The Income Tax Appellate Tribunal ( ITAT ), Pune Bench, has recently, in an appeal filed before it, held that assessment and rectification order does not contain DIN and that order number is invalid.
The aforesaid observation was made by the Pune ITAT, when a batch of four appeals pertaining to one single assessee Shri Sanjay P. Kothari, was filed before it, with the former assessment year 2017-18containing the assessee’s twin appeals arising against the CIT(A), Pune’s separate orders, dated 10.11.2021 and 25.01.2022, passed in case Nos.ITBA/APL/S/250/2021-22/1036818962(1)andITBA/APL/S/250/2021-22/1039080137(1), in proceedings u/s 154 and 143(3) r.w.s. 153A of the Income Tax Act, 1961, and the latter assessment year 2018-19 involvingthe assessees and Revenue’s cross appeals ITA Nos.47 and 59/PUN/2021, directed against the very CIT(A)’s DIN & order No. ITBA/APL/S/250/2020-21/1029367933(1), dated 30.12.2020 in proceedings u/s 143(3) of the Income Tax Act.
It having transpired during the course of hearing that the assessee’s twin appeals IT(SS)A Nos. 12/PUN/2021 and 11/PUN/2022,for the former assessment year 2017-18, have hardly required the ITAT Panel to delve deeper in the relevant factual matrix,it was found that neither the Assessing Officer’s assessment herein dated 27.12.2019 nor his 154 rectifications in both these appeals; respectively contain the corresponding “DIN & Order” details as prescribed in CBDT’stwin circular Nos.19/2019, dated 14.08.2019 and 27/2019 dated 26.09.2019 respectively.
The above-mentioned former circular having rather made it explicitly clear in para 4 thereof, that any communication not containing such DIN and Order number, shall be treated as invalid and shall be deemed to have never been issued, it so happened that, faced with the situation, Mr. Jasnani filed the Assessing Officer’s subsequent intimation to the assessee, dated 29.12.2019, that he had duly allotted DIN & Order number to his assessment order dated 27.12.2019.
“We find no merit in the Revenue’s instant vehement argument supporting the assessment herein as once the CBDT circular has clarified that such an order ought to be treated as to have never been issued herein. We conclude that the impugned assessment deserves to be quashed on this count alone. This tribunal’s order in ITA No.625/Bang/2021 in Shri H.K. Suresh vs. PCIT has already rejected the Revenue’s identical contentions that its default in allotting “DIN and Order” number in above terms could not be condoned by way of any subsequent intimation as well. We therefore quash the impugned assessment here in as well as the Assessing Officer’s section 154 rectification dated 04.01.2021 in very terms. These assessee’s twin appeals IT(SS)A Nos.12/PUN/2021 and 11/PUN/2022 stand accepted.”, the ITAT Bench observed.
“This leaves us with the latter assessment year 2018-19 wherein both the assessee as well as the Revenue have filed their respective appeals ITA Nos.47 & 59/PUN/2021; respectively. The sole issue that arises for our apt adjudication in both these appeals is that of “telescoping” of section 69A unexplained money addition of Rs.1,66,40,000/- made by the Assessing Officer, which has been partly allowed to be set off in CIT(A)’s order to the extent of Rs.1,18,22,400/-”, the ITAT Panel added.
With Shri Neelesh Khandelwal, the AR for the assessee having sought to delete the impugned section 69A addition of Rs.1,66,40,000/- in entirety , it was submitted by him that the same is very much eligible to be set off as well; both against unaccounted cash of Rs.1,18,22,400/- as well as unaccounted jewelry of Rs.1,00,90,400/-, as per the decisions in the cases of Kantilal & Bros. vs. ACIT and CIT vs. Jawanmal Gemaji Gandhi, so as to avoid double addition, while on the other hand, Shri M.G. Jasnani , on behalf of the Revenue, vehemently supported the Assessing Officer’s action in entirety, thereby not allowing the impugned set off.
“We have given our thoughtful consideration for vehement rival stands. Learned departmental representative could hardly dispute that the foregoing twin judicial precedents are already in assessee’s support that such a set off could very well be granted even against jewelry items and vice-versa. This is further coupled with the clinching fact that page 41 before us is the seizedmaterial against the assessee found during the course of search on 04.11.2017. There is neither any amount mentioned therein nor the sum total thereof so as to draw any presumption of correctness of contents thereof u/s 292C of the Act. Mr. Jasnani at this stage vehemently argued that the assessee‟s search statement had admitted various amounts as per the contents of seized document. We find no merit in the Revenue‟s instant argument in light of CBDT‟s twin landmark circulars dated 10.03.2003 and 18.12.2004 that a searched party‟s admissions or confessions during search or survey hardly carry any significance in the absence of any supportive evidence”, the ITAT Panel comprising of Dipak P. Ripote, the Accountant Member, along with S.S Godara, the Judicial Member noted.
Thus, allowing the assessee’s appeals, the Pune ITAT held:
“We reiterate that the foregoing sole seized document is totally “dumb” as there are no clear-cut entries which could suggest any payments or receipts, as the case may be, involving this assessee. Faced with the situation, we accept the assessee’s pleadings as well as the main appeal ITA No.47/PUN/2021 and dismiss the Revenue’s cross appeal ITA No.59/PUN/2021 as the necessary corollary.”
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