An instruction issued by the Central Board of Direct Taxes, as F. No. 225/97/2021/ITA-II, dated 6 September 2021. Issued under section 144B(8) and clause 5(2) of the Faceless Penalty Scheme, 2021.
A communication of the Board laying down how a jurisdictional assessing officer is to conduct an assessment or a penalty proceeding that has been taken out of the faceless system, either under sub-section (8) of section 144B or under clause 5(2) of the Faceless Penalty Scheme, 2021. The transfer puts the case back into the older, face-to-face procedure, and the Board's object is to carry across as much of the faceless discipline as the ordinary procedure can accommodate.
This is an instruction to the department's own officers. It tells them how to do something — which cases to take up, what to check, how to record it. It is an internal direction, and its whole force runs downwards inside the department.
Four directions are given. All processes in a transferred case are to be conducted electronically so far as is technically feasible, the exception being an assessee with no e-filing account or registered email, whom the officer should help to register so that the proceeding can be run digitally. A request for personal hearing requires the approval of the Range Head and should ordinarily follow written submissions; video conference is the preferred mode, and where that is not available the hearing is held in a designated area of the income-tax office, with the proceedings recorded. The verification units and technical units of the faceless system may still be used where technically feasible. The Range Head is to be associated in finalising the assessment, using section 144A where appropriate, and penalty approval follows the existing requirement in section 274(2).
Section 144B(8) allows a case to be taken out of faceless assessment, but until this communication nothing said how it was then to be conducted. The risk was that a transferred case would revert entirely to the old ways, losing the electronic record, the structured use of verification and technical units and the supervision of the Range Head, and that personal hearings would be granted or refused inconsistently. The Board therefore set a common procedure so that the transfer changes the forum rather than the standard.
This binds the department: it is an instruction to assessing officers and Range Heads about how to run a transferred case. It gives the assessee no enforceable right, including no right to a personal hearing, which remains subject to the Range Head's approval. It does not bind the Tribunal or a court, which will judge the fairness of the proceeding on the statute and on natural justice, not on whether an internal procedure was followed.
Issued 6th September, 2021. It applies to assessments transferred under section 144B(8) and to penalties transferred under clause 5(2) of the Faceless Penalty Scheme, 2021, from that date onwards. No deadline is prescribed.
Personal hearing here is not automatic: it needs the Range Head's approval and is expected to come after written submissions, so ask early and in writing. Where a hearing is held by video conference or in the office it is to be recorded, and that record is worth asking for. Involvement of the Range Head under section 144A is an internal safeguard and is not a direction the assessee can invoke.
may be conducted electronically to the extent technically feasible
— the Central Board of Direct Taxes, instruction F. No. 225/97/2021/ITA-II, 6 September 2021. Read it in the department’s own PDF.
| Under the Income-tax Act, 1961 | Now, in the Income-tax Act, 2025 |
|---|---|
| section 144B | section 273 |
| section 144A | section 272 |
| section 274 | section 471, section 532 |
The High Court quashed my s.148 notice because the ward officer issued it instead of the faceless unit. Does that judgment still stand?
The faceless order came without any show-cause notice or draft order. Will it just be annulled?
I did not tick s.115BAA in the return and filed Form 10-IC late. Can I still get the concessional rate?
The faceless show-cause notice gave me four days to reply. Is that enough time?
I asked for a personal hearing in the faceless assessment and was refused. Does the order survive?
Can a faceless order stand if the mandatory procedure was skipped?
What here is the Board’s and what is ours. The document is the Central Board of Direct Taxes’ own. Its number, its date and the words quoted above are reproduced from the Board’s own PDF, which is here. Everything else on this page is ours: the plain-English account of what the document is and what it does, the reading of which provision it turns on, the note on what to watch, and the choice of cases. Where our account and the document part, the document governs.
An order of the Board binds the department, not you and not a court. The Board writes to its own officers. An assessee may hold the department to an order or an instruction that helps him; the department cannot hold an assessee to one that hurts him, and the Tribunal and the courts decide the law for themselves. This is the most common mistake made with this material, and it is worth making twice: a direction of the Board is not a section of the Act.
We did not read all of it. The department’s file returned only part of this document to us, so what is written above is written from the part we could read. Open the PDF before you rely on it.
What we could not settle. The communication runs to two pages and the four lettered paragraphs could not be obtained verbatim; two reads returned them only in substance, so the wording of paragraphs A to D is reported in summary rather than quoted.