TaxTMI 
TaxTMI 
2023 (11) TMI 396
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....l the assessment years, and submitted that it go to the root of the validity of jurisdiction in this case. The additional grounds read as under:- "10. On the facts and in the circumstances of the case and in law, the Ld. DRP erred in not quoting a valid computer-generated DIN on the body of the DRP directions dated December 16, 2022 passed under section 144C(5) of the Act, in contravention to Circular No. 19 of 2019 issued by the CBDT, thus rendering such an order/direction to be invalid and never to have been issued as per para 4 to the said Circular. 11. On the facts and in the circumstances of the case and in law, the final assessment order dated January 20, 2023 under section 147 read with section 144C (13) of the Act, passed by the Ld. AO pursuant to the invalid and non-est directions passed by Hon'ble DRP, is bad in law, null and void and liable to be quashed. " 4. Since the additional ground goes to the root of the matter, we admit the same and adjudicate as under. 5. The DRP order in the cases is dated 15/12/2022 / 16.12.2022. At the outset, ld. Counsel of the assessee submitted that there is no DIN mentioned in the DRP order which is contrary to....
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.... 2. 2015-16 19.12.2022 ITBA/DRP/S/91/2022-23/1048079374(1) 3. 2016-17 19.12.2022 ITBA/DRP/S/2022-23/ 1048079054(1) 4. 2017-18 19.12.2022 ITBA/DRP/S/2022-23/ 1048078168(1) 4. Thus, two DINs were generated by the system for a A.Y., one for generating the order u/s 144C(5) of the Act and the other generated while issuing intimation letter of the order to the assessee. 5. In view of the above, it is evident that the DRP has not passed its directions without quoting/mentioning DINs generated through ITBA portal and the directions/order passed and served upon the assessee are in consonance with the requirements of law laid down by the CBDT vide its Circular No. 19/2019 dated 14.08.2019." Submitted for your kind information and necessary action." 7. We have heard both the parties and perused the records. First, we consider the contents of CBDT Circular No.19/2019 dated 14.08.2019, which reads as under:- "Circular No. 19 /2019 Government of India Ministry of Finance Department of Revenue Central Board of Direct Taxes New Delhi, dated the 14th of August, 2019 Subject: Generation/Allotment/Quoting of ....
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.... manually but only after recording reasons in writing in the file and with prior written approval of the Chief Commissioner / Director General of income-tax. In cases where manual communication is required to be issued due to delay in PAN migration, the proposal seeking approval for issuance of manual communication shall include the reason for delay in PAN migration. The communication issued under aforesaid circumstances shall stale the fact that the communication is issued manually without a DIN and the date of obtaining of the written approval of the Chief Commissioner / Director General of Income-Tax for issue of manual communication in the following format- " .. This communication issues manually without a DIN on account of reason/reasons given in para 3(i)/3(ii)/3(iii)/3(iv)/3(v) of the CBDT Circular No ...dated (strike off those which are not applicable) and with the approval of the Chief Commissioner / Director General of Income Tax vide number .... dated .... " 4. Any communication which is not in conformity 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....
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....ar is for creating an audit trail. In paragraph 2, it has been very clearly mentioned that no communication shall be issued by any income-tax authority relating to assessment, appeals, orders, statutory or otherwise, exemptions, enquiry, investigation, verification of information, penalty, prosecution, rectification, approval etc. to the assessee or any other person, on or after the 1st day of October, 2019, unless a computer generated DIN has been allotted and is duly quoted in the body of such communication. Paragraph 3 of the circular carves out certain exceptions to paragraph 2 by providing that under certain exceptional circumstances, enumerated in clause (i) to (v) of paragraph 3, the communication may be issued manually but only after recording reasons in writing not only in the file and with prior written approval of the Chief Commissioner/Director General of Income-tax, but, the communication issued manually in such circumstances must also state the reasons why communication is issued manually without a DIN and must also mention the date and number of written approval of the Chief Commissioner/Director General of Income-tax for issuing manual communication. In fact, in par....
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....N. 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. 17.2 The aforementioned principle stands enunciated in a long line of judgements, including the Supreme Court's judgment rendered in K.P. Varghese v. Income Tax Officer, Ernakulam and Anr., (1981) 4 SCC 173. The relevant extracts are set forth hereafter: "12. But the construction which is commending itself to us does not rest merely on the principle of contemporanea expositio. The two circulars of the Central Board of Direct Taxes to which we have just referred are legally binding on the Rev....
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.... stringent provisions of Section 12(1-B) as it was introduced in 1955, were substantially granted exemption from the operation of the said provisions by making it clear to all the companies and their shareholders that if the past loans were genuinely refunded to the companies they would not he taken into account under Section 12(1 -B), " Sections 2(6-A)(e) and 12(1-B) did not suffer from the vice of unconstitutionality. This decision was followed in Ellerman Lines case [(1972) 4 SCC 474 : 1974 SCC (Tax) 304 : 82 ITR 913] where referring to another circular issued by the Central Board of Revenue under Section 5(8) of the Indian Income Tax Act, 1922 on which reliance was placed on behalf of the assessee, this Court observed: "Now, coming to the question as to the effect of instructions issued under Section 5(8) of the Act, this Court observed in Navnitlal C. Javeri v. K.K. Sen, Appellate Assistant Commissioner, Bombay [AIR 1965 SC 1375 : (1965) 1 SCR 909 : 56 ITR 198] : 'It is clear that a circular of the kind which was issued by the Board would be binding on all officers and persons employed in the execution of the Act under Section 5(8) of the Act. This c....
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....ot call for our interference. 21. As noted above, in the instant appeal all that we are required to consider is whether any substantial question of law arises for consideration, which, inter alia, would require the Court to examine whether the issue is debatable or if there is an alternate view possible. Given the language employed in the 2019 Circular, there is neither any scope for debate not is there any leeway for an alternate view. 21.1 We find no error in the view adopted by the Tribunal. The Tribunal has simply applied the provisions of the 2019 Circular and thus, reached a conclusion in favour of the respondent/assessee." 9. Thus, keeping in view the aforesaid observations of the Hon'ble Delhi High Court and in terms of paragraph 4 of the circular No. 19/2019 dated 14.08.2019, we hold that the impugned DRP order is invalid and shall be deemed to have never been passed. Accordingly, we quash the impugned DRP/AO order. Further, the issue that a simultaneous DIN number was generated and communicated have been considered by Co-ordinate Bench of the Tribunal in the case of Abhimanyu Chaturvedi vs DCIT in ITA Nos.2486, 2487 and 2488/Del/2022. The relevant par....