Govt. plans to introduce unique document id number for Income Tax communications

After introducing unique account numbers for taxpayers (PAN) and those for tax deductors (TAN), the government will this fiscal introduce a unique document identification number (DIN) to be quoted on “every” income tax related communication.

The department will soon put in place a tech-based mechanism to generate DIN which will not only be allotted to taxpayers but also the officials of the department from October this year, which will become essential while filing the annual income tax return of the financial year (2010-11).

According to a Central Board of Direct Taxes “insertion of new Section 282B” in the I-T Act, DIN will be made mandatory “in respect of every notice, order, letter or any correspondence” with the department.

“The number will be generated by the department and will be useful essentially for error-free filing of tax returns, claiming refunds and other communication with the department by the assesses,” a senior Finance Ministry official said.

Taxpayers and tax deductors currently are required to quote Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) among others for filing returns with the department.

Assesses will not be put to any trouble as the numbers will be generated and allotted by the department itself. Once allotted, the assessee will have to quote it thereon. I-T officials will also be allotted the numbers as the effort is to streamline the process, the official said.

According to section 282B of the Income Tax Act which deals with DIN — “in respect of every notice, order, letter or any correspondence issued by him (I-T authority) to any other income tax authority or assessee or any other person and such number shall be quoted thereon.

“It is further provided that where the notice, order, letter or any correspondence issued by any income-tax authority does not bear a Document Identification Number, such notice, order, letter or any correspondence shall be treated as invalid and shall be deemed never to have been issued.”

DIN is aimed at bringing more transparency in tax administration as the whole exercise involves a number of documents. Apart from the regular filing of taxes, a taxpayer deals with the department for various other financial services which DIN will help streamline, the official said.

According to the I-T department, “it is also provided that every document, letter or any correspondence, received by an income-tax authority or on behalf of such authority, shall be accepted only after allotting and quoting of a computer generated Document Identification Number.

Further, it is provided where the document, letter or any correspondence received by any income-tax authority or on behalf of such authority does not bear Document Identification Number, such document, letter or any correspondence shall be treated as invalid and shall be deemed never to have been received.”