RAGHUNATH REDDY GANGARAM,HYDERABAD vs. DCIT, CENTRAL CIRCLE-1(2),, HYDERABAD

Facts

The assessee's case was selected for scrutiny following a search operation. The Assessing Officer (A.O.) made additions based on unexplained investments in property and cash found. The Commissioner of Income Tax (Appeals) sustained these additions. The assessee appealed to the Tribunal, raising an additional ground that the assessment order was vitiated due to a mechanical approval under Section 148B.

Held

The Tribunal admitted the additional ground, holding that the approval under Section 148B by the Additional CIT/JCIT was mechanical and lacked application of mind, as evidenced by the brief approval order and the short time taken. Consequently, the assessment order was deemed invalid.

Key Issues

Whether the assessment order passed under Section 143(3) is vitiated due to mechanical approval under Section 148B without application of mind by the approving authority.