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2024 (2) TMI 1164 - AT - Income TaxValidity of assessment order not bearing Document Identification Number (DIN) - HELD THAT - The assessee s only grievance before us was that the assessment order not bearing Document Identification Number (DIN), the assessment is, in view of CIT v. Brandix Mauritius Holdings Ltd. 2023 (4) TMI 579 - DELHI HIGH COURT and Board Circular 19/2019, dated 14/8/2019, placing copies of the same on record, invalid. Even as he was unable to show us the legal basis for the same; s. 292B, with sub-heading Allotment of Document Identification Number , being omitted by Finance Act, 2011, w.e.f. 01.04.2011, nor indeed any Rule to that effect, assessment record was called for, allowing Smt. Devi, the ld. Sr. DR, time to do so. She would vide her written submission dated 16/11/2023, place on record a communication dated 30/11/2021, the date of the assessment order, which bears DIN. Though Appellant would object, stating that the said document is a separate document, titled Intimation letter for order u/s. 143(3) of the Income Tax Act , we find it as without merit and, rather, appears to have been made without reading the said document, whereby the assessee is informed of being conveyed the order u/s. 143(3) dated 30.11.2021, issued earlier, electronically, i.e., after completion of accounting by CPC. There is no dispute that both the assesssment order and the Intimation were uploaded on 30/11/2021. That apart, notice of demand u/s. 156 of the Act dated 30.11.2021, manually signed, as is the assessment order, forms part of the appeal file itself. This is in complete conformity with the Board Circular supra. What, then, is the assessee s grievance? Rather, the Intimation and the order being displayed on the Revenue s portal, the objection is not only invalid but also unfortunate.The assessee s appeal for AY 2015-16 is accordingly dismissed. Assessment order has not been signed, either physically or digitally, by the AO - AY 2016-17 - HELD THAT - Sec. 282A(2) provides that if the name and office of the designated income tax authority is printed, stamped or otherwise written on any notice or document required to be issued, served or given for the purposes of the Act by any income tax authority, the same shall be deemed to be authenticated. Further, r. 127A provides that the printing of the name and office of the income authority in the body of the email or in the attachment thereto where the notice or other document is transmitted by way of attachment to the email, or is displayed as a part of electronic record, or likewise on the attachment to the electronic record, it would be deemed to be authenticated where the email or, as the case may be, electronic record is sent from the email address of the income tax authority or, as the case may be, displayed on its designated website. It is clear that the law has provided for deemed authentication in view of the transmission of the documents electronically from a designated email address or per a designated website. The name of the officer, along with designation, is clearly printed on the assessment order. That is, not only is the assessment order signed physically, it is also deemed to be authenticated. There is no case by the assessee that the conditions of r. 127A have not been complied with; the Revenue stating of both uploading as well as transmission through email ID on the date of passing the assessment order, and which aspect is not in dispute. Adoption of correct profit rate - Adoption of a higher net profit rate of 5% (of sales) for AY 2019-20, as against at 2% for the preceding years - HELD THAT - For years prior to AY 2019-20, the Revenue was, in the absence of the assessee returning income u/s. 148, constrained to assess the income u/s. 144 of the Act, which obliged the AO to gather material and confront the same to him. That is, the Act throws the burden for making an informed estimate of the assessee s income for the relevant year/s on the AO. Though the returns voluntarily filed earlier, disclosing profit at 8%, disregarded due to the assessee being a non-resident, could validly be regarded as evidence, the Revenue has not done so. Board requiring the assessments to be evidence-based, rather than on the basis of the statements, unless corroborated, the Revenue has proceeded on the basis of the reported profit of other firms in the business. It has failed to appreciate that all the returns, filed earlier by the assessee voluntarily, returning profit at 8%, is corroborating material, so that the lower of the two rates, i.e., 5%, as admitted, could have been applied for all the years. Be that as it may, it is not so constrained for the current year, for which the assessment is u/s. 143(3) of the Act. The assessee returning income at Rs. 98,70,252, the AO has accepted the same. The same is consistent with the estimated turnover of Rs. 20 crores, yielding a profit rate of less than 5%. Appellant was in this regard specifically questioned by the Bench about the turnover per the software for f.y. 2018-19, i.e., the previous year relevant to AY 2019-20, and to which he replied as being not available. There is, in this view of the matter, no scope, factually and, therefore, legally; the ld. CIT(A) emphasizing the latter, for any reduction therein. That is, the assessee stands rightly assessed. As we have dwelled on the facts of the case as we are, in confirming the assessed income, not in agreement with the ld. CIT(A). There is no law that the assessed income, a product of the law as applied to the facts of a case, cannot be lower than the returned income. Rather, it is only where an assessment fails, that the assessee may not be able to avoid the tax incident on his returned income (CIT v. Shelly Products 2003 (5) TMI 4 - SUPREME COURT Assessee s appeals are dismissed.
Issues Involved:
1. Validity of assessments without Document Identification Number (DIN). 2. Validity of assessments without physical or digital signatures. 3. Adoption of net profit rate for different assessment years. Summary: 1. Validity of assessments without Document Identification Number (DIN): The assessee contended that the assessment order was invalid due to the absence of a Document Identification Number (DIN). However, the Tribunal found that the assessment order dated 30.11.2021 did bear a DIN, as evidenced by a communication dated the same day. The Tribunal noted that the assessment order and the intimation were uploaded on the Revenue's portal on 30.11.2021, in compliance with Board Circular 19/2019. The Tribunal dismissed the assessee's appeal for AY 2015-16, stating that the objection was invalid and unfortunate. 2. Validity of assessments without physical or digital signatures: For AY 2016-17 and 2019-20, the assessee argued that the assessment orders were not signed, either physically or digitally. The Tribunal examined the assessment records and found a physically signed copy of the assessment order for AY 2016-17. The Revenue explained that due to technical problems, digital signatures might not work, and in such cases, orders are manually signed. The Tribunal upheld the validity of the assessment order, stating that there was due compliance with s. 282A r/w r. 127A of the Income Tax Rules, 1962. For AY 2019-20, the Tribunal found that the assessment order bore the name and designation of the Assessing Officer, fulfilling the condition of s. 282A when read with r. 127A. The Tribunal dismissed the assessee's appeal for AY 2016-17 and 2019-20, finding no merit in the objections. 3. Adoption of net profit rate for different assessment years: The assessee initially returned income under section 44AD of the Act, which was not accepted due to the non-resident status. The Assessing Officer (AO) applied a net profit rate of 3% for AY 2015-16, which the Commissioner of Income Tax (Appeals) [CIT(A)] reduced to 2%. For AY 2019-20, the AO applied a profit rate of 5%, which was confirmed by the CIT(A). The Tribunal found that the assessee admitted to suppressing sales and not maintaining books of account. The Tribunal noted that the assessee's brother-in-law, managing the business, admitted to sales suppression and a profit rate of 5% during the survey. The Tribunal upheld the AO's adoption of a higher net profit rate of 5% for AY 2019-20, finding it consistent with the estimated turnover and profit rate. The Tribunal dismissed the assessee's appeals, confirming the assessed income. Conclusion: The Tribunal dismissed the assessee's appeals for AY 2015-16, 2016-17, and 2019-20, finding no merit in the objections raised regarding the validity of assessments and the adoption of net profit rates. The Tribunal confirmed the assessed income as determined by the AO and CIT(A).
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