2024 (4) TMI 1196 - HC - Income Tax

Validity of assessment order u/s 153(D) - no application of mind as mechanical approval has been granted by the Joint Commissioner - HELD THAT - From perusal of the language of the letter we cannot presume that there was no application of mind as the approval need not be a detailed assessment order. The presumption u/s 114 of the Evidence Act would follow when such official Act has been done in accordance with official procedure and will lead to presumption that due diligence was followed. Even otherwise, the order of the ITAT would reflect that the case of appellant was remanded back to the AO for fresh adjudication of the issue. The liberty was given to the assessee to raise all such issues before the Revenue Authorities and furnish necessary information/evidences in support of his contention. When such right has already been reserved in favour of the assessee, to raise grounds, we do not find that any prejudice has been caused and in fact the ITAT has principally accepted the contention of the appellant and in furtherance to advance the rules of natural justice, opportunity is given to appellant assessee. No substantial question of law.

Summary

Issues:
Challenge to assessment order under Section 153(D) of the Income Tax Act 1961.

Analysis:
The appellant challenged the assessment order made under Section 153(D) of the Income Tax Act 1961, contending that the approval obtained from the Joint Commissioner was merely a mechanical approval without proper application of mind. The appellant relied on the law laid down by the High Court of Orissa, emphasizing that the approving authority must indicate the thought process involved in granting approval, even though detailed reasons are not required. The High Court analyzed the approval order and the ITAT's order, concluding that the mandate of Section 153(D) was complied with as the approval of the Joint Commissioner was obtained. The High Court noted that the Joint Commissioner was satisfied based on the documents on record, indicating that the approval was justified. The court emphasized that the approval need not be a detailed assessment order and that the presumption of regularity under Section 114 of the Evidence Act applies when official acts are done in accordance with official procedure.

The High Court further observed that the ITAT had remanded the case back to the Assessing Officer for fresh adjudication, granting the appellant the liberty to raise all issues and furnish necessary information. The court found that no prejudice was caused to the appellant as the ITAT accepted the appellant's contentions and provided an opportunity to present their case before the Revenue Authorities. The High Court concluded that no substantial question of law arose for consideration and disposed of the appeal without making any observations on the merits of the case.