TaxTMI 
TaxTMI 
2025 (10) TMI 198
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....essment order has been passed for Assessment Year 2012-13 u/s 143(3) of the Income Tax Act, 1861 ('Act' for short) pursuant to a search and seizure operation u/s 132 of the Act by computing the income of the Assessee at Rs. 6,70,95,025/- as against declared income of Rs. 42,11,890/-. Aggrieved by the assessment order dated 31/03/2014, the Assessee preferred an Appeal before the Ld. CIT(A). The Ld. CIT(A) vide order dated 17/10/2014, deleted certain additions by sustaining the some of the additions. Aggrieved by the order of the Ld. CIT(A), both the Department as well as the Assessee have filed respective Appeals. 4. The Ld. Counsel for the Assessee addressing on the additional Grounds of Assessee's Appeal submitted that the approval accorded u/s 153D of the Act is a mechanical and arbitrary approval without their being any application of mind and also without satisfying the statutory pre-conditions of the Act as such the assessment so framed is null and void. The Ld. Senior Counsel further submitted that approval issued u/s 153D of the Act does not mention any seized document having been perused and a single approval has been granted in case of three Assessee's containing 21 Ass....
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....lause (b) of sub-section (1) of Section 153A of the Act. It is beneficial to refer to the decision of the High Court of Judicature at Allahabad in the case of PCIT v. Sapna Gupta [2022 SCC OnLine All 1294] which captures with precision the scope of the concerned provision and more significantly, the import of the phrase- "each assessment year" used in the language of Section 153D of the Act. The relevant paragraphs of the said decision are reproduced as under:- "13. It was held therein that if an approval has been granted by the Approving Authority in a mechanical manner without application of mind then the very purpose of obtaining approval under Section 153D of the Act and mandate of the enactment by the legislature will be defeated. For granting approval under Section 153D of the Act, the Approving Authority shall have to apply independent mind to the material on record for "each assessment year" in respect of "each assessee" separately. The words 'each assessment year' used in Section 153D and 153A have been considered to hold that effective and proper meaning has to be given so that underlying legislative intent as per scheme of assessment of Section 153A to 1....
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....gitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 20/05/2024 at 21:34:51 need not be given, there has to be some indication that the approving authority has examined the draft orders and finds that it meets the requirement of the law. As explained in the above cases, the mere repeating of the words of the statute, or mere "rubber stamping" of the letter seeking sanction by using similar words like "seen" or "approved" will not satisfy the requirement of the law. This is where the Technical Manual of Office Procedure becomes important. Although, it was in the context of section 158BG of the Act, it would equally apply to section 153D of the Act. There are three or four requirements that are mandated therein, (i) the Assessing Officer should submit the draft assessment order "well in time". Here it was submitted just two days prior to the deadline thereby putting the approving authority under great pressure and not giving him sufficient time to apply his mind ; (ii) the final approval must be in writing ; (iii) the fact that app....
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....ntains the approval u/s 153D, 14 cases pertained to the assessee herein and Smt. Neetu Nayyar. The remaining cases may belong to some other assessees, which information is not available before us. In any event, whether it is humanly possible for an approving authority like ld. Addl. CIT to grant judicious approval u/s 153D of the Act for 43 cases on a single day is the subject matter of dispute before us. Further, section 153D provides that approval has to be granted for each of the assessment year whereas, in the instant case, the ld. Addl. CIT has granted a single approval for all assessment years put together." 17. Notably, the order of approval dated 30.12.2020 which was produced before us by the learned counsel for the assessee clearly signifies that a single approval has been granted for AYs 2011-12 to 2017-18 in the case of the assessee. The said order also fails to make any mention of the fact that the draft assessment orders were perused at all, much less perusal of the same with an independent application of mind. Also, we cannot lose sight of the fact that in the instant case, the concerned authority has granted approval for 43 cases in a single day which is evi....
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....ubhash Dabas (supra) has held in chorus that the approval granted under s. 153D of the Act, if granted mechanically, will vitiate the assessment order itself. 12. As noted in the instant case, In the first para of the approval memo, it is mentioned that draft assessment order dated 28/03/2014 has been received for approval and in the second para of the approval memo, it was stated that the draft assessment orders has been approved. Such mechanical approval cannot be sustainable in law in the light of judicial dicta available. The approval memo is totally silent on the issues involved and has granted omnibus approval without any thoughtful process being discernible. A single approval u/s 153D has been accorded in respect of three different Assessees comprising out of 21 Assessment Years and there is no other material to show involvement of the superior authority in the course of assessment. Applying the ratio of judgements delivered as noted above, the assessment order based on ritualistic approval stands vitiated and thus quashed by allowing additional Grounds of appeal of the Assessee. 13. In the result, the appeal of the Assessee in ITA No. 480/Del/2015 is allowed. 14. S....