A logistics company assessed through the faceless machinery received a show-cause notice on 6 March 2025 proposing a variation of Rs 1,86,00,000 for AY 2022-23 on share application money treated as unexplained credits, calling for a reply by 10 March 2025. The company uploaded its reply with confirmations, bank statements and audited accounts on 10 March and, in the same submission, asked for a personal hearing through video conference. It repeated the request in a separate submission on 12 March, quoting the acknowledgement number of the first. No link was ever issued and no hearing was held. The final order under s.143(3) read with s.144B was passed on 25 March 2025, records that no request for personal hearing is on record, does not deal with two of the three confirmations filed, and attaches a penalty notice under s.270A. Every submission carries a portal acknowledgement number and timestamp.
Download and preserve the full portal message trail before anything else, because the right to a video hearing is triggered by a request and the entire case turns on that request being demonstrably on the record before the order. A screenshot with the acknowledgement number and timestamp of each submission is worth more here than any argument, and the order's own statement that no request was made becomes the strongest fact in the file once it is contradicted by the Department's own portal.
The hearing right is triggered by an actual request, and the authority holding it mandatory does not say a hearing must be offered where none was asked for. So the request has to be on the record, identified by acknowledgement number and timestamp, before the argument can be made at all. The faceless machinery is entirely electronic and the record is the portal, which means an order that misstates the record is contradicted by the Department's own system. The library now records where that request has to be filed: the hearing clause itself prescribes no form, but another clause of the same sub-section routes the assessee's responses through his registered account and makes the acknowledgement with its hash result the proof that a response was filed at all. A request sent only by email or by letter is therefore a supplement and not a substitute, and where one has already gone that way it should be repeated on the portal in terms that recite the earlier one and annex it.
High Courts have held that an assessee has a vested right to a personal hearing in a faceless assessment, that the permissive word in the old sub-clause was to be read as mandatory, and that failure to consider repeated requests before finalising a variation vitiates the order. Since the amendment of 2022 the right does not need that reading at all: where a request has been received the authority is required to allow the hearing, conducted through video conferencing to the extent technologically feasible. Pleading the current provision is stronger and avoids an easy answer.
A High Court has set aside an assessment where the faceless show-cause notice allowed four days to reply, holding that the Board's standard operating procedure for faceless assessments requires seven days and that giving less breached both that requirement and the principles of natural justice. That is a separate and self-contained ground: it does not depend on the hearing request being on record, so it survives even if the hearing point is contested on facts. Where an order carries adverse civil consequences a real opportunity to be heard is required, not a nominal one.
The sub-section that made an assessment not made in accordance with the prescribed procedure a nullity has been omitted with retrospective effect, so the automatic consequence that the older decisions applied is gone. Orders quashed on the footing that no show-cause with a draft variation was issued also have to be read carefully, because after 1 April 2022 no draft order is required for an ordinary assessee. What survives is a natural justice challenge, which is a different and more fact-specific plea.
The Supreme Court has held that even where the show-cause notice with the draft variation was not served and the order was passed in breach of the faceless provisions and of natural justice, the High Court ought to have remanded the matter for a fresh order rather than simply annulling it. High Courts have likewise set orders aside and remanded to the show-cause stage with a proper opportunity to respond. So the realistic prize is a fresh opportunity, and the material the company will file on remand should be ready when the petition goes in.
A natural justice challenge to a faceless order is a conventional writ ground because it is decided on the record, but the first appeal preserves the merits as well and runs on a thirty day clock from service of the demand notice. Limitation for completing an assessment is a separate outer boundary from the notice periods, so a remand late in the cycle may leave the Department little room, which cuts both ways and should be checked before the forum is chosen.
The first appeal is itself routed through faceless machinery, and a High Court has set aside an appellate order and restored the appeal where a video hearing was specifically requested and no link was provided. The same discipline therefore applies one rung up: ask in the memorandum of appeal, ask again in every submission, and keep the acknowledgement numbers. Whether the appeal lies to the Commissioner or to the Joint Commissioner depends on the category, and the hearing right applies in both channels.
Most of these end in a remand to the show-cause stage with a direction to give a hearing, not in the addition disappearing. Where the order affirmatively misstates the record by saying no request was made, High Courts have been readier to intervene, but the relief is still usually a fresh assessment. A minority are simply run at CIT(A), where the addition is decided on merits and the procedural complaint becomes a makeweight, so the choice of forum matters more than the strength of the natural justice point.