AI Drafter 
TaxTMI 
TaxTMI 
2024 (1) TMI 1222
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.... Ghaziabad (hereinafter referred to as the Ld. AO). The Revenue has also filed appeal against the above orders of the ld. FAA for AYs 2012-13 to 2015-16 arising out of the above orders of the ld. AO. 2. Heard and perused the record. At the time of hearing, on behalf of the assessee an application is filed seeking permission for raising additional grounds as follows:- 1. "That having regard to the facts and circumstances of the case, the action of ld. AO in passing the impugned assessment order u/s 143(3) dated 31.12.2019 is illegal, bad in law, inter alia for the reason that the said assessment order has been passed without DIN number as is must as held in the judgements of CIT (international taxation) vs. Brandix Mauritius Holdings Ltd. ITA No. 163/2023, dated 20.03.2023 (Del), PCIT(E) vs. M/S Tata Medical Centre Trust, ITAT/202/2023, dated 26.09.2023 (Cal)and Ashok Commercial Enterprises vs. Asstt. CIT, WP No. 2595 of 2021, dated 04.09.2023 (Bom) and CBDT Circular No. 19/2019 dated 14.08.2019. 2. That in any case and in view of the matter, passing of the impugned assessment order u/s 143(3) dated 31.12.2019 is illegal, bad in law and the same is not sustainab....
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....dy of the assessment order, the order cannot be void ab initio. 4.4 The ld. DR has also tried to distinguish between the effect of passing of an order and issuing/communicating of order. It is submitted that this aspect of distinction between the two has been taken note of by the Hon'ble Supreme Court in the case of CIT Chennai vs. Mohd. Meeran Shahul Hameed, 283 Taxmann 454 (2021). 4.5 The ld. DR has further relied on the judgement of the Hon'ble Jharkhand High Court in the case of Prakash Lal Khandelwal vs. CIT, 151 taxmann.com 72 (2023) to submit that the Hon'ble Jharkhand High Court has decided the issue in favour of the Revenue with regard to non-mentioning of DIN. 4.6 The ld. DR has further pointed out that presently there are seven decisions of the different High Courts on the issue of DIN. Out of seven, four decisions namely Prakash Lal Khandelwal Vs CIT (151 taxmann.com 72) 2023 of Hon'ble Jharkhand HC, Chanderbhan Vs. UOI and others in Writ tax no. 829 of 2023 of Hon'ble Allahabad High Court, M/s South Cost Spices Export Pvt. Ltd. WP(C) NO.33771 of 2023 of Hon'ble Kerala High Court and Texmo Precision Casting UK Ltd. Vs. CIT(International Taxation) 138 taxmann.co....
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....s, the summarized submissions of the ld. DR are reproduced herein below:- "J. Lastly for the convenience of the Hon'ble Bench, the above discussion with regard to the compliance of Circular No. 19/2019 is summarized below:- 1. It is the settled law that any legislation/ circular etc are to be interpreted in such a way that the intention and the purpose behind the legislation get fulfilled/implemented in letter and spirit. In the instant case, both the intention and the purpose i.e. prevention of manual communication and establishing audit trail are fully established. 2. The Hon'ble Supreme Court in various cases has consistently held that a procedural violations have to be corrected if no serious prejudice is caused to a person. Further the Hon'ble Supreme Court has held that the Courts should focus more on doing substantial justice then deciding the cases of procedural /technical violations. 3. The Circular no. 19/2019 talks about the issuance of communications relating to order, notice etc and which has nothing to do so with the passing of the orders like assessment order etc which is governed by provisions of Income Tax Act. It is also reitera....
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....ven irrespective of this jurisdiction. 10. In several recent cases, the Hon'ble Supreme Court/Hon'ble Delhi High Court have held the procedural violation as technical defaults and did not quash the entire assessment proceedings and remitted the matter back to AO/DRP for fresh consideration. 11. As the issue of mention of DIN on intimation/cover letter sent along with the assessment order/notice etc. being a sufficient compliance of Circular no. 19/2019 and there is no further requirement of quoting DIN of the body of the order has been decided by the Hon'ble Kerala High Court and accordingly the various decisions of the Tribunal quoted by assessee's counsel are not being discussed separately because the decision of Hon'ble Kerala High Court is binding on the Tribunal even though some of the coordinate benches has decided the issue otherwise . because the decision of the Hon'ble Kerala High Court being very recent (i.e. 22.11.2023) of Hon'ble Bench, it has not been considered on any if the ITAT decisions submitted by assessee counsel. 5. We have taken into consideration the submissions of ld. DR. However, we find that all these submissions have been duly conside....
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....on, penalty, prosecution, rectification, approval etc. to the assessee or any other person, on or after the 15th day of October, 2019 unless a computer-generated Document Identification Number (DIN) has been allotted and is duly quoted in the body of' such communication. 3. In exceptional circumstances such as, - (i) when there are technical difficulties in generating/allotting/quoting the DIN and issuance or communication electronically; or (ii) when communication regarding enquiry, verification etc. is required to be issued by an income-tax authority, who is outside the office, for discharging his official duties; or (iii) when due to delay in PAN migration, PAN is lying with non- jurisdictional Assessing Officer; or (iv) when PAN of assessee is not avail able and where a proceeding under the Act (other than verification under section 131 or section 133 of the Act) is sought to be initiated; or (v) When the functionality to issue communication is not available in the system, the communication may be issued manually but only after recording reasons in writing in the file and with prior written approval of the Chief Commissioner / Di....
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....ed above. It is informed that the facility for generation of Document Identification Number (DIN) for documents prepared outside ITBA system and uploaded manually is now made available in Income Tax Business Application from 25/10/2019. Now, DIN can be generated prior to uploading the document in ITBA. 2. ITBA provides the functionality to capture and upload the letters, notices and orders issued manually and served on the assessee by users due to any exceptional reasons like technical issue in system etc. DIN was generated for every such document uploaded manually. However, there was no facility to quote the system generated DIN in the physical copy of documents. 3. Therefore, whenever user uploads a document which was issued outside ITBA system, DIN will be generated prior to uploading of such manual letter or notice or order in ITBA. User may use the same for reference and quoting as Doc. No. in physical copy. 4. Intimation letter will continue to be generated in ITBA. The same document will also be shared with e-Filing portal through e- Proceedings interface for authentication purpose. Assessee can verify the authenticity of the Letter or Notice or Or....
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....d 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 .. .. " 15.2 To make it crystal clear here the words 'Communication' is not used to define merely the mode of transmission of the information but the circular No 19 of 2019 makes it clear by defining it in following words "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"). So the assessment order itself is a communication and all compliances expected have to be specific to the assessment order. 15.3 Coming back to the assessment orders, in fact as para no. 1....
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....ny exceptions whatsoever. In support of this plea of assessee that the 2019 Circular is binding on the revenue Hon'ble Delhi High Court in Brandix Mauritius Holdings Ltd. (supra) has considered judgments of Hon'ble Supreme Court in UCO Bank v. CIT, [1999] 237 ITR 889 (SC), Ellerman Lines Ltd. v. CIT, [1971] 182 ITR 913 (SC) and held as follows; "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 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 Revenue and this binding character attaches to the two circulars even if they be found not in accordance with the correct interpretation of sub-section (2) and they depart or deviate from....
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.... their shareholders that if the past loans were genuinely refunded to the companies they would not be 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 circular pointed out to all the officers that it was likely that some of the companies might have advanced loans to their shareholders as a result of genuine transactions of loans, and the idea was not to affect such ....
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....orities may take benefit of limitation period provided under the Act to pass assessment order and may rectify the mistake within the limitation period and issue a fresh communication bearing DIN on the body of the communication. 9.1 But, once assessee has a statuary right to be conveyed such 'communication', as far as the immediate consequences of the communication not bearing DIN is concerned, as the same is presumed to have never been issued, such communication has no legal foundation left and becomes a voidable communication at the instance of the assessee, irrespective of assessee establishing the plea of prejudice. 10. The difference pointed out in the passing of an order and issuing communication of order is very much clarified by the Circular as the word 'communication' has been primarily used in the sense of a 'Noun', specifying what all sorts of orders, notices etc. will require DIN on the body. It is not used in the form of a 'verb' indicating the mode of transmission of information or delivery or transmitting a copy thereof as 'service of the notice' referred u/s 282 of the Act. Thus to say that there is merely an improper manner of service and such rigour is mitig....