The absence of a Document Identification Number (DIN) in tax communications renders them invalid, necessitating strict compliance with procedural requirements to maintain audit trails as per the CBDT Circular.

JUDGMENT :

SUNDER MOHAN, J.

1. By consent, the captioned Tax Case Appeal is taken up for final hearing and disposed of at the admission stage itself.

2. Respondent/assessee aggrieved by the final assessment order passed under Section 143 (3) r/w Section 144C (13) r/w Section 254 of the INCOME TAX ACT , 1961 [hereinafter referred to as ‘the Act’] for the assessment year 2015-16 filed an appeal in IT (TP) A.No.44/CHNY/2021, before the Income Tax Appellate Tribunal [hereinafter referred to as ‘ITAT’].

3. ITAT by impugned order allowed the appeal holding that the direction issued by the Dispute Resolution Panel [hereinafter referred to as 'DRP'] under Section 144C (5) of the Act did not contain a Document Identification Number [hereinafter referred to as 'DIN'] as mandated by the Central Board of Direct Taxes [hereinafter referred to as ‘CBDT’] by its Circular No.19/2019 [F.No.225/95/2019-ITA II] dated 14.08.2019 [hereinafter referred to as 'Circular']; that the subsequent communication intimating the DIN for DRP proceedings did not satisfy the conditions prescribed in paragraph No.3 of the circular; and that therefore, the directions are invalid in law and as a sequitur, the assessment order which was impugned before ITAT is liable to be quashed. In the instant case, the assessment order also did not contain a DIN. Aggrieved by the said order passed in common along with the challenges made by other assessees raising the same points, appellant is before us.

4. Appellant in the grounds of appeal has proposed the following substantial questions of law.

“1. Whether on the facts and circumstances of the case the Income Tax Appellate Tribunal is correct in holding that that department has not complied with the CBDT Circular No.19/2019 dated 14.08.2019 even when the manual order was communicated with DIN and in addition to that order was also communicated by e-portal and email with intimation letter and that also had DIN and the information of the DIN of the assessment order, all these were done within 15 days as mandated in the said Circular.

2. Whether on the facts and circumstances of the case, the Ld. Income Tax Appellate Tribunal had failed to consider that electronic quoting of DIN is only a procedural issue and the fact that DIN is issued only to keep track of the proceedings for audit trial of the department and to ensure genuineness of the orders passed and that non- mentioning of the DIN in the DRP order electronically which was otherwise generated immediately and informed to the assessee is sufficient compliance of the CBDT Circular No.19/2019 dated 14.08.2019.

3. Whether the Ld. Income Tax Appellate Tribunal is right in not appreciating the fact that the impugned final assessment order had electronically generated valid DIN which order alone is challengable before the ITAT and that the directions of the DRP merged with the final assessment orders serves only as a guidance to the Assessing Officers to pass the final assessment orders.”

5. Mr. Karthik Ranganathan, learned counsel for appellant/revenue, submitted that DRP proceedings had a valid DIN and was also subsequently communicated to assessee by another communication and therefore, the requirement under the circular has been complied with; and that in any case, assessee had not challenged the directions issued by DRP and therefore, the impugned assessment order ought not to have been quashed.

6. Mr. Balaji, learned counsel for respondent/assessee submitted that apart from the fact that a DIN was not generated electronically for DRP proceedings, the subsequent communication does not satisfy the requirement in paragraph No.3 of the circul