TMI Blog2024 (2) TMI 36X X X X Extracts X X X X X X X X Extracts X X X X ..... LHI HIGH COURT] The case of the assessee also finds support by the subsequent decisions of the Hon ble Calcutta High Court in the case of M/s. Tata Medical Centre Trust [ 2023 (9) TMI 1324 - CALCUTTA HIGH COURT] and Hon ble Bombay High Court in the case of Ashok Commercial Enterprises [ 2023 (9) TMI 335 - BOMBAY HIGH COURT] wherein the Hon ble Bombay High Court, inter-alia held that subsequent generation of the DIN will not be sufficient as the requirement of the CBDT Circular, is quoting of the DIN, in the body of such communication and / or order. Thus we are inclined to quash the assessment order passed by the AO under section 143(3) of the Act. - SHRI M. BALAGANESH, ACCOUNTANT MEMBER AND MS. ASTHA CHANDRA, JUDICIAL MEMBER For the Appellant : Dr. Rakesh Gupta, Advocate For the Respondent : Ms. Harpreet Kaur, Sr. DR ORDER PER ASTHA CHANDRA, JM The appeal filed by the Revenue and the cross objection filed by the assessee is directed against the order dated 31.03.2023 of the Ld. Commissioner of Income Tax (Appeals) 26, New Delhi ( CIT(A) ) pertaining to Assessment Year ( AY ) 2017-18. 2. The Revenue has taken the following grounds: i. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e leave to add, amend, modify, delete any of the ground(s) of cross objection before or at the time of hearing. 4. At the outset, the Ld. AR submitted that the ground of cross objection No. 2 wherein the assessee has challenged the legal sanctity of the impugned assessment order as it was passed in absence of DIN, goes to the root of the matter and hence the matter be heard and decided on this ground alone. We agree with submission of the assessee and proceed to take up this ground first. 5. The Ld. AR invited our attention to the order of the Ld. Assessing Officer ( AO ) dated 31.12.2019 for AY 2017-18 passed under section 143(3) of the Income Tax Act, 1961 (the Act ) which was the subject matter of appeal before the Ld. CIT(A). He pointed out that it will be observed that there is no mention of Document Identification Number ( DIN ) in the body of the assessment order. He further submitted that perusal of the order would also reveal that there is no mention of any reason for non-issuance of DIN nor does it mention the date and number of approval of Director General / Chief Commissioner of Income Tax for issuing the order without DIN. The requisite condition mentioned in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave also gone through the CBDT Circular No. 19/2019 dated 14.08.2019, which reads as under:- 8. In para 2 thereof it is stated that in order to prevent instances (narrated in the opening para) and to maintain audit trail of all communication, no communication shall be issued by any Income Tax Authority to the assessee or any other person on or after the 1 st day of October, 2019 unless a computer generated DIN has been allotted and is duly quoted in the body of such communication. In the present case at hand, undoubtedly, the impugned assessment order is one such communication which has been issued by the Ld. AO without allotting a computer generated DIN and duly quoting in the body of the impugned assessment order. There is thus clear violation of the specific requirement under the CBDT Circular No. 19/2019 to allot and quote the DIN in the body of the impugned assessment order. 9. Para 3(i),(ii),(iii),(iv) and (v) of the Circular No. 19/2019 enumerate the exceptional circumstances in which the Income Tax Authority may issue the communication manually but only after recording reasons in writing in the file and with the prior written approval of Chief Commissioner/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner / Director General of Income Tax. The fact remains that the assessment order does not contain the DIN and any reason for non-issuance of DIN. The DIN has to be generated prior to the assessment order being uploaded on the ITBA Systems as per the Instructions from Directorate of Income Tax (System) dated 25.10.2019. Subsequent generation of DIN and uploading of the same on ITBA will not, in our view, validate this deficiency. 13. In taking the above view, we are supported by the ratio decidendi of the decision of Hon ble jurisdictional High Court of Delhi in CIT (International Taxation) vs. Brandix Mauritious Holdings Ltd. dated 20.03.2023 reported in (2023) 293 Taxman 385 (Delhi) wherein the Hon ble Delhi High Court dismissed the Revenue s appeal observing and holding as under:- 8.1 In a nutshell, communications referred to in the 2019 Circular would fall in the following slots: i. Those which do not fall in the exceptions carved out in paragraph 3(i) to (v) ii Those which fall in the exceptions embedded in paragraph 30 to (v), but do not adhere to the regime set forth in the 2019 Circular. 8.2 Therefore, whenever communications are issued in the circ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 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 such construction. It is now well settled as a result of two decisions of this Court, one in Navnitlal C. Javeri v. K.K. Sen [AIR 1965 SC 1375 : (1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 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 transactions and not to bring them within the mischief of the new provision. The directions given in that circular clearly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ither 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. 22. Accordingly, the appeal filed by the appellant/revenue is closed. 14. The case of the assessee also finds support by the subsequent decisions of the Hon ble Calcutta High Court in the case of M/s. Tata Medical Centre Trust (ITAT/202/2023) dated 26.09.2023 and Hon ble Bombay High Court in the case of Ashok Commercial Enterprises (WP. No.2595 of 2021 with WP. No. 2953 of 2021, 2847, 2588, 2598, 2597, 2696, 2625, 2594 of 2021) wherein the Hon ble Bombay High Court, inter-alia held that subsequent generation of the DIN will not be sufficient as the requirement of the CBDT Circular, is quoting of the DIN, in the body of such communication and / or order. 15. In view of the above factual matrix of the assessee s case and in the light of the various decisions (supra) of the Hon ble High Courts as well as the binding CBDT Circular 19/2019, we are inclined to quash the assessment order dated 31.12.201 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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