2025 (7) TMI 1157 - AT - Income Tax

Assessment order without DIN valid under Section 292B despite missing contents on portal

Indu Bala Porwal Versus Deputy Commissioner of Income Tax, Central Circle-1, Udaipur.

Indu Bala Porwal Versus Deputy Commissioner of Income Tax, Central Circle-1, Udaipur. - TMI ISSUES: Validity of assessment order issued without Document Identification Number (DIN) as mandated by CBDT Circular No. 19/2019.Validity of approval under Section 153D of the Income Tax Act for passing assessment order.Jurisdiction and validity of assessment under Section 153A versus Section 153C of the Income Tax Act in absence of incriminating material.Ownership and disclosure of foreign bank account and assets held in the name of a family trust versus individual ownership for income tax purposes.Application of provisions under Sections 69 and 69A of the Income Tax Act relating to unexplained assets and income.Requirement and applicability of filing declaration under Chapter VI of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.Levy of interest under Section 234B of the Income Tax Act consequent to additions made.Admissibility and evidentiary value of documents allegedly recovered from third party's premises and their attribution to the assessee under Sections 65A and 65B of the Indian Evidence Act.Validity of references from the Foreign Tax and Tax Recovery (FT & TR) division in the assessment proceedings. RULINGS / HOLDINGS: Assessment order was validly issued with DIN generated through ITBA system; absence of DIN on face of order was a technical defect without substantive infirmity, hence the ground challenging order without DIN was dismissed.Approval under Section 153D given on the same day as assessment order was not invalid merely on that ground; no evidence of non-application of mind was established, thus approval was held valid.In absence of any incriminating material found during search in the assessee's premises and with completed assessment prior to search, invocation of Section 153A was held invalid; assessment under Section 153A was quashed and additions deleted accordingly.Foreign bank account and portfolio assets held in the name of the family trust (BWR Trust) were not owned by the assessee individually; documentary evidence including trust deed, family settlement deed, financial statements, and bank statements established ownership by the trust, leading to deletion of additions made in assessee's hands under Sections 69 and 69A.Documents allegedly recovered from third party's premises could not be attributed to the assessee without proper enquiry; reliance on such documents without adherence to Sections 65A and 65B of the Indian Evidence Act was held erroneous.References from FT & TR division were upheld but did not independently justify additions without corroborative evidence; no separate adjudication was required on this ground.Levy of interest under Section 234B was consequential and did not require separate adjudication in view of deletion of additions.Requirement to file declaration under Chapter VI of the Black Money Act was not upheld against the assessee as additions were deleted. RATIONALE: The Court applied the provisions of the Income Tax Act, 1961, specifically Sections 153A, 153C, 153D, 69, 69A, 131, 234B, and relevant procedural circulars issued by CBDT, including Circular No. 19/2019 regarding DIN issuance.Assessment orders must comply with procedural mandates including DIN issuance; however, technical non-compliance without prejudice does not invalidate orders, consistent with Section 292B protection.Approval under Section 153D requires application of mind but can be given contemporaneously with assessment order if prior discussions have occurred; mere timing does not invalidate approval.Jurisdiction under Section 153A is contingent upon existence of incriminating material found during search in the assessee's case; absent such material and with completed assessments, reopening is impermissible as per binding precedents including the Supreme Court ruling in PCIT Central-3 v. Abhisar Buildwell (P.) Ltd.Ownership of assets for tax purposes depends on substantive control and beneficial interest; evidence of family trust formation, fund flow, and trust financials established that foreign assets belonged to the trust, not the individual assessee.Assessing Officer's reliance on documents recovered from third parties without proper authentication or linkage to the assessee violates principles of evidence under Sections 65A and 65B of the Indian Evidence Act.Judicial precedents emphasize that burden of proof lies on revenue to establish ownership and unexplained income; mere possession or association is insufficient to invoke Sections 69 and 69A.Partial relief granted by appellate authority on account of double additions and notional gains was upheld, reflecting adherence to principles of fair assessment.The Court recognized the importance of procedural fairness and evidentiary standards in tax assessments, rejecting mechanical or arbitrary additions unsupported by credible evidence.