TaxTMI 
TaxTMI 
TaxTMI 
2025 (11) TMI 1831
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....validity of approval granted u/s. 153D of the Income Tax Act,1961(hereinafter referred to as 'the Act'). The ld. Counsel placed on record copy of approval u/s. 153D of the Act dated 28.12.2018 and submitted that the Additional Commissioner of Income Tax vide single order had granted approval in 51 cases including approval in the case of assessee for AYs 2011-12 to 2017-18 along with seven other assessees for multiple assessment years. He pointed that the AO had sent draft assessment orders in 51 cases to the Additional Commissioner of Income Tax on 27.12.2018. On the very next dated i.e. 28.12.2018 the approval was accorded by the Addl. CIT in all 51 cases. It is not possible to grant approval in 51 cases in just one day if the seized material and draft assessment order in each of the cases is examined. The manner in which approval has been granted clearly shows that the approval has been granted in a mechanical manner without application of mind. Placing reliance on the decision of Hon'ble Delhi High Court in the case of PCIT vs. Shiv Kumar Nayyar, 163 taxamann.com 9 and in the case of PCIT vs. MDLR Hotels (P) Ltd., 166 taxamann.com 327 he submitted that where single approval has ....
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....in 51 cases by the Addl. CIT in a single day in a mechanical manner. 5. The Hon'ble Delhi High Court in the case of PCIT vs. Shiv Kumar Nayyar (supra) having similar facts held that where approval u/s. 153D was granted for 43 cases on a single day without independent application of mind, such assessment orders are illegal. The relevant excerpts from the said judgment are reproduced herein below:- "10. Before embarking upon the analysis of the factual scenario of the instant appeal, we deem it apposite to examine the underlying intent of the relevant provision of the Act i.e., section 153D, which is culled out as under :- "153-D. Prior approval necessary for assessment in cases or requisition. - No order of assessment or reassessment shall be passed by an Assessing Officer below the rank of Joint Commissioner in respect of each assessment year referred to in clause (b) of [sub-section (1) of section 153A] or the assessment year referred to in clause (b) of sub-section (1) of Section 153B, except with the prior approval of the Joint Commissioner : Provided that nothing contained in this section shall apply where the assessment or reassessment order, as t....
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....hasis supplied] 12. It is observed that the Court in the case of Sapna Gupta (supra) refused to interdict the order of the ITAT, which had held that the approval under Section 153D of the Act therein was granted without any independent application of mind. The Court took a view that the approving authority had wielded the power to accord approval mechanically, inasmuch as, it was humanly impossible for the said authority to have perused and appraised the records of 85 cases in a single day. It was explicitly held that the authority granting approval has to apply its mind for "each assessment year" for "each assessee" separately. 13. Reliance can also be placed upon the decision of the Orissa High Court in the case of Asst. CIT v. Serajuddin & Co. [2023] 150 taxmann.com 146/292 Taxman 566/454 ITR 312/SCC OnLine Ori 992 to understand the exposition of law on the issue at hand. Paragraph no.22 of the said decision reads as under:- "22. As rightly pointed out by learned counsel for the assessee there is not even a token mention of the draft orders having been perused by the Additional Commissioner of Income-tax. The letter simply grants an approval. In other ....
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....ssessee. The said letter clearly states that a letter dated 30.12.2018 was filed by the ld. AO before the ld. Addl. CIT seeking approval of draft assessment order u/s 153D of the Act. The ld. 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 years in the case of Smt. Neetu Nayyar. It is also pertinent in this regard to refer to pages 68 and 69 of the paper book which contains information obtained by Smt. Neetu Nayyar from Central Public Information Officer who is none other than the ld. Addl. Commissioner of Income-tax, Central Range-S, New Delhi, under Right to Information Act, wherein, it reveals that the ld. Addl. CIT had granted approval for 43 cases on 30.12.2018 itself. This fact is not in dispute before us. Of these 43 cases, as evident from page 36 of the paper book which contains 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 authorit....
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..... 8. As ground no. 2 of appeal raising legal issue has been decided in favour of the assessee, the other grounds of appeal become academic and thus, are not deliberated upon. 9. In the result, appeals of the assessee for AYs. 2012-13, 2013-14 & 2015-16 to 2017-18 are allowed. ITA Nos. 1337 to 1341 & 1348/Del/2021 (A.Ys. 2012-13 to 2017-18) 10. Since, we have held assessment orders to be invalid in the absence of valid approval u/s. 153D of the Act, the Departments appeal for corresponding assessment years are dismissed. 11. For the assessment years 2014-15, there is no appeal by the assessee and only Revenue is in appeal. Nevertheless, the approval u/s. 153D of the Act for passing the assessment order for AY 2014-15 is in similar manner, for parity of reasons the appeal of Revenue is dismissed. Order pronounced in the open court on Thursday the 31st day of July, 2025. ============= Document 1 OFFICE OF THE ADDL. COMMISSIONER OF INCOME TAX CENTRAL RANGE, BHANSHALI GROUND, MEERUT. Phone-0121-2403191, Fax-0121-2510082 F. No Addl.CIT/CR/MRT/Approval/ 153D/2018-19/ Dated: 28.12.2018 2004 To. The Dy. Commissioner of Income Tax. Central Circle, Ghaziabad....