Absence of Generated DIN in Notice of demand u/s 156 of Income Tax Act: ITAT quashes assessment order and Notice demand [Read Order]

In a major ruling, The Income Tax Appellate Tribunal (ITAT) quashed the assessment order and notice of demand under Section 156 of the Income Tax Act, 1961, due to the absence of a generated Document Identification Number (DIN) in the notice of demand.

The assessee against the order of the Commissioner of Income Tax (Appeals)-Delhi (‘CIT(A)’ dated 03.10.2023 arising from the assessment order dated 30.03.2022 passed by the Assessing Officer (AO) under Section 147 r.w. Section 143(3) of the Income Tax Act, 1961, concerning AY

The counsel for the assessee Mr. Pranshu Singhal submitted that the assessee had questioned the non-availability of DIN on the body of notice of demand before the CIT (A) which was decided with disfavor. However, the assessee also now raised the grounds of appeal no.2 to contend that the assessment order itself is vitiated due to violation of Circular No.19 of 2019 as such assessment order do not bear any DIN in the body of the order

 It was contended that firstly, the DIN was not recorded in the body of the communication, i.e., assessment order under Section 147 of the Income Tax Act, and consequently such DIN has been intimated to the assessee after the issuance of the assessment order. No reasons have been assigned for not assigning the DIN in the body of the assessment order.

Ms. Kirti Sankratyayan representing  the Revenue submitted that DIN has been duly issued in so far as the assessment order is concerned as intimated by separate intimation letter dated 30.03.2022. Substantial compliance to the CBDT circular has thus been made.

It was further submitted that the circular of the CBDT should not be read like a statute to give such strict interpretation where compliance of identification of assessment order on the records of Income Tax Department has been carried out. Furthermore submitted that the assessment order should not be disturbed based on such purported procedural defects.

The single member bench of the tribunal comprising Pradip Kumar Kediya (Accountant member) observed that DIN has not been mentioned in the body of assessment order. However, DIN has been separately issued and intimated to the assessee vide letter dated 30.03.2022 which appears to have been issued on 31.03.2022, i.e., subsequent to the issuance of assessment order. Thus, it was evident that at the time of issue of assessment order DIN was not assigned. Be that as it may, no DIN was found in the body of the assessment order. Similarly, no DIN has been generated at all while issuing the notice of demand under Section 156 of the Act.

The tribunal therefore found merit in the plea of the assessee for quashing the assessment order at the threshold. The assessment order as well as the notice of demand in question thus stands quashed.  In such a view of the matter, ITAT not inclined to address the issue raised on merits.

To Read the full text of the Order CLICK HERE

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