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TMI Blog2025 (2) TMI 401X X X X Extracts X X X X X X X X Extracts X X X X ..... er of Income Tax Appeals-29, Delhi ['Ld. CIT(A)' for short] dated 09/02/2022for the Assessment Year 2013-14 and 2014- 15 respectively. 2. Apart from raising several grounds on merits, the Assessee has also filed an additional ground of Appeal which reads as under:- "a) On the facts and under circumstances of the case the order of the A.O. is void ab initio as the same has been passed on the basis of mechanical and consolidated approval of 153D for all years of search." 3. Brief facts of the case are that, the assessment proceedings have been initiated against the Assessee pursuant to a search and seizure operation dated 05/10/2017 conducted u/s 132 of the Income Tax Act, 1961 ('Act' for short) in the case of the Assessee. An approval u/s 153D of the Act dated 29/12/2019 has been issued by the Addl. Commissioner of Income Tax, Central Range, 7, New Delhi in respect of the assessment years 2012-13 to 2018-19 pursuant to the office letter of ACIT, Central Circle, 25-New Delhi dated 29/12/2019. Based on the said approval granted u/s 153D of the Act, the assessment proceedings have been initiated for those assessment years. The assessment order came to be passed for Assessment Years ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h assessment proceedings right from the time of receipt of appraisal report from the Investigation Wing and is involved with the Ld. AO from time to time while issuing various questionnaires. The ld. ACIT in Central Range also examined the seized documents in detail in respect of each Assessment Years immediately after receipt of the appraisal report and provided able assistance to the Ld. AO about the interpretation of the said seized documents while issuing questionnaires to Assessee's, examining the replies filed by the Assessee's and drawing conclusions thereon. Thus, submitted that it is very easy for the ld. ACIT to grant approval of the draft assessment order on the same day since the Ld. ACIT is involved with the assessment proceedings right from the inception. Therefore, submitted that the by contention of the Assessee's Representative that the Ld. ACIT has given mechanical approval has no force. 8. Further, the Ld. DR vehemently argued that bare reading of provisions of section 153D of the Act, which provides only about existence of approval from the ld. ACIT. There is no mention of application of mind on the part of the ld. ACIT or the approving authority in the sai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mandatory requirement of law. The said approval granting proceedings by the ld. JCIT is a quasi judicial proceeding requiring application of mind by the ld. JCIT judiciously. In order to ensure smooth implementation of the aforesaid provisions, in consonance with the true spirit of the scheme of the Act, it is the bounden duty of the Ld. AO to seek to place the draft assessment order together with copies of the seized documents before the ld. JCIT well in time much before the due date of completion of search assessment. The ld. JCIT is supposed to examine the seized documents, questionnaires raised by the Ld. AO on the assessee seeking explanation of contents in the seized documents, replies filed by the assessee in response to the questionnaires issued by the Ld. AO and the conclusions drawn by the Ld. AO vis- à-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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the last moment, then no fault could be attributed to the assessee. In such circumstances, the only irresistible conclusion that could be drawn is that the ld. AO is not serious about the statutory deadlines provided in the Act. In our considered opinion, if the arguments of the Ld. CIT DR are to be appreciated that the ld. JCIT need not apply his mind while granting approval of the draft assessment orders u/s 153D of the Act as it is not provided in section 153D of the Act, then it would make the entire approval proceedings contemplated u/s 153D of the Act otiose. The law provides only the Ld. AO to frame the assessment, but, certain checks and balances are provided in the Act by conferring powers on the ld. JCIT to grant judicious approval u/s 153D of the Act to the draft assessment orders placed by the Ld. AO. 9. Let us now examine whether in the aforesaid background of the scheme of the Act, whether the approval in terms of section 153D of the Act has been granted by the ld. JCIT in a judicious way after due application of mind or not, in the instant case. We have gone through the approval granted by the ld. JCIT on 27.03.2015 u/s 153D of the Act. The said approval letter cle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decided by the Tribunal in the case of Sanjay Duggal (supra). In that case, at least the assessment folders were sent whereas in the instant case, as appears from the letter of the Assessing Officer seeking approval, he has sent only the draft assessment order without any assessment records what to say about the search material. As mentioned earlier, there are infirmities in the figures of original return of income as well as total assessed and the Addl. CIT while giving his approval has not applied his mind to the figures mentioned by the AO. Therefore, approval given in the instant case by the Addl. CIT, in our opinion, is not valid in the eyes of law. We, therefore, hold that approval given u/s 153D has been granted in a mechanical manner and without application of mind and thus it is invalid and bad in law and consequently vitiated the assessment order for want of valid approval u/s 153D of the Act. In view of the above discussion, we hold that the order passed u/s 153A r.w.s. 143(3) has to be quashed, thus ordered accordingly. The ground raised by the Assessee is accordingly allowed". [Emphasis is ours] 14. In this appeal, we are required to examine whether any sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame would be merely academic in nature and, hence, they are left open. 13. In the result, the appeal of the assessee is allowed, cross objections of the assessee is allowed and appeal of the revenue is dismissed." 11. Considering the fact that the Ld. ACIT accorded the approval u/s 153D of the Act on the very same day wherein consolidated single approval has been granted for different Assessment Years and on the very same day of according the sanction, the assessment orders were passed, thus by following the ratio laid down in the case of SEH Realtors Pvt. Ltd. (supra), we allow the Additional Grounds of Appeal of the respective Appeal challenging the assessment order which was framed based on the invalid approval accorded u/s 153D of the Act. Accordingly, we set aside both the impugned Assessment Orders in the captioned Appeals. 12. In the result, the Appeal of the Assessee in ITA Nos. 556/Del/2022 and 557/Del/2022 are partly allowed. 13. Since we have quashed the respective assessment orders on the ground of invalid sanction accorded u/s 153D of the Act, other Grounds of Appeal raised by the Assessee's have not been adjudicated. Order pronounced in the open court on 07th Fe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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