LOVELY RANI CONSTRUCTIONS PRIVATE LIMITED,PATNA vs. ASSISTANT COMMISSIONER OF INCOME, PATNA

6. Aggrieved with the assessment order, the assessee filed an appeal before the ld.CIT(A) on legal issues as well as on merit, however, the ld. CIT(A) did not adjudicate the legal issue raised by the assessee challenging the validity of the assessment framed by the Assessing Officer u/s.153A of the Act on the ground of being based upon the invalid and mechanical approval granted by the ld. JCIT, Central Range-1, Patna u/s 153D of the Act.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 8. Per Contra, ld. CIT-DR vehemently opposed the arguments of the ld. counsel and submitted that there was no question of any invalid or mechanical approval of any kind whatsoever by the JCIT. Ld.CIT-DR submitted that if the assessee is same and common issues are involved then it is quite feasible that it approval could be given by way of consolidated order u/s 153D of the Act. The ld.CIT-DR submitted that the Addl.CIT/JCIT are always involved in search assessment proceedings right from the beginning to the end till the assessment is framed and each and every step/action of the department is proposed and taken under their guidance. In other words, the whole proceedings are monitored by the higher authorities. Therefore, to say that the approval given by the JCIT is mechanical, is bereft of any merit and may be dismissed summarily.

9. After hearing the rival contentions and perusing the material available on record, we find that in this case a search was conducted by the Investigation Wing Patna on the assessee on 6.3.2019 and accordingly assessment was framed u/s.153A of the Act vide order dated 24.08.2021. The legal issue before us raised by the assessee is as to whether the common approval granted by the JCIT, Central Range-1 Patna for all the assessment years involved right from A.Y.2013-2014 to 2019-2020 is invalid, mechanical and given without application of mind. For the sake of ready reference, we extract the copy of approval granted u/s.153D of the Act as under :-

10. A perusal of the above said approval u/s.153D of the Act dated 25.06.2021 reveals that the approval has been given in case of Saroj Bala from A.Y.2013-2014 to A.Y.2019-2020 by a consolidated order. In our opinion, the approval has to be granted by the JCIT after perusing the draft assessment order placed before him by the Assessing Officer for each assessment year separately, however, in the present case a consolidated approval was granted for all the assessment years. In our , 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 opinion, the JCIT is supposed to exercise with utmost caution and care while granting approval u/s 153D of the Act as this is a safeguard provided in the Act so that if any wrongs committed by the Assessing Officer, the same would be taken care of while granting the approval and set right accordingly. However, granting approval in a mechanical manner without application of mind would defeat the very purpose of safeguard provided in the Act. In our opinion the mechanical approval granted without application of mind is invalid. In these circumstances, we are not in a position to sustain the order passed by the Assessing Officer which is based on invalid approval granted u/s.153D of the Act. The case of the assessee is squarely covered by the decision of Hon’ble Delhi High Court in the case of Shiv Kumar Nayyar, reported in [2024] 163 taxmann.com 9 (Delhi High Court), wherein the Hon’ble Delhi High Court has held as under:-

1.

3. As per record, the appeal pertains to Assessment Year ["AY"] 2015-16. The dispute essentially emanates from a search and seizure operation which was conducted on 18.11.2016 under Section 132 of the Act by the Investigation Wing in Nayyar Group of cases, including the residential premises of the assessee. The said operation was followed by a survey operation under Section 133A of the Act.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 4. Pursuant to the aforenoted search, an order under Section 127 of the Act was passed which led to centralization of the case of the assessee. Consequently, a notice under Section 153A of the Act was issued to the assessee on 22.09.2017. In response to the said notice, the assessee filed its Income Tax Return ["ITR"] on 14.08.2018, declaring an income of ₹18,48,450/- and the same was processed as per the provisions of Section 143(1) of the Act. Subsequently, the case of the assessee was picked up for scrutiny assessment and a notice under Section 143(2) was duly issued.

5. Thereafter, on 30.12.2018, an assessment order was passed by the assessing officer ["AO"] under Section 153A read with Section 143(3) of the Act, whereby, the total taxable income of the assessee was pegged at ₹5,19,85,970/-. Being aggrieved by the additions made by the AO, the assessee preferred an appeal before the Commissioner of Income Tax (Appeals) ["CIT(A)"]. Vide order dated 09.07.2021, the CIT(A), while partly allowing the appeal of the assessee, deleted certain additions made by the AO.

7. Learned counsel for the Revenue submitted that there is no infirmity in the approval granted by the concerned authority and therefore, the ITAT has erred in declaring the assessment order to be invalid. He contended that merely because the approval was granted on the same day when the draft assessment orders were sent by the AO, the same cannot be a ground to hold that the approval was accorded without any application of mind. According to him, since the authority granting approval has been involved in the assessment proceedings from the initial days, the same cannot be divested of its right to accord approval on the same day. He, therefore, mainly proposed the following substantial question of law for our consideration:- "Whether the ITAT has erred in law, in considering the Assessment Order under Section 153A of the Act, as invalid and bad in law by stating that the approval granted by the Range head under section 153D of the Act is void as the same was granted in a mechanical manner without application of mind?"

11. A plain reading of the aforesaid provision evinces an uncontrived position of law that the approval under Section 153D of the Act has to be granted for "each assessment year" referred to in clause (b) of sub-section (1) of Section 153A of the Act. It is beneficial to refer to the decision of the High Court of Judicature at Allahabad in the case of PCIT v. Sapna Gupta [2022 SCC Online All 1294] which captures with precision the scope of the concerned provision and more significantly, the import of the phrase- "each assessment year" used in the language of Section 153D of the Act. The relevant paragraphs of the said decision are reproduced as under:- "13. It was held therein that if an approval has been granted by the Approving Authority in a mechanical manner without application of mind then the very purpose of obtaining approval under Section 153D of the Act and mandate of the enactment by the legislature will be defeated. For granting approval under Section 153D of the Act, the Approving Authority shall have to apply independent mind to the material on record for "each assessment year" in respect of "each assessee" separately. The words 'each assessment year' used in Section 153D and 153A have been considered to hold that effective and proper meaning has to be given so that underlying legislative intent as per scheme of assessment of Section , 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 153A to 153D is fulfilled. It was held that the "approval" as contemplated under 153D of the Act, requires the approving authority, i.e. Joint Commissioner to verify the issues raised by the Assessing Officer in the draft assessment order and apply his mind to ascertain as to whether the required procedure has been followed by the Assessing Officer or not in framing the assessment. The approval, thus, cannot be a mere formality and, in any case, cannot be a mechanical exercise of power. *** 19. The careful and conjoint reading of Section 153A(1) and Section 153D leave no room for doubt that approval with respect to "each assessment year" is to be obtained by the Assessing Officer on the draft assessment order before passing the assessment order under Section 153A." [Emphasis supplied] 12. It is observed that the Court in the case of Sapna Gupta (supra) refused to interdict the order of the ITAT, which had held that the approval under Section 153D of the Act therein was granted without any independent application of mind. The Court took a view that the approving authority had wielded the power to accord approval mechanically, inasmuch as, it was humanly impossible for the said authority to have perused and appraised the records of 85 cases in a single day. It was explicitly held that the authority granting approval has to apply its mind for "each assessment year" for "each assessee" separately.

16. In the present case, the ITAT, while specifically noting that the approval was granted on the same day when the draft assessment orders were sent, has observed as under:- "10. We have gone through the approval granted by the ld. Addl. CIT on 30.12.2018 u/s 153D of the Act which is enclosed at page 36 of the paper book of the assessee. The said letter clearly states that a letter dated 30.12.2018 was filed by the ld. AO before the ld. Addl. CIT seeking approval of draft assessment order u/s 153D of the Act. The ld. Addl. CIT has accorded approval for the said draft assessment orders on the very same day i.e., on 30.12.2018 for seven assessment years in the case of the assessee and for seven assessment years in the case of Smt. Neetu Nayyar. It is also pertinent in this regard to refer to pages 68 and 69 of the paper book which contains information obtained by Smt. Neetu Nayyar from Central Public Information Officer who is none other than the ld. Addl. Commissioner of Income-tax, Central Range-S, New Delhi, under Right to Information Act, wherein, it reveals that the ld. Addl. CIT had granted approval for 43 cases on 30.12.2018 itself. This fact is not in dispute before us. Of these 43 cases, as evident from page 36 of the paper book which contains the approval u/s 153D, 14 cases pertained to the assessee herein and Smt. Neetu Nayyar. The remaining cases may belong to some other assessees, which information is not available before us. In any event, whether it is humanly possible for an approving authority like , 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 ld. Addl. CIT to grant judicious approval u/s 153D of the Act for 43 cases on a single day is the subject matter of dispute before us. Further, section 153D provides that approval has to be granted for each of the assessment year whereas, in the instant case, the ld. Addl. CIT has granted a single approval for all assessment years put together."

18. Therefore, under the facts of the present case, considering the foregoing discussion and the enunciation of law settled through judicial pronouncements discussed hereinabove, we are unable to find any substantial question of law which would merit our consideration.

19. Consequently, the appeal stands dismissed. Pending application(s), if any, are also disposed of.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 To answer the same, we are required to go through the relevant provisions of the Income Tax Act. Section 132 provides the procedure for search and seizure operations in consequence of the information in possession of the Income Tax Authorities. Section 153A prescribes assessment in case of search or requisition. Section 153A provides that in the case of a person where a search is initiated under Section 132, the Assessing Officer shall issue notice to such person requiring him to furnish within such period, as may be specified in the notice, the return of income in respect of each assessment year falling within six assessment years (and for the relevant assessment year or years) referred to in clause (b), in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed and the provisions of this Act shall, so far as may apply accordingly as if such return were a return required to be furnished under Section 139. Section 153D of the Act relevant for our purposes is to be noted hereinunder: "Prior approval necessary for assessment in cases of search or requisition. 153D. No order of assessment or reassessment shall be passed by an Assessing Officer below the rank of Joint Commissioner in respect of each assessment year referred to in clause (b) of [sub- section (1) of] section 153A or the assessment year referred to in clause (b) of sub-section (1) of section 153B, except with the prior approval of the Joint Commissioner." Provided that nothing contained in this section shall apply where the assessment or reassessment order, as the case may be, is required to be passed by the Assessing Officer with the prior approval of the [Principal Commissioner or] Commissioner under sub-section (12) of section 144BA. The Tribunal while quashing the assessment order had relied upon its earlier decision in Navin Jain and Others (Supra) wherein a detailed discussion has been made with regard to the requirement of prior approval of superior authority on the draft assessment order under Section 153D, before passing the assessment order by the Assessing Officer. It was noted that the word 'approval' though has not been defined in the Income Tax Act but the general meaning of the word 'approval' in Black's Law Dictionary, 6th Edition was to be seen. The decision of the Apex Court in Vijayadevi Naval Kishore Bharatia vs. Land Acquisition Officer (2003) 5 SCC 83 wherein the distinction between Approving Authority and Appellate Authority was drawn, had been noted. The decision of the High Court of Gauhati in Dharampal Satyapal Ltd. vs. Union of India (2019) 366 ELT 253 (Gau.) has been noted to record that grant of approval , 272-279/PAT/2023 ITA Nos.282, 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 means due application of mind on the subject matter approved which satisfies all the legal and procedural requirements. There is an exhaustive discussion on the requirement of prior approval under Section 153D of the Act and it was noted that the requirement of approval cannot be treated as mere formality and the mandate of the Act that the Approving Authority has to act in a judicious manner by due application of mind in a manner of a quasi judicial authority, has been considered. It was held therein that if an approval has been granted by the Approving Authority in a mechanical manner without application of mind then the very purpose of obtaining approval under Section 153D of the Act and mandate of the enactment by the legislature will be defeated. For granting approval under Section 153D of the Act, the Approving Authority shall have to apply independent mind to the material on record for "each assessment year" in respect of "each assessee" separately. The words 'each assessment year' used in Section 153D and 153A have been considered to hold that effective and proper meaning has to be given so that underlying legislative intent as per scheme of assessment of Section 153A to 153D is fulfilled. It was held that the "approval" as contemplated under 153D of the Act, requires the approving authority, i.e. Joint Commissioner to verify the issues raised by the Assessing Officer in the draft assessment order and apply his mind to ascertain as to whether the required procedure has been followed by the Assessing Officer or not in framing the assessment. The approval, thus, cannot be a mere formality and, in any case, cannot be a mechanical exercise of power. It was noted that the obligations of the approval of the Approving Authority serves two purposes: (i) On the one hand, he has to apply his mind to ensure the interest of the revenue against any omission or negligence by the Assessing Officer in taxing right income in the hands of right person and in right assessment year. (ii) On the other hand, superior authority is also responsible and duty-bound to do justice with the tax-payer by granting protection against arbitrary or creating baseless tax liability on the assessee. The Tribunal has further noted that the provisions contained in Sections 153A to Section 153D provide for separate notice to be given to assessee for assessment for each year as specified in Section 153A of the Act; the assessee has to file separate ITR for each year as specified in Section 153A of the Act; separate assessment orders are to be passed for each year as specified in Section 153A of the Act.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 It was observed that this is an important concept mentioned in Section 153A of the Act, which is peculiar to the scheme of the said Section. Keeping in view of this basic fundamental features of Section 153A, if Section 153D is scrutinized, then, it would become manifest that an important phrase is employed in the text of Section 153D, which is "each assessment year". The reading of the provisions in Section 153A and 153D conjointly makes it clear that separate approval of draft assessment order for each year is to be obtained under Section 153D of the Income Tax Act. In its erudite judgement with the discussion on the legislative intent of Section 153A to 153D and the meaning of the "approval" as defined in Black's Law Dictionary as also the decisions of the Apex Court in the case of Sahara India vs. CIT and Others (2008) 300 JTR 403 (SC) where the discussion on the requirement of prior approval of Chief Commissioner or Commissioner in terms of provision of Section 142(2A) of the Act had been made, it was noted that the Apex Court has held therein that the requirement of previous approval of the Chief Commissioner or Commissioner in terms of the said provision being an in-built protection against arbitrary or unjust exercise of power by the Assessing Officer casts a very heavy duty on the said high ranking authority to see that the approval envisaged in the section is not turned into an empty ritual. The Apex Court has held therein that the approval must be granted only on the basis of material available on record and the approval must reflect the application of mind to the facts of the case. The above discussion made in the judgement of Tribunal dated 3.08.2021 in the case of Navin Jain Vs. Dy. C.I.T. (Supra) has been relied by the Tribunal, in the instant case, to arrive at the conclusion that the mechanical approval under Section 153D of the Act would vitiate the entire proceedings in the instant case. For the reasoning given in the case of Navin Jain (Supra), as extracted in the impugned order passed by the Tribunal, as noted above, there cannot be any two opinion to the requirement of prior approval of the Joint Commissioner to the draft assessment order prepared by the Assessing Officer, as per the mandate of Section 153D of the Income Tax Act. The approval of draft assessment order being an in-built protection against any arbitrary or unjust exercise of power by the Assessing Officer, cannot be said to be a mechanical exercise, without application of independent mind by the Approving Authority on the material placed before it and the reasoning given in the assessment order. It is admitted by Sri Gaurav Mahajan, learned counsel for the appellant-revenue that the approval order is an administrative exercise of power on the part of the Approving Authority but it is sought to be submitted that mere fact that the approval was in existence on the date of the passing of the assessment order, it could not have been vitiated. This submission is found to be a , 272-279/PAT/2023 ITA Nos.282, 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 fallacy, in as much as, the prior approval of superior authority means that it should appraise the material before it so as to appreciate on factual and legal aspects to ascertain that the entire material has been examined by the Assessing Authority before preparing the draft assessment order. It is trite in law that the approval must be granted only on the basis of material available on record and the approval must reflect the application of mind to the facts of the case. The requirement of approval under Section 153D is pre-requisite to pass an order of assessment or re- assessment. Section 153D requires that the Assessing Officer shall obtain prior approval of the Joint Commissioner in respect of "each assessment year" referred to in Clause (b) of sub-section (1) of Section 153A which provides for assessment in case of search under Section 132. Section 153A(1)(a) requires that the assessee on a notice issued to him by the Assessing Officer would be required to furnish the return of income in respect of "each assessment year" falling within six assessment years (and for the relevant assessment year or years), referred to in Clause (b) of sub- section (1) of Section 153A. The proviso to Section 153A further provides for assessment of the total income in respect of each assessment year falling within such six assessment years (and for the relevant assessment year or years). The careful and conjoint reading of Section 153A(1) and Section 153D leave no room for doubt that approval with respect to "each assessment year" is to be obtained by the Assessing Officer on the draft assessment order before passing the assessment order under Section 153A. In the instant case, the draft assessment order in 85 cases, i.e. for 85 assessment years placed before the Approving Authority on 30.12.2017 was approved on same day i.e. 30.12.2017, which not only included the cases of respondent-assessee but the cases of other groups as well. It is humanly impossible to go through the records of 85 cases in one day to apply independent mind to appraise the material before the Approving Authority. The conclusion drawn by the Tribunal that it was a mechanical exercise of power, therefore, cannot be said to be perverse or contrary to the material on record. As the facts are admitted before us, the questions of law framed on the factual issues related to the findings recorded by the Assessing Officer are not open to agitate within the scope of the present appeal being in the nature of second appeal. No substantial question of law arises for consideration before us. The Appeal is dismissed being devoid of merit.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 12. Similar position has been laid down in various decisions passed by various Hon’ble High Courts and coordinate benches of the Tribunal. Similarly Hon’ble Orissa High Court in the case of M/s Serajuddin& Co., reported in 454 ITR 312 (Orissa-HC), has held as under :- 21. It is seen that in the present case, the AO wrote the following letter seeking approval of the Additional CIT: GOVERNMENT OF INDIA OFFICE OF THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE-1(2), BHUBANESWAR No. ACIT/C-1(2)//Approval/2010-11/5293 Dated, Bhubaneswar, the 27/29th December, 2010 To The Addl. Commissioner of Income-tax, Range-1, Bhubaneswar. Sub: Approval of draft orders u/s 153D of the I.T. Act 1961 in the case of M/s. Serajuddin& Co. 19A, British India Street, Kolkata (in Serajuddin Group of Cases)- matter regarding. Sir, Enclosed herewith kindly find the draft orders u/s 153A of the I.T.Act, 1961 along with assessment records in the case of M/s Serajuddin& Co., 19A, British India Street, Kolkata for kind perusal and necessary approval u/s.153D. No. Name of the assessee Section under which order passed Asst. Year 1 M/s Serajuddin& Co, 19A, u/s.153A/143(3)/144/145(3) 2003-04 British India Street, Kolkata 2. -do- -do- 2004-05 3. -do- -do- 2005-06 4. -DO- -do- 2006-07 5. -DO- -DO- 2007-08 6. -DO- -DO- 2008-09 7. -DO- U/s.143(3)/144/153B(B)/145(3) 2009-10 3) The above cases will be barred by limitation on 31.12.2010. Encl: As above Yours faithfully, Sd/- Asst. Commissioner of Income-tax, Circle-1(2), Bhubaneswar OFFICE OF THE ADDL. COMMISSIONER OF INCOME TAX, 3 Floor, Range-1, Bhubaneswar No. Addl. CIT/R-1/BBSR/SD/2010-11/5350 Dated, Bhubaneswar, the 30th December, 2010 ITA Nos.284-290/CTK/2025 To The Assistant Commissioner of Income Tax, Circle-1(2), Bhubaneswar.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 Sub: Approval u/s 153D-in the case of M/s Serajuddin& Co., 19A, British India Street, Kolkata-Matter regarding. Ref: Draft Orders u/s 153A/143(3)/144 for the A.Y. 2003- 04 to 2008-09 u/s.143(3)/153B (b)/144 of the A.Y.2009-10 in the case of above mentioned assessee. Please refer to the above The draft orders u/s 153A/143(3)/144 for the A.Y. 2003-04 to 2008-09 and u/s. 143(3)/153B(b)/144 for the A.Y. 2009-10 submitted by you in the above case for the following assessment years are hereby approved: Assessment Year Income Determined (Rs.) 2003-04 11,66,22,771 2004-05 36,46,80,016 2005-06 65,70,12,805 2006-07 60,02,65,791 2007-08 130,03,13,307 2008-09 274,68.87,069 2009-10 301,17,05,952 You are requested to serve these orders expeditiously on the assessee, submit a copy of final order to this office for record. Sd/- Addl. Commissioner of Income Tax, Range-1, Bhubaneswar 22. As rightly pointed out by learned counsel for the Assessee there is not even a token mention of the draft orders having been perused by the Additional CIT. The letter simply grants an approval. In other words, even the bare minimum requirement of the approving authority having to indicate what the thought process involved was is missing in the aforementioned approval order. While elaborate reasons need not be given, there has to be some indication that the approving authority has examined the draft orders and finds that it meets the requirement of the law. As explained in the above cases, the mere repeating of the words of the statute, or mere "rubber stamping" of the letter seeking sanction by using similar words like 'see' or 'approved' will not satisfy the requirement of the law. This is where the Technical Manual of Office Procedure becomes important. Although, it was in the context of Section 158BG of the Act, it would equally apply to Section 153D of the Act. There are three or four requirements that are mandated therein, (i) the AO should submit the draft assessment order "well in time". Here it was submitted just two days prior to the deadline thereby putting the approving authority under great pressure and not giving him sufficient time to apply his ITA Nos.284-290/CTK/2025 mind; (ii) the final approval must be in writing; (iii) The fact that approval has been obtained, should be mentioned in the body of the assessment order.

25. For all of the aforementioned reasons, the Court finds that the ITAT has correctly set out the legal position while holding that the requirement of prior approval of the superior officer before an order of assessment or reassessment is passed pursuant to a search operation is a mandatory requirement of Section 153D of the Act and that such approval is not meant to be given mechanically. The Court also concurs with the finding of the ITAT that in the present cases such approval was granted mechanically without application of mind by the Additional CIT resulting in vitiating the assessment orders themselves.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 13. We note that in the said decision the Hon’ble Orissa High Court has held that the approval granted in mechanical manner by the competent authority without application of mind is not a valid approval. The said decision of the Hon’ble Orissa High Court has been affirmed by the Hon’ble Supreme Court on the SLP filed by the revenue, reported in 163 taxmann.com 118 (SC). In view of the above, we do not find any merit in the contention of the ld. CIT-DR that the competent authority i.e. Addl./JCIT are usually involved in the assessment proceedings right from stage 1 till the end and, thus, they are aware of all the facts and proceedings. Therefore, the argument of the ld. CIT-DR that granting of approval by way of consolidated order was valid, is devoid of any merit as in all the aforesaid decisions, it has categorically been held by various Courts/judicial forums that the approval shall be granted separately for each year. Therefore, considering the facts of the present case before us, in the light of the ratio laid down in the above decisions, we are inclined to quash the approval granted u/s 153D of the Act and also the assessment framed by the AO on the ground of being framed on the basis on invalid and mechanical approval granted u/s.153D of the Act.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 15. Now, we shall decide ITA Nos.279, 282 & 283/PAT/2023 filed by the assessee-Lovely Rani Constructions Pvt. Ltd. for the assessment years 2013-2014, 2016-2017 & 2018-2019.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 17. As we have already adjudicated the issue in ITA No.234/PAT/2024 for A.Y.2014-2015 in favour of the assessee by holding that the consolidated approval granted by the JCIT u/s 153D of the Act as well as consequential order is not sustainable in the eyes of law. Therefore, the findings recorded by us in the said appeal shall apply mutatis mutandis to these appeals as well. Thus, ITA Nos.279, 282 & 283/PAT/2023 filed by the assessee-Lovely Rani Constructions Pvt. Ltd. for the assessment years 2013-2014, 2016-2017 & 2018-2019 are allowed.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 20. As we have already adjudicated the issue in ITA No.234/PAT/2024 for A.Y.2014-2015 in favour of the assessee by holding that the consolidated approval granted by the JCIT as well as consequential assessment order is not sustainable in the eyes of law. Therefore, the findings recorded by us in the said appeal shall apply mutatis mutandis to these appeals as well.

23. Now, we shall decide filed by the assessee- Saroj Bala for the assessment year 2013-2014.

24. The only issue raised by the assessee is against confirmation of addition of Rs.7,15,600/- as made by the AO treating the agricultural , 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 income as unexplained income u/s.69A of the Act and bringing to tax @60% u/s.115BBE of the Act.

26. In the appellate proceedings the ld. CIT(A) also dismissed the appeal of the assessee by ignoring the submissions of the assessee that the assessee owned agricultural land of 14.32 acres at Kishanganj near Bihar and Bengal border for which the assessee submitted necessary documents of ownership of land during the assessment proceedings. It was also observed by the ld. CIT(A) that before the AO the assessee has submitted that the assessee was not doing the agricultural activities by herself. Therefore, she could not submit the necessary documents as required by the AO during the assessment proceedings. The ld. CIT(A) noted that the agricultural operations were being carried out by the agriculturists who were managing all the affairs like growing or selling the agricultural produce. However, the bills regarding diesel, water charges, pesticides etc. were produced before the ld. CIT(A) for which ld. CIT(A)

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 observed that the agricultural activities were being carried out on the aforesaid land.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 Anusuya Singh had been recorded in the books of accounts in A.Y.2012- 2013 & 2013-2014. The assessee also submitted that there was no evidence other than the sale deed which showed that the assessee had received any money over and above the sale consideration. It was only while making the addition, the AO referred to the documents seized by the Investigation wing without confronting the same to the assessee. However, the contention of the assessee did not find favour with the AO and he made addition to the income of the assessee of Rs.1,24,50,000/-.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 35. After hearing the rival contentions of the parties and perusing the material available on record , we find that in the instant case the assessee had sold flat to Smt. Anusuya Singh for which the sale deed was executed and the payments received from Smt. Anusuya Singh were duly shown and recorded in the books of accounts maintained fot A.Y.2012-2013 & 2013-2014 and offered the same to tax accordingly. The AO referred to the seized document being MDP-07 which was not found and discovered from the possession of the assessee but from Shri Murlidhar Prasad, and, therefore, it was never confronted to the assessee during the assessment proceedings. We note that the AO has only asked the assessee to explain the cash, however, the assessee denied that no such cash was ever received and admittedly proof of receipt of cash was not impounded from the assessee but from Shri Murlidhar Prasad. We have examined the seized documents MDP -07, which were seized from Shri Murlidhar Prasad and found that there is no mention of Smt. Anusuya Singh in the said documents. The copy of the said document is available in the paper book from page no. 1 to 22. We find that there are number of transactions mentioned in the said documents ranging from 2000 to 50,000, however, it is not clear as to what entries represented the said receipt of Rs.1,24,50,000/-, which were stated to be received from Smt. Anusuya Singh, in respect of sale of Flat. Therefore, we find merit in the argument of the ld. Counsel of the assessee that addition made on the said document cannot be sustained. The said documents only contained some , 272-279/PAT/2023 ITA Nos.282, 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 description of transactions without any signatures and narrations as to whom, these transactions pertained to. Therefore, the ld. CIT(A) has erred in considering Rs.1,24,50,000/- as receipt from Anusuya Singh nonetheless the ld CIT(A) allowed expenses to the tune of Rs.85,39,730/- on the basis of MDP-07. In our opinion, the said document was never confronted to assessee and any addition made on the basis of such document cannot be sustained. At the most, the said document is a dump document and cannot attach any importance/significance/reliance for making addition. We have examined the seized documents MDP-07 seized from Shri Muralidhar Prasad and found that there is no mention of Smt. Anusuya Singh from whom Rs.1.24 crores was stated to be received. We find merit in the argument of the ld. counsel that in the said documents no mention of receipts of Rs.1.24 crores which according to the AO is the amount received from Anusuya Singh. The case of the assessee find support from the decision of Sunil Kumar Sharma Vs. DCIT (2023) 146 taxmann.com 553 (Karnataka) and SK Gupta Vs. DCIT 63 TTJ 532 (Delhi). Consequently, we reverse the order of the ld. CIT(A) on this issue and direct the AO to delete the addition.

, 272-279/PAT/2023 283, 291, 293, 295/PAT/2023 & CO No.02/PAT/2023 37. Thus, ITA No.267/PAT/2024 is allowed and ITA No.295/PAT/2023 & CO NO.02/PAT/2023 are dismissed. 38. In the result, ITA Nos.233-235/PAT/2024, ITA Nos.279, 282, 283, 272-276, 278, 277/PAT/2023& 267/PAT/2024 are allowed. Revenue’s appeal in ITA No.291, 293 & 295/PAT/2023 along with Cross Objection of the assessee in CO No.02/Pat/2023 are dismissed. Order pronounced in the open court on 14/10/2025.