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TMI Blog2024 (7) TMI 1134X X X X Extracts X X X X X X X X Extracts X X X X ..... ial precedents which provides guidance in applying the law in this regard. Approval granted by the superior authority in mechanical manner defeats the very purpose of obtaining approval u/s 153D of the Act. Such perfunctory approval has no legal sanctity in the eyes of the law. In the case of Serajuddin and Co [ 2023 (11) TMI 1254 - SC ORDER] dismissed the Appeal filed by the Department of Revenue against the order [ 2023 (3) TMI 785 - ORISSA HIGH COURT] wherein the Hon ble High Court had quashed the Assessment Order on the ground of inadequacy in procedure adopted for issuing approval u/s 153D of the Act by expressing discordant note on such mechanical exercise of responsibility placed on designated authority u/s 153D of the Act. Hence, considering the above facts and circumstances, we find considerable force in the plea raised by the Assessees in the Ground No. 1 of the Appeal which is against erroneous approval granted u/s 153D of the Act. In our opinion the approvals so granted under the shelter of section 153D does not pass the test of legitimacy. Thus, the impugned Assessment order in consequence to such inexplicable approval lacks legitimacy. The impugned assessment in capti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned investment and deleted the addition of Rs. 2,39,757/- made by the A.O. on account of cash seized during the search operation. Aggrieved by the order of the Ld. CIT(A) in sustaining the above addition, the assessee preferred the present Appeal on the grounds mentioned above. 5. The Ld. Counsel for the assessee submitted at the BAR that, the assessee is not pressing the Ground No. 2 3 of the Appeal. Recording the submission made by the Assessee's Representative, the Ground No. 2 3 of the Appeal are dismissed. 6. In Ground No.1, the assessee contended that the Assessment Order passed by the A.O. is liable to be quashed as the same is contrary to the provisions of Section 153D of the Act for following reasons:- (i) The additional CIT has given combined approval u/s 153D of the Act for seven years which is not conformity with law. (ii) The Assessing Officer sent the letter for approval the Additional CIT(A) on 28/12/2019 and the additional CIT granted approval on the very next day i.e. on 29/12/2019 and on the said date, the Additional CIT has given approval for 178 cases of 29 Assessees which makes it clear that the Additional CIT had no time to properly examine the facts of ea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omatic from the plain reading of approval memo that various assessment orders and the issues incorporated in the assessment orders, were never subjected to any discussion with the authority granting approval prior to 29.12.2019. As per the CBDT Circular No. 3 of 2008 dated 12.03.2008, 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 of the respective Assessment order. Solemn object of entrusting the duty of Approval of assessment in search case 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt and the High Courts in support of its conclusion that the approval whenever required under the law, must be preceded by application of mind and consideration of relevant factors before the same can be granted. The approval should not be an empty ritual and must be based on consideration of relevant material on record. 5. The learned Counsel for the Revenue submitted that the question of legality of the approval was raised by the assessee for the first time before the Tribunal. He further submitted that the Additional CIT had granted the approval. The Tribunal committed an error in holding that the same is invalid. 6. Having heard the learned Counsel for the both sides and having perused the documents on record, we have no hesitation in upholding the decision of the Tribunal. The Additional CIT while granting an approval for passing the order of assessment, had made following remarks : To, The DCIT(OSD)1, Mumbai Subject: Approval u/s 153D of draft order u/s 143(3) r.w.s. 153A in the case of Smt. Shreelekha Nandan Damani for A.Y. 2007-08 reg. Ref: No. DCIT (OSD)1/ CR7/Appr/2010-11 dt. 31.12.2010 As per this office letter dated 20.12.2010, the Assessing Officers were asked to sub ..... X X X X Extracts X X X X X X X X Extracts X X X X
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