The Pune Bench of Income Tax Appellate Tribunal ( ITAT ) invalidated the impugned order issued without the signature of the first appellate authority. The tribunal remanded the matter back to the National Faceless Appeal Centre ( NFAC ) for re-adjudication.
Assessee, Baban Tukaram Khade received an order on 12.01.2024 from the NFAC under section 250 of the Income-tax Act, 1961, for the assessment year 2017-18. The impugned order was communicated online by the NFAC which lacked a digital or physical sign. The assessee appealed before the Income Tax Appellate Authority, Pune.
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The assessee’s representative Sanket Joshi, grabbed the tribunal’s attention toward the impugned first appellate order dated 12.01.2024 which was communicated to the assessee through the web portal before stating any facts or merits of the case. The impugned order bears the DIN number but was not signed either digitally or physically by the NFAC.
The counsel argued that the impugned order was not signed by the authority and it should be treated as non-est. The counsel prayed to remand the matter to the NFAC for re-adjudication to ensure justice. On the other hand, the revenue accepted the fact that there was indeed a mistake made by the NFAC and did not object to the assessee’s request for re-adjudication.
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Hearing both sides, the two-member bench comprising G. D.Padmahshali (Accountant Member) and Vinay Bhamore (Judicial Member) observed that under Section 282A of the Income-tax Act and Rule 127A of the Income Tax Rules, 1962, any notice or document related to income tax must be signed by the issuing authority, either physically or digitally.
The tribunal noted that any notice or other document issued not following the provisions of Section 282A of the Income Tax Act r.w.s. 127A of Income Tax Rules renders is deemed irregular and ceases to have any effect in law. The tribunal referred to the Bombay High Court case of Ramani Suchit Malushte vs UOI where it was held that an order without a digital signature has no legal effect.
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The Tribunal observed that in this case the impugned order was communicated electronically and does bear no digital signature of the first appellate authority who adjudicated the appeal, rendering it ineffective in the eyes of law. Thus, the tribunal set aside the impugned order, and the matter was remanded to the NFAC for re-adjudication.
The tribunal directed the NFAC to provide three effective hearing opportunities before making the decision. The tribunal emphasized that the NFAC must pass a speaking order in compliance with Section 250(6) and Section 282A of the Income-tax Act. The assessee’s appeal was allowed.
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