Navigating Procedural Lapses in Faceless Assessment: Protocols When the Assessing Officer Fails to Join Video Conference Hearings

The introduction of the Faceless Assessment Scheme marked a paradigm shift in the Indian taxation landscape. By removing the physical interface between the tax gatherer and the tax payer, the government aimed to curb corruption, enhance transparency, and streamline the assessment process. However, the transition from physical hearing halls to digital corridors has not been without its teething troubles.

One of the critical components of this digital framework is the provision for a personal hearing via Video Conferencing (VC). While the assessment is primarily written and submission-based, the law recognizes that certain complexities require oral elucidation. Consequently, when a Draft Assessment Order proposes variations prejudicial to the interest of the assessee, a request for a personal hearing is generally granted.

However, tax professionals and assessees are increasingly encountering a peculiar administrative glitch: The VC request is approved, a slot is allocated, and the link is generated. The assessee logs in punctually, only to stare at a static screen displaying "Waiting for meeting host to start the meeting."

This article outlines the strategic and procedural steps an assessee must take when the Assessing Officer (AO) fails to conduct the scheduled hearing, ensuring that the assessee's rights are preserved against any adverse orders.

Under the provisions of the Income Tax Act 1961, specifically within the ambit of Faceless Assessment (governed largely by Section 144B), the right to be heard is not merely a procedural formality but a substantive right. The principles of natural justice, specifically audi alteram partem (no one should be condemned unheard), are embedded in the tax jurisprudence.

In the physical era, if an officer was unavailable, the matter would simply be adjourned. In the digital ecosystem, the "system" records the scheduling of a hearing. If the hearing does not materialize due to the officer's absence, but the system marks the event as "concluded" or "opportunity granted," the assessee faces a significant risk. The risk is that the Final Assessment Order may be passed on the premise that an opportunity was afforded but not utilized effectively by the assessee.

Crucial Note: Typically, the Faceless Assessment algorithm allows for a VC request to be raised and approved only once for a specific show-cause notice or draft order. Therefore, a "failed" hearing that goes unrecorded as a technical lapse can permanently close the door for oral representation unless immediate corrective action is taken.

The Scenario: The "Missing Host" Dilemma

Consider a scenario where an assessment proceeding is underway. The National Faceless Assessment Centre (NaFAC) has issued a Show Cause Notice proposing a significant addition to the income. The assessee, exercising their right, requests a personal hearing. The request is approved.