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2024 (1) TMI 156 - AT - Income TaxValidity of assessment order u/s 148 with no DIN mentioned - HELD THAT - Non-mentioning of DIN on the body of the order is not a defect curable u/s 292B and in the absence of a DIN on the body of the order, the said order is deemed to never have been issued We find that there is consistent view taken across various Benches of the Tribunal starting from the Calcutta Bench in case of Tata Medical Centre Trust 2023 (9) TMI 1324 - CALCUTTA HIGH COURT , Brandix Mauritius Holding Ltd. 2022 (11) TMI 34 - ITAT DELHI , Pratap Singh Yadav 2023 (6) TMI 270 - ITAT DELHI , Abhimanyu Chaturvedi 2023 (8) TMI 378 - ITAT DELHI , Sharda Devi Bajaj 2023 (11) TMI 645 - ITAT DELHI , Teleperformance Global Services Private Limited 2023 (4) TMI 1235 - ITAT MUMBAI , Bangalore Benches in case of Dilip Kothari 2022 (11) TMI 33 - ITAT BANGALORE , that the communication issued by the Income tax authorities by way of notices and assessment orders which are not in compliance with the aforesaid CBDT Circular no 19/2019 are non-est in eyes of law. As we have seen and discussed above, some of these matters have reached the respective Hon ble High Courts and the findings of the Tribunal have been upheld in case of Brandix Mauritius Holding Ltd. and Tata Medical Centre Trust. On this account as well, we respectfully follow the collective wisdom as expounded in various decisions rendered by the Coordinate Benches across the Country and do not see any justifiable basis to deviate from the same. We are of the considered view that the impugned order passed u/s 147 r/w 143(3) cannot be upheld and deserve to be set-aside as the same has been passed in violation of CBDT Circular no 19/2019 r/w CBDT Circular No 27/2019 and the same is hereby treated as non-est in eyes of law. Decided in favour of assessee.
Issues Involved:
1. Validity of the assessment order due to non-compliance with procedural requirements. 2. Legitimacy of the initiation of proceedings under Section 148. 3. Appropriateness of the reassessment under Section 148 based on documents found during a third-party search. 4. Opportunity to cross-examine individuals whose statements were relied upon. 5. Compliance with departmental instructions and procedural irregularities. Summary: Issue 1: Validity of the Assessment Order Due to Non-Compliance with Procedural Requirements The Tribunal addressed the procedural validity of the assessment order, particularly focusing on the absence of a Document Identification Number (DIN) on the assessment order. The assessee argued that the assessment order was non-est and invalid as it was not uploaded on the e-filing portal and lacked a DIN, violating CBDT Circular No. 19/2019. The Tribunal noted that the CBDT Circular mandates the inclusion of a DIN in all communications from the Income Tax Department to ensure transparency and traceability. The Tribunal held that the absence of a DIN on the assessment order rendered it invalid and deemed never to have been issued, following the binding nature of the CBDT Circular on the Assessing Officer. The Tribunal cited multiple judicial precedents supporting this view, including decisions from the Hon'ble Delhi High Court and other Tribunal benches. Issue 2: Legitimacy of the Initiation of Proceedings Under Section 148 The assessee contended that the initiation of proceedings under Section 148 was unjustified. The Tribunal examined whether the reasons recorded for reopening the assessment were valid. The Tribunal found that the Assessing Officer had reasons to believe that income had escaped assessment due to the booking of bogus expenses, justifying the issuance of notice under Section 148. The Tribunal upheld the initiation of proceedings under Section 148, finding no procedural lapses in this regard. Issue 3: Appropriateness of the Reassessment Under Section 148 Based on Documents Found During a Third-Party Search The assessee argued that the reassessment under Section 148 was based solely on documents found during a search at a third party's premises, which should have warranted action under Section 153C instead. The Tribunal noted that the Assessing Officer had relied on documents and statements obtained during the search, which indicated that the assessee had booked bogus expenses. The Tribunal upheld the reassessment under Section 148, finding that the Assessing Officer had sufficient grounds to believe that income had escaped assessment. Issue 4: Opportunity to Cross-Examine Individuals Whose Statements Were Relied Upon The assessee claimed that no opportunity was provided to cross-examine individuals whose statements were relied upon by the Assessing Officer. The Tribunal acknowledged this contention but did not provide a detailed ruling on this issue, as the primary ground of appeal regarding the procedural validity of the assessment order was sufficient to decide the case. Issue 5: Compliance with Departmental Instructions and Procedural Irregularities The assessee argued that the assessment proceedings were not conducted in compliance with departmental instructions, specifically the mandatory digital conduct of proceedings and the requirement to mention DIN on all communications. The Tribunal found that the assessment order was manually issued without a DIN, violating CBDT Circular No. 19/2019. The Tribunal noted that the procedural irregularities, including the failure to upload the order on the e-filing portal and the absence of a DIN, rendered the assessment order invalid. Conclusion: The Tribunal set aside the reassessment order under Section 147 read with Section 143(3) due to non-compliance with procedural requirements, particularly the absence of a DIN on the assessment order. Other grounds of appeal were deemed academic and not adjudicated. The appeal of the assessee was partly allowed, with the assessment order being treated as non-est in the eyes of the law.
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