9911796707
TMI Blog2023 (10) TMI 686X X X X Extracts X X X X X X X X Extracts X X X X ..... without any consideration of factual and legal position in proposed additions/disallowances and without contents of appraisal report before him or incriminating material collected in search etc. has buckled under statutory compulsion and proceeded to grant a simplicitor approval with caveats and disclaimers. This approach of the JCIT has ipso facto rendered the impugned approval to be a mere ritual or an empty formality to meet the statutory requirement and can not thus be countenanced in law. We are unhesitatingly disposed to hold that the assessment order for AY 2014-15 in question, in pursuance of a hollow cosmetic approval accorded u/s 153D and undeniably without application of mind, is rendered unenforceable in law and hence quashed. Appeal of the Assessee is allowed. - SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER For the Appellant : Shri Amit Goel, CA For the Respondent : Ms. Sarita Kumari, CIT (DR) ORDER PER PRADIP KUMAR KEDIA, A.M.: The captioned appeal has been filed by the Assessee against the order of the Commissioner of Income Tax (Appeals)-IV, Kanpur [ CIT(A) ] dated 19.03.2018 arising from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment order was passed under Section 153A of the Act with the prior approval of the Joint Commissioner of Income Tax, Central Range, Meerut dated 31/12/2016 accorded under Section 153D of the Act and communicated to AO vide F. No. JCIT/CR/MRT/S S/153D/1422 dated 31/12/2016. 4. Aggrieved by the staggering assessment made by the AO, the assessee moved an appeal before the CIT(A). Before the CIT(A), the assessee challenged the additions / disallowances made by the AO both on legal grounds as well as merits. The assessee inter alia challenged the assessment order passed by the AO on the ground that the approval granted for framing assessment order is contrary to provision of Section 153D of the Act. The CIT(A) however did not find any merit in the plea of the assessee in any of the grounds and consequently declined any relief. 5. Aggrieved by the denial of relief by the CIT(A), the assessee preferred appeal before the Tribunal. 6. Before the Tribunal, the Ld. Counsel for the assessee Mr. Amit Goel vociferously assailed the order of the CIT(A) on multiple grounds. 6.1 To begin with, the Ld. Counsel raised a preliminary ground and submitted that the assessment order fram ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing very little time / no time at his disposal for proper examination of facts of the case or for conducting enquiries etc. The JCIT in its last minute approval letter, in dated 31/12/2016 (para no. 9.1.2) while granting approval under Section 153D, in turn, has again noted that the technical approval has been accorded to pass assessment orders in 18 cases including assessee, for which draft assessment orders were submitted by the Assessing Officer Noida. b) The JCIT in his approval memo for all 18 cases also directed the AO to ensure taking into account the seized documents / papers and comments in the appraisal report pertaining to AYs under reference. The JCIT thereafter also observed that the fact of initiation of penalty proceedings, wherever applicable, must also be incorporated in the last para of the order. The initiation of correct penalty provisions of the Act under Section 271(1)(c)/ 271AAB as per facts of the case were also directed to be ensured at the end of the AO. c) After taking into consideration the above points, a copy of the final orders passed be sent to the JCIT. d) As many as 18 draft assessment orders including the assessment order of the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act) for his perusal and prior approval. The approving authority is necessarily required to objectively evaluate such draft assessment order with due application of mind on various issues contained in such order so as to derive his/ her conclusive satisfaction that the proposed action of AO is in conformity with subsisting law and with underlying factual matrix. The AO is obligated is pass the assessment order exactly, as per approval / directions of the designated authority. It is not open to the AO to modify the assessment order without the knowledge and concurrence of the designated authority. Inevitably, this evaluation is to be made on basis of material gathered at time of search as well as obtained in the course of assessment proceeding. The requirement of law is to grant approval not merely as a formality or a symbolic act but a mandatory requirement. 9.5 In the instant case, it is a matter of record by the own admission of JCIT that the approval granted is merely technical and without appraisal of evidences or enquiries. Thus fact thus need not be traversed any further. In the backdrop of the unequivocal observations made by the JCIT, approval granted under Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... njoins a salutary duty of statutory nature. The designated superior authority is thus expected to confirm to the statutory requirements in letter and spirit. As noted in the preceeding paragraphs, it is a classic case of collective abdication of statutory responsibility assigned under Act and yet putting civil consequences of onerous nature on a tax payer. It is axiomatic from the plain reading of approval memo that the JCIT is in complete dark on facts while being called upon to grant his clearance to the draft assessment orders. It is evident from the CBDT Circular No. 3 of 2008 dated 12.03.2008 that the legislature in its highest wisdom made it obligatory that the assessments of search cases should be made with the prior approval of superior authority, so that the superior authority apply their mind on the materials and other attending circumstances on the basis of which the Assessing officer is making the assessment and after due application of mind and on the basis of seized materials, the superior authority is required to accord approval the respective Assessment order. The solemn object of entrusting the duty of Approval of assessment in search cases is that the Additional/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15-16 where co- ordinate bench found total lack of propriety in such statutory approval. There are plethora of decisions of various co-ordinate benches including Sanjay Duggal ors (ITA 1813/Del/2019 ors; order dated 19.01.2021 which have also echoed the same view o n similar fact situation. 13. The CIT(A) in para 7 of first appellate order has brushed aside the legal objection summarily merely on an inept indifferent premise that the assessment order makes mention of the approval from JCIT under 153D of the Act. The cryptic conclusion drawn by the CIT(A) is bereft of any reasons whatsoever and thus cannot be reckoned to be a judicial finding on the point. The observations so made are not tenable in law. 14. In the light of foregoing discussions, We are unhesitatingly disposed to hold that the assessment order for AY 2014-15 in question, in pursuance of a hollow cosmetic approval accorded under S. 153D and undeniably without application of mind, is rendered unenforceable in law and hence quashed. 15. In view of legal objection answered in favour of the Assessee, the aspects of other objections on jurisdiction or merits of additions/ disallowance does not call for se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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