2023 (8) TMI 1518 - AT - Income Tax

Validity of communication without quoting DIN - HELD THAT - The impugned appellate order was subject matter of DIN compliance; however same remained to be complied by generating quoting the DIN in the body thereof. Thus admittedly impugned appeal order was communicated in violation of Para-2 of CBDT Circular. Further, the Revenue also failed to place on record any evidence showcasing effectively that the case of the assessee fell within any of the five exceptional circumstances as envisaged in Para-3 and accompanying therewith evidentiary documents in terms Para-5 thereof in establishing regularisation of earlier manual communication. Therefore, this communication of impugned order suffered from compliance and rendered invalid as if it has never been issued. The impugned order ceases to have any effect in the eyes of law as non-est. In view of this categorical finding, delving deeper into merits is unwarranted. Appeal of the assessee is Allowed.

Summary

Issues:
Appeals challenging orders of first appellate authority under the Income-tax Act for various assessment years; Validity of impugned orders in light of Circular No.19/2019 issued by CBDT; Admissibility of legal ground raised for the first time before the Tribunal; Compliance with the DIN requirement as per CBDT Circular No. 19/2019; Effect of non-generation and non-quoting of DIN on communication of appellate orders.

The judgment by the Appellate Tribunal ITAT PANAJI involved thirty-eight appeals and cross-objections challenging orders of the first appellate authority under the Income-tax Act for various assessment years. The common issue arose regarding the validity of the impugned orders in light of Circular No.19/2019 issued by the Central Board of Direct Taxes (CBDT). The Tribunal decided to address this common issue collectively for all appeals, with 'Good Luck Developers' ITA No. 59/PAN/2020 as the lead case.

During the hearing, the legal representatives of the appellants raised an oral legal ground challenging the validity of the impugned orders based on the CBDT Circular. On the contrary, the Departmental Representatives argued that the impugned orders complied with the Circular by having a manual Appeal Register Number and ITA Nos. allotted, even though the DIN was not quoted in the communication to the assessee. The Tribunal considered the arguments, relevant case laws, and the facts of the case before proceeding with the adjudication.

The Tribunal deliberated on the admissibility of the legal ground raised for the first time before the Tribunal, emphasizing that no new facts needed verification. The Tribunal admitted the legal ground based on judicial precedents and the absence of wilful omission in raising the ground initially. It was noted that the CBDT Circular mandated the generation, allotment, and communication of computer-generated DIN for all official communications related to assessments, appeals, orders, etc., effective from October 1, 2019.

The Tribunal highlighted the importance of DIN compliance as per the CBDT Circular and the consequences of non-generation or non-quoting of DIN in official communications. Citing a decision by the Hon'ble Delhi High Court, the Tribunal emphasized that communications without DIN have no legal standing and can be deemed invalid. In the present case, the impugned appellate order lacked DIN compliance, rendering it invalid and having no legal effect.

Consequently, the Tribunal allowed the appeal of the assessee and fourteen other appeals, while dismissing thirteen appeals and a cross-objection of the Revenue. Additionally, nine Cross Objections of different assessee's were allowed. The Tribunal pronounced these orders in open court in accordance with ITAT Rules.