Section 144B - Faceless Assessment: What Does the Income Tax Notice Mean?

Have you received a notice from the Income Tax Department stating that your Income Tax Return (ITR) for Assessment Year 2024–25 has been selected for faceless scrutiny under Section 144B?

Don’t panic. This is a routine process in many cases and does not necessarily imply any wrongdoing on your part. In this blog, we’ll help you understand what the notice means, why you may have received it, and what steps you should take next.

📄 Why Did You Receive This Notice?

The notice simply informs you that your return has been picked for faceless assessment under Section 144B of the Income Tax Act.

This does not automatically mean that there is an issue with your return. The selection can be a part of the department’s regular review mechanism.

❓Will You Receive Further Notices?

Yes, most likely.

The current communication is just an intimation. A detailed notice may follow, which could ask for:

• Clarifications
• Additional documents
• Explanations regarding certain entries or claims

You can find all such notices under the “e-Proceedings” section of the Income Tax Portal.

🔍 Common Reasons for Selection Under Section 144B

Your ITR may have been flagged for any of the following reasons:

💰 1. High Refund Claimed

If you’ve claimed a large refund not backed by corresponding TDS or advance tax, it can trigger scrutiny.

🏛 2. Political Donations (Section 80GGC)

Returns with high donations to political parties may be selected, particularly when:

• Amounts are unusually high
• Donations are made in cash (which is disallowed)
• No digital payment trail or bank record exists

📊 3. Mismatch in Reported Income

Discrepancies between your ITR and data from:

• Form 26AS
• Annual Information Statement (AIS)
• Taxpayer Information Summary (TIS)

Common mismatches include:

• Salary income
• Interest income
• TDS credits

🏘 4. High-Value Transactions

Certain transactions often catch attention:

• Property purchases
• Stock market trading
• Large mutual fund investments
• Foreign remittances or overseas assets

🧾 5. Unusual Deductions or Loss Claims

Significant claims under:

• Section 80C (e.g., PPF, ELSS)
• Section 80D (Health Insurance)
• Business or Capital Losses

Such claims may invite scrutiny if they seem inconsistent with your income level.

🎲 6. Random Selection

At times, cases are picked randomly to ensure compliance. This does not reflect any specific issue.

📁 What Documents Might Be Requested?

If your return is under scrutiny, you may be asked to furnish:

• 🏦 Bank Statements – To verify income and refund claims
• 📑 Proof of Deductions – LIC, mediclaim, tuition, loan interest, donations, etc.
• 📉 Investment/Capital Gains Details – Especially for real estate, stocks, or business losses
• ❗ Clarification on Mismatches – Between ITR and Form 26AS/AIS/TIS

📌 What You Should Do Now

Follow these steps to stay compliant:

1. Log in to https://www.incometax.gov.in
2. Go to the “Pending Actions” or “e-Proceedings” section
3. Check regularly (at least once every few days)
4. Respond promptly to any notice — response time is generally 7 to 15 days
5. If needed, consult ChhotaCFO for guidance

Failure to respond may result in penalties or adverse assessments without your inputs.

🛡 Final Word

Faceless assessments are part of the Income Tax Department’s initiative to enhance efficiency, transparency, and accountability.

If your filings are correct and you have supporting documents for your claims, there is no need to worry. Stay proactive, keep your records ready, and respond promptly to communications from the department.