Tribunal quashes assessment orders for invalid approval, dismisses revenue appeals, and allows assessee cross objections.

The Tribunal admitted the additional ground of appeal challenging the assessment orders, quashed the orders due to invalid approval under section 153D, and did not address the merits of the additions or disallowances. The appeals by the revenue were dismissed, and cross objections by the assessee were allowed.

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Issues Involved:
1. Admission of additional ground of appeal.
2. Validity of assessment orders passed under section 153A read with section 143(3) due to alleged improper procedure followed under section 153D.
3. Merits of the additions or disallowances in the assessment orders.

Issue-wise Detailed Analysis:

1. Admission of Additional Ground of Appeal:
The assessees filed a common additional ground of appeal for all the assessment years, challenging the assessment orders on the basis that the proper procedure of law was not followed while granting approval under section 153D of the Income Tax Act. The Tribunal considered the application for admission of this additional ground as a preliminary issue. It was argued that this additional ground is a legal ground that goes to the root of the matter and should be admitted in the interest of justice. The Tribunal, relying on the Supreme Court's decision in the case of National Thermal Power Co. Ltd. vs. CIT, held that any legal ground which can be decided on the basis of facts already available on record should be admitted for adjudication. Consequently, the additional ground was admitted for consideration and adjudication on merits.

2. Validity of Assessment Orders under Section 153A read with Section 143(3):
The main contention of the assessees was that the Joint Commissioner of Income Tax (JCIT) granted approval under section 153D in a mechanical manner without proper application of mind. The Tribunal noted that the JCIT's approval letter merely stated that "approval is hereby accorded as per the provisions of section 153D of the I.T. Act for passing the assessment orders" without mentioning that the relevant assessment records and draft assessment orders were perused. The Tribunal emphasized that the approval under section 153D is not a mere formality but a statutory duty requiring proper application of mind. The Tribunal referred to various judicial precedents, including the decisions of the Bombay High Court in the case of Smt. Shreelekha Damani and the ITAT Delhi in the case of M/s. M3M India Holdings, which held that approval granted without application of mind is invalid. The Tribunal concluded that the JCIT granted approval in a mechanical manner without application of mind, rendering the assessment orders void and bad in law. Consequently, the assessment orders were quashed.

3. Merits of the Additions or Disallowances:
Since the Tribunal quashed the assessment orders on the legal ground of invalid approval under section 153D, the grounds challenging the merits of the additions or disallowances became academic and were not adjudicated upon.

Conclusion:
The Tribunal allowed the additional ground of appeal, quashed the assessment orders due to invalid approval under section 153D, and did not adjudicate on the merits of the additions or disallowances. Appeals filed by the revenue were dismissed, and cross objections filed by the assessee were allowed.

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