TaxTMI 
TaxTMI 
2025 (6) TMI 2132
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....sesse taken common grounds of appeal except and therefore grounds of appeal are extracted from ITA No. 903/Jodh/2024 in respect with Assessment Year 2018-19 as a lead case for discussion and finding which reads as under: 1. The CIT(A) erred in law and on facts in confirming the assessment order passed u/s 153A of the Act ignoring that the said order was passed without requisite approval warranted u/s 153D of the Act and therefore bad in law. Thus, the assessment order so framed ignoring the provisions of the law should be quashed. 2. The CIT(A) erred in law and on facts in confirming the addition of Rs for alleged on money received on sale of property made merely on presumptions and surmises on the basis of a excel sheet seized during the course of search (a) ignoring that the seized excel sheet was a dumb document and mentioned some rough estimates/projections calculation and did not contain any actual figures which has been ignored while framing the assessment order for assessment year 2017-18 (b) without bringing any corroborative evidence on record to suggest that the assessee received any on money (c) without making any inquiries from the buyers in this regar....
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....w and on facts in confirming the 25 addition of Rs. made merely on presumptions and surmises on the basis of a excel sheet seized during the course of search (a) ignoring that the seized excel sheet was a dumb document and mentioned some rough estimates/ projections calculation and did not contain any actual figures which has been ignored while framing the assessment order for assessment year 2017-18 (b) without bringing any corroborative evidence on record to suggest that the assessee received any on money (c) without making any inquiries from the buyers in this regard (d) by picking and choosing figures from two different seized documents as per convenience, (e) without appreciating the affidavit of the assessee and (f) the fact that no sale of land was undertaken by the assessee. Thus, the addition so made should be deleted. 7. The CIT(A) erred in law and on facts in confirming and Same addition of Rs. 33,21,000/- made by assessing officer out of Rs. 52,00,000/- merely on surmises and conjectures by presuming that Rs. 18,79,000 out of Rs. 52,00,000/- pertained to on money received for properties sold in AY 2017-18 and Rs. 33,21,000/- pertained to AY 2018-19 though nothi....
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....regard. 12. The appellant craves the leave to add, substitute, Leg modify, delete or amend all or any ground of appeal either before or at the time of hearing. 3. In ground No.1 the assessee has challenged validity of the assessment order passed u/s 153A of the Act in absence of the requisite approval warranted u/s 153D of the Act and so these orders were bad in law. 3.1 The Ld. CIT (A) has observed in the impugned order that there is no time limit prescribed in the statute for granting approval. Hence, the granting of approval cannot be said to be mechanical when there is clear noting about going through the draft assessment order (DFA) by the Additional Commissioner in the letter granting the approval. Thus, he rejected the legal ground by stating that the approval u/s 153D is merely an administrative action and in support, he relies on the decision of the Income Tax Appellate Tribunal Mumbai Bench "C", Mumbai in the case of Pratibha Pipes & Structurals Ltd Vs DCIT, Cent. Cir. 17 & 28, Mumbai ITA No. 3874/Mum/2015 - AY 2007-08 ITA No. 3875/Mum/2015 - AY 2008-09 and ITA No.3876/Mum/2015 - AY 2009-1b ITA No. 7120/Mum/2016 - AY 2011-12. 3.2 The Ld. Counsel for the ....
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....ssments which cannot be given mechanically. The High Court, thus, concurred with the finding of the ITAT that such approval was granted mechanically without application of mind by the Addl. CIT which vitiated the assessment orders. 4.2 On the similar facts, the ITAT Amritsar Bench has adjudicated and decided the issue in favour of the assessee in the case of "Madan Lal vs DCIT", 112 to 118/ Asr/2018 dated 16/08/2021 by following its own judgement in another case of Arch Pharmalabs Ltd. vs. ACIT ITA No. 6656/Mum/2017 dated 07.04.2021 wherein it was held as under :- 11. We have carefully considered the rival submissions and material placed on record and case laws cited. The legal objection of transgression of requirements of approval under section 153D is in controversy. Pursuant to search carried out in the premises of the Assessee and other connected group cases, the assessment was carried out under S. 153A/ 143(3) of the Act. The Assessing officer has forwarded the draft assessment orders for 7 years (AY 2003-04 to AY 2009-10) for endorsement and approval of the superior authority at the fag end of the limitation period on 29/12/2010 to meet the legal requirement impos....
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....ver 7 assessment years and thus only a symbolic exercise to meet the requirement of law (iii) Total lack of objectivity in drawing satisfaction on objective material while giving a combined approval for 7 assessments and also without evaluating the nuances of each assessment year involved (iv) the mundane action of Addl. CIT under S. 153D in a cosmetic manner gives infallible impression of approval on dotted line and thus defeats the purpose of supervision of search assessments (iv) initiated draft assessment orders not available in office records. 11.3 As observed, Section 153D bestows a supervisory jurisdiction on the designated authority in respect of search related assessment and thus enjoins a salutary duty of statutory nature. The designated superior authority is thus expected to confirm to the statutory requirement in letter and spirit. It is evident from the communication of AO and consequent approval thereon under S. 153D that no assessment record for any assessment year in question or any seized material had travelled to the authority concerned for his objective consideration of the same qua the draft assessment orders. No reference in this regard is made in the ....
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....accord approval the respective Assessment order. Solemn object of entrusting the duty of Approval of assessment in search cases 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 to the taxpayer against arbitrary or unjust exercise of discretion by the AO. The approval granted under section 153D of the Act should necessarily reflect due application of mind and if the same is subjected to judicial scrutiny, it should stand for itself and should be self-defending. There are long line of judicial precedents which provides guidance in applying the law in this regard. 11.5 At the cost of repetition, it may be reiterated that in the instant case, approving authority did not mention anything in the approval memo towards his/ her process of deriving s....
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....anjay Duggal & ors (ITA 1813/Del/2019 & ors; order dated 19.01.2021 has also echoed the same view after a detailed analysis of similar facts and also expressed a discordant note on such mechanical exercise of responsibility placed on designated authority under section 153D of the Act. Hence, vindicated by the factual position as noted in preceding paras, we find considerable force in the plea raised by the Assessee against maintainability of hollow approval under s. 153D totally devoid of any application of mind. The approval so granted under the shelter of section 153D, does not, in our view, pass the test of legitimacy. The Assessment orders of various assessment years as a consequence of such inexplicable approval lacks legitimacy. Consequently, the impugned assessments relatable to search in captioned appeals are non est and a nullity and hence quashed. 12. In view of prima facie merits found in the legal objections, We do not consider it expedient to look into the aspects on merits of additions/ disallowance." 4.3 We note that the Ld. CIT(A) failed to rebut the contention of the assessee that in one day how the additional CIT could do justice in granting approval i....