BEST CROP SCIENCE PRIVATE LIMITED,DELHI vs. DCIT-CENTRAL CIRCLE-28, DELHI

The appellant has raised legal grounds of appeal as well as those on merits of addition. The ld. Counsel of the assessee submitted that as the legal grounds strike at the root of the matter, the same be adjudicated first in preference to other grounds. The ld. Counsel for the assessee accordingly requested for adjudication of its ground of appeal no.3 first in preference over other grounds of appeal. Explaining the brief factual matrix of the case, the ld. Counsel for the assessee submitted that Return of Income was filed on 31.10.2023 declaring income of Rs.118,40,27,800/-. Thereafter, a search was conducted upon the assessee u/s 132 on 26.09.2023. Search proceedings indicated through incriminating material that the assessee was indulging in transactions which were not recorded in the books of accounts. Notice u/s 143(2) was issued on 28.06.2024 to the assessee selecting case of the assessee under the category of compulsory scrutiny. After considering, the ld. Assessing Officer proceeded to make addition under various heads so as to finally determine the taxable income at Rs.136,43,02,528/- The ld. First Appellate Authority confirmed the findings of the ld. Assessing Officer. The appellant assessee is in appeal assailing the impugned appellate order. 3. Heard rival parties and perused the material available on record. 4. The ld. Counsel for the assessee has through ground of appeal no.3 has argued that the assessment has been completed with the approval of Additional Commissioner of Income Tax and that since the assessment was made u/s 143(3), there was no statutory requirement for taking any approval from the Addl. Commissioner. The ld. Counsel argued that the said action of the ld. Assessing Officer has vitiated the impugned assessment. The ld. Counsel drew our attention to the following noting on the last page no.28, at para-49 of the assessment order. “…49. This order is passed with the prior statutory approval of the Addl. Commissioner of Income Tax, Central Range-7, New Delhi as conveyed vide office letter and DIN No. ITBA/COM/F/17/2024-25/1075312692(1) dated 31.03.2025….” 5. The ld. Counsel further submitted that its case is fully covered by the decision of this Tribunal in ITA No.7092/Del/2025 in Chemical Agencies, order dated 29.07.2026. It was submitted that accordingly the assessment order deserves to be quashed. 6. The ld. DR place reliance upon the orders of the lower authorities. 7. We have noted that the facts of case of Chemical Agency (supra) are identical to those in the present appeal. In the impugned decision, it was held as under:- “…5. The ld. Counsel for the appellant assessee drew our attention to the findings recorded by ld. Assessing Officer on page-1 to 4 of the assessment order to conclusively drive home the point that the impugned assessment was arising out of survey proceedings u/s 133A and not any search proceedings u/s 132. The ld. Counsel preliminary contest to the impugned assessment order is that the same is void ab initio. It was argued that it is trite law that if an Assessing Officer is influenced in his decision making by any other authority, then his order cannot be treated as a valid order. To prove the point, the ld. Counsel drew our attention to para-10 of the Assessing Officer’s order on page-8 recording as under:- “…10. The order passes with the prior approval of Joint Commissioner of Income Tax, Central Range-8, New Delhi as accorded vide his office letter F.No.JCIT/CR8/153D/2021- 22/1276 dated 29.09.2021…..” 6. The ld. Counsel vehemently argued that the said findings of the ld. Assessing Officer clearly alludes that there was intervention of the Joint Commissioner of Income Tax, Central Range-8, New Delhi in the assessment order and that as the same is not permissible and would constitute an interference in Assessing Officer’s working, the assessment order dated 29.09.2021 has become non-est. The ld. Counsel argued that the assessee was subjected to a survey operation under Section 133A of the Income Tax Act on 31/10/2018, and not a search and seizure operation. The proceedings were initiated by issuing a notice u/s 143(2) and the assessment was framed u/s 143(3) of the Act. It was argued that the statutory mandate of obtaining prior approval under Section 153D is specifically restricted to assessments made under Sections 153A and 153C, which exclusively arise from search or requisition cases. There is absolutely no legal requirement or provision within the Act that mandates or permits the AO to obtain prior approval u/s 153D for an assessment framed under Section 143(3) pursuant to a survey u/s 133A. It was stated that the position is firmly established by the Hon'ble Supreme Court in the case of Chandra Kishore Jhav. Mahaveer Prasad 8 SCC 266, and it is a well- settled solitary principle that "if statute provides for a thing to be done in a particular manner, then it has to be done in that manner and in no other manner". This principle was further reiterated by the Hon'ble Telangana High Court in Kankanala Ravindra Reddy Vs. ITO 156 taxmann.com 178, holding that doing a thing in a manner not provided under the law means "it would have no existence in the eye of law". By wrongfully invoking Section 153D for a Section 143(3) assessment, the AO has acted beyond statutory parameters, rendering the assessment invalid. It was argued that an act committed by a statutory authority contrary to the provisions of the law inherently causes prejudice to the assessee, entirely negating the need to prove any further specific or financial prejudice. The Hon'ble Bombay High Court in the case of Hexaware Technologies Ltd Vs. ACIT 162 taxmann.com 225 Bom. HC) categorically dealt with this exact proposition, holding that "An act which is done by an authority contrary to the provisions of the statue, itself causes prejudice to assessee". The Court ruled that all assessees possess a fundamental and indefeasible entitlement to be assessed strictly as per the law and by following the procedure prescribed by law. Therefore, when an authority proposes to take action without following due process, the said action itself results in a prejudice to assessee and there is no question of assessee having to prove further prejudice before arguing the invalidity of the action. 7. The ld. Counsel submitted that as held by the Hon’ble Apex Court in Tata Chemicals Ltd. v. Commissioner of Customs 2015] 58 taxmann.com 126 (SC), "there can be no estoppel against law," and something that is illegal cannot be converted into something legal simply because an authority chose to act outside its prescribed statutory parameters. Thus, obtaining an inapplicable approval is not just a harmless administrative redundancy; it is a fatal jurisdictional defect that legally extinguishes the assessment order, severely prejudicing the assessee by violating the rule of law. It was argued that it is also a case of abdication of Quasi-Judicial Powers and influenced by external dictation by the ld. Assessing Officer. In support of his contention, our attention was invited to the decision of the Hon'ble Punjab & Haryana High Court in the case of Findoc Finvest Private Limited vs Deputy Commissioner of Income Tax [2025] 172 taxmann.com 773 (Punjab & Haryana), holding that "where there is no provision, the order of assessment would be vitiated in law if the Assessing Officer consults or seeks approval of the assessment from his superior officers". In the said judgment, Hon’ble High Court held that an order passed under the influence and directions of superior officers would mean that "the Assessing Officer has abdicated his authority and, therefore, the order has become vitiated in law" Further reliance was placed upon the decision of the Hon'ble Supreme Court in Anirudhsinhji Karansinhji Jadeja vs State of Gujarat 5 SCC 302 holding that if a statutory authority is vested with jurisdiction, they must exercise it according to their own discretion. If the discretion is exercised under the direction or in compliance with a higher authority's instruction, "it will be a case of failure to exercise discretion altogether" and constitutes an invalid "exercise of power on the basis of external dictation". The AO in the present case failed to bear his own independent and unfettered judgment, instead forwarding a draft assessment to the JCIT for validation. 8. The ld. DR placed reliance upon the decision of lower authorities. The fact of inscription placed by the ld. Assessing Officer in para-10 of his order (supra) could not be satisfactorily controverted. 9. It is trite law discussed in judicial precedents hereinabove that due process of law would mean compliance to the law as it is and that what is required to be done in the manner and fashion prescribed has to be accomplished accordingly. In the instant case, the ld. Assessing Officer was concluding an assessment proceeding as a sequel to survey proceedings u/s 133A. The law does not mandate the ld. Assessing Officer to seek any prior approval of any supervisory authority. Para-10 of the Assessing Officer’s order (supra) clearly alludes that he had obtained the approval of his supervisory authority. The said act of the Assessing Officer is not supported by any provision of law. Thus, in view of the decision of the Hon’ble Punjab & Haryana High Court (supra), the same would constitute an act of interreference by the ld. Assessing Officer. Accordingly, we are of the considered view that in respectful compliance to the said decision of the Hon’ble Punjab & Haryana High Court (supra), the order u/s 143(3) dated 29.09.2021 cannot survive. We therefore set-aside the order of the lower authorities and quashed the assessment order u/s 143(3) dated 29.09.2021. The ground of appeal no.2 of the assessee is therefore allowed.

As the facts of the present case have been found to be nearly identical to those in Chemical Agencies(supra) and therefore the ratio dicendi therein shall apply mutatis mutandis in the present case. Accordingly, in respectful compliance to the decision in the case of Chemical Agencies(supra), we therefore set-aside the order of the lower authorities and quashed the assessment order u/s 143(3) dated 30.03.2025. The ground of appeal no.3 of the assessee is therefore allowed. 9. As the assessee has succeeded in its ground of appeal no.3, all other grounds of appeal have become academic in nature and hence left open. 10. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 12th August, 2026. Sd/- Sd/- [SUDHIR PAREEK] [AMITABH SHUKLA] JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 12.08.2026 Shekhar Copy forwarded to: 1. Appellant 2. Respondent 3. PCIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi,