TMI Blog2022 (7) TMI 1334X X X X Extracts X X X X X X X X Extracts X X X X ..... ] wherein it was held that circulars bind the ITO but will not bind the appellate authority or the Tribunal or the Court or even the assessee. The department, CBDT circular and the judicial precedents including that of Hon ble Supreme Court and the jurisdictional High Court of Calcutta, we are inclined to adjudicate on the additional ground in favour of the assessee by holding that the order passed by the Ld. CIT(E) is invalid and deemed to have never been issued as it fails to mention DIN in its body by adhering to the CBDT circular no. 19 of 2019. Accordingly, additional ground taken by the assessee is allowed. Having so held on the legal issue raised by the assessee in the additional ground, the grounds relating to the merits of the case requires no adjudication. Accordingly, the appeal of the assessee is allowed in terms of above observations and findings. Appeal of the assessee is allowed. - ITA No.238/Kol/2021 - - - Dated:- 18-7-2022 - SHRI SANJAY GARG, JUDICIAL MEMBER AND SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER Appellant by :Shri Akshay Ringasia, CA Tarak Nath Jaiswal, Advocate Respondent by : Shri Deb Kr. Sonowal, CIT, DR O R D E R PER GIR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or its admission and adjudication in the interest of justice. In this respect, for ease of reference, Rule 11 of the ITAT Rules is reproduced as under: 11. The appellant shall not, except by leave of the Tribunal, urge or be heard in support of any ground not set forth in the memorandum of appeal, but the Tribunal, in deciding the appeal, shall not be confined to the grounds set forth in the memorandum of appeal or taken by leave of the Tribunal under this rule : Provided that the Tribunal shall not rest its decision on any other ground unless the party who may be affected thereby has had a sufficient opportunity of being heard on that ground. 6. On going through the above Rule, we note that assessee can take any ground not set forth in the Memorandum of Appeal but only with the leave of the Tribunal for which sufficient opportunity of being heard is to be granted to the party being affected thereby. To this effect, submissions of the Ld. Counsel of the assessee were confronted to the Ld. CIT, DR who did not object upon. Thus, in terms of Rule 11 and further, by respectfully following the decision of Hon ble Supreme Court in the case of NTPC (supra) and also in the inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y 11 AM of 30.03.2021. Ld. Counsel submitted that assessee filed its reply on 30.03.2021 and the impugned order was passed on the last date of the time barring period i.e. on 31.03.2021 with a direction to Ld. AO to make addition under different heads. In view of the additional ground taken, Ld. Counsel stated that the impugned order passed u/s. 263 of the Act did not contain any Document Identification No. (DIN) nor any reason for non issuance of DIN along with the impugned order. According to the ld. Counsel, impugned order is without any DIN which is in violation of the very basic object of CBDT Circular No.19/2019 dated 14.08.2019. He further stated that non-issuance of DIN has not been acknowledged in the body of the impugned order so as to clarify the reason for its non-issuance. He submitted that the whole objective of the said CBDT Circular requiring a mandatory quoting of DIN in all the communications of the department is to maintain the audit trail which otherwise gets lost. In order to tackle this ambiguity, the said circular vide para 4 renders such orders without a DIN as invalid or deemed to have never been issued . The arguments made by the Ld. Counsel in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 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 audit trail of such communication. 2. In order to prevent such instances and to maintain proper audit trail of all communication, the Board in exercise of power under section 119 of the Income-tax Act, 1961 (hereinafter referred to as 'the Act ), has decided 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 Document Identification Number (DIN) has been allotted and is duly quoted in the body or 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 aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of this Circular, the income-tax 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. (Sarita Kumari) Director (ITA.II), CBDT (F.No. 225/95/2019-ITA.II) 12. From the perusal of above circular, we note that CBDT came out with this circular to mitigate the issues/instances where certain notices, orders, summons, letters and other correspondences which have been issued manually do not have proper audit trail of their communication despite various e-governance initiatives and computerization of its work. Therefore, in order to prevent such instances and to maintain proper audit trail of all the communications, CBDT directed that no communication shall be issued by any Incometax 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 01.10.2019 unless a computer generated DIN has been allotted and is duly quoted in the body of such communication. We note that para 3 of the said circular provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... communication in the prescribed format has to be stated therein. In the present case, no such fact of issuing the present order manually without a DIN by obtaining an approval from prescribed authority in the prescribed format is mentioned/quoted in the body of the impugned order and, therefore, even if the case records are verified, it will not serve any purpose since the impugned order itself does not contain any such factual notation as contemplated in para 3 of the CBDT circular. 12.3 In order to demonstrate how a communication issued electronically containing a DIN would look like, the Ld. Counsel referred to one such notice u/s. 154 dated 08.10.2020 issued on the assessee, placed at paper book page 53, scanned copy of which is reproduced hereunder for ease of reference: 12.4 From this notice, Ld. Counsel pointed out that on the top left corner it bears a Bar Code. Further, in the box on the top of right hand side it bears a DIN and Notice No. Also, in the body of the notice, it mentions about the fact that document is digitally signed. Further, in the left bottom of the said notice, there is a legend put with an asterisk (*) mark which says DIN . 12.5 In contra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e power for its own advantage under the Act is given the right to forgo the advantage when required to wield it in a manner it considers just by relaxing the rigour of the law or in other permissible manners as laid down in section 119. The power is given for the purpose of just, proper and efficient management of the work of assessment and in public interest. It is a beneficial power given to the Board for proper administration of fiscal law so that undue hardship may not be caused to the assessee and the fiscal laws may be correctly applied. Hard cases which can be properly categorized as belonging to a class, can thus be given the benefit of relaxation of law by issuing circulars binding on the taxing authorities. 13.3 In the matter of Nayana P. Dedhia [2004] 270 ITR 572 (AP), the Hon ble Andhra Pradesh High Court held that the guidelines issued by the Board in exercise of powers in terms of section 119 of the Act relaxing the rigours of law are binding on all the officers responsible for implementation of the Act and, therefore, bound to follow and observe any such orders, instructions and directions of the Board. 13.4 In the decision of DCIT v. Sunita Finlease Ltd. [201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... annot act with discrimination. In case, it does that, the act of the department is bound to be struck down under Article 14 of the Constitution. In the facts of the case, it is not necessary for us to decide whether the intention of CBDT was to restrict the period of issuance of notice from the date of filing the return laid down under section 143(2) of the I.T. Act. [emphasis supplied by us by underline] 14. Considering the facts on record, perusal of the impugned order, submissions made by the Ld. Counsel and the department, CBDT circular and the judicial precedents including that of Hon ble Supreme Court and the jurisdictional High Court of Calcutta, we are inclined to adjudicate on the additional ground in favour of the assessee by holding that the order passed by the Ld. CIT(E) is invalid and deemed to have never been issued as it fails to mention DIN in its body by adhering to the CBDT circular no. 19 of 2019. Accordingly, additional ground taken by the assessee is allowed. Having so held on the legal issue raised by the assessee in the additional ground, the grounds relating to the merits of the case requires no adjudication. Accordingly, the appeal of the assessee is all ..... X X X X Extracts X X X X X X X X Extracts X X X X
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