Tax Assessment Cannot be Held Invalid Over Minor DIN Errors or Omission: Budget 2026

The Finance Minister, Smt Nirmala Sitharaman, presented the Union Budget 2026 on February 1, 2026, where she proposed a clarification in the Income Tax Law to stop the income tax assessments from being held invalid due to small technical mistakes related to Document Identification Numbers (DINs).

The Income Tax officers are required to include a computer-generated DIN on assessment orders while issuing them to the taxpayers. This is a mandatory requirement as per the CBDT Circular 19 of 2019 dt. 14.8.2019. Citing this circular, some High Courts have cancelled the assessment orders, holding them invalid just because the DIN was not on every page of the assessment order, or the DIN was not on the body of the assessment order, even though it was generated correctly and mentioned in accompanying documents.

These assessment orders were cancelled just because of the technical errors and on unnecessary grounds, even though the tax assessments were legal and valid.

Section 292B of the Income-tax Act, 1961 ensures that the Income Tax Returns, assessments, notices or summonses are not held invalid merely over some mistakes, defects, or omissions if they follow the intent of the law.

Now, since the Income Tax Act, 2025 is coming into effect from April 1, 2026, which primarily aims to bring clarity to the income tax provisions, the government believed that there is a need to bring more clarification to Section 292B of the Income-tax Act, 1961, so that the intent is uniformly reflected in both the new and the old income tax law.

Therefore, the Budget 2026 proposed to clarify Section 292B that tax assessments will no longer be invalid due to any mistake, defect, or omission of quoting a computer-generated DIN, as long as the DIN is referenced in the assessment order. Further, even if there is a small error, defect, or omission in notices or summons related to such assessment, the same will not be invalid and would be a sufficient compliance if there is a reference to DIN in the assessment order.

This clarification aims to reduce litigation and uncertainty. This will be added to both the Income Tax Act, 1961, with retrospective effect from October 1, 2019 and the Income-tax Act, 2025, with effect from April 1, 2026.