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Income Tax Appellate Tribunal, DELHI BENCH ‘C’: NEW DELHI
Before: SHRIS.RIFAUR RAHMAN & SHRI VIMAL KUMAR
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘C’: NEW DELHI BEFORE SHRIS.RIFAUR RAHMAN, ACCOUNTANT MEMBER and SHRI VIMAL KUMAR, JUDICIAL MEMBER (Assessment Year: 2016-17) (Assessment Year: 2017-18) Karsanbhai Khimabhai Patel, vs. DCIT, C – 208, Hardhyan Singh Road, Central Circle 17, Karol Bagh, New Delhi. Delhi – 110 005. (PAN : ANTPP5589K) ITA No.2092/DEL/2023 (Assessment Year: 2017-18) Rajesh Karsanbhai Patel, vs. DCIT, C – 101, Shanti Enclave, Central Circle 17, Opp. Railway Station, New Delhi. Mira Road East, Thane Mumbai – 401 107 (Maharashtra). (PAN : AGVPP5568P) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri Nirbhay Mehta, Advocate Ms. Vanshika Mehta, Advocate REVENUE BY : Shri Daya Inder Singh Sidhu, CIT DR Date of Hearing : 05.06.2025 Date of Order : 20.08.2025 O R D E R 1574 & 2092 /DEL/2023 PER S.RIFAUR RAHMAN,ACCOUNTANT MEMBER :
1. 1. These appeals are filed by the assessees against the order of ld. Commissioner of Income Tax (Appeals)-27, New Delhi [“ld. CIT(A)”, for short] dated 29.03.2023, 29.03.2023 & 26.05.2023 for AYs 2016-17, 2017- 18 & 2017-18.
2. Since the issues are common and the appeals are connected, therefore, the same are heard together and being disposed off by this common order. First we take up assessee’s appeal for AY 2016-17 being ITA No.1573/Del/2023.
3. At the time of hearing, ld. AR of the assessee submitted that assessee has taken additional grounds vide letter dated 30.11.2024 and pleaded to admit the additional grounds. The additional grounds read as under:- “3. Whether on the facts and circumstances of the case, the approval granted under section 153D of the Act through a common approval for separate assessment orders passed u/s 153A for AY 2011-2012 TO 2016-17 AND U/S 153a R.W.S. 144 of the IT Act for AY 2017-18 is considered valid in law in view of judgment of Hon’ble ITAT Delhi bench in the case of Millenium Vinimay Pvt. Ltd. vs. ACIT in ITA No.458/Del/2022. 3.1 Whether approval granted vide letter F.No.Addl.CIT/C.R-5/153D/2018- 19/1012 dated 26.12.2018 is valid in terms of the provisions of section 153 D of the IT Act.”
4. Considered the rival submissions and material placed on record by both the parties. We observed that the issues raised by the assessee in additional grounds go to the root of the matter challenging the jurisdictional issue. In the light of Hon’ble Supreme Court in the case of NTPC, Limited vs. CIT (1998) 229 ITR 383 (SC), we are inclined to admit the additional grounds and take up the same for adjudication herein below.
1574 & 2092 /DEL/2023 5. With regard to the additional grounds, ld. AR of the assessee has taken a plea that in the case of assessee approval under section 153D of the Income- tax Act, 1961 which states prior approval necessary for assessment in cases of search and requisition bearing F.No. Addl.CIT/C-R.5/153D/2018- 2019/1012 was approved on the same date for all Assessment years from 2011-2012 to 2017-2018 as on the date on which assessment order was passed i.e. 26.12.2018. In this regard, he placed reliance on Amolak Singh Bhatia v. DCIT (Delhi ITAT) order dated 18.04.2023 wherein the ITAT observed that, “it is not mentioned in the approval that what is the amount of determination of income in each assessment year of each assessee. Approval was granted within 24 hours of proposal. Approval have been granted on the same day on 22.12.2017 despite the fact that AO was having his office at Japalpur and JCIT was holding his Office at Bhopal in which there is a significant distance. It is not humanly possible to look into assessment records as well as draft assessment orders thereon and apply its own mind objectively by a senior designated authority involving such complex matters and grant approval as contemplated u/s 153D. it is not mentioned as to how the draft order and assessment record, if any, have been received by the JCIT, if has gone through the assessment record or that assessment record, about the mode, through which, assessment record was transmitted by AO at Bilaspur to JCIT, Raipur and vice versa. It is also noted that the AO had time till September 2019 for passing the assessment 1574 & 2092 /DEL/2023 order, why the approvals were granted within 24 hours and order also was passed. The approval given was a conditional approval and on the basis of presumption only.” He further relied on various case laws. He further submitted that the approving authority without considering proper evidences and without application of mind gave approval on the same date as on the date assessment order was passed. He accordingly prayed to allow the additional ground.
On the other hand, ld. DR of the Revenue reiterated his submissions made in the written submissions placed before the Bench and pleaded that the facts of the instant cases are significantly distinguishable from the fact all those cases where Hon’ble courts and the ITAT have held approval under section 153D as a mechanical approval without due application of mind by the approving authority. He further submitted that moreover, content of the approval letter clearly establishes that while granting approval, the approving authority had considered facts of the case, assessment records and seized documents and had applied his mind independently. He further submitted that assessee has not taken this plea before the Assessing Officer. Accordingly, he prayed that the contention of the assessee on this ground be rejected.
Considered the rival submissions and material placed on record. Before deciding this ground, we may refer facts of the case in brief. Search and seizure action under section 132 of the Act was conducted on 14.12.2016 on 1574 & 2092 /DEL/2023 Apple Gem Group. Various residential & business premises were covered which included premises of the assessee. The case of the assessee was centralized and accordingly notice u/s 127 of the Act was issued to the assessee on 14.12.2017. The assessee did not comply with notices issued at the assessment stage, hence the Assessing Officer completed the assessment proceedings ex-parte u/s 144 of the Act and made addition. Aggrieved by the order of the Assessing Officer, the assessee appealed before the CIT (A) and filed an application for additional evidence under Rule 46A of the Income Tax Rules submitting necessary evidences. However, the ld. CIT (A) sustained the order of the Assessing Officer.
We have gone through the submissions of the ld. AR of the assessee and ld. DR on the issue of approval under section 153D of the Act. We observe that the Assessing Officer has passed the assessment order under section 153A r.w.s. 144 of the Act. We further observe that the assessee cannot raise the plea of non-application of mind at this stage. The assessee himself has not cooperated in the assessment proceedings. The non-cooperative assessee cannot raise any technical plea as an escape route to avoid any liability. We find force in the submissions of the ld. DR of the Revenue that this plea taken by the assessee at this stage be rejected, hence we reject this ground of the assessee. However, as the assessment order passed ex-parte without giving proper opportunity to the assessee and Ld. CIT(A) affirmed the action of the Assessing Officer, we are of the considered view that in 1574 & 2092 /DEL/2023 the interest of justice, the matter requires denovo assessment. Therefore, we remit back the issues to the file of the Assessing Officer with the directions to decide the same afresh, after giving adequate opportunity of being heard to the assessee, for which Ld. DR has no objection. Assessee is directed to fully cooperate with the AO during the proceedings. We hold and direct accordingly.
In the result, the appeal filed by the assessee being is partly allowed for statistical purposes.
With regard to appeals being and ITA No.1574/Del/2023, since the facts are exactly similar to ITA No.1573/Del/2023 our above findings in ITA No.1573/Del/2023 are applicable mutatis mutandis in ITA No.2092/Del/2023 and ITA No.1574/Del/2023. Accordingly, the appeals filed by the assessees being ITA No.2092/Del/2023 and ITA No.1574/Del/2023 are partly allowed for statistical purposes.