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TMI Blog2023 (8) TMI 378X X X X Extracts X X X X X X X X Extracts X X X X ..... tablished that the DIN was not quoted before it was physically signed by the AO. The generation of DIN subsequently and generation of intimation to be sent to assessee are of no consequence for the purpose of assessment and raising the demand. Decided in favour of assessee. Extension of Period of limitation - The orders as uploaded on the ITBA were incomplete and that would only come to aid of assessee for extending the period of the limitation for filing the appeal but order does not become void on that ground and there is no case of time barred assessment. So issue number two is decided against the assessee. To make the order complete and effective, it should be issued, so as to be beyond the control of the authority concerned, for any possible change or modification therein. That is best achieved with the introduction of DIN but once the order is complete in all respects and within the prescribed period, the actual service of the order may be beyond that period and that will only give rise to question of start of limitation period for challenging it but that does not invalidate the order itself. Thus the orders as uploaded on the ITBA were incomplete and that would only come to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, which is bad in law, the same may kindly be deleted. 10. Without prejudice to all above points, the Ld. CIT (A) has erred in allowing the initiation of penalty proceedings u/s 271 (l)(c) of IT Act, 1961, which is bad in law, the same may kindly be deleted. 11. That the appellant craves the leave to add, modify, amend or delete any of the grounds of appeal before or at the time of hearing and all the above grounds are without prejudice to each other. 4. The relevant facts as picked up from the matter on record and submissions are that the appellants are family members whose LTCG arising on sale of certain shares which were purchased simultaneously by each assessee in the same company and have been added back to the income of the each assessees vide separate assessment orders passed under Section 153A read with Section 143 (3) of the Income Tax Act. 1961 ( the Act ) and which stands confirmed by Ld CIT(A). 4.1 The details of the Assessees/appellants as provided in the submission are hereunder: Name of the Assessee/Appellant Details of profession Return details for 2013-14 Returned income for AY 2022 - 2023 Abhimanyu Chaturvedi S/o Prabhat Chandra Chaturvedi a retired Civil Serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aving Document No. (DIN) ITB A/AST/M/153 A/2021-22/1035679086(1). DIN Letter at p. 8 of the PB and the ITBA Assessment Order at p. 4 of the PB filed in Abhimanyu s Case The DIN has been generated as an afterthought of more than a month since the order was dated. The DIN is also not mentioned in either of the two Mallika Chaturvedi Dated 09.08.2021 (257 pages) received on 16.10.2022 Dated 09.08.2021 (4 pages). DIN generated on 18/09/2021 is having Document No. (DIN) ITB A/AST/S/2021-22/1035704817(l)(l). DIN Letter at p. 8 of the PB and the ITBA Assessment Order at p. 4 of the PB in Mallika s Case The DIN has been generated as an afterthought of more than a month since the order was dated. The DIN is also not mentioned in either of the two Alka Chaturvedi Dated 09.08.2021 (257 pages). Received on 16.10.2021 Dated 09.08.2021 (9 pages). DIN generated on 17/09/2021 is having Document No. (DIN) ITB A/AST/M/153 A/2021-22/1035685990 (1). DIN Letter at p. 13 of the PB and the ITBA Assessment Order at p. 4 of the PB in Alka s Case In addition to the above it is also pointed out that in case of Alka Chaturvedi the Approval u/s 153D was not obtained from the Add CIT and the date of the same is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent order was uploaded on ITBA before 30.09.2021. In view of the above facts, it is clear that the assessment order was passed well within time and communicated to the assessee as well before time barring date i.e. 30.09.2021. Supporting documents i.e. intimation letter for order u/s 153A of the Income Tax Act, 1961 and case noting history on ITBA are enclosed for your kind perusal. In view of these facts, it is evident that the DIN for the said assessment order was generated through ITBA well within time limitation for passing assessment order and the also the same was communicated to the assessee well within time limitation. Relevant Assessment record is submitted for kind perusal. 8. Ld. Counsel for the appellant has submitted that the CBDT Circular no. 19/2019 dated 14.08.2019 has made it mandatory that all the orders of Department should have DIN indicated on the face of order. It was submitted that in the cases in hand, no DIN has been quoted on the assessment orders. Relying judgment of Hon ble Delhi High Court in the case of CIT vs. Brandix Mauritius Holdings Ltd. 2023: DHC : 2502 it was submitted that Hon ble High Court has categorically laid down that the Circular is of b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Tribunal order in ITA No. 3556 3557/Del/2015 order dated 08.02.2019 in the case of Pankaj Sharma vs. DCIT and ITA No. 415 421/CTK/2019 in Sujata Panda, The X-ray clinic vs. ACIT . 8.3 It was also mentioned that notice of Tax Demand dated 09.08.2021 was also barred and not enforceable as it was received by the assessee only after 30.09.2021 and the judgment of Hon ble Delhi High Court in the case of Suman Jeet Agarwal vs. ITO in W.P. (C) nos. 10 and 269 of 2022 and judgment of Hon ble Allahabad High Court in Daujee Abhushan Bhandar Pvt. Ltd. vs. Union of India (2022) 136 taxmann.com 246 was relied. 8.4 Ld. Counsel also submitted that there two set of order, one available ITBA Portal which has been only 4 pages or 9 pages in the respective cases with a DIN purportedly generated on 17.09.2021 and 18.09.2021 and the Second dated 09.08.2021, of over 270 pages, which was sent by post. Ld. Counsel also demonstrated before the Bench in the presence of ld. DR as to how the ITBA Portal works and she was able to demonstrate that still on the portal the assessment order available are 4 pages or 9 pages respectively in the cases. 9. On merits of ld. Counsel submitted that the Ld. AO and Ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. 12. In regard to first issue it will be appropriated to reproduce here the complete text of the Circular no. 19/2019 while making the crucial part of it in BOLD : New Delhi, dated the 14th August, 20 19 Subject: Generation/Allotment/Quoting of Document Identification Number in Notice/Order/Summons/letter/correspondence issued by the Income-tax Department - reg. With the launch of various e-governance initiatives, Income-tax Department is moving toward total computerisation of its work. This has led to a significant improvement in delivery of services and has also brought greater transparency in the functioning of the tax administration. Presently, almost all notices and orders are being generated electronically on the Income Tax Business Application (ITBA) platform. However, it has been brought to the notice of the Central Boa rd of Direct Taxes (the Board) that there have been some instances in which the notice, order, summons, letter and any correspondence (hereinafter referred to as communication ) were found to have been issued manually, without maintaining a proper aud it trail of such communication. 2. In order to prevent such instances and to maintain proper audit trail o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mity with Para-2 and Para-3 above, shall be treated as invalid and shall be deemed to have never been issued . 5. The communication issued manually in the three situations specified in para 3- (i), (ii) or (iii) above shall have to be regularised within 15 working days of its issuance, by i. uploading the manual communication on the System. ii. compulsorily generating the DIN on the System; iii. communicating the DIN so generated to the assessee/any other person as per electronically generated pro-forma available on the System. 6. An intimation of issuance of manual communication for the reasons mentioned in para 3(v) shall be sent to the Principal Director General of Income-tax (Systems) within seven days from the date of its issuance. 7. Further, in all pending assessment proceedings, where notices were issued manually, prior to issuance of this Circular, the incometax authorities shall identify such cases and shall upload the notices in these cases on the Systems by 31th October, 2019. 8. Hindi version to follow. 13. It will also be appropriate to reproduce the relevant content of instructions from Directorate of Income Tax (System), dated 25.10.2019 as follows :- Subject: Chang ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stem. The system generated Intimation letter will also be generated for reference and will be available in View/Download Letter/Notice/Orders screen for user to download the same. 14. Now considering the vital piece of material before us is the letter dated 27.06.2023 in the form of report submitted by the Ld. AO which makes it admitted that the order was passed manually. It was uploaded on ITBA on 17.09.2021. The DIN no. was generated on 17.09.2021 through ITBA. Ld. AO admitted that to his understanding whenever manually is passed the assessment order is uploaded on ITBA through manual to system tab, a DIN is generated for that particular assessment order. Accordingly, the DIN was generated in the cases and intimations were sent. 15. However, from the assessment order it does not appear that Ld. AO had proceeded to pass the order manually. There is nothing in the assessment order mentioning the reasons which as exception only allow passing of the assessment order manually. 15.1 In this context from the aforesaid Circular no. 19/2019 it can be noted that it mandates that if the communication is issued under aforesaid three exceptions the communication shall state the fact that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... face and then only it should be signed. Thus for the purpose of section 153A/143(3) of the Act, the assessment can be said to be made only when the DIN is quoted on the order before it is signed. If without first generating the DIN and before it is quoted on the order, the order is signed, the order is non-est. 17. The Bench is of considered view that forwarding of the intimation of generation of the DIN in ITBA is only a subsequent action and that is not part of assessment order. The manner in which the word communication is defined shows every notice, order, summons, letter and any correspondence from Tax authorities should have a DIN quoted and it is for this reason that the Intimation issued about the DIN of assessment order itself has a DIN quoted on it. 18. In the case in hand the facts coming from the assessment order when considered establish that DIN was not generated prior to uploading the document in ITBA. It is also established that the DIN was not quoted before it was physically signed by the Ld. AO. The generation of DIN subsequently and generation of intimation to be sent to assessee are of no consequence for the purpose of assessment and raising the demand. 18.1 As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hear a DIN. There is nothing on record to show that the appellant/revenue took steps to demonstrate before the Tribunal that there were exceptional circumstances, as referred to in paragraph 3 of the 2019 Circular, which would sustain the communication of the final assessment order manually, albeit, without DIN. 16.1 Given this situation, clearly paragraph 4 of the 2019 Circular would apply. 17. Paragraph 4 of the 2019 Circular, as extracted hereinabove, decidedly provides that any communication which is not in conformity with paragraph 2 and 3 shall be treated as invalid and shall be deemed to have never been issued. The phraseology of paragraph 4 of the 2019 Circular fairly puts such communication, which includes communication of assessment order, in the category of communication which are non-est in law. 17.1 It is also well established that circulars issued by the CBDT in exercise of its powers under Section 119 of the Act are binding on the revenue. 18.4 The Hon ble High Court has further specifically observed in regard to Circular no. 19 of 2019 as follows :- 21. As noted above, in the instant appeal all that we are required to consider is whether any substantial question of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e order complete and effective, it should be issued, so as to be beyond the control of the authority concerned, for any possible change or modification therein. That is best achieved with the introduction of DIN but once the order is complete in all respects and within the prescribed period, the actual service of the order may be beyond that period and that will only give rise to question of start of limitation period for challenging it but that does not invalidate the order itself. 19.2 Hon ble Supreme Court in the case of Raja Harish Chandra Raj Singh vs. Dy. Land Acquisition Officer (1961 AIR 1500) while considering the provisions of section 18 of the Land Acquisition Act, 1894 under which a person aggrieved by the acquisition award was required to file his application objecting to the award within six months from the date of the award. The Appellant here had filed his application not within six months from the date of the order, but within six months from the date he came to know of the order, which application was held barred by limitation. When the issue came before the Hon ble Supreme Court, it held If the award is treated as an administrative decision taken by the Collector ..... X X X X Extracts X X X X X X X X Extracts X X X X
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