The Banglore Bench of the Income Tax Appellate Tribunal ( ITAT ) has recently held that non-mentioning of Document Identification Number (DIN) as per the instruction of the Central Board of Direct Taxes (CBDT) in Circular 19/2019 dated 14.08.2019 invalidates the revision order and consequently set aside the impugned order.
The appellant-assessee, H K Suresh submitted that, The impugned order passed by the learned Principal Commissioner of Income Tax is without a valid Document Identification No. (DIN) and consequently, the revision order is invalid and non-est on the facts and circumstances of the case.
The assessee raised many grounds pertaining to the revision order passed by the PCIT setting aside the order of the AO to make a fresh assessment on the point of payments amounting to Rs.17 crores.
On behalf of the assessee, Chartered Accountant Hemanth Pai submitted that the order under Section 263 of the Income Tax Act is a manual order without any DIN mentioned therein and therefore the order passed is in violation of the CBDT Circular No.19 of 2019 dated 14.8.2019. The representative also pointed out paragraph 3 of the said circular wherein the CBDT had laid down certain procedures to be followed when a manual order is issued under exceptional circumstances.
The representative contended further that as per para 4 of the Circular, any communication which is not in conformity with paragraphs 2 & 3 of the said Circular shall be treated as invalid. He also prayed that the order be quashed on this legal ground.
On behalf of the department, Commissioner of Income Tax Vandana Ramachandan submitted that as per Circular, DIN was mandated for maintaining proper audit trail of all communications and therefore the PCIT generating DIN in a separate intimation on the same date of the order under Section 263 of the Income Tax Act is valid and needs to be considered along with the order.
The Tribunal Bench of Judicial Member George George K and Accountant Member Padmavathy S observed that, ‘the order under Section 263 of the Income Tax Act neither contains the DIN in the body of the order, nor contains the fact in the specific format as stated in Para 3 that the communication is issued manually without a DIN after obtaining the necessary approvals” and held that, the impugned order is not in conformity with Para 2 and Para 3 of the CBDT circular and quashed it.
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