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TMI Blog2021 (6) TMI 933X X X X Extracts X X X X X X X X Extracts X X X X ..... re being hereby heard and decided together as a common legal issue in involved in both the appeals. 2.0 First, we are taking up appeal in the case of the assessee Shri Inder Pal Singh Arora bearing ITA No.3900/Del/2015. This appeal is against the order passed by the Ld. Commissioner of Income Tax Dehradun {(CIT (A)} vide order dated 30/03/2015 and is relating to assessment year 2007-08. The brief facts of the case are that a search action u/s 132 of the Act was carried out on 21/10/2010 on the Juyal Group covering the case of the assessee. Pursuant to the search, the assessment for the year under consideration was completed u/s 153A(1)(b) r.w.s. 143(3) of the Act vide order dated 28/03/2013. The Assessing Officer (AO) made additions of ₹ 36,05,000/- and ₹ 36,00,950/- as undisclosed investment and unexplained credit u/s 68 of the Act respectively. The Ld. CIT (A) has upheld the additions made by the assessing officer and hence the assessee is in appeal before us. 2.1 The assessee has raised the following grounds of appeal: 1. That in facts and circumstance of the case, the Learned CIT has erred wrongly in sustaining the addition of ₹ 72,05,950/ - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are purely of legal nature and requested the admission of the same by citing various judicial decisions. On merits of the additional ground, our attention was drawn to the approval u/s 153D of the Act dated 28/03/2013 placed at Pages 2-3 of the Paper book. It was submitted that the approving authority u/s 153D of the Act is vested with important power to grant approval and same should be exercised after due application of mind. It was submitted that the assessing officer forwarded the copy of draft assessment order to the Addl. CIT on 28/03/2013 and the approval was granted on the same date i.e. 28/03/2013. The Ld. Counsel further highlighted that a common approval was accorded to the draft orders passed in the cases of 20 assessees in very limited time i.e. only on a single day. It was the submission of the Ld. Counsel that the approving authority has mechanically granted the approval without even going through the draft assessment order and as such the approval u/s 153D of the Act was invalid and bad in law. 5.0 The Ld. DR, on the other hand, placed on record the report submitted by the assessing officer in respect of the additional grounds taken by the assessee and argued t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e facts of the individual cases. This position is further corroborated from the contents of the approval letter itself wherein the approving authority is admitting that due to limitation of time, only broad issues were discussed. The relevant paragraph i.e. paragraph 3 in the approval letter is reproduced hereunder: 3. As most of the draft orders have been received at the end of the limitation period, it is not possible to discuss minute details and only broad issues have been discussed with you. Due to limitation involved, approval is being accorded. 7.2 We find it difficult to comprehend as to how the approving authority satisfied itself about the correctness of the search based draft assessment orders without even looking at the search material. In these circumstances, we have no doubts in our mind that the approving authority has acted casually and granted the approval u/s 153D of the Income tax Act, 1961 in a mechanical manner without judicious exercise of power. 7.3 At this juncture, it is relevant to make a reference to the provisions of section 153D of the Income tax Act, 1961: Prior approval necessary for assessment in cases of search or r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her enquiries made by the A.O. during the course of assessment proceedings. Therefore, necessarily at the time of grant of approval of the assessment made by the A.O, the Joint Commissioner is required to verify the above issues, apply his mind that whether they have been properly appreciated by the A.O. while framing the assessment orders or not. The JCIT is also required to verify whether the required procedure have been followed by the A.O. or not at the time of framing of the assessments. Thus, the approval cannot be a mere discretion or formality, but, is mandatory being Quasi Judicial function and it should be based on reasoning. In our view, when the legislature has enacted some provision to be exercised by the higher Revenue Authority enabling the A.O. to pass assessment order or reassessment order in search cases, then, it is the duty of the JCIT to exercise such powers by applying his judicious mind. We are of the view that the obligation of the approval of the Approving Authority is of two folds ; on one hand, he has to apply his mind to secure in build for the Department against any omission or negligence by the A.O. in taxing right income in the hands of right p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stead of granting approval under section 153D for each assessment years separately. 16. In some of the cases the approval was granted on the date the request was made for approval by the A.O. In all those cases merely draft assessment order and the assessment folders were available with the A.O. For example in the case of Shri Sanjay Duggal family, in the case of Ms. Kritika Talwar on the same date the approval was granted and that too merely on the basis of the assessment records and draft assessment order and in most of the cases approval has been granted either on the same day or on the next day. Further, there is no reference that seized material as well as appraisal report have been verified by the JCIT. It is not clarified whether assessment record is also seen by the JCIT.It may also be noted that even in some of the Talwar group of cases approval is granted prior to 30.12.2017 but in main cases of Shri Sanjay Duggal and Rajnish Talwar the approval is granted on 30.12.2017. Therefore, without granting approval in the main cases how the JCIT satisfied himself with the assessment orders in group cases which is also not explained. Therefore, the approval granted b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irement of approval u/s 153D of the Income Tax Act is equally relevant for passing of the assessment order for the year of search as per section 153D read with section153B(1)(b) of the Income Tax Act, 1961. Further, in this case, the approval u/s 153D was accorded vide the same common approval letter dated 28/03/2013 which has already been dealt by us while deciding the appeal in the case of Shri Inder Pal Singh Arora (Supra) in ITA No. 3900/Del/2015. 10.1 As the issue involved in this appeal is identical to that in ITA No. 3900/Del/2015 wherein we have quashed the approval u/s 153D and consequently the assessment order, the finding recorded in that case is applicable mutatis mutandis to this appeal. Accordingly, by parity of reasoning, we hereby quash the assessment order passed u/s 143(3) dated 28/03/2013. As a result, the additional ground raised by the assessee is allowed. 10.2 As we have quashed the impugned assessment order for want of proper approval, other grounds raised by the assessee become academic in nature and do not require any adjudication. 11.0 In the result ITA No. 2784/Del/2015 stands allowed. 12.0 In the final result, both the appeals of th ..... 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