TMI Blog2023 (11) TMI 396X X X X Extracts X X X X X X X X Extracts X X X X ..... e 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 [ 2023 (8) TMI 378 - ITAT DELHI] which says 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. - Decided in favour of assessee. - Shri Shamim Yahya, Accountant Member And Shri Kul Bharat, Judicial Member For the Assessee : Shri Ravi Sharma, Advocate, Ms. Salini Sheetal, AR For the Revenue : Shri Vijay B. Vasanta, CIT DR ORDER PER SHAMIM YAHYA, ACCOUNTANT MEMBER : These appeals by the assessee are directed against the respective orders of the Assessing Officer pursuant to the directions issued by the DRP for the respective assessment years. 2. Since the issues are common and the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, the signature of each of the Panel members is taken on the DRP order. To prevent any further inadvertent editing from happening after signatures have been taken, the document is uploaded on ITBA in a PDF format. After being uploaded on ITBA portal, the DIN is generated on ITBA portal itself. In this case, the directions/orders u/s 144C(5) for A.Y. 2013-14, 2015-16, 2016-17 and 2017-18 were uploaded on the system on different dates for which DIN [Documents Identification Numbers] were generated by the system. The details of DIN generated are as under:- Sl.No. A.Y. Date of uploading on ITBA DINs generated through ITBA for uploading manual direction/order 1. 2013-14 16.12.2022 ITBA/DRP/M/144C(5)/2022-23/1048078560(1) 2. 2015-16 15.12.2022 ITBA/DRP/M/144C(5)/2022-23/1048079341(1) 3. 2016-17 15.12.2022 ITBA/DRP/M/144C(5)/2022/1048079035(1) 4. 2017-18 16.12.2022 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... being generated electronically on the Income fax Business Application (ITBA) platform. However, it has been brought to the notice of the Central Board 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 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 1SI 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pal 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 income-tax authorities shall identify such cases and shall upload the notices in these cases on the Systems by 31st October, 2019. 8. Hindi version to follow. Sd/- (Sarita Kumari) Director (ITA, II) CBDT (F. No. 225/95/2019-1TA.H) Copy to:- i. PS to FM/OSD to FM/PS to MoS(F)/OSD to MoS(F) ii. PS to Secretary (Revenue) iii. Chairman, CBDT All Members. CBDT iv. All Pr.CCsIT/Pr.DsGIT v. All Joint Secretaries/CslT, CBDT vi. C AG vii. CIT (M TP), Official Spokesperson of CBDT viii. O/o Pr. DGIT(Systems) for uploading on official website ix. Addl.CIT (Database Cell) for uploading on the departmental website Sd/- (Sarita Kumari) Director (ITA, II) CBDT 7. The compliance is not in accordance with the Circular. The Circular mandates that in the body of the order / communication, it has to be stated that the communication is issued manually without a DIN and the date of obtaining of the written approv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... N number in order of the DRP. Is such a situation, the DRP order will lose its validity. Subsequent separate communication of DIN is a superfluous exercise. In this regard, we are referring to the decision of the Hon ble jurisdictional High Court in the case of CIT vs Brandix Mauritius Holdings Ltd. (2023)(4) TMI 579 (Delhi High Court). The Hon ble Delhi High Court has held as under:- 12. We have heard learned counsel for the parties. The present appeal is preferred under Section 260A of the Act. The Court s mandate, thus, is to consider whether or not a substantial question of law arises for consideration. 12.1 As noted above, the impugned order has not been passed on merits. 13. The Tribunal has applied the plain provisions of the 2019 Circular, based on which, it has allowed the appeal preferred by the respondent/assessee. 14. The broad contours of the 2019 Circular have been adverted to by us hereinabove. 14.1 Insofar as the instant case is concerned, admittedly, the draft assessment order was passed on 30.12.2018. 15. The respondent/assessee had filed its objections qua the same, which were disposed of by the Dispute Resolution Panel [DRP] via order dated 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1965) 1 SCR 909 : 56 ITR 198] was in regard to the constitutional validity of Sections 2(6- A)(e) and 12(1-B) which were introduced in the Indian Income Tax Act, 1922 by the Finance Act, 1955 with effect from April 1, 1955. These two sections provided that any payment made by a closely held company to its shareholders by way of advance or loan to the extent to which the company possesses accumulated profits shall be treated as dividend taxable under the Act and this would include any loan or advance made in any previous year relevant to any assessment year prior to Assessment Year 1955-56, if such loan or advance remained outstanding on the first day of the previous year relevant to Assessment Year 1955-56. The constitutional validity of these two sections was assailed on the ground that they imposed unreasonable restrictions on the fundamental right of the assessee under Article 19(1)(f) and (g) of the Constitution by taxing outstanding loans or advances of past years as dividend. The Revenue however relied on a circular issued by the Central Board of Revenue under Section 5(8) of the Indian Income Tax Act, 1922 which corresponded to Section 119 of the present Act and this circula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... understatement of the consideration in respect of the transfer. [Emphasis is ours] 17.3 Also see the following observations of a coordinate bench in Back Office IT Solutions Pvt. Ltd. v. Union of India , 2021 SCC OnLine Del 2742, in the context of the impact of circulars issued by the revenue: 24....In this context, tax administrators have to bear in mind the well- established dicta that circulars issued by the statutory authorities are binding on them, although, they cannot dictate the manner in which assessment has to be carried out in a particular case. A Circular cannot be sidestepped causing prejudice to the assessee by bringing to naught the object for which it is issued. [See: K.P. Varghese vs. Income-tax Officer 1, [1981] 7 Taxman 13 (SC); Also see: UCO Bank, Calcutta v. Commissioner of Income Tax, W.B., (1999) 4 SCC 599], 18. The argument advanced on behalf the appellant/revenue, that recourse can be taken to Section 292B of the Act, is untenable, having regard to the phraseology used in paragraph 4 of the 2019 Circular. 19. The object and purpose of the issuance of the 2019 Circular, as indicated hereinabove, inter alia, was to create an audit trai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax 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 to 3.1 of the assessment order dated 09.08.2021 are considered they mention that notice u/s 153A of the Act was issued through ITBA portal. Subsequent notice u/s 143(2) of the Act was also issued through ITBA Portal. Thus, the notices for the purpose of assessment were issued through ITBA Portal and if thereafter the assessment was carried out manually the assessment order should have mentioned the aforesaid fact to comply with the mandate of Circular with regard to communications issued manually. 16. Furth ..... X X X X Extracts X X X X X X X X Extracts X X X X
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