment Centres and the unit set up, inan automated and mechanised environment, includingformat, mode, procedure and processes in respect of thefollowing, namely:— (a) service of the notice, order or any other communication; (b) receipt of any information or documents from theperson in response to the notice, order or any othercommunication; (c) issue of acknowledgement of the response furnished bythe person; (d) provision of “e-proceeding” facility including loginaccount facility, tracking status of assessment, display ofrelevant details, and facility of download; (e) accessing, verification and authentication of informationand response including documents submitted during theassessment proceedings; (f) receipt, storage and retrieval of information ordocuments in a centralised manner; (g) circumstances in which proviso to sub-section (6) shallapply; (h) circumstances in which personal hearing referred toclause (viii) shall be approved; (i) general administration and grievance redressalmechanism in the respective Centres and units.mechanism in the respective Centres and units. (8) Notwithstanding anything contained in sub-section (1) or sub-section (2), the Principal Chief Commissioner or the Principal DirectorGeneral in charge of National Faceless Assessment Centre may at anystage of the assessment, if considered necessary, transfer the case tothe Assessing Officer having jurisdiction over such case, with the priorapproval of the Board. (f) receipt, storage and retrieval of information ordocuments in a centralised manner; (g) circumstances in which proviso to sub-section (6) shallapply; (h) circumstances in which personal hearing referred toclause (viii) shall be approved; (i) general administration and grievance redressalmechanism in the respective Centres and units.mechanism in the respective Centres and units. (8) Notwithstanding anything contained in sub-section (1) or sub-section (2), the Principal Chief Commissioner or the Principal DirectorGeneral in charge of National Faceless Assessment Centre may at anystage of the assessment, if considered necessary, transfer the case tothe Assessing Officer having jurisdiction over such case, with the priorapproval of the Board. (9) Notwithstanding anything contained in any other provision of thisAct, assessment made under sub-section (3) of section 143 or undersection 144 in the cases referred to in sub-section (2) (other than thecases transferred under sub-section (8), on or after the 1st day of April,2021), shall be non-est if such assessment is not made in accordancewith the procedure laid down under this section.” 7.The Co-ordinate Bench of this Court had an occasion todeal with similar issue. In the case of Agrawal JMC Joint Ventureversus Assistant/Joint/Deputy/Assistant Commissioner IncomeTax, had looked into the statutory mechanism mandated undersection 144B of the act. The relevant observation are asunder : “16.5 Clause (vii) of sub-section (7) of Section 144 A providesthat where a variation is proposed in the draft assessment orderor final draft assessment order or revised draft assessmentorder, an opportunity is provided to the assessee by serving anotice calling upon him to show cause as to why the assessment should not be completed as per such draft or final draft orrevised draft assessment order. The assessee or his authorisedrepresentative, as the case may be, may request for personalhearing so as to make his oral submissions or present his casebefore the income tax authority in any unit. Such request maybe approved for personal hearing, if the Chief Commissioner orthe Director General, In-charge of Regional Faceless AssessmentCentre is of the opinion that the request is covered by thecircumstances referred to in sub-clause (h) of clause (xii), wheresuch request for personal hearing is approved, such hearing isrequired to be conducted exclusively through videoconferencing or through video telephony including by use of anytelecommunication software, which support the videoconferencing or video telephony in accordance with theprocedure laid down by the Court. The Board is required toestablish the suitable facility for video conferencing as perclause (xii) of subsection 7 of Section 144B or video telephonyincluding telecommunication application software whichsupports the video conferencing or video telephony to ensurethat the assessee or its authorised representatives or any otherperson is not denied the benefit of faceless assessment mearlyon the consideration that such assessee or its authorisedrepresentatives do not have access to the video conferencing orvideo telephony at a web site. 16.6 Clause (xii) of sub-section 7 of section 144 B provides forthe Principal Chief Commissioner or Principal Director General,In-charge of the National Faceless Assessment Scheme Centrewith the prior approval of the Board to lay down the standardprocedure and process for effective functioning of the NationalFaceless Assessment Centres, Regional Faceless AssessmentCentres and the Unit set up in an automated and mechanisedenvironment for the various services including the service ofnotice, order or other communication, the receipt of aninformation or document, etc. One of which is important is sub-clause (h) of clause (xii) which provides for the circumstances inwhich the personal hearing referred to the clause (viii) needs tobe approved. 16.6 Clause (xii) of sub-section 7 of section 144 B provides forthe Principal Chief Commissioner or Principal Director General,In-charge of the National Faceless Assessment Scheme Centrewith the prior approval of the Board to lay down the standardprocedure and process for effective functioning of the NationalFaceless Assessment Centres, Regional Faceless AssessmentCentres and the Unit set up in an automated and mechanisedenvironment for the various services including the service ofnotice, order or other communication, the receipt of aninformation or document, etc. One of which is important is sub-clause (h) of clause (xii) which provides for the circumstances inwhich the personal hearing referred to the clause (viii) needs tobe approved. 16.7 Specific mention of sub-section (9) of Section 144 Bneeds at this stage which starts with Non-obstante clause anddeclares that the assessment made under sub-section (3) ofSection 143 or under Section 144 in the cases referred to in sub-section (2)other than sub-section(8) on or after the 1st day ofApril, 2021, shall be non est if such assessment is not made inaccordance with the procedure laid down under the said section.Principles of natural juristic writs large in this provision andlegislature’s instead to avail the opportunity of hearing also isstamped all over. A very strong deterrence issued by thelegislature for the revenue to adhere to the detailedrequirement of this provision as otherwise the assessment wouldbe non-est. 16.8 In this backdrop, worthwhile would be to refer to thedecision of the Delhi High Court rendered in case of SanjayAggarwal vs. National Faceless Assessment Centre, Delhi, reported in (2021) 127 taxmann.com 637 (Delhi) where the HighCourt was considering the challenge to the assessment orderand consequential proceedings. While interpreting the word‘may’ in section 144 B(vii) according to the Delhi High Court, theprovision cannot absolve the revenue from obligation cast uponit to consider the request made for grant of personal hearing.Where the revenue served a show cause notice-cum draftassessment order on assessee proposing to vary the incomedisclosed by the assessee and thereafter without affording apersonal hearing to the assessee when passed the assessmentorder the same was quashed. 16.9 The relevant paragraphs discussing this aspect deservesreproduction. reported in (2021) 127 taxmann.com 637 (Delhi) where the HighCourt was considering the challenge to the assessment orderand consequential proceedings. While interpreting the word‘may’ in section 144 B(vii) according to the Delhi High Court, theprovision cannot absolve the revenue from obligation cast uponit to consider the request made for grant of personal hearing.Where the revenue served a show cause notice-cum draftassessment order on assessee proposing to vary the incomedisclosed by the assessee and thereafter without affording apersonal hearing to the assessee when passed the assessmentorder the same was quashed. 16.9 The relevant paragraphs discussing this aspect deservesreproduction. “11. Having perused the record and heard the learnedcounsel for the parties, in our view, what has clearlyemerged is, as follows: (i) That prior to the issuance ofthe how cause notice cum-draft assessment order dated23-4-2021, a show cause notice-cum-draft assessmentorder was issued on 13-4 2021. In between these twodates, the petitioner had, on two occasions, i.e., 15-4-2021 and 20-4-2021, asked or personal hearing in thematter. (ii) After the show cause notice-cum-draftassessment order dated 23-4-2021 was issued, viawhich the petitioner was invited to file hisresponse/objections, the petitioner, once again, whilefiling his reply, on 24-4-2021, asked for being accordedpersonal hearing in the matter. 11.1 The sum andsubstance of the requests made, is that, both before andafter the issuance of the show cause notice-cum-draftassessment order dated 23-4- 2021, the petitionercontinued to press the respondent/revenue to accordhim a personal hearing, before it proceeded to pass theimpugned assessment order. As noticed above,according to the petitioner, the request was made as thematter was complex and therefore, required some bit ofexplanation. 11.2 It has also emerged that [somethingwhich is not in dispute], the respondent/revenue madeproposals for varying the income, both via the show-cause notice dated 13-4-2021 as well as the show-causenotice-cum-draft assessment order dated 23-4-2021. Asnoticed above, the declared income was proposed to be,substantially, varied. 11.3 In this context, if one were tolook at the relevant provisions, [which, or the sake ofconvenience are extracted hereafter], then, one wouldget a sense as to why the legislature has provided apersonal hearing in the matter: "144B. Facelessassessment - (1).** (7) For the purposes of facelessassessment- (vii) in a case where a variation is proposedin the draft assessment order, or final draft assessmentorder or revised draft assessment order, and anopportunity is provided to the assessee by serving anotice calling upon him to show-cause as to why theassessment should not be completed as per the suchdraft or final draft or revised draft assessment order, the assessee or his authorised representative, as the casemay be, may request for personal hearing so as to makehis oral submissions or present his case before theincome tax authority in any unit; (viii) the ChiefCommissioner or the Director General, in charge of theRegional Faceless Assessment Centre, under which theconcerned unit is set up may approve the request forpersonal hearing referred to in clause (vi) if he is of theopinion that the request is covered by thecircumstances referred to in sub-clause (h) of clause(xii); (xii) the Principal Chief Commissioner or thePrincipal Director General, in charge of the NationalFaceless Assessment Centre shall, with the priorapproval of the Board, lay down the standards,procedures and processes for effective functioning ofthe National Faceless Assessment Centre, RegionalFaceless Assessment Centres and the unit set up,