“Since the assessment proceedings no longer involve human interaction and is based on records alone, the assessment proceeding should have commenced much earlier so that before passing assessment order, the respondent assessing officer could have come to a definite conclusion on facts after fully understanding the nature of business of the petitioner,” states the order.According to the tax department’s case, Salem Sree Ramavilas Chit Company was unable to explain the cash deposits. The petitioner contended that this was subscribers’ money which it could not deposit with banks before the announcement of demonetisation. It said this was explained in the details furnished on February 17, 2017, in compliance with the requirements of the Reserve Bank of India.“In my view, the petitioner has prima facie demonstrated that the assessment proceeding has resulted in distorted conclusion on facts,” the high court said. It set aside the tax department’s order on the additions and asked the assessing officer to pass a fresh order within 60 days.The finance ministry introduced the faceless assessment in October last year. Of the 58,322 cases selected under this so far, it has served digitally signed notices on 48,000 people.

Source: Economic Times February 19, 2020 06:00 UTC