2023 (11) TMI 796 - AT - Income Tax

DRP directions communicated without mentioning DIN - whether a curable defect? - HELD THAT - It mandates that on or after 1st day of October, 2019, no communication will be issued without a computer generated DIN, which has to be quoted in the body of the communication A perusal of the DRP order shows that it is clear in the body of DRP order, no DIN number is mentioned nor there is any reason of not mentioning the DIN number in order of the DRP. Is such a situation, the DRP order will lose its validity. Subsequent separate communication of DIN is a superfluous exercise. Thus, keeping in view the clear language above the assessment orders have to be declared as non-est and deemed to have never been issued. While coming to such conclusion, we find support from various judicial precedents cited before us by learned counsel for the assessee, including the decision of Brandix Mauritius Holdings Ltd 2023 (4) TMI 579 - DELHI HIGH COURT . Assessee appeal allowed.

Summary

Issues Involved:
1. Validity of jurisdiction due to the absence of Document Identification Number (DIN) in the DRP order.

Summary:

Validity of Jurisdiction:

The primary issue raised by the assessee pertains to the validity of the jurisdiction due to the absence of the mandatory Document Identification Number (DIN) in the Dispute Resolution Panel (DRP) order dated 29 April 2022. The assessee argued that the absence of DIN in the DRP order contravenes CBDT Circular No.19/2019 dated 14 August 2019, rendering the order void ab initio and invalid. The Revenue, however, contended that the process of uploading DRP directions on the ITBA system includes the generation of DIN, which is communicated through an Intimation Letter.

The Tribunal examined the contents of CBDT Circular No.19/2019, which mandates that no communication by any income-tax authority shall be issued without a computer-generated DIN, unless exceptional circumstances are recorded in writing and approved by the Chief Commissioner / Director General of Income-tax. The Circular also specifies that any communication not conforming to these requirements shall be deemed invalid and treated as never issued.

Upon review, the Tribunal found that the DRP order did not mention a DIN nor provided any reason for its absence, thus failing to comply with the Circular. The Tribunal referenced the Delhi High Court's decision in CIT vs Brandix Mauritius Holdings Ltd., which held that communications without a DIN are invalid and non-est in law. The Tribunal concluded that subsequent communication of DIN is superfluous if the initial order lacks it.

Consequently, the Tribunal held that the DRP order is invalid and deemed to have never been passed, thereby quashing the impugned DRP/AO order. The Tribunal further noted that simultaneous issuance of DIN is insignificant without it being mentioned in the body of the communication.

Given the decision on Ground No.4, the remaining grounds raised by the assessee were rendered academic and did not require adjudication. Both appeals filed by the assessee were allowed, and the order was pronounced in the open court on 9th November 2023.