The CBDT has through Circular No.19 / 2019 dated 14.08.2019 made it compulsory
that on and from 01.10.2019 a DIN has to be duly allotted and quoted in the body of
all communication. This the Board has clarified has to be in respect of all
communications issued by any Income Tax Authority relating to assessment,
appeals, orders, statutory or otherwise, exemptions, enquiry, investigation,
verification of information, penalty, prosecution, rectification, approval etc. The Board
also clarified certain exceptional circumstances where the communication can be
issued manually and the manner of regularising the same. The said Circular makes it
clear that communications issued which is not in compliance with the Circular shall
be treated to be invalid and shall be treated never to have been issued.
The Delhi High Court in CIT (International Taxation) v Brandix Mauritius Holdings Ltd
[20230 149 taxmann.com 238 (Del) has held that an order passed without a DIN
would be invalid and will have to be struck down. A similar view was taken by the
Kolkata Tribunal in Tata Medical Centre Trust v CIT [2022] 140 taxmann.com 431
(Kol Trib) and the Bangalore Tribunal in Dilip Kothari v PCIT [2023] 146 taxman.com
442 (Bang Trib). In the case before the Bangalore Tribunal, the issue was with
regard to a case where the DIN was not found in the body of the order though a DIN
had been generated. The Tribunal after considering the CBDT circular held that the
non quoting of the DIN on the face of the order rendered the order invalid.
Recently the Madras High Court in Ericsson India Private Limited v Deputy
Commissioner of Customs & Ors. 2023 (3) TMI 1290 – Madras High Court had an
occasion to consider the effect of communication without a DIN. This decision was
rendered in the context of the Customs Act and after considering the circulars issued
in that context held that a communication without a DIN was invalid. Therefore one
has to in each and every case examine whether the Board circular is complied in
letter and spirit and thereafter come to conclusion as to whether the said
communication is valid or invalid. A view can however be taken that where a notice
is non jurisdictional though the notice may be invalid but the proceeding per se or the
order may not be invalid if such order is compliant with the circular.
A view that a show cause notice u/s.263 without a DIN is valid since the purpose is
served by giving an opportunity to the assessee is satisfied, has been taken by the
Cochin Bench of the Tribunal in Viswanatha Manoj Kumar v PCIT 2023 (6) TMI 573
– ITAT Cochin
One may also look at the impact of the Circular where the DRP has issued directions
in terms of section 144C where there is a variation as a result of a TP adjustment or
where the assessee is a non-resident not being a company or any foreign company.
It is possible that one may urge that DRP directions are valid even without a DIN
since it is not a notice, order, summons, letter or any correspondence. However one
can see that the Board Circular clearly refers to “any correspondence” and further
does not merely lists out the communication relating to assessment, appeals, orders,
statutory or otherwise, exemptions, enquiry, investigation, verification of information,
penalty, prosecution, rectification, approval which must contain DIN but also
thereafter uses the word “etc” which clearly indicate that even a direction of the DRP
must contain a DIN as contemplated by the said Circular. Non-compliance with the
Circular will render the directions invalid and any order passed consequent to the
said direction, by an AO would also be invalid.
DIN, # Mandatory, # on the face of order, # DRP directions
