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TaxTMI 
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2026 (4) TMI 808
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....te orders passed u/s 153A of the Act. 2. At the time of hearing, it was stated that the issues involved in all these cross-appeals are common, interlinked and arising from the search action on the assessee and other persons. Hence, all these cases have been heard together and adjudicated by this common order. 3. First we take the appeal of the assessee in ITA No. 3361/Del/2025 for AY 2015-16 in the case of NV Distilleries Pvt. Ltd. Vs. DCIT. ITA No. 3361/Del/2025 [AY 2015-16] NV Distilleries Pvt. Ltd. Vs. DCIT.[Assessee's case] 4. Before us, Ld. AR for the assessee submitted that in all the captioned cases, approval u/s 153D of the Act was granted by ld. Addl. CIT, Central Range-8, New Delhi letter dated 31.12.2019 which is mechanical approval. Ld. AR further submits that ld. Addl. CIT granted common approval for various Assessment Years from 2015-16 to 2018-19 in terms of letter bearing No. Addl. CIT/(CR- 8/2019-20/155 dated 31.12.2019. He submits that from the perusal of the same it could be seen that approval granted by the Id. Adl. CIT was mechanical approval and separate approval for each Assessment Year was not given rather approval was given by a single order ....
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....actices and guidelines, the approving authority has a comprehensive understanding of the issues involved in a particular case well in advance, prior to the case being submitted to him for approval under section 153D of the Act. It is thus prayed by Id. CIT DR that the contentions of the assessee on the issue of approval u/s 153D of the Act may please be rejected and the order of the AO may please be upheld. Reliance is placed on the judgement of Co-ordinate Mumbai Bench of Tribunal in the case of Usha Satish Salvi Vs. ACIT in ITA No. 4237 to 4239/Mum/2023 order dated 23.01.2025 wherein the issue of validity of assessment order passed u/s 143(3) r.w.s.153A of the Act in light of provisions of section 153D of the ACT was decided against the assessee. 7. Heard the contentions of both the parties and perused the material available on record. In the instant case, from the perusal of common approval letter as reproduced above, for all the four assessment years, it is incumbent upon the Addl. CIT while granting the approval, to examine all the material including the assessment records, full appraisal report and seized material pertaining to each Assessment Year with reference to the ad....
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....g of Section 153A(1) and Section 153D leave no room for doubt that approval with respect to each assessment year is to be obtained by the Assessing Officer on the draft assessment order before passing the assessment order under Section 153A." [Emphasis 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 and Co. (2023 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 point....
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....s 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 ld. 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 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 Id. 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 he....
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....approving authority having to indicate what thought process involved leading to the aforementioned approval has not been provided. As explained, the mere repeating of words of the Statue or mere rubber stamping of the communication seeking sanction by using similar words like 'approval' will not, by itself, meet the requirement of law. The Hon'ble Court made reference to manual issued by the CBDT in the context of erstwhile section 158BG of the Act and observed that such manual serves as a guideline to the AOs. Since it was issued by CBDT, the powers of issuing such guidelines can be traced to section 119 of the Act. The Hon'ble High Court also held that noncompliance of requirement of section 153D of the Act is not a mere procedural irregularity and lapse committed by Revenue may vitiate the assessment order. The SLP filed against the aforesaid judgement in the case of ACIT vs Serajuddin & Co. was dismissed as reported in (2024) 163 taxmann.com 118 (SC). 10. In so far as the order of the Co-ordinate Bench of the Tribunal (Mumbai Bench) relied by the Ld. Department's Representative in the case of Usha Satish Salvi (supra), in the said case, certain modificati....
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.... passed u/s 143(3) r.w.s.153A of the Act in light of provisions of section 153D of the Act which issue has been decided in favour of the assessee in ITA No. 3361/Del/2025 for AY 2015-16 in the case of NV Distilleries Pvt. Ltd, hereinabove. Since the facts are identical and the approval was granted by Addl. CIT for all these assessment years also by a common order in terms of approval letter No. Addl. CIT/(CR-8/2019-20/155 in the case of NV Distilleries Pvt. Ltd. and Addl. CIT/(CR-8/153D/2019-20/156 in the case of NV Distilleries & Breweries Pvt. Ltd. for Asst. Year 2015-16 to 2018-19 respectively. Thus, by following the aforesaid observations, ground of appeal taken with respect to the validity of approval in all the captioned appeals of the assessee are allowed. 15. Since we have allowed legal ground of appeal of the assessee with regard to the validity of assessment on account of approval u/s 153D thus, other grounds of appeal in all the captioned appeals of the assessee are not adjudicated. 16. In the result, all captioned appeals of the assessee are allowed. ITA Nos. 4375, 4376, 629 & 4511/Del/2025 [Assessment Years 2015-16 to 2018-2019] [Revenue's appeals] 17....
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....0N 153A 2017-18 M/s NV Distilleries & Breweries Pyu Lida AAACN3240N. :143(3) 2018-19: Assessment records are returned: Yours faithfully Dy. Commissioner of Income Tax Central Circle-31, New Delhi (Vinod Jolui) Addl, Cominissioner of Income Tax, Central Range-8, New Delhi. 31 DEC 2019 RECEIVED Document 2 Office of the Addl. Commissioner of Income-tax; Central Range-8-New Delhi, Room No. 328, 3'" Floor, ARA Centre, E-2, Jhandewalan Extension, New Delhi-110055 F. No. Addl.CIT/CR-8/ 2019-20/ 155 Dated: 31.12.2019 To The Deputy Commissioner of Income Tax, Central Circle-31, New Delhi. Sub :- Approval u/s 153D of the Income Tax Act, 1961 in the case of NV Group of cases-reg. Please refer to you letter F.No. DCIT/CC-31/153D/2019-20/1201 dated 31.12.2019 on the above subject. Approval is hereby accorded to the draft assessment order in the following case :- S.No. Name of the assessee. PAN Asstt. Year. 1. M/s NV Distilleries Pvt. Ltd. AABCN4592Q 2015-16 2. M/s NV Distilleries Pvt. Ltd. AABCN4592Q 2016-17 3. M/s NV Distilleries Pvt. Ltd. AABCN4592Q 2017-18 4. M/s NV. Distilleries Pvt. Ltd. record is enclosed. AABCN4592Q 2018....