TaxTMI 
TaxTMI 
2026 (9) TMI 1542
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....by this common order for the sake of convenience, by dealing with ITA No. 3402/Del/2026 (A.Y. 2021-22)- M-Power Energy India Pvt. Ltd., being lead case. 2. The first and foremost issue which is jurisdictional in nature involved in all the 05 appeals raised by the assessee's is as regards the assessment framed u/s. 143(3) of the Act after obtaining approval from the Additional Commissioner of Income Tax, Central Range-2, New Delhi and after holding discussion from time to time for framing the assessment is bad in law and void. 3. The brief facts of the case are that the assessment was framed by the ACIT, Central Circle-8, Delhi for the A.Y. 2021-22 u/s. 143(3) of the Act vide order dated 31.12.2022. Ld. Cousnel for the assessee drew our attention towards the assessment order which is enclosed in Assessee's Appeal Set at Page No. 42 and he took us through para 10 of the assessment order, which reads as under:- "10. This order is being passed with the prior approval of the Addl. Commissioner of Income Tax, Central Range-2, Delhi conveyed vide letter F. No. Addl. CIT (CR)-02/2022-23/1445 dated 31.12.2022 vide F. No. 299/36/2021-Dir(Inv.III)/577 dated 15.07.2022 and the d....
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.... except with prior approval of Jt. CIT (Search Cases); d) Section 158BG : No order of assessment for the block period shall be passed without previous approval of Addl. CIT/Jt. CIT in respect of search / survey initiated on or after 01.09.2024 (Search Assessment). 5. Ld. Counsel for the assessee submitted that the above itself explains that the Act contemplates situation where the Assessing Officer is required to seek prior approval or discussions before passing of assessment order. In the absence of any statutory mandate for passing a regular assessment u/s. 143(3) of the Act it is patently clear that it is not at all the intent of the legislature that a regular scrutiny assessment u/s. 143(3) of the Act shall be passed after taking approval / discussion with the Additional Commissioner of Income Tax. Ld. Counsel for the assessee relied upon the case law of Hon'ble Punjab and Haryana High Court in the case of FinDoc Finvest (P) Ltd. vs. DCIT [2025] 481 ITR 58 (P&H) wherein, the Hon'ble High Court has considered the provisions of section 119 as well as section 116 of the Act and also relied upon the judgement of the Hon'ble Supreme Court in the case of Anirudhsinhji Kar....
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.... all the intent of the legislature that a regular scrutiny assessment u/s. 143(3) of the Act shall be passed after taking approval / discussion with the Additional Commissioner of Income Tax, which is happened in the instant case. We note that the jurisdictional issue in dispute in the present case in is no longer res integra, in view of the decision of the Hon'ble Punjab and Haryana High Court passed in the case of FinDoc Finvest (P) Ltd. vs. DCIT [2025] 481 ITR 58 (P&H) wherein, the Hon'ble High Court has considered the provisions of section 119 as well as section 116 of the Act by relying upon the judgement of the Hon'ble Supreme Court in the case of Anirudhsinhji Karansinhji Jadeja vs. State of Gujarat [1995] 5 SCC 302 (SC) CIT vs. Anjum M.H. Ghaswala 119 Taxman 352/252 ITR 1 (S.C.); Hon'ble Delhi High Court decision in the case CIT vs. SPL Siddhartha Ltd. [2012] 345 ITR 223 (Del.) & Nazir Ahmed vs. King Emproer 1936 (BC) 253 (2) and held as under:- "18. Before we deal with the facts of the case, it would be apposite to quote relevant provisions of Section 119, 153 and 275: Instructions to subordinate authorities. 119 (1) The Board may, from ....
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....: xx Provided: xx Provided further : xx Provided also: xx Provided also: xx Provided: xx Provided further: xx Provided : xx Provided further: xx Provided also: xx Provided also: that in respect of an order of assessment relating to the assessment year commencing on or after the 1st day of April, 2022, the provisions of this sub-Section shall have effect, as if for the words 'twenty-one months', the words 'twelve months' had been substituted. Bar of limitation for imposing penalties. 275 2[(1)] No order imposing a penalty under this Chapter shall be passed. (a) In a case where the relevant assessment or other order is the subject matter of an appeal to the [Joint Commissioner (Appeals) or to the Commissioner (Appeals) under Section 246] [or section 246A] or an appeal to the Appellate Tribunal under section 253, after the expiry of the financial year in which the proceedings, in the course of which action for the imposition of penalty has been initiated, are completed, or six months from the end of the month in which the order of the (Joint Com....
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....(Prevention) Act, 1987 and has observed as under:- 11. The case against the appellants originally was registered on 19th March, 1995 under the Arms Act. The DSP did not give any prior approval on his own to record any information about the commission of an offence under TADA. On the contrary, he made a report to the Additional Chief Secretary and asked for permission to proceed under TADA. Why? was it because he was reluctant to exercise jurisdiction vested in him by the provision of Section 20A (1)? This is a case of power conferred upon one authority being really exercised by another. If a statutory authority has been vested with jurisdiction, he has to exercise it according to its own discretion. If the discretion is exercised under the direction or in compliance with some higher authority's instruction, then it will be a case of failure to exercise discretion altogether. In other words, the discretion vested in the DSP in this case by Section 20A (1) was not exercised by the DSP at all. 12. Reference may be made in this connection to Commissioner of Police vs. Gordhandas Bhanji, 1952 SCR 135, in which the action of Commissioner of Police in cancelling the ....
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....pplied to Judicial Officers making a record under Section 164.'. Thus, as held in CIT vs. Anjum M.H.Ghaswala & Ors.2002 (1) SCC 633, by the Constitutional Bench that 'it is a normal rule of construction that when a statue vests certain powers in a authority to be exercised in a particular manner then the said authority has to exercise it only in the manner provided in the statue itself. If that be so, since the Commission cannot exercise the power of relaxation found in Section 119(2) (a)in the manner provided therein it cannot invoke that power under Section 119(2)(a) to exercise the same in its judicial proceedings by following a procedure contrary to that provided in sub-section (2) of Section 119. 23. Section 116 of the Act, defines the Income Tax Authorities as different and distinct authorities. Such different and distinct authorities have to exercise its powers in accordance with law in specified circumstances. Thus, the Assessing Officer would have to exercise its own discretion to reach a conclusion and would not be influenced by any other officer. In view thereto, we find force in the contention raised by the learned senior counsel for the petitioner that....