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| DATE: | February 1, 2013 (Date of publication) |
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| Click here to download the judgement (akil_somji_154D_approval_JCIT.pdf) |
Failure To Obtain JCIT’s Approval Renders s. 153C Assessment Order Void
Pursuant to search & seizure action u/s 132 on the premises of a third party, certain documents belonging to the assessee were found and seized pursuant to which a notice u/s 153C was issued to the assessee and assessment u/s 153C r.w.s. 144 were framed. In passing the assessment orders, the AO (ITO) omitted to obtain the consent of the JCIT as mandated by s. 153D. Before the Tribunal, the assessee argued that the failure to obtain the JCIT’s consent rendered the assessment a nullity. The Tribunal (137 ITD 94) upheld the plea on the basis that as the heading to s. 153D refers to a “prior approval” and uses negative wording and the word “shall”, compliance of s. 153D is mandatory and cannot be waived by the assessee. Reliance was also placed on Clause 9 of the Manual of Office Procedure which makes it clear that an assessment order under Chapter XIV-B can be passed only with the previous approval of the JCIT and that the approval must be in writing and stated to have been obtained in the body of the assessment order. On appeal by the Department to the High Court, HELD dismissing the appeal:
Though the question raised proceeds on the basis that approval of the JCIT was given as he had corrected the draft assessment order and the changes were incorporated by the AO in the final assessment order, the finding of fact was recorded by the Tribunal is that no prior approval of the Joint Commissioner was taken before the ITO passed the order. In view of the above, there is no reason to entertain the proposed question and the appeal is dismissed.
quite right. when a section mandates why mandate is omitted is the question that arises? Why mandate is avoided there are several reasons. if AO wants to encash a section for his own personal reasons how he will take the prior permission of JCIT? He will not definitely. Similarly even sections 143(2) and 142(1) is misused. Here AO acts after the limitation period is over say 12 months from the date of return. This is to make money at the ignorance of assessee of the details of provision. So every provision if not to be intelligible to assessee , the assessee is screwed up. that is how corruption is increasing thanks to perversion. so tribunals and courts need to be very firm to put AOs on sensible track, else revenue incurs loss just because unnecessary litigation surfaces. In fact tribunals and courts need to impose costs on revenue in favor of assessees that will be the product of vicarious liability besides the relevant officer is to be demoted that will bring administrative discipline, is it not?