TaxTMI 
TaxTMI 
TaxTMI 
2025 (7) TMI 1800
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....for the AY 2018- 19 2. Your honour the applicant in the present case filed the appeal on 20.02.2024 and accordingly there is delay in filing of appeal by 526 days. 3. Your honour, the order was passed on 22.07.2022 and the applicant forwarded the order passed by the CIT(A) to the staff working in the office of the chartered accountant. However, the office staff who received the order forgot to inform and hand over the order to the chartered accountant who had to take the action against the said order. 4. Now Recently, the applicant received the show cause notice dated 14.02.2024 for the AY 2018-19 regarding the initiation of penalty proceedings under section 271AAC(1) of the Act and the same was forwarded to the Chartered Accountant office for necessary action. 5. Thereafter, the chartered Accountant informed the applicant that the penalty proceedings has been initiated against the addition which was confirmed by the CIT(A) vide order dated. 22.07.2022 and enquired about the status of any appeal filed before ITAT against that CIT(A) order. 6. The applicant informed to the CA that the order was submitted to his office on the same day i.e., on 22.07.2022 for necessary actio....
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....preferred an appeal before the Ld. CIT(A) who by and under the impugned order dated 22.07.2022 dismissed the appeal by confirming the addition made by the Ld. AO. Hence, the instant appeal before us. 5. By and under an application dated 6.10.2024 the assessee sought to raise the following additional ground of appeal: "On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law, in confirming the order passed by the AO despite that the consequent reassessment framed under section 143(3) r.w.s. 153B(1)(b) is in violation of mandatory provision of section 153D of the Act and as such is bad in the eyes law. That the purported approval u/s 153D of the Act is illegal, bad in law and also without application of mind." 6. The additional ground sought to be raised being legal ground and since going to the root of the matter and having regard to the judgment passed by the Hon'ble Apex Court in the case of National Thermal Power Corporation (NTPC) v. CIT (229 ITR 383), the same is admitted and is addressed at the very threshold of the matter. 7. The assessee has filed synopsis which for the sake of clarity is reproduced here under: "This is an a....
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.... the assessee vide a common approval letter, which covered not only the assessee's case but also three other assesses ➤ Further, It is most relevant and significant to bring to the kind attention of the Hon'ble Bench that on the same day i.e. on 29-12-2019, the Additional CIT, Central range-4, New Delhi, granted approval for 178 cases alone. ➤ Thus, approvals of 182 days (178+4) granted by Additional CIT in a single day, including the present case of the assessee. ➤ Furthermore, it is pertinent to point out that the letter forwarded by the Assessing Officer to the approving authority specifically mentioned that the draft assessment order was being submitted under Section 143(3) of the Act. However, the final assessment order has erroneously been passed under Section 143(2) of the Act, which is procedurally incorrect and legally untenable. This inconsistency reflects a clear and apparent mistake on the face of the record, further reinforcing the conclusion that the assessment proceedings were carried out in a hurried and mechanical manner, without adherence to the prescribed legal framework. 4. Based on the above facts, the assessee submits that ....
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....ed by the same Additional CIT, Central Range-4, New Delhi. The approval was granted on the same date, i.e., 29.12.2019. The approval was issued through a common letter covering 178 cases of 29 assessee's on a single day, including the assessee in the present case. The approval lacked any reference to appraisal reports, seized material, or draft assessment orders, and did not demonstrate application of mind, as required by law. 9. The assessee's case is factually and legally indistinguishable from the facts in the Mysore Bhaskara Pankaja case: The same approving authority (Addl. CIT, Central Range-4, New Delhi) granted approval. Approval was granted on the exact same date (29.12.2019). A common approval letter was issued for multiple cases, including that of the assessee. The letter was generic, lacking any reference to the specific seized material or draft assessment order. No evidence of independent or case-specific application of mind exists in the record. 10. Relevant finding of in the case of Mysore Bhaskara Pankaja v. ACIT [2024 (7) TMI 1134] reproduced as under: 8. We have heard both the parties and perused the material available on record. As could ....
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....d in the case of GD Goenka Pvt. Ltd. v. ACIT [2024 (11) TMI 83] dated 29.10.2024 wherein the Tribunal quashed the assessment orders passed under Section 153A of the Act on the ground that the approval granted under Section 153D by the same Additional CIT, Central Range-4, New Delhi, on the same date (29.12.2019), was found to be mechanical, perfunctory, and devoid of any application of mind. The Tribunal held that such consolidated approvals-covering a large number of assessee's and multiple assessment years within an unreasonably short time frame-were legally unsustainable and rendered the resultant assessments non-est and invalid in law. The present case, being identically situated, squarely falls within the ambit of this authoritative precedent. Relevant findings reproduced hereunder: 10. Identical dispute emanating from the same approval memo in question came up for adjudication in the case of Mysore Bhaskara Pankaja (supra) wherein the Coordinate Bench of Tribunal has discredited the validity of the approval granted under Section 153D of the Act in identical circumstances. It was held therein that the approval so granted suffers from vice of non-application of mind and conse....
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....hanical exercise of power, therefore, cannot be said to be perverse or contrary to the material on record. ➤ HON'BLE SUPREME COURT VIDE ITS ORDER DATED 09.08.2024 dismissed the SPECIAL LEAVE PETITION IN THE ABOVE REFERRED CASE. ➤ Case of the assessee is covered by the judgement of HON'BLE DELHI HIGH COURT IN THE CASE OF PR. COMMISSIONER OF INCOME TAX-15 VERSUS SHIV KUMAR NAYYAR 2024 (6) TMI 29 - DATED 15.05.2024 wherein hon'ble court held as under: 16. In the present case, the ITAT, while specifically noting that the approval was granted on the same day when the draft assessment orders were sent, has observed as under:- "10. We have gone through the approval granted by the Id. Addl. CIT on 30.12.2018 u/s 153D of the Act which is enclosed at page 36 of the paper book of the assessee. The said letter clearly states that a letter dated 30.12.2018 was filed by the Id. AO before the Id. Addl. CIT seeking approval of draft assessment order u/s 153D of the Act. The Id. Addl.CIT has accorded approval for the said draft assessment orders on the very same day i.e., on 30.12.2018 for seven assessment years in the case of the assessee and for seven assessment ....
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....53C r.w.s. 153A of the Act in the absence of a valid approval granted by the Ld. ACIT, Central Range-4, Delhi Further reliance can also be placed on the following judicial pronouncements:- ➤ ITAT DELHI IN THE CASE OF DCIT, CENTRAL CIRCLE 8 NEW DELHI VERSUS AMOLAK SINGH BHATIA AND AMOLAK SINGH BHATIA VERSUS DCIT, CENTRAL CIRCLE 8 NEW DELHI ➤ SANJAY DUGGAL, KRITIKA TALWAR, ARUN DUGGAL, RATNA TALWAR, C/O KAPIL GOEL, ADV, NEHA DUGGAL, NANY DUGGAL, POONAM DUGGAL, NEERU DUGGAL, RAJNISH TALWAR, RATNASHRI BUILDTECH PVT. LTD, DUGGAL ESTATE PVT. LTD, DUGGAL & SONS BUILDWELL P.LTD., VERSUS ACIT, CENTRAL CIRCLE-4, NEW DELHI, 2021 (1) TMI 909 - ITAT DELHI." 8. The matters relates to approval granted under Section 153D of the Act. The approval which has been challenged before us as non-est, mechanical and, therefore, liable to be quashed is also the crux of the submission made by the Ld. Senior Counsel for the assessee. 9. At the very threshold of the matter, the Ld. Sr. counsel Shri Ved Jain, appearing for the assessee, submitted that the issue is squarely covered in favour of the assessee as in identical group of matters, the Co-ordinate Bench has been pleased to quash th....
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....ng approval prior to 29.12.2019. As per the 10 ITA No. 3823/Del/2023 Mysore Bhaskara Pankaja Vs. ACIT CBDT Circular No. 3 of 2008 dated 12.03.2008, the legislature in its highest wisdom made it obligatory that the assessments of search cases should be made with the prior approval of superior authority, so that the superior authority apply their mind on the materials and other attending circumstances on the basis of which the Assessing officer is making the assessment and after due application of mind and on the basis of seized materials, the superior authority is required to accord approval of the respective Assessment order. Solemn object of entrusting the duty of Approval of assessment in search case is that the Additional CIT, with his experience and maturity of understanding should at least minimally scrutinize the seized documents and any other material forming the foundation of Assessment. It is elementary that whenever any statutory obligation is cast upon any statutory authority, such authority is required to discharge its obligation not mechanically, not even formally but after due application of mind. Thus, the obligation of granting Approval acts as an inbuilt protection....
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....proval whenever required under the law, must be preceded by application of mind and consideration of relevant factors before the same can be granted. The approval should not be an empty ritual and must be based on consideration of relevant material on record. 5. The learned Counsel for the Revenue submitted that the question of legality of the approval was raised by the assessee for the first time before the Tribunal. He further submitted that the Additional CIT had granted the approval. The Tribunal committed an error in holding that the same is invalid. 6. Having heard the learned Counsel for the both sides and having perused the documents on record, we have no hesitation in upholding the decision of the Tribunal. The Additional CIT while granting an approval for passing the order of assessment, had made following remarks : "To, The DCIT(OSD)1, Mumbai Subject: Approval u/s 153D of draft order u/s 143(3) r.w.s. 153A in the case of Smt. Shreelekha Nandan Damani for A.Y. 2007-08 reg. Ref: No. DCIT (OSD)1/ CR7/Appr/2010-11 dt. 31.12.2010 As per this office letter dated 20.12.2010, the Assessing Officers were asked to submit the draft orders for approval u/s 153D on or before ....
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....d by the Assessee's in the Ground No. 1 of the Appeal which is against erroneous approval granted under Section 153D of the Act. In our opinion the approvals so granted under the shelter of section 153D of the Act does not pass the test of legitimacy. Thus, the impugned Assessment order in consequence to such inexplicable approval lacks legitimacy. Consequently, the impugned assessment in captioned appeal is non-est and a nullity and hence liable to be quashed accordingly, the impugned assessment order and the order of the Ld. CIT(A) is hereby set aside by allowing Ground No. 1 of the Assessee. 14. Since we have allowed the Ground No. 1 and set aside the assessment order itself, the other grounds on merits have become in-fructuous, which requires no adjudication. 15. In the result, the Appeal filed by the Assessee is allowed." 10. On the other hand, the Ld. DR relied upon the order passed by the authorities below. 11. We have heard rival submissions made by the respective parties and perused the materials available on record. In the case in hand, it is revealed from the approval granted by the Addl. CIT that the Assessing Officer, vide letter dated 29.12.2019 sent draft asses....