Best judgment assessments under Section 144 of the Income-tax Act, 1961 (and Section 271 of the new 2025 Act) are an important part of tax administration, allowing authorities to complete an assessment when a taxpayer does not participate. But what happens when that non-participation is not deliberate, and the taxpayer did not have an effective opportunity to respond?

This is the question Almitra Rego and Anuja Maniar Shah raise in their recent article in Taxsutra.

Drawing on a forthcoming study of 181 Income-tax Appellate Tribunal decisions, the authors find that deliberate avoidance or non-response accounted for only about a third of the Section 144 disputes studied. In a significant number of cases, non-participation was instead linked to systemic issues such as ineffective service of notices, digital access barriers and inadequate opportunity at the assessment or appellate stage.

The consequences can be significant. More than 60% of the cases studied were remanded for fresh adjudication, effectively restarting the process, even though the median time from the assessment order to disposal by the Tribunal was already nearly five years.

The article offers a data-backed look at how procedural gaps can prolong disputes and delay certainty and finality. Worth reading, especially if you work in tax, law or public policy.

Read the full article here – https://www.taxsutra.com/dt/experts-corner/when-best-judgments-result-poor-outcomes
The views expressed in this article are solely those of the author’s, and they do not represent the views of DAKSH