2023 (11) TMI 124 - AT - Income Tax

Validity of assessment order without DIN - Communications emanating from the revenue - scope of CBDT Circular no. 19/2019 dated 14.08.2019 - HELD THAT - A perusal of the AO order shows that it is clear in the body of AO order, no DIN number is mentioned nor there is any reason of not mentioning the DIN number in order of the AO. Is such a situation, the AO order will lose its validity. Subsequent separate communication of DIN is a superfluous exercise. Failure to Non allocate DIN is not mere mistake as corrected by taking recourse to Section 292B of the Income Tax Act We are referring to the decision of the Hon ble jurisdictional High Court in the case of CIT vs Brandix Mauritius Holdings Ltd. 2023 (4) TMI 579 - DELHI HIGH COURT as held that communication relating to assessments, appeals, orders, etcetera which find mention in paragraph 2 of the 2019 Circular, albeit without DIN, can have no standing in law, having regard to the provisions of paragraph 4 of the 2019 Circular. Appeal of assessee allowed.

Summary

Issues Involved:

1. Validity of the assessment order due to non-mentioning of DIN.
2. Applicability and interpretation of CBDT Circular No.19/2019.
3. Impact of subsequent communication of DIN.

Summary:

1. Validity of the assessment order due to non-mentioning of DIN:
The assessee challenged the assessment order dated 04.12.2019, arguing it was null and void as it violated CBDT Circular No.19/2019 by not mentioning a DIN. The Tribunal admitted the additional ground as it went to the root of the matter. The Tribunal found that the assessment order did not mention a DIN, nor provided reasons for not doing so, rendering the order invalid. The Tribunal referred to the Delhi High Court's decision in CIT vs Brandix Mauritius Holdings Ltd., which held that an assessment order without a DIN is non-est in law.

2. Applicability and interpretation of CBDT Circular No.19/2019:
The Tribunal examined CBDT Circular No.19/2019, which mandates that all communications by income-tax authorities must include a computer-generated DIN, unless issued under exceptional circumstances with prior approval. The circular aims to create an audit trail and enhance transparency. Paragraph 4 of the circular stipulates that any communication not conforming to these requirements shall be treated as invalid and deemed never to have been issued.

3. Impact of subsequent communication of DIN:
The Revenue argued that the DIN was generated and communicated to the assessee via a letter dated 06.12.2019. However, the Tribunal held that subsequent communication of DIN is superfluous and does not validate the original assessment order. The Tribunal referred to its own decision in Abhimanyu Chaturvedi vs DCIT, which emphasized that the assessment order itself must mention the DIN to be valid.

Conclusion:
The Tribunal quashed the assessment order for non-compliance with CBDT Circular No.19/2019, rendering the remaining grounds academic. The appeal filed by the assessee was allowed. The order was pronounced on November 1, 2023.