2023 (10) TMI 1312 - AT - Income Tax

Validity of proceedings / orders without DIN - Absence of DIN on the directions issued by DRP - assessee is a foreign company incorporated in France and is a tax resident therein - HELD THAT - As relying on BRANDIX MAURITIUS HOLDINGS LTD. 2023 (4) TMI 579 - DELHI HIGH COURT and circular No. 19/2019 dated 14.08.2019,the impugned DRP order is invalid and shall be deemed to have never been passed. Accordingly, we quash the impugned assessment order which has been passed pursuant to the DRP order.

Summary

Issues Involved:
1. Validity of proceedings due to absence of Document Identification Number (DIN) on the Dispute Resolution Panel (DRP) directions.

Summary:

1. Validity of Proceedings Due to Absence of DIN:
The assessee, a foreign company incorporated in France, appealed against the assessment order dated 28.07.2022 passed u/s 143(3) r.w.s. 144C(13) of the Income Tax Act, 1961, arguing the absence of DIN on the DRP directions, which is contrary to CBDT Circular No.19/2019. The assessee contended that the absence of DIN invalidates the jurisdiction assumed, citing various case laws to support this claim.

The Tribunal examined the CBDT Circular No.19/2019, which mandates that no communication shall be issued by any income-tax authority relating to assessment, appeals, orders, etc., unless a computer-generated DIN is duly quoted. The circular also specifies that any communication not in conformity with this requirement shall be treated as invalid and deemed never to have been issued.

The Tribunal found that the DRP order did not mention a DIN nor provided reasons for its absence, thus rendering the order invalid. This conclusion was supported by the Delhi High Court's decision in CIT vs Brandix Mauritius Holdings Ltd., which emphasized the binding nature of CBDT circulars issued u/s 119 of the Act.

Conclusion:
The Tribunal held that the impugned DRP order was invalid due to non-compliance with the DIN requirement and quashed the subsequent assessment order. Consequently, the remaining grounds of appeal were rendered academic and did not require adjudication. The appeal was allowed, and the order was pronounced in the open court on 09th October, 2023.