|CORAM:||N. K. Billaiya (AM), Vijay Pal Rao (JM)|
|CATCH WORDS:||sanction, Search assessment|
|DATE:||August 19, 2015 (Date of pronouncement)|
|DATE:||September 11, 2015 (Date of publication)|
|FILE:||Click here to download the file in pdf format|
|S. 153A/ 153D: Approval to the assessment order granted by the Addl. CIT in a casual and mechanical manner and without application of mind renders the assessment order void|
The Addl CIT granted approval u/s. 153D to the draft order u/s. 143(3) r.w.s. 153A by stating that “As per this office letter dated 20.12.2010, the Assessing Officers were asked to submit the draft orders for approval u/s. 153D on or before 24.12.2010. However, this draft order has been submitted on 31.12.2010. Hence there is no much time left to analise the the issues of draft order on merit. Therefore, the draft order is being approved as it is submitted. Approval to the above said draft order is granted u/s. 153D of the I.T. Act, 1961.” The assessee claimed that the said approval was not valid and vitiated the assessment order. HELD by the Tribunal accepting the claim:
(i) The Legislative intent is clear inasmuch as prior to the insertion of Sec.153D, there was no provision for taking approval in cases of assessment and reassessment in cases where search has been conducted. Thus, the legislature wanted the assessments/reassessments of search and seizure cases should be made with the prior approval of superior authorities which also means that the superior authorities should apply their minds on the materials on the basis of which the officer is making the assessment and after due application of mind and on the basis of seized materials, the superior authorities have to approve the assessment order.
(ii) On facts, the Addl. Commissioner has showed his inability to analyze the issues of draft order on merit clearly stating that no much time is left, inasmuch as the draft order was placed before him on 31.12.2010 and the approval was granted on the very same day. Considering the factual matrix of the approval letter, we have no hesitation to hold that the approval granted by the Addl. Commissioner is devoid of any application of mind, is mechanical and without considering the materials on record. The power vested in the Joint Commissioner/Addl Commissioner to grant or not to grant approval is coupled with a duty. The Addl Commissioner/Joint Commissioner is required to apply his mind to the proposals put up to him for approval in the light of the material relied upon by the AO. The said power cannot be exercised casually and in a routine manner. We are constrained to observe that in the present case, there has been no application of mind by the Addl. Commissioner before granting the approval. Therefore, we have no hesitation to hold that the assessment order made u/s. 143(3) of the Act r.w. Sec. 153A of the Act is bad in law and deserves to be annulled.