9911796707
TMI Blog2024 (9) TMI 1666X X X X Extracts X X X X X X X X Extracts X X X X ..... r goes against the revenue, as that cannot mean that when approval is given, the same is mere formality. We are of considered view that the approval is not given for validating an act of the AO. The approval order should indicate to the assessee that there is due exercise of powers of search assessment, under correct provisions of Act and admissible material relied to make additions. In the cases before us, the use of identical languages and reasoning in regard to different set of assessee for whom approval requests were independently received and on different dates the approval was granted, manifests that there was mechanical approval, without going through the records and draft assessment orders. Thus, we find force in contention of Ld. AR that giving an approvals of an assessee whose case was all together and for which already approval stood granted on 15.11.2019 shows quite mechanical way of handling this important quasi judicial power u/s 153D - Decided in favour of assessee. - SHRI M. BALAGANESH, ACCOUNTANT MEMBER AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER For the Appellant : Shri Lalit Mohan, CA Shri Parth Singhal, Advocate For the Revenue : Shri Dharm Veer Singh, CIT-DR ORD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e ld. FAA. 4. Now, in regard to the merits of this ground, the ld. AR took us through the copy of approvals granted u/s 153D of the Act. The copies of same are available at page Nos. 184 of the paper book in ITA No.429/Del/2024 and in ITA No.1400/Del/2023 at page no. page 388 of the paper book and both these approvals are given by the same Joint Commissioner of Income-tax, Range-2, Gurgaon. 4.1 As with regard to ITA No.429/Del/2024 Ld. AR has submitted that on 27.12.2019, the AO sought approval and on the same date, 27.12.2019, this approval was granted and on 30.12.2019 the impugned assessment order was framed and passed. 4.2 As with regard to the ITA No.1400/Del/2023 Ld. AR has submitted that on 30.12.2019, the AO sought approval of six assessee involving 30 assessment years and, on the same date, 30.12.2019, this approval was granted and on the same date the impugned assessment order was framed and passed. 4.3 In both the appeals relying the respective approvals, Ld. AR submitted that the impugned approval does not indicate if the approving authority had examined the draft order to find if the same is reasoned and requirement of law is fulfilled. It was submitted that the impugn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wal, 149 taxmann.com 373 (All), order dated 12.12.2022; (ix) Pr. CIT vs. Siddarth Gupta, 450 ITR 534 (All), order dated 12.12.2022; (x) PCIT vs. Sapna Gupta, 147 Taxmann.com 288 (Allahabad), order dated 12.12.2022; (xi) ACIT vs. M/s Serajuddin Co., 454 ITR 312 (Orissa), order dated 15.03.2023 affirmed by Hon ble Supreme Court in SLP (Civil) Diary No. 44989/2023 dated 15.3.2023; (xii) ACIT vs. Janak Raj Gupta Co., ITA No. 62 l/D/2012, order dated 15.12.2023; (xiii) Mysore Finlease (P) Ltd. vs. ACIT, ITA No. 8821/D/2019, order dated 10.01.2024; (xiv) DCIT vs. Zync Global (P) Ltd., ITA Nos. 4456 4457/D/2019, order dated 22.01.2024; (xv) MDLR Airlines (P) Ltd. vs. DCIT, ITA No. 1420/D/2023, order dated 29.04.2024; (xvi) Nageshwar Builders (P) Ltd. vs. DCIT, ITA No. 1661/D/2023, order dated 29.04.2024; (xvii) Millenium Vinimay (P) Ltd. vs. ACIT, ITA No. 458/D/2022, order dated 31.05.2024; (xviii) Vrushali Sanjay Shinde vs. DCIT, 107 ITR(T) 274 (Mum-Trib.), order dated 08.09.2023; (xix) Yogendra Kumar Garg vs. DCIT, ITA No. 2908/D/2018, order dated 26.06.2024; (xx) PCIT vs. Smt. Shreelekha Damani 174 DTR 86 (Bom), order dated 27.11.2018 affirming the decision of Hon ble Mumbai Bench of T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re and content of seized material at every stage during the assessment itself and, in fact, the authority has supervisory role also, therefore, if approval is granted on the same day that cannot be fatal. In this context, the CBDT Guidelines F.No.286/161/2006-IT (Inv.II) dated 22.12.2016 is relied to submit that copy of appraisal report is shared by Inv. Wing with both the Assessing Officers and Joint CIT and, further, CBDT Guidelines on the subject of search required a close coordination of all the authorities. 6.5 The ld. DR distinguished the judgement in the case of PCIT vs. Anuj Bansal (2023) 117 CCH 0050 Del HC and submitted that in that case no assessment record was sent along with the draft order and there were infirmities in the original return and assessed income and for that reason, the approval may have been vitiated. As regards the judgement in PCIT vs. Shiv Kumar Nayyar (2024) 163 taxmann.com 9 (Delhi), it was submitted that in that case the approval order failed to make any mention of the fact that draft assessment orders were perused at all, much less perusal of the same with an independent application of mind. It was also submitted that in the case of Shiv Kumar Nay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. AO and the conclusions drawn by the Ld. AO vis- -vis the said seized documents after considering the reply of the assessee. All these functions, as stated earlier, are to be performed by the ld. JCIT in a judicious way after due application of mind. Even though as vehemently argued by the Ld. CIT-DR, the ld. JCIT is involved with the search assessment proceedings right from the time of receipt of appraisal report from the Investigation Wing, still, the ld. JCIT, while granting the approval u/s 153D of the Act has to independently apply Page | 7 SEH Realtors Pvt. Ltd his mind dehors the conclusions drawn either by the Investigation Wing in the appraisal report or by the Ld. AO in the draft assessment order. The copy of the appraisal report submitted by the Investigation Wing to the Ld. AO and ld. JCIT are merely guidance to the Ld. AO and are purely internal correspondences on which the assessee does not have any access. Moreover, the Act mandates the Ld. AO to frame the assessment after getting prior approval from ld. JCIT u/s 153D of the Act. The ld. JCIT getting involved in the search assessment proceedings right from inception does not have any support from the provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... JCIT to grant judicious approval u/s 153D of the Act to the draft assessment orders placed by the Ld. AO. 8. In the light of aforesaid we like to further observe that it is the settled proposition of law that as regards examining the issue like valid approval, every case has to be examined independently on its own facts. This principle equally applies to the approving authority. In the cases in hand, if we examine the approval, we find that the approving authority was same person for these assessee and that although on two different dates the approvals have been granted, the language used in approvals and the format of the approvals is exactly same. We consider it appropriate to reproduce the conclusion of approving authority, in both the approvals, herein below:- 2. The approval u/s 153D of the IT Act, 1961, is accorded in the above cases for the above mentioned A.Y (s) considering the facts as submitted that 1. Proper opportunity of being heard were provided to assessee 2. All the issues appearing from the material on record were duly examined. 3. Relevant copies of seized documents were verified before passing the draft order. 4. It is further directed that orders should be pas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he revenue, as that cannot mean that when approval is given, the same is mere formality. We are of considered view that the approval is not given for validating an act of the AO. The approval order should indicate to the assessee that there is due exercise of powers of search assessment, under correct provisions of Act and admissible material relied to make additions. In the cases before us, the use of identical languages and reasoning in regard to different set of assessee for whom approval requests were independently received and on different dates the approval was granted, manifests that there was mechanical approval, without going through the records and draft assessment orders. 13. Particularly in regard to the ITA No.1400/Del/2023, we find force in contention of Ld. AR that giving an approvals of an assessee whose case was all together and for which already approval stood granted on 15.11.2019 shows quite mechanical way of handling this important quasi judicial power u/s 153D of the Act. 14. In the result, the approvals granted in the cases before us are established to be invalid and consequential assessments not sustainable. The relevant grounds in both appeals are sustained ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
