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TMI Blog2025 (1) TMI 567X X X X Extracts X X X X X X X X Extracts X X X X ..... pproval and it clearly lacks of thought process which is essential for a valid approval that competent authority entered into thought process and after application of mind he issued the same and mechanical approval issued in the mechanical way is not permissible in the eye of law. Thus, we find that there is material substance in the submissions advanced on behalf of the assessee/appellant. As approval in question is quite mechanical, passed without application of mind and lacks sufficient thoughtful process, which is nto permissible in the eye of law and resultantly assessment order followed by such approval lacks legitimacy and term as non-est and null and void and liable to be quashed. Assessee appeal allowed. - Shri Shamim Yahya, Accountant Member And Shri Sudhir Pareek, Judicial Member For the Assessee : Sh. Kapil Goel, Adv. And Sh. Sandeep Goel, Adv. For the Revenue : Ms. Nidhi Singh, CIT(DR), And Sh. Satya Prakash Sharma, Sr. DR ORDER PER SUDHIR PAREEK, JM These appeals are preferred by the different Assessee against the different order dated 11.03.2024, 13.03.2024, 14.03.2024, 15.03.2024, passed by the Learned Principal Commissioner of Income Tax (Central), Gurgaon (herei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ASST. ORDER WITH APPROVAL U/S 153D: CAN NOT BE REVISED U/S That impugned revision order u/s 263 is nullity and void ab initio as underlying assessment order admittedly passed with statutory approval u/s 153D cannot be revised u/s 263 of 1961 Act, as held in series of juridical precedents. 5. PENDING FIRST APPEAL SO NO REVISION U/S 263 PERMISSIBLE: That impugned revision order u/s 263 is nullity and void ab initio as there is valid appeal pending before first appeal authority which denudes power of revision u/s 263 of 1961 Act. 6. LACK OF VALID SCN U/S 263 :That impugned revision order u/s 263 is nullity and void ab initio as there is violation of principle of natural justice and lack of valid scn u/s 263 of 1961 Act. 3. We take ITA No.- 1918/Del/2024 as a lead case. In this case, a search and seizure operation u/s 132 and survey operation u/s 133(A) were conducted on 03.05.2018 in M/s Jai Bharat Group of cases, Samalkha, Panipat. The assessee s case was also covered u/s 133(A) of Income Tax Act, 1961 (hereinafter referred to as the Act ). 4. At the time of hearing, the Ld. Counsel for Assessee, submitted at the outset that the disputed issues in this appeals is covered in favour o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oid ab initio, being not passed in accordance with due course of law. The following judgements, which the Id. AR has relied, also brings forth the settled proposition of law that a non est and void order cannot be subject matter to the revisionary proceedings u/s 263 of the Act:- (i) Gigabyte Technology (India) (P.) Ltd. V. CIT. [2020] 121 taxmann.com 301 (Bombay) (HC); (ii) DCIT v. Dina Mahabir Re-Rollers Pvt. Ltd. [2022] 135 taxmann.com 338(Patna - Trib.); (iii) Mohan Jute Bags Mfg. Co. v. PCIT [2021] 131 taxmann.com 309 (Kolkata -Trib.); (iv) Keshab Narayan Banerjee v. CIT [1998] 101 Taxman 512 (Cal.) (Calcutta-HC): (v) Westlife Development Ltd. v. Principal Commissioner of Income Tax [2017] 88 taxmann.com 439 (Mum. - Trib.); and (vi) V. Narayanan v. DCIT, [2010] 127 ITD 133 (Chennai) (Trib. Full Bench) 11. The learned AR also relied upon in this context the order of the coordinate Bench in the case of M/s Sahi Exports Pvt. Ltd. v. PCIT (ITA nos. 2170 2171/Del/2017 dated 24.03.2021). The relevant para 16 is reproduced herein below as under: 16. In light of the aforesaid ratio laid down by the Hon'ble Supreme Court, we are of the considered opinion that the assumption of juri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . From bare perusal of section 153D it is crystal clear that concrete approval is a condition precedent to initiate the proceedings and in absence of valid approval, proceedings initiated will have no effect in the eye of law. 16. In this regard learned AR referred the order passed by the Hon ble Jurisdictional High Court of Delhi in the case of PCIT v. Shiv Kumar Nayyar [ITA 285/2024 CM Appeal 28994/2024 order dated 15.05.2024], in which Hon ble Delhi High Court, in relevant para 17 has held as under: 17. Notably, the order of approval dated 30.12.2020 which was produced before us by the learned counsel for the assessee clearly signifies that a single approval has been granted for AYs 2011-12 to 2017-18 in the case of the assessee. The said order also fails to make any mention of the fact that the draft assessment orders were perused at all, much less perusal of the same with an independent application of mind. Also, we cannot lose sight of the fact that in the instant case. the concerned authority has granted approval for 43 cases in a single day which is evident from the findings of the ITAT, succinctly encapsulated in the order extracted above. 17. Learned AR further referred t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... discordant note on such mechanical exercise of responsibility placed on designated authority under section 153D of the Act. 17. Hence, vindicated by the factual position as noted in preceding paras, we find considerable force in the arguments advanced by the Ld. the Assessee's Representative on the Aditional Ground of Appeal. In our considered opinion the approvals so granted under the shelter of section 153D of the Act does not pass the test of legitimacy. The Assessment orders of various assessment years as a consequence of such inexplicable approval lacks legitimacy. Consequently, the impugned assessments orders in the captioned appeals are non-est and a nullity and hence the same are quashed . 18. In the course of hearing learned AR also relied upon the order passed by the Hon ble Orissa High Court in the case of ACIT v. M/s Serjuddin Co. [ITA nos. 39, 40, 41, 42, 43, 44 45/2022 dated 15.03.2023], in which the Hon ble High Court in relevant paras 15,16, 22 23 has observed as under: 15. A plain reading of Section 153D itself makes it abundantly clear that the legislative intent was to be obtaining of prior approval by the AO when he is below the rank of a Joint Commissioner, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Technical Manual of Office Procedure becomes important. Although, it was in the context of Section 158BG of the Act, it would equally apply to Section 153D of the Act. There are three or four requirements that are mandated therein, (1) the AO should submit the draft assessment order well in time . Here it was submitted just two days prior to the deadline thereby putting the approving authority under great pressure and not giving him sufficient time to apply his mind; (ii) the final approval must be in writing; (III) The fact that approval has been obtained, should be mentioned in the body of the assessment order. 23. In the present case, it is an admitted position that the assessment orders are totally silent about the AO having written to the Additional CIT seeking his approval or of the Additional CIT having granted such approval. Interestingly, the assessment orders were passed on 30th December 2010 without mentioning the above fact. These two orders were therefore not in compliance with the requirement spelt out in para 9 of the Manual of Official Procedure . 19. It is relevant to mention here that appeal preferred by the revenue against the above judgment passed by the Hon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issions advanced on behalf of the assessee/appellant. 23. On the basis of foregoing submissions, discussion and the ratio of decisions given by judicial pronouncements as mentioned earlier, we find material substance in the submissions advanced on behalf of the assessee/appellant on grounds 1.3, 2 4 and we are of the firm opinion that approval in question is quite mechanical, passed without application of mind and lacks sufficient thoughtful process, which is nto permissible in the eye of law and resultantly assessment order followed by such approval lacks legitimacy and term as non-est and null and void and liable to be quashed. 24. In the light of the foregoing discussion, as we find material substance in the submission of the assessee/appellant, we need not go into the merits of the case. As issue regarding mandatory approval u/s 153D has been decided in favour of the assessee/appellant, so other grounds raised in the appeals of the assessee/appellant become academic or infructuous and do not require specific adjudication. We also hold that revisional authority overlooked the mandatory requirement of law and in such a circumstances, impugned order is quite unsustainable in the e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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