KALIYAPERUMAL PADMANABAN,CUDDALORE vs. ITO, WARD-2, , CUDDALORE

आयकर अपीलीय अिधकरण, ’सी’
यायपीठ, चे ई।
IN THE INCOME TAX APPELLATE TRIBUNAL
‘C’ BENCH: CHENNAI

ी एबी टी. वक
, ाियक सद एवं
एवं
एवं
एवं

ी अिमताभ शुा, लेखा सद के सम

BEFORE SHRI ABY T. VARKEY, JUDICIAL MEMBER AND SHRI AMITABH SHUKLA, ACCOUNTANT MEMBER

आयकर अपील सं./ITA No.1176/Chny/2025
िनधारण वष/Assessment Year: 2012-13

Kaliyaperumal Padmanaban,
North Street, Karikuppam,
C. Puthupettai,
Parangipettai,
Cuddalore-608 502. v.
The ITO,
Ward-2,
Cuddalore.
[PAN: BVPPP 3938 R]

(अपीलाथ/Appellant)

(यथ/Respondent)

अपीलाथ क ओर से/ Appellant by :
Mr.N. Arjun Raj, Advocate
यथ क ओर से /Respondent by :
Ms. Anitha, Addl. CIT
सुनवाईकतारीख/Date of Hearing
:
15.07.2025
घोषणाकतारीख /Date of Pronouncement
:
25.08.2025

आदेश / O R D E R
PER ABY T. VARKEY, JM:

This is an appeal preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals)/NFAC, (hereinafter referred to as “the Ld.CIT(A)”), Delhi, dated 28.02.2025 for the Assessment Year (hereinafter referred to as "AY”) 2012-13. 2. At the outset, the Ld.AR of the assessee wanted us to take up the legal issue which according to him was that the AO failed to follow the prescription of law while passing the assessment order dated 29.09.2021
Kaliyaperumal Padmanaban
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u/s.144 r.w.s.147 of the Income Tax Act, 1961 (hereinafter referred to as "the Act”). Drawing our attention to the assessment order dated
29.09.2021, the Ld.AR pointed out that there is no “DIN” endorsed on the body of the assessment order, which is in violation of the binding order of the CBDT Circular No.19/2019 dated 14.08.2019. Therefore, according to the Ld.AR, the omission of the AO not complying with the aforesaid CBDT
Circular and communicating the assessment order without quoting “DIN”
[electronically], the assessment order is invalid. For such a proposition, the Ld.AR cited the decision of the Hon’ble Madras High Court dated
10.06.2025 in the case of CIT, International Taxation, Chennai v.
M/s.Laserwoods US Inc. [TCA No.46 of 2025]. And also cited the decision of the Hon’ble Bombay High Court in the case of Ashok Commercial
Enterprises v. ACIT reported in [2023] 154 taxmann.144 (Bom.) and number of other cases. Therefore, in the light of the aforesaid submissions, the Ld.AR wants us to allow the legal issue raised before us.
3. Per contra, the Ld.DR submitted that the “DIN” was generated, but the same has couldn’t be incorporated in the assessment order dated
29.09.2021. But immediately thereafter i.e., on the same day, an intimation letter was issued with DIN:ITBA/AST/S/91/2021-
22/1036022859(1) which was communicated to the assessee and drew our attention to the copy of the report by the ITO Ward-2, Cuddalore wherein the aforesaid facts have been reiterated. Therefore, according to Kaliyaperumal Padmanaban
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the Ld.DR, since the “DIN” has been intimated to the assessee on the same day, and there can’t be any prejudice caused to the assessee and therefore, the legal issue needs to be dismissed.
4. Having heard both the parties and after perusal of the records, it is noted that the impugned assessment order has been passed by the AO on 29.09.2021 u/s.144 r.w.s.147 of the Act for AY 2012-13 without incorporating in its body, the “DIN”. In the absence of “DIN” being not quoted in the assessment order, we find the action of the AO passing the assessment order to be in violation of the binding Circular No.19/2019 of CBDT dated 14.08.2019, which omission vitiates the assessment order.
The Ld.AR has drawn our attention to Para No.4 of the ibid Circular and asserted that if “DIN” is not quoted in the body of the assessment order, then the assessment should be treated as invalid and deemed to have never been issued. It would be gainful to refer to the contents of the Circular No.19/2019 which reads as under:
Circular No.19/2016 [F.No.225/95/2019-ITA.II], dated 14.08.2019. Subject: Generation/Allotment/Quoting of Document Identification Number ins
Notice/Order/Summons/letter/correspondence issued by the Income-tax
Department -reg.

With the launch of various e-governance initiatives, Income-tax
Department is moving toward total computerization of its work. This has led to a significant improvement in delivery of services and has also brought greater transparency in the functioning of the tax-administration. Presently, almost all notices and orders are being generated electronically on the Income Tax
Business Application (ITBA) platform. However, it has been brought to the notice of the Central Board of Direct Taxes (the Board) that there have been some instances in which the notice, order, summons, letter and any correspondence (hereinafter referred to as "communication") were found to have been issued manually, without maintaining a proper audit trail of such communication.
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iii.
communicating the DIN so generated to the assessee/any other person as per electronically generated pro-forma available on the System.

(iii) when due to delay in PAN migration, PAN is lying with non- juri ictional Assessing Officer; or (iv) when PAN of assessee is not available and where a proceeding under the Act (other than verification under section 131 or section 133
of the Act) is sought to be initiated; or (v) When the functionality to issue communication is not available in the Neutral
Citation
No:
2023:DHC:2502-DB system, the communication may be issued manually but only after recording reasons in writing in the file and with prior written approval of the Chief Commissioner / Director General of income tax. In cases where manual communication is required to be issued due to delay in PAN migration, the proposal seeking approval for issuance of manual communication shall include the reason for delay in PAN migration. The communication issued under aforesaid circumstances shall state the fact that the communication is issued manually without a DIN and the date of obtaining of the written approval of the Chief Commissioner /
Director General of Income-Tax for issue of manual communication in the following format-
"..This communication issues manually without a DIN on account of reason/reasons given in para 3 (i)/3(iI)/3 (iii)/3
(iv)/3 (v) of the CBDT Circular No ... dated .... . (strike off those which are not applicable) and with the approval of the Chief Commissioner / Director General of Income Tax vide number .... dated .. .. "
5. It is relevant to note that insofar as the exceptions given in paragraph 3 (i),
(ii) and (iii) are concerned, the specified authority is required to take steps to regularise the failure to quote DIN within fifteen (15) working days. The manner in which regularisation is to take place is set out in paragraph 5. Once again, for the sake of convenience, the relevant part of paragraph 5 of the 2019 Circular is extracted hereafter:
"5. The communication issued manually in the three situations specified in para 3- (i), (ii) or (iii) above shall have to be regularized within 15 working days of its issuance, by - i.
uploading the manual communication on the System.
ii.
compulsorily generating the DIN on the System; iii.
communicating the DIN so generated to the assessee/any other person as per electronically generated pro-forma available on the System."
6. Furthermore, the 2019 circular, in paragraph 6, states that the intimation of issuance of manual communication, for the reasons mentioned in paragraph
3(v), shall be sent to the Principal Director General of Income- Tax (Systems) within seven (7) days from the date of its issuance.
7. As a matter of fact, paragraph 7 of 2019 Circular mandates alignment
Neutral
Citation
No:
2023:DHC:2502-DB of all pending assessment proceedings, where notices were issued manually, prior to the issuance of the said circular, by having them uploaded in the system by the date given therein, i.e., 31.10.2019. Kaliyaperumal Padmanaban
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never been issued. Before us, the Ld.DR couldn’t bring on record that the assessee’s case falls in exception which is given in Para No.3 of the ibid
Circular. In such a scenario, according to us, the department was bound to follow the Circular and violation of it is fatal to the Revenue; and in the said event, we find that assessee succeeds on the legal issue and the consequences as set out in the Para No.4 of the Circular follows viz., the invalidity of the assessment order. Before parting, we would like to address the contention of Ld DR that in the present case, though the AO didn’t quote the DIN in the body of assessment, but he intimated the DIN on the same day to the assessee, which action would anyway cure the technical fault if any, doesn’t impress us and according to us, such an action, would not cure the impugned assessment order. Similar contention/action taken by the Revenue was repelled by the Hon’ble
Madras High Court in the case of M/s.Laserwoods US Inc. (supra) [refer to Para No.12] wherein their Lordships have upheld the action of this Tribunal wherein, inter alia, “DIN” wasn’t reflected in the DRP/assessment order, but it was intimated on the same day (as in the present case). The Tribunal in that case is noted to have held the action of the DRP & the consequent AO order to be invalid for violating the mandate given in CBDT Circular (supra), which action of the Tribunal was upheld by the Hon’ble Madras High Court, even though the DIN was intimated on the same day (refer para 12 infra) by holding as under:
Kaliyaperumal Padmanaban
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No.3 of the circular, i.e., to state the reasons in the prescribed format for not generating the DIN; that in the instant case, the assessment order also does not contain a DIN; and that therefore, the impugned order by ITAT does not call for any interference.
7. It is not in dispute that the assessment order which was challenged before
ITAT was passed pursuant to the directions of DRP. The circular issued by the Director of CBDT reads as follows:
"CIRCULAR NO.19/2019 (F. NO.225/95/2019-ITA.II], DATED 14-8-
2019
Subject: Generation / Allotment / quoting of Document Identification
Number in Notice / Order / Summons / letter / correspondence issued by the Income-tax Department - reg.
With the launch of various e-governance Initiatives, Income tax
Department is moving toward total computerization of its work. This has led to a significant improvement in delivery of services and has also brought greater transparency in the functioning of the tax- administration Presently, almost all notices and orders are being generated electronically on the Income Tax Business Application
(ITBA) platform. However, it has been brought to the notice of the Central Board of Direct Taxes (the Board) that there have been some instances in which the notice. order, summons, letter and any correspondence (hereinafter referred to as "communication" were found to have been issued manually, without maintaining a proper audit trail of such communication.
2. In order to prevent such instances and to maintain proper audit trail of all communication, the Board in exercise of power under section 119
of the income-tax Act, 1961 (hereinafter referred to as "the Act"), has decided that no communication shall be 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. to the assessee or any other person, on or after the 1st day of October, 2019
unless a computer- generated Document Identification Number (DIN) has been allotted and is duly quoted in the body of such communication.
3. In exceptional circumstances such as,-
(i) when there are technical difficulties in generating/allotting/
quoting the DIN and issuance of communication electronically; or (ii) when communication regarding enquiry, verification etc. is required to be issued by an income-tax authority, who is outside the office, for discharging his official duties; or (iii) when due to delay in PAN migration. PAN is lying with non- juri ictional Assessing Officer; or (iv) when PAN of assessee is not available and where a proceeding under the Act (other than verification under section 131 or section 133 of the Act) is sought to be initiated; or Kaliyaperumal Padmanaban
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(v) when the functionality to issue communication is not available in the system, the communication may be issued manually but only after recording reasons in writing in the file and with prior written approval of the Chief Commissioner/ Director General of income- tax. In cases where manual communication is required to be issued due to delay in PAN migration, the proposal seeking approval for issuance of manual communication shall include the reason for delay in PAN migration.
The communication issued under aforesaid circumstances shall state the fact that the communication is issued manually without a DIN and the date of obtaining of the written approval of the Chief Commissioner/ Director General of Income-tax for issue of manual communication in the following format-
"....... This communication issues manually without a DIN on account of reason/reasons given in para3(i)/3(ii)/3(iii)/3(iv)/
3(v) of the CBDT Circular No .... dated (strike off those which are not applicable) and with the approval of the Chief
Commissioner/Director General of Income Tax vide number ....
dated ...."
4. Any communication which is not in conformity with Para-2 and Para-
3 above, shall be treated as invalid and shall be deemed to have never been issued.
5. The communication issued manually in the three situations specified in para 3- (i), (ii) or (iii) above shall have to be regularised within 15
working days of its issuance, by- i. uploading the manual communication on the System.
ii. compulsorily generating the DIN on the System; iii. communicating the DIN so generated to the assessee/any other person as per electronically generated pro- forma available on the System.
6. An intimation of issuance of manual communication for the reasons mentioned in para 3(v) shall be sent to the Principal Director General of Income-tax (Systems) within seven days from the date of its issuance.
7. Further, in all pending assessment proceedings, where notices were issued manually, prior to issuance of this Circular, the Income-tax authorities shall identify such cases and shall upload the notices in these cases on the Systems by 31th October, 2019."
8. It is well settled that circulars issued by CBDT in exercise of its powers under Section 119 of the Act are binding on the revenue. The consequences of not following the directions issued in the circular are also provided in the circular.
9. Paragraph No.4 of the circular extracted above would make it clear that any communication which is not in conformity with paragraph Nos.2 and 3 of the circular shall be treated as invalid and shall be deemed to have never been issued.
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and laudatory and intended to ensure that proper trail of all assessment and other orders are maintained and further that any deviation therefrom can only be undertaken after prior written approval of the higher authorities under the Act. Therefore, the satisfaction note dated 13 th July 2021 and the impugned order of assessment dated 28th September 2021 ought to be treated as invalid and deemed never to have been issued;
(f) On this ground, rule ought to be made absolute in the following petitions :
A.Y. 2011-2012 - WP No.2593 of 2021
A.Y. 2012-2013 - WP No.2598 of 2021
A.Y. 2013-2014 - WP No.2847 of 2021
A.Y. 2014-2015 - WP No.2597 of 2021
A.Y. 2015-2016 - WP No.2594 of 2021
A.Y. 2016-2017 - WP No.2588 of 2021
A.Y. 2017-2018 - WP No.2595 of 2021
A.Y. 2018-2019 - WP No.2625 of 2021
A.Y. 2019-2020 - WP No.2696 of 2021"

the merits of the appeal preferred by the assessee and quas the impugned assessment order.
8. In the result, appeal filed by the assessee is allowed.

Order pronounced on the 25th day of August, 2025, in Chennai. (अिमताभ शुा)
(AMITABH SHUKLA)
लेखा सदय/ACCOUNTANT MEMBER (एबी टी. वक
)
(ABY T. VARKEY)
याियक सदय/JUDICIAL MEMBER
चे ई/Chennai,
!दनांक/Dated: 25th August, 2025. TLN
आदेश क ितिलिप अ$ेिषत/Copy to:
1. अपीलाथ /Appellant
2. थ /Respondent
3. आयकरआयु/CIT, Chennai / Madurai / Salem / Coimbatore.
4. िवभागीयितिनिध/DR
5. गाड फाईल/GF