JYOTI MEDISERVICES PRIVATE LIMITED,ALLAHABAD vs DCIT, CENTRAL CIRCLE, ALLAHABAD, ALLAHABAD

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JYOTI MEDISERVICES PRIVATE LIMITED,ALLAHABAD vs DCIT, CENTRAL CIRCLE, ALLAHABAD, ALLAHABAD | BharatTax

The learned Departmental Representatives submitted, that after the aforesaid order dated 30/09/2025 of Allahabad Bench of the Income Tax Appellate Tribunal, another order has been passed in the case of Ramji Vaish (I.T.A. No.36 etc, order dated 31/10/2025). The learned D.R. submitted that the aforesaid order dated 31/10/2025 passed by Allahabad Bench of the Income Tax Appellate Tribunal in the case of Ramji Vaish has taken a different view (regarding provisions of section 153D of the Act) from aforesaid order dated 30/09/2025 in the case of Mintro Developers Pvt. Ltd. (supra) and therefore, the matter required to be decided again in these appeals after taking the aforesaid order dated 31/10/2025 in the case of Ramji Vaish (supra) into consideration. The learned Departmental Representatives also requested for adjournment on the ground that the Department was contemplating engagement of special counsel. However, the learned Counsel for the assessee submitted that the issue regarding validity of approval under section 153D of the Act in these appeals is squarely covered by the aforesaid decision of Allahabad Bench of the Income Tax Appellate Tribunal in the case of Minto Developers Pvt. Ltd. (supra). He further submitted that the approvals in the cases pertaining to , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 7 the present appeals under section 153D of I.T. Act and the approvals given in the case of Minto Developers Pvt. Ltd. (supra) by the JCIT; were through the same i.e. common approval letter F.No.Jt.CIT/CR/VNS/Approval u/s 153D/JJ Group/2017-18;304; dated 31/07/2017. Therefore, he contended, the issue in dispute in the present appeals regarding validity of approval given under section 153D of the Act , was not just similar but identical with the case of Minto Developers Pvt. Ltd. (supra) on which view has already been taken by the Allahabad Bench of the Income Tax Appellate Tribunal. The present cases being identical to Minto Developers Pvt. Ltd. (supra), the learned Counsel for the assessee submitted, it was not open for the Allahabad Bench of Income Tax Appellate Tribunal, having regard to the principles of stare decisis and binding precedent to take a view different from view taken in the case of Minto Developers Pvt. Ltd. (supra). He further contended that in case Department had any inconvenience with the order of Allahabad Bench of the Tribunal in the case of Minto Developers Pvt. Ltd. (supra); it was open for Department to take the matter to higher forum i.e. Hon'ble High Court, but it would not be open for Allahabad Bench of the Tribunal to take a different view from the view already taken in Minto Developers Pvt. Ltd. (supra). Therefore, he submitted, no useful purpose would be served by adjourning these matters and, any adjournment will cause unnecessary and unavoidable delay in disposal of these appeals. Accordingly, the learned Counsel for the assessee opposed the request for adjournment made by learned Departmental Representatives. Thus persuaded by the learned Counsel for the assessee, we rejected the request for adjournment made by learned Departmental Representatives. At this stage learned Departmental Representatives made request for making submissions, to which the learned Counsel for the assessee expressed no objection. The Bench heard the representatives of both sides in detail in the context of the present appeals before us.

(B.1) The learned Departmental Representatives submitted that the order in the case of Minto Developers Pvt. Ltd. (supra) did not mention anywhere , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 24 that approvals were given by JCIT in a mechanical way without due application of mind. In the absence of any such finding in the case of Minto Developers Pvt. Ltd. (supra), the learned Departmental Representative submitted, this conclusion cannot readily be inferred in the present appeals under hearing. Further, the learned Departmental Representative submitted, the order in the case of Minto Developers Pvt. Ltd. (supra) did not take into consideration the fact that the JCIT had given certain directions regarding the first draft of the assessment order submitted along with letter dated 18/07/2017, and that the final draft, which was approval by the JCIT vide aforesaid common approval letter dated 31/07/2017, were slightly different in some cases from the earlier drafts. They also submitted that the JCIT, who gave approval vide aforesaid letter 31/07/2017, whose affidavit could not be obtained by Revenue earlier, and who was not available for deposition of evidence, was now available for giving affidavit and also for giving deposition. They also submitted that the spelling mistake in writing ‘pen drive’ as ‘pen drib’ and in writing of ‘one piece’ as ‘one pees’ was not a significant mistake and despite these mistakes, the claim of the Revenue that pen drive was sent along with the letter dated 18/07/2017 should be accepted. As regards the contents of pen drive, the learned Departmental Representatives submitted, it may not have been of sufficient capacity to include assessment orders, seized materials, digital data in CPU, HDD and laptop, report under Rule 9 and 9A of ITSC(P) rules, assessee’s submissions; and even if these materials were not available in physical form also for consideration of the JCIT; it was irrelevant because the JCIT was in any case not required to peruse and take all the aforesaid materials into consideration before granting of approval. He submitted that neither the JCIT nor the Assessing Officer has so much time to peruse all the aforesaid materials. That is why, learned Departmental Representatives submitted, there was a practice in Department, that Investigation Wing, , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 25 which conducted search under section 132 of the I.T. Act; also prepared appraisal report after full consideration of materials found/seized in the course of search under section 132 of the Act. They contended that the appraisal report thus prepared by the Investigation Wing of Income Tax Department is made available to the Assessing Officer as well as to the JCIT, and it was sufficient for the Assessing Officer and the JCIT to start from the findings given in the appraisal report. They further submitted that it was common practice in Department, considering the huge magnitude of assets, documents and information found/seized at the time of search under section 132 of the Act, that the task of appraising the materials seized/found during search under section 132 of the Act, was left to Investigation Wing culminates in preparation of appraisal report and the Assessing Officer as well as the JCIT start their work with appraisal report as basis. The learned Departmental Representatives also submitted that in the present cases the JCIT had the initial draft of the assessment orders for about 10 days before final approval was given vide aforesaid common approval letter dated 31/07/2017. Subsequently, written submissions were also filed by the learned Departmental Representatives, relevant portion of which is reproduced below:

, 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 35 (F.1.1) The learned Counsel for the assessee challenged the validity of approval granted u/s 153D of the Act on many grounds. To begin with, he contended that the approvals were given without due application of mind. In this regard he drew our attention to the fact that the draft assessment orders were sent to the JCIT by the Assessing Officer vide letter F.No.ACIT/CC/Approval/Alld/2017-18/352 dated 28/07/2017. He further drew our attention to the fact that the next two days, i.e. 29th & 30th July, 2017 were closed holidays on account of Saturday and Sunday. Thereafter, the JCIT gave approval u/s 153D of the Act vide aforesaid letter dated 31/07/2017 in the case of aforesaid 11 assessees for a total of 63 assessments pertaining to , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 36 different assessment years in the cases of the aforesaid 11 different assessees. It was the contention of the learned Counsel for the assessee that considering the enormity of seized materials, digital data, submissions of the assessees, appraisal report provided by the Investigation Wing of Income Tax Department, reports under Rules 9 and 9A of ITSC(P) Rules, and other materials including assessment records, it was humanly impossible for the JCIT to exercise due application of mind before granting approval to the Assessing Officer for 63 assessments pertaining to 11 different assessees for various assessment year; vide aforesaid common approval letter dated 31/07/2017, sufficiently in time on 31/07/2017 for the letter of approval to reach the Assessing Officer along with seized materials, digital data, submissions of the assessees, appraisal report provided by the Investigation Wing of Income Tax Department, reports under Rules 9 & 9A of ITSC(P) Rules and other materials including assessment records to reach the Assessing Officer on 31st July 2017 itself from Varanasi (where JCIT was stationed) to Allahabad (where the Assessing Officer was stationed) in order to also enable the Assessing Officer to pass the assessment order on 31/07/2017 itself, which was the last date for passing assessment order (after which the assessments would have been barred by limitation).

(i) [2003] 263 ITR 550 (SC), ACIT vs. Velliappa Textiles Ltd. (ii) [2002] 255 ITR 144 (Madras), Sakthivel Bankers vs. ACIT , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 43 (iii) [2004] 267 ITR 577 (Karnataka) Rishabchand Bhansali vs. DCIT (iv) [2000] 243 ITR 425 (AP) (v) [2001] 252 ITR 712 (Madras), Lakshmi Jewellery vs. DCIT (H) Learned Departmental Representatives further contended that the approval u/s 153D of the Act was akin to approval u/s 274(2) of the Act and further that the approval u/s 274(2) of the Act was held to be a procedural requirement which did not go to the root of the jurisdiction of the Assessing Officer to levy penalty. In this regard they placed reliance on the case of Sardar Harinder Singh vs. ITAT [1996] 219 ITR 257 (All). They also contended that no infirmity can be attributed in the statutory approvals even when it was not recorded in so many words. They placed reliance on the case of Prem Chand Shaw (Jaiswal) vs. ACIT [2016] 383 ITR 597 (Calcutta) and contended that mere fact that the additional Commissioner did not record his satisfaction in so many words, would not render invalid the sanction granted under section 151(2) when the reasons on the basis of which sanction was sought for could not be assailed. They relied on the order in the case of Chhagan Chandrakant Bhujbal vs. Income Tax Officer 136 taxmann.com 24 (Bombay) for the proposition that the small time gap between the proposal received for approval/sanction and approval/sanction accorded would not mean that there was non-application of mind in granting approval/sanction. Learned Departmental Representatives also relied on the case laws reported at 243 ITR 674 (Karnn) Gayathri Textiles vs. CIT, 1 SOT 281 (Jodh) Ratan Lal Dalmia vs Income Tax Officer; 230 ITR 301 (MP) CIT vs. Vijay Dall Mills; 292 ITR 281 (Ker) G. Manoharan vs. ACIT and 44 taxmann.com 311 (Cal) Sagar Dutta vs. CIT for the proposition that even absolute absence of the JCIT’s approval u/s 274(2) did not mean inherent lack of jurisdiction on the Assessing Officer so as to render his order ab initio void but to decide the matter afresh after obtaining the JCIT’s approval. Learned Departmental Representatives also placed reliance on the case laws in 40 ITR 298 (SC) Guduthur Bros vs. Income Tax Officer, 180 ITR 84 (MP) Prabhudayal Amichand vs. CIT and 222 ITR 401 (MP) CIT vs. Damodaras Murari Lal for the proposition that the irregularity supervened not at the initial stage, but at a later stage of the proceedings would not lead to nullity. Learned Departmental Representatives further placed reliance on the case law in Mahendra Mills Ltd. vs. Appellate Assistant Commissioner , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 44 99 ITR 135 (SC) for the proposition that a decision is a precedent on its own facts; that each case presents its own features; and that Income Tax authorities and Tribunals are supposed to apply the ratio of a decision to the facts of particular cases with due care and discernment. They also placed reliance on the case laws in the cases of 155 ITR 120 (SC) Distributors (Baroda) (P.) Ltd. vs UOI and 130 Taxman 218 (Cuttack)(Mag.) Orissa State Civil Supplies Corpn. Ltd. vs DCIT for the proposition that the Tribunal has liberty of applying its mind afresh. Learned Departmental Representatives also placed reliance on the cases of 199 ITR 1 (SC) CIT vs. Assam Travels Shipping Service, 63 ITR 232 (SC) Hukumchand Mills Ltd. vs CIT and 53 ITR 225 (SC) CIT vs. Kanpur Coal Syndicate; for the proposition that ITAT has power to remand/remit the matter back to the authorities below in appropriate cases. They further placed reliance on the case laws in the cases of 448 ITR 594 (SC) New Noble Educational Society vs. CCIT; 262 ITR 278 (SC) Pandian Chemicals Ltd. vs. CIT and 100 ITR 698 (SC) Raja Jagdambika Pratap Narain Singh vs. CBDT for the proposition that where a word used in the statute is unambiguous/unequivocal and capable of only one meaning, the legislation has to be given effect of the word in its own terms and there is no scope for importing any rule of interpretation. Learned Departmental Representatives also placed reliance on the precedents in the cases of 438 ITR 288 (SC) CIT vs. Mohammed Meeran Shahul Hameed and 362 ITR 673 (SC) CIT vs. Calcutta Knitwears for the proposition that a provision of the Act is to be read as it is and nothing is to be added or taken away from it. Learned Departmental Representatives placed further reliance on 266 ITR 1 (SC) Prakash Nath Khanna vs CIT and 121 ITR 535 (SC) CIT vs. National Taj Traders for the proposition that casus omissus should not be readily inferred. Learned Departmental Representatives also relied on the case laws in [1963] 48 ITR 1 (SC) Gursahai Saigal vs. CIT and [1955] 27 ITR 20 (SC) India United Mills Ltd. vs. Commissioner of Excess Profits Tax for the proposition that rule of construction applies only to a taxing provision (which creates a charge for the tax) but, not to the machinery provision for making the assessment. They also relied on the [2004] 271 ITR 401 (SC) for the proposition that rule of construction is to be applied only when there is an ambiguity. Learned Departmental Representatives also relied on orders of Mumbai Bench of ITAT in the cases of Pratibha Pipes & Structurals Ltd. vs. DCIT 173 taxmann.com 147 (Mumbai-Trib) and Usha Satish Salvi vs. ACIT (order dated 23/10/2025 in – 4239/Mum/2023) and also on order of Cuttack Bench of ITAT in the case of Bibhudutta Panda vs. ACIT (order dated 01/02/2023 in I.T.A.

(H.1) Learned Departmental Representatives also submitted that procedural irregularity was not fatal if jurisdictional issue was established. Further, learned Departmental Representatives submitted that fiscal acts should be interpreted in a way which enables functioning of the Act and does not frustrate the Act. Learned Departmental Representatives submitted furthermore, that there was no statutory form prescribed for granting approval u/s 153D of the Act and therefore, the approval given u/s 153D of the Act in the present case did not suffer from any infirmity. Learned Departmental Representatives moreover submitted that the draft assessment order sent by the Assessing Officer to the JCIT vide aforesaid letter dated 28/07/2017 was the second draft order; that the first draft order was sent by the Assessing Officer along with the letter dated 18/07/2017, which was received by the then JCIT (Shri Abhay Kumar Thakur) on 19/07/2017; that the earlier JCIT, who held charge from 15/09/2016 to 20/07/2017 (who received the original draft assessment orders) did not give approval u/s 153D of the Act; but the approval u/s 153D of the I.T. Act was given by the new incumbent (Shri Giriraj Parikh) who took charge on 21/07/2017. They submitted that the new incumbent called the Assessing Officer for discussion, that the discussion between the JCIT and the Assessing Officer took place on 25/07/2017; that after the discussion, the JCIT gave certain directions to the Assessing Officer and the Assessing Officer forwarded the second draft assessment order along with the aforesaid letter dated 28/07/2017, which was approved by the JCIT u/s 153D of the I.T. Act, on 31/07/2017. They also submitted that the Assessing Officer had sent, along with the aforesaid letter dated 18/07/2017, the assessment records and a pen drive (of 8GB capacity) containing seized materials, digital data, submissions of the assessees, appraisal report provided by the Investigation Wing of Income Tax Department and other materials of assessment records; which remained in the office of the JCIT till 31/07/2017 when the JCIT gave approvals u/s 153D of the Act vide aforesaid common letter dated 31/07/2017. They submitted that although the new incumbent, in the office of JCIT (Shri Giriraj Parikh) took charge on 20/07/2017, he immediately came into action regarding the matter of giving approvals u/s 153D of the Act immediately and the approval was given vide aforesaid letter dated 31/07/2017 after due application of , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 46 mind. Learned Departmental Representatives also submitted that the earlier incumbent in the office of the JCIT (Shri Abhay Kumar Thakur) had visited Allahabad for discussion with the Assessing Officer on multiple occasions and had also stayed in the guest house of the Income Tax department a couple of times. Learned Departmental Representatives also submitted that although the second draft of the proposed assessment orders were not sent to the JCIT by e-mail, the physical copies were indeed sent to the JCIT on 28/07/2017 itself along with the aforesaid letter dated 28/07/2017 with an Inspector of the income tax department, named Mr. Agrahari. Learned Departmental Representatives produced the concerned Inspector, Mr. Agrahari, in person before us, who stated in his oral testimony that the second drafts of the proposed assessment orders were physically carried by him from Allahabad to Varanasi and were handed over to the JCIT on 28/07/2017 itself.

(H.1.1) Learned Departmental Representatives contended emphatically that whether the JCIT had given approval u/s 153D of the Act after due application of mind, was a question of fact and the answer would depend on facts and circumstances of each case. They contended that a conclusion arrived at in a particular case that the approvals were given u/s 153D of the Act without application of mind, did not act as a precedent (being a question of fact) in another case; and conclusion as to whether there was due application of mind in a particular case was to be decided for each case, based on the specific facts of the particular case; and the conclusion was to be arrived at independent of conclusion arrived at in any other case. Learned Departmental Representatives also submitted that the earlier incumbent in the office of JCIT (Mr. Abhay Kumar Thakur) had issued directions u/s 144A of the Act in June 2017, which also enabled him to develop familiarity with the case. Moreover, they contended that the limited time available with the Assessing Officer and the JCIT for the process of approval u/s 153D of the Act was partly attributable to the assessees, as the assessees had sought adjournment of hearing till 12/07/2017. Moreover, they contended that the direction of CBDT to Assessing Officer to seek approval of the approving authority at least one month before the time barring date was directory and not mandatory. They also submitted that although the JCIT, who gave approval, took charge of office on 20/07/2017 which may have been just a few days before limitation date for passing assessment order, the association of the predecessor JCIT (Shri Abhay Kumar Thakur) with the Assessing Officer was part of institutional memory which was , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 47 reflected in the final approval given vide aforesaid common approval letter dated 31/07/2017 by the next incumbent in the office of JCIT who succeeded him. In view of the submissions made, Learned Departmental Representatives pleaded that the validity of approval given u/s 153D of the Act by the JCIT should be upheld. In their alternate submissions, Learned Departmental Representatives pleaded that the matter regarding approval u/s 153D of the I.T. Act should be restored back to the file of the approving authority (i.e. Addl. CIT/JCIT) for fresh view to be taken; in case it was found that the approval granted u/s 153D of the I.T. Act suffered from infirmities or were invalid. In order to support their submissions, Learned Departmental Representatives drew our attention to the affidavit of Shri M. L. Meena, ACIT, the Assessing Officer. The affidavit of Shri M. L. Meena dated 13/08/2025 is reproduced below for the ease of reference:

, 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 48 , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 49 , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 50 , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 51 , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 52 (I) The learned Counsel for the assessee, in his rejoinder, countered the submissions made by learned Departmental Representatives emphatically. He submitted that affidavit of the Assessing Officer and the Departmental Inspector are de void of any credibility. He submitted that it was an important and material fact to be noted that the JCIT who gave approval u/s 153D of the IT Act, and who had since superannuated, did not file any affidavit/statement in support of Revenue’s contentions. Since it was the JCIT who gave approval, and he did not support Revenue’s stand; the version of Assessing Officer and Inspector, who still working in the Department and were under the control and discipline of Department; must be rejected. In this regard he contended that the affidavit and personal testimony of Departmental Inspector were self-serving documents and it was aimed at covering omissions and mistakes of Departmental authorities. He also contended that the affidavit and personal testimony of the Departmental Inspector are not supported by any documentary evidence. Further he submitted that the Assessing Officer was not competent to state on oath about the conduct of some other officer specially his senior officer. In particular he referred to paragraph-7 of the affidavit of the Assessing Officer wherein he has stated that Shri Giriraj Parikh, JCIT, came into action right since his joining on 21/07/2017. The deponent Assessing Officer has further stated that the JCIT perused all the relevant records/materials already available in his office, which included appraisal report, the report under Rule 9 of Income Tax Settlement Commission (Procedure) Rules, 1997 [”ITSC(P) Rules” for short], the report of the Addl. CIT dated 12/01/2016, the orders and directions u/s 144A of the I.T. Act etc. The learned Counsel for the assessee also drew our attention to paragraph 8 of the affidavit wherein the deponent Assessing Officer has stated that the JCIT, examined the entire materials (pre existing in the JCIT’s office and also considering those submitted along with letter dated 18/07/2017). The learned Counsel for the assessee further drew our attention to para 10 of the affidavit of the deponent Assessing Officer wherein he has stated that the JCIT granted approval u/s 153D of the Act after further perusal and close examination of all the relevant materials. The learned Counsel for the assessee contended that the deponent Assessing Officer has made statements in the affidavit regarding these materials about which only the JCIT had personal knowledge and the deponent Assessing Officer could not have personal knowledge, information and , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 53 belief. Further he submitted that in paragraph-9 of the affidavit of the deponent Assessing Officer and in the personal testimony of the Departmental Inspector, it has been stated that the Inspector handed over draft orders to Shri Giriraj Parikh, JCIT on 28/07/2017 along with letter No.ACIT/CC/Approval/All./2017/18/352 dated 28/07/2017. However, no documentary evidence, such as acknowledgement from the office of the JCIT is available on record and no such documentary evidence has been produced by Revenue. The learned Counsel for the assessee also contended that the affidavit of the deponent Assessing Officer has been made on 13/08/2025 after more than 8 years since 31/07/2017 on which approval was given by the JCIT u/s 153D of the Act. He contended that it was impossible for the deponent Assessing Officer to remember the facts of the case including specific dates and specific letter numbers; which are found in the affidavit; after such substantial lapse of time; and similarly, it was impossible for the Inspector to remember things in such specific details after such a long time. In view of these facts and circumstances, the learned Counsel for the assessee submitted that the affidavit of the deponent Assessing Officer and the personal testimony of the Departmental Inspector should be rejected being completely de void of any credibility.

(I.1) Learned Counsel for the assessee also submitted that the contention of Revenue that the Assessing Officer was in regular supervision of the earlier incumbent in the office of the JCIT (Shri Abhay Kumar Thakur) and that Shri Abhay Kumar Thakur regularly discussed with the Assessing Officer, monitored/supervised the progress of the assessment proceedings and extended guidance to the Assessing Officer was entirely irrelevant because it was not Shri Abhay Kumar Thakur who gave approval u/s 153D of the Act. He submitted that it was Shri Giriraj Parikh, JCIT, who took charge on 21/07/2017 who, on 31/07/2017 gave approval u/s 153D of the Act and the validity of the approval u/s 153D of the Act is to be examined regardless of whatever was done and whatever happened when Shri Abhay Kumar Thakur, the earlier incumbent before Shri Giriraj Parikh, held office. He also submitted that 21/07/207 was Friday and before 31st July 2017 (on which approval was given u/s 153D of the Act) there were only five working days (excluding Saturdays and Sundays which were closed holidays). The learned Counsel for the assessee also submitted that although it is contended by Revenue that the letter dated 18/07/2017 containing initial draft of the assessment order was accompanied with a pen drive (8GB capacity), the note and , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 54 order sheet of the office of the JCIT dated 19/07/2017, does not make a mention of any pen drive accompanying the aforesaid letter. The notes and order sheet merely mentioned the receipt of letter of the Assessing Officer, and makes no mention of pen drive. Further he submitted that the letter dated 18/07/2017 of the Assessing Officer also does not contain any description of the contents of the pen drive and merely mentions at the bottom of the letter, in hand writing “Pen Drib 1 pees. 8GB” . He also drew our attention to the report of an expert (included in the paper book, filed by the assessee) in which it has been mentioned that there were approximately 40,434 seized documents, 7 CPUs, 26 HDDs and one laptop seized during the search u/s 132 of the Act. The expert has opined that the storage of this data would require a memory of 200GB and that it was impossible to store it on a pen drive of 8GB capacity. The learned Counsel for the assessee also submitted that in any case there was no evidence from record that the JCIT did even examine the contents of the pen drive and also that the letter dated 18/07/2017 did not in any case provide any description of the contents of the pen drive. In the absence of any description of the contents of the pen drive in letter dated 18/07/2017 of the Assessing Officer and in the absence of any reference to pen drive in the notes and order sheet of the office of the JCIT, the claim of Revenue that a pen drive was sent along with letter dated 18/07/2017 carried no value or relevance for the issue at hand, the learned Counsel for the assessee contended. For the ease of reference, the aforesaid letter dated 18/07/2017 of the Assessing Officer is reproduced below:

, 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 55 (I.2) The learned Counsel for the assessee submitted further that the reliance of the learned Departmental Representatives on precedents of Hon'ble Courts, pertaining to section 158BG of the Act to draw equivalence with section 153D of the Act deserved to be rejected outrightly because section 158BG pertained to block assessment order in which, under the mandate of law the Assessing Officer was required to pass one assessment order for the block period consisting of multiple years; whereas under section 153D of the Act, separate approvals are to be given by the approving authority for separate assessment orders pertaining to different assessment years for each assessee. The learned Counsel for the assessee stated that the contention of the learned Departmental Representatives that there was no statutory form prescribed for granting approval u/s 153D of the Act also deserved to be rejected because in any case the approval is to be granted u/s 153D of the Act after due application of mind of the approval authority and the approval given by the approving authority should be done in a speaking manner and not in a summary manner. The learned Counsel for the assessee submitted that the contention of the learned Departmental Representatives that the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 56 assessee had sought adjournment of hearing till 20/07/2017 is misleading. He pointed out that the reports under Rule 9 and 9A of ITSC(P) Rules were already on the record of the Assessing Officer, which contained all the information sought for by the Assessing Officer. Moreover, in any case, whether the assessee delayed the assessment proceedings or not is wholly irrelevant for the purpose of examining the validity of approval of the proposed draft assessment order, under section 153D of the Act. He contended that the Assessing Officer was at liberty to proceed with ex-parte order if he considered that there was default on the part of the assessee in providing information or in making compliance with the notices. The learned Counsel for the assessee also submitted that direction of CBDT to Assessing Officer to seek approval of the approving authority at least one month before the time barring date was mandatory on the Assessing Officer. He also contended that the association of the JCIT/Addl CIT with the Assessing Officer till the time of preparation of the draft assessment order has no significance for considering the validity of the approval given u/s 153D of the Act because the statutory requirement of approval u/s 153D of the Act cast a separate duty upon the approving authority which was de hors any other role and responsibility of the approving authority. He also submitted that the contention of the learned Departmental Representatives that the association of the predecessor JCIT (Shri Abhay Kumar Thakur) with the Assessing Officer was part of institutional memory, deserved to be rejected for the aforesaid reason. In view of the submissions and contentions presented before us by learned Counsel for the assessee, he submitted that the approval granted by the JCIT was invalid and suffered from the infirmity, because it was humanly impossible for the JCIT to apply his independent mind to total of 63 assessments pertaining to 11 different assessees for different assessment years having regard to enormity of the seized materials, digital data, submissions of the assessees, appraisal report provided by the Investigation Wing of Income Tax Department, reports under Rules 9 & 9A of ITSC(P) Rules, and other materials including assessment records. The learned Counsel for the assessee submitted that although it has been contended in the affidavit of the Assessing Officer and in the submissions of the learned Departmental Representatives that the JCIT sent approvals u/s 153D of the Act to the Assessing Officer on 31/07/2017 through e-mail and Whatsapp, there was no evidence on record that any such e-mail or Whatsapp was sent by the JCIT; and also no print out of such e-mail/Whatsapp communication has been adduced from the side of the Revenue at any stage. In this regard, he also relied on the various paper books, , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 57 referred to in foregoing paragraph (E) of this order, and on the compilation of the case laws/decisions referred to in foregoing paragraph (E) of this order.

(D.1) The first limb of the contention raised by the learned Counsel for the assessee is on the legal ground that statutory approval given to the Assessing Officer for the assessment orders was not based on application of mind. It was the case of the learned Counsel for the assessee that approval was given by Addl. CIT in a mechanical manner within a short period of time during which it was humanly impossible for the Addl. CIT to go through exhaustive assessment records, search & seizure materials and to thereafter give approval , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 84 after due application of mind. The learned Counsel for the assessee submitted that the Addl. CIT gave approval to 110 cases in two days which included; 48 cases on 27/12/2019 and 62 cases on 28/12/2019. These cases included approvals given for assessment orders which are subject matters of the present batch of appeals before us. The learned Counsel for the assessee further drew our attention to the fact that approval No. 1490 was requested by the Assessing Officer for 16 cases on 28/12/2019 and approval was given by the Addl. CIT on the same day i.e. on 28/12/2019. He further drew our attention to the fact that approval No. 1488 was requested by the Assessing Officer for 15 cases on 26/12/2019 and approval was given by the Addl. CIT on the very next day i.e. on 27/12/2019. He also drew our attention to the fact that draft assessment orders were sent by the Assessing Officer for approval to the Addl. CIT at the fag end of the assessment proceedings on 26/12/2019 and 28/12/2019 though the assessments were going to be barred by limitation barely a few days later, on 31/12/2019. Placing reliance on the order of Hon'ble Allahabad High Court in the case of Pr. CIT vs. Subodh Agarwal, of 2022, dated 12/12/2022 and order of Hon'ble Orissa High Court in the case of ACIT vs. Serajuddin & Co. (supra) and further on the order of Hon'ble Delhi High Court in the case of Pr. Commissioner of Income Tax vs. Shiv Kumar Nayyar (supra), learned Counsel for the assessee submitted that the assessment orders passed by the Assessing Officer, based on mechanical approval given by the Addl. CIT, without due application of mind, lacked legal validity and deserved to be quashed. He also placed reliance on the orders of Income Tax Appellate Tribunal in the case of Khoday Ehshwarsa and Sons vs. DCIT, & 1080/Bang/2024 dated 20/09/2024 and in the case of Sanjay Duggal and Others, and in the case of Quality Structure Pvt. Ltd. vs. DCIT, IT(SS)A No. 679 & 680/Lkw/2019. The learned CIT, D.R. for Revenue submitted that it was the normal practice that the Assessing Officer and the Addl. CIT/Jt. CIT engage in periodical discussion over a long period of time. Therefore, it was possible for the Addl. CIT to grant approval to draft assessment order after application of mind even though time available was short. In his rejoinder, learned Counsel for the assessee submitted that there is nothing on record to show that there was discussion between the Assessing Officer and Addl. CIT. In response to specific query from Bench whether the assessees were responsible for the delay on the part of the Assessing Officer in submission of draft assessment orders to the Addl. CIT at the fag end of the limitation period; and if so, whether the submissions made by the assessee would still be good on merits, , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 85 learned Counsel for the assessee submitted that the delay on the part of the Assessing Officer in submission of the draft assessment orders to the Addl. CIT was due to the fact that assessment proceedings were taken up in haste by the Assessing Officer after lapse of substantial duration of time available during the limitation period. He further submitted that the assessees made compliance with the notices of the Assessing Officer even though sufficient time was not given by the Assessing Officer. Therefore, he contended that the delay on the part of the Assessing Officer in submission of the draft assessment order to the Addl. CIT was entirely attributable to Revenue and to the Assessing Officer in particular; and further, that the assessees were in no way responsible for the delay. After hearing both sides, we are of the view that the issue in dispute is squarely covered by the order of the Hon'ble Allahabad High Court in the case of Pr. CIT vs. Subodh Agarwal, of 2022, dated 12/12/2022, order of Hon'ble Orissa High Court in the case of ACIT vs. Serajuddin & Co. (supra) and order of Hon'ble Delhi High Court in the case of Pr. Commissioner of Income Tax vs. Shiv Kumar Nayyar (supra), in favour of the assessee. Further the issue in dispute is also squarely covered in favour of the assessee by the orders of the Income Tax Appellate Tribunal in the case of Khoday Ehshwarsa and Sons vs. DCIT, I.T.A. No.1079 & 1080/Bang/2024 dated 20/09/2024 and in the case of Sanjay Duggal and Others, I.T.A. No.1813/Del/2019 and in the case of Quality Structure Pvt. Ltd. vs. DCIT, IT(SS)A No. 679 & 680/Lkw/2019 (supra). In view of the foregoing, we set aside the impugned appellate orders of learned CIT(A) deserve to be set aside; and the assessment orders passed by the Assessing Officer deserve to be annulled.

9. We have heard the rival parties and have gone through the material placed on record. We find that in these cases, in view of a search carried out on the Sigma Group, the assessments of various assessees were reopened and various assessees were required to file income tax returns as required under the provisions of section 153A of the Act. The search was conducted on 23/08/2016 which continued upto 25/08/2016 and therefore, assessment year 2017-18 became the search year and the years preceding the search year became the subject matter of reopening u/s 153A of the Act. The issue raised by Learned counsel for the assessee is that the approval granted by the Addl. CIT is bad in law as it is humanly impossible to go through documents exceeding 17,800 in a single day and then grant approval on the same day. Since the controversy involved here is with respect to approval u/s 153D of the Act, it would be appropriate to first visit the provisions of section 153D of the Act, which for the sake of completeness are reproduced below: "SECTION 153D. Prior approval necessary for assessment in cases of search or requisition [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 , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 89 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.]" 9.1 The above provisions of section 153D of the Act were inserted by Finance Act, 2007 with effect from 01/06/2007. In our humble understanding of the said provisions, we are of the opinion that the Legislature wanted the assessment/reassessment of the search cases should be made and order should be passed with the prior approval of superior authority. The word approval has not been defined in the Income Tax Act but the general meaning of word approval can be understood from Black Law of Dictionary which defines approval as: "The Act of confirming, rectifying, sanctioning or consenting to some act or thing done by another. To approve means to be satisfied with, to confirm, rectify, sanction or 'consent to some act or thing done by another, to consent officially, to rectify, to confirm, to pronounce good, thing or Judgment of, admitting propriety or excels or to pleas with." 9.2 The Hon'ble Supreme Court of South Carolina in State vs. Duckett 133 SC 85 [SC 1925], 130 SE 340 decided on 05.11.1925 held that approval implies knowledge and, the exercise or discretion after knowledge. 9.3 Further Hon'ble Supreme Court in the case of Vijayadevi Naval Kishore Bharatia vs. Land Acquisition Officer [2003] 5 SCC 83 has held as under: "Whenever there is an administrative approval given by higher authority, higher authority applies its mind to see whether the proposed Award is acceptable to the Government or not ? Such Authority may satisfy itself as to the material relied upon by the Adjudicator, but, the Approving Authority cannot reverse the finding, as he is an Appellate Authority for the purpose of remanding the matter to the Adjudicating Authority as can be done by the Appellate Authority. Further, the Approving Authority also cannot exercise its power of prior approval to give directions to the Adjudicating Authority in what beneficial to accept/ appreciate tine material on record in regard to , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 90 the compensation payable. Otherwise, it would tantamount to blurring the distinction between Approving Authority and Appellate Authority''. 9.4 Further Hon'ble Gauhati High Court in the case of Dharampal Satyapal Ltd., vs., Union of India [2019] 366 ELT 253 (Gau.) Manu/GH/07070/2018 in para-28 has held as under : "When an Authority is required to give his approval, it is also to be understood that such Authority makes an application of mind as to whether the matter that is required to be approved satisfies all the requirements of Law or procedure to which it may be subjected. In other words, grant of approval and application of mind as to whether such approval is to be granted must co- exist and, therefore, where an Authority grants an approval it is also to be construed that there was due application of mind that the subject matter approved and satisfies all the legal and procedural requirements." Therefore, from the definition of approval as per above authorities, its meaning with respect to approval u/s 153D means that the superior authority should apply his mind on the material on the basis of which the Assessing Officer is making or passing assessment order and after due application of mind to material in the hands of the Department and after going through the explanation by the assessee and documentary evidence and other relevant material, the superior authority has to grant approval u/s 153D for passing assessment/reassessment order in search cases. The approval u/s 153D of the Act cannot be treated mere formality only and the purpose of inserting this provision is two fold i.e. one before approving the senior authority will ensure that the assessee should be protected against the undue and irrelevant addition and disallowances and the approving authority will also ensure that proper enquiry or investigations are carried out by the Assessing Officer on the relevant materials including material in the hands of the Department. Secondly, the Assessing Officer also keeps in mind the interest of Revenue. Therefore, the said provision provides application of mind by the approving authority of the Department.

Therefore, the provision of section 153D of the Act cannot be treated as mere formality and mandate therein is required to be followed by the approving authority in a judicious manner by due application of mind in a manner of a quasi judicial authority. We are cautious about the fact that reasons for granting approval may not be a subject matter of challenge or not required to be mentioned in the order of approval but the manner and material on the basis of which approval has been granted can be challenged by the assessee. The scope and issue agitated by the assessee by way of legal ground in the present cases is not that of granting of approval but the main grievance of the assessee is that the approving authority has granted approval without application of mind and without looking into the seized material. We are inclined to hold 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 u/s 153D of the Act and mandate of enactment by the Legislature will be defeated. It is a trite law that for granting approval u/s 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 rationale of word "Each" as specifically referred to in Section 153D and Section 153A deserves to be given effective/proper meaning so that underlying legislative intent as per scheme of assessment of Section 153A to 153D is fulfilled. The meaning of 'approval', as contemplated u/s 153D of the Act, is that the Jt. CIT is required to verify the issues raised by the Assessing Officer in the draft assessment order and apply his mind and to ascertain as to whether the entire facts have been properly appreciated by the Assessing Officer. The Jt. CIT is also required to verify whether the required procedure has been followed by the Assessing Officer or not in framing the assessment. Thus, the approval cannot be a mere discretion or formality but quasi judicial function based on reasoning. In our view, when the Legislature has enacted the provision to be exercised by the higher authority to pass assessment order in the search cases then it is the duty of the Jt. CIT to exercise such power by applying his judicious mind. The obligation of the approval of the approving authority is of two fold i.e. on one hand, he has to apply his mind to , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 92 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 and 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 provisions contained from section 153A to section 153D contain features by which the assessee is to be given separate notice for assessment for each year as specified u/s 153A of the Act. Secondly, the assessee has to file separate ITR for each year as specified in section 153A of the Act. Thirdly, separate assessment orders are to be passed for each year as specified in section 153A of the Act. There is an important concept mentioned in section 153A of the Act, abated and non abated which is peculiar to the scheme of section 153A of the Act. Keeping in view the above basic fundamental features of Section 153A, if Section 153D is scrutinized, then, it would become manifest that very important phrase as deployed in text of Section 153D, is "Each" assessment year. The word "Each" has been used extensively and this word needs to be given due weightage and adequate meaning and as such for each year separate approval is to be given under section 153D of the I.T. Act which is lacking in the present cases. There are many other provisions where statutory approval is required from higher authorities. Few of them are noted like in Section 151 and Section 274 etc., respectively dealing with the approvals on reopening cases and penalty cases. When Section 153D is juxtaposed with Section 151 and Section 274, most important differences which is peculiar to Section 153D is the word "Each". Word each is not used in Section 151 and Section 274 and the word "Each" is specially and consciously referred to in Section 153D so that assessee-wise and year-wise application of mind on the part of the approving authority is there which is in accordance with the overall scheme of Section 153A to Section 153D of the I.T. Act. Hon'ble Allahabad High Court in the case of Shri Mohd. Ayub vs. ITO [2012] 346 ITR 30 (Alld) dealt with non issue of separate notice under section 148 of the I.T. Act and held it to be invalid because each assessment year was to be taken as an independent unit of assessment and therefore, if the above settled position is tested with the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 93 provisions of Section 153D, it would emerge that when in a case where requirement of separate notice under section 148 of the I.T. Act was given absolute primacy therefore, in the context of Section 153D of the I.T. Act (where each word is expressly used and which is a year centric special scheme of assessment with concept of abated/non-abated assessments) there is absolute necessity of separate approval for each year and for each assessee. In the present cases Jt. CIT has given approval u/s 153D of the Act for all the years altogether involved in search and the approving authority in a mechanical manner and as an idle formality has granted approval. In one line the approving authority has given blank go ahead to pass order under section 153A without even taking minimum possible pains to take appropriate note of year-wise income as computed. The legislative intent behind Section 153D can be discerned/gathered from the CBDT Circular No.3/2008 dated 12.03.2008 in which it is highlighted that approval of the approving authority is mandatory. For the sake of completeness, the contents of Circular No. 3/2008 are reproduced below: "50. Assessment of search cases Orders of assessment and reassessment to be approved by the Joint Commissioner. 50.1 The existing provisions of making assessment and reassessment in cases where search has been conducted under section 132 or requisition is made under section 132A does not provide for any approval for such assessment. 50.2 A new section 153D has been inserted to provide that no order of assessment or reassessment shall be passed by an Assessing Officer below the rank of Joint Commissioner except with the previous approval of the Joint Commissioner. Such provision has been made applicable to orders of assessment or reassessment passed under clause (b) of section 153A in respect of each assessment year falling within six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted under section 132 or requisition is made under section 132A. The provision has also been made applicable to orders of assessment passed under clause (b) of section 153B in respect of the assessment year relevant to the previous , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 94 year in which search is conducted under section 132 or requisition is made under section 132A. 50.3 Applicability-These amendments will take effect from the 1st day of June, 2007." 9.5 It is evident from the CBDT Circular that the legislature in its highest wisdom made it compulsory that the assessments of search cases should be made with the prior approval of superior authority, so that the superior authority could apply his mind on the materials and other circumstances 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 authority have to approve the assessment order. The object of entrusting the duty of approval of assessment in search cases is that the Jt. CIT, with his experience and understanding could scrutinize the seized documents and any other material forming the foundation of assessment. It is an elementary law that whenever any statutory obligation is casted upon any statutory authority, such authority is required to discharge its obligation not mechanically, not even formally but after due application of mind. The approval granted under section 153D of the Act should necessary reflect due application of mind and if the same is subjected to judicial scrutiny, it should stand for itself and should be self defending. In the above background of law and in the light of order dated 30.12.2018 passed under section 153D of the Act, which gives legality to the impugned assessment orders, question which arises for our consideration is whether the approval granted by the Additional CIT, Central, Kanpur vide his order dated 30.12.2018 can be held to be granted after due application of mind and can be held to be valid in the eyes of law. Learned counsel for the assessee, during the proceedings before us had filed a chart showing number of documents seized during search belonging to the group totaling 15,800 pages. Besides the above documents, replies filed by assessees belonging to the group consisted of about 200 pages and in fact there were documents belonging to other group also, the approval of which has also been granted along with assessees on the same day through the same approval letter. Therefore, keeping in view huge number of documents involved, it is humanely impossible for a person to apply his mind on all cases individually and that too in , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 95 a single day. For the sake of completeness, the said approval dated 30/12/2018 has been made part of this order and is reproduced below: The contents of the approval speaks for itself loud and clear. The following inferences are inevitable from the bare reading of the said order. The draft assessment orders were placed before the Additional CIT, Central, Range- Kanpur on 30/12/2018 for the first time and on the same day approval was granted. As clearly mentioned in the approval under challenge, prior to this date the case was never discussed with the authority granting the approval. The Additional CIT without any consideration on merits in respect of the issues on which addition was made, granted the approval and such approval is an eyewash and idle formality and such a mechanically granted approval is no approval in the eyes of law. The entire gamete of law, as contemplated u/s 153D of the Act, has been considered by Delhi Bench of the Tribunal in a bunch of 52 appeals in in the case of Sanjay Duggal and Others wherein the Hon'ble Bench vide order dated 19/01/2021 has quashed the assessment orders by holding that the approval granted u/s 153D of the Act was in a mechanical manner and thus cannot be held to be an approval as required u/s 153D of the Act. The relevant findings of the Tribunal are contained in para 11 onwards, which for the sake of completeness are reproduced below: "11. We have considered the rival submissions and perused the written submissions filed by the parties and considered the material on record. It is an admitted fact that search and seizure action were carried-out in the cases of the assessees on 29.12.2015. Section 153A have been inserted into the Income Tax Act w.e.f. 01.06.2003. Prior to that there were provisions contained under section 158BC being the special procedure for assessment of search cases. Thus, the provisions of Section 153A to 153D are applicable in the case of assessees. According to Section 153A of the I.T. Act, there should be a search initiated under section 132 of the I.T. Act and panchanama drawn, the A.O. shall have to issue notice to the assessee requiring him to furnish the return of income within the specified time in respect of each assessment year falling within six assessment years. The A.O. shall assess or re-assess the total income of six assessment , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 96 years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition is made. Provided that the A.O. shall assess or re-assess the total income in respect of each assessment year falling within such six assessment years. It is further provided that assessment or re-assessment, if any, relevant to any assessment year falling within the period of six assessment years referred to in this Section pending on the date of initiation of the search under section 132 or making of requisition under section 132A as the case may be, shall abated. Thus, when provisions of Section 153A are applicable in a case of assessee, A.O. shall have to give separate notice of each assessment year and assessee shall have to be directed to file return of income for each year and separate orders shall have to be passed for each assessment year. In Section 153A of the I.T. Act, the A.O. shall have to see whether there are abated or non- abated assessments which was not provided in earlier provisions for block assessments. The Hon'ble Delhi High Court in the case of CIT vs., Kabul Chawla [2016] 380 ITR 573 (Del.) considered the issue of abated and non-abated assessments and with regard to completed assessments held that the same can be interfered with by the A.O. while making the assessment under section 153A only on the basis of some incriminating material unearthed during the course of search which was not produced or not already disclosed or made known in the course of original assessment. It is also held in the same Judgment that in so far as pending assessments are concerned, the jurisdiction to make the original assessment and the assessment under section 153A merges into one. Only one assessment shall have to be made separately for each assessment year on the basis of the findings of the search and any other material existing or brought on record by the A.O. Therefore, these were the mandatory provisions contained in Section 153A which shall have to be satisfied by the A.O. before proceeding to frame assessment in the cases of persons searched under section 132 of the I.T. Act, 1961. Further safeguard have been provided for framing the assessments under section 153A that prior approval shall be necessary for assessments in the cases of the search or requisitioned, under section 153D of the IT. Act. Section 153D of the I.T. Act is reproduced as under :

"153D - No Order of assessment or re-assessment 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 (ii) 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 Commissioner under sub- section (12) of section 144BA.". 11.1. It is an admitted fact that in all the above appeals assessments under section 153A have been framed by ACIT, Central Circle, New Delhi, therefore, prior approval of the JCIT in respect of each assessment year referred to under section 153A or 153B shall have to be obtained. Thus, no order of assessment or re-assessment shall be passed by the A.O. in the present cases in respect of each assessment years under section 153A/153B of the I.T. Act, 1961, except with the prior approval of the Joint Commissioner. Learned Counsel for the Assessee has argued that the approval under section 153D have been granted by the JCIT without going through the seized material, appraisal report and other material on record. Thus, the approval is granted in a most mechanical manner and without application of mind. Therefore, same is invalid, bad in Law and void ab initio and as such all assessments under section 153A got vitiated and as such A.O. was not having jurisdiction to pass the assessment orders under section 153A of the I.T. Act, 1961. 11.2. The meaning of the word "Approval" as defined in Black Law Dictionary is - "The Act of confirming, rectifying, sanctioning or consenting to some act or thing done by another. To approve means to be satisfied with, to confirm, rectify, sanction or 'consent to some act or thing done by another, to consent officially, to rectify, to confirm, to pronounce good, thing or Judgment of, admitting propriety or excels or to pleas with."

11.3. The Hon'ble Supreme Court of South Carolina in State vs., Duckett 133 SC 85 [SC 1925], 130 SE 340 decided on 05.11.1925 held that "Approval implies knowledge and, the exercise or discretion after knowledge." 11.4. The Hon'ble Supreme Court in the case of Vijayadevi Naval Kishore Bharatia vs., Land Acquisition Officer [2003] 5 SCC 83 wherein it has been held that : "Whenever there is an administrative approval given by higher authority, higher authority applies its mind to see whether the proposed Award is acceptable to the Government or not ? Such Authority may satisfy itself as to the material relied upon by the Adjudicator, but, the Approving Authority cannot reverse the finding, as he is an Appellate Authority for the purpose of remanding the matter to the Adjudicating Authority as can be done by the Appellate Authority. Further, the Approving Authority also cannot exercise its power of prior approval to give directions to the Adjudicating Authority in what beneficial to accept/ appreciate tine material on record in regard to the compensation payable. Otherwise, it would tantamount to blurring the distinction between Approving Authority and Appellate Authority''. 11.5. The Hon'ble Gauhati High Court in the case of Dharampal Satyapal Ltd., vs., Union of India [2019] 366 ELT 253 (Gau.) Manu/GH/07070/2018 in para-28 has held as under : "When an Authority is required to give his approval, it is also to be understood that such Authority makes an application of mind as to whether the matter that is required to be approved satisfies all the requirements of Law or procedure to which it may be subjected. In other words, grant of approval and application of mind as to whether such approval is to be granted must co- exist and, therefore, where an Authority grants an approval it is also to be construed that there was due application of mind that the subject matter approved and satisfies all the legal and procedural requirements." 11.6. Therefore, in the cases of search, assessment orders whether framed under section 153A or 153C, the Joint Commissioner [Approving Authority] is required to see that , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 99 whether the additions have been made in the hands of assessee are based properly on incriminating material found during the course of search, observations/comments in the appraisal report, the seized documents and further enquiries made by the A.O. during the course of assessment proceedings. Therefore, necessarily at the time of grant of approval of the assessment made by the A.O, the Joint Commissioner is required to verify the above issues, apply his mind that whether they have been properly appreciated by the A.O. while framing the assessment orders or not. The JCIT is also required to verify whether the required procedure have been followed by the A.O. or not at the time of framing of the assessments. Thus, the approval cannot be a mere discretion or formality, but, is mandatory being Quasi Judicial function and it should be based on reasoning. In our view, when the legislature has enacted some provision to be exercised by the higher Revenue Authority enabling the A.O. to pass assessment order or reassessment order in search cases, then, it is the duty of the JCIT to exercise such powers by applying his judicious mind. We are of the view that the obligation of the approval of the Approving Authority is of two folds ; on one hand, he has to apply his mind to secure in build for the Department against any omission or negligence by the A.O. in taxing right income in the hands of right person and in right assessment year and on the other hand, JCIT is also responsible and duty bound to do justice with the tax payer [Assessee] by granting protection against arbitrary or unjust or unsustainable exercise and decision by the A.O. creating baseless tax liability on the assessee and thus, the JCIT has to discharge his duty as per Law. Thus, granting approval under section 153D of the I.T. Act is not a mere formality, but, it is a supervisory act which requires proper application of administrative and judicial skill by the JCIT on the application of mind and this exercise should be discernable from the Orders of the approval under section 153D of the I.T. Act." 9.7 Further we find that I.T.A.T. Cuttack Bench in the case of Geetarani Panda vs. ACIT in vide order dated 05/07/2018 has held as under:

"24. In our considered view, the provisions contained in Section 153D as enacted by the Parliament cannot be treated as an empty formality. The provision has certain purpose. It is apparent that the purpose behind the enactment of the above provision in the Statute by the Parliament are two folds. Firstly, the approval of the Senior Authority will ensure that the assessee is not prejudiced by the undue or irrelevant addition or assessment. Secondly, the approval by Senior Authority will also ensure that proper enquiry or investigation are carried out by the Assessing Authority. Thus, the above provision provides for mental application of a Senior Officer of the Department, which in turn, provides safeguard to both i.e. Revenue as well as the assessee. Therefore, this important provision laid down by the legislature cannot be treated as a mere empty formality. The same view was expressed by the Pune Benches of the Tribunal in the case of Akil Gulamali Somji vs ITO, in IT Appeal Nos.455 to 458 (Pune) of 2010 order dated 30.3.2012, wherein, it was held that when the approval was granted without proper application of mind, the order of assessment will be bad in law. The Hon'ble Bombay High Court in the case of CIT-II Vs Shri Akil Gulamali Somji, in Income Tax Appeal (L) No.1416 of 2012 order dated 15.1.2013 concurred with the view of the Tribunal that not following of the provisions of section 153D of the Act will render the related order of assessment void." 9.8 Further we find that I.T.A.T. Mumbai Bench in the case of Shreelekha Dammani vs. DCIT in vide order dated 19/08/2015 has decided the issue in favour of the assessee by holding as under: "12. Coming to the facts of the case in hand in the light of the analytical discussion hereinabove and as mentioned elsewhere, 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 , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 101 mechanical and without considering the materials on record. In our considered opinion, 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. 153 A of the Act is bad in law and deserves to be annulled. The additional ground of appeal is allowed.

14. Since we have annulled the assessment order, we do not find it necessary to decide the issues raised on merits of the case." 9.9 In this case, the Addl. Commissioner has showed his inability to analyze the issues of draft order clearly stating that no much time was left as the draft order was placed before him on 31/12/2010 and approval was granted on the same day. In the case before us the Addl. CIT has though not expressly expressed his inability to analyze the issues of draft order but it is abundantly clear that he had not analyzed the issues in the draft order as in the present cases the approval has been given in 67 cases on the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 102 same date which is humanly impossible. If an ACIT cannot express his opinion on a single case in one day how another ACIT can express his opinion in 67 cases in a single day. 9.10 The Hon'ble Bombay High Court has dismissed the appeal of the Department filed against the above order of the Mumbai Tribunal in the case of Shreelekha Damani vide judgment dated 27/11/2018. The findings of Hon'ble Bombay High Court are reproduced below: "7. In plain terms, the Additional CIT recorded that the draft order for approval under Section 153D of the Act was submitted only on 31st 3 of 4 Uday S. Jagtap 668-16- ITXA- 15=.doc December, 2010. Hence, there was not enough time left to analyze the issues of draft order on merit. Therefore, the order was approved as it was submitted. Clearly, therefore, the Additional CIT for want of time could not examine the issues arising out of the draft order. His action of granting the approval was thus, a mere mechanical exercise accepting the draft order as it is without any independent application of mind on his part. The Tribunal is, therefore, perfectly justified in coming to the conclusion that the approval was invalid in eye of law. We are conscious that the statute does not provide for any format in which the approval must be granted or the approval granted must be recorded. Nevertheless, when the Additional CIT while granting the approval recorded that he did not have enough time to analyze the issues arising out of the draft order, clearly this was a case in which the higher Authority had granted the approval without consideration of relevant issues. Question of validity of the approval goes to the root of the matter and could have been raised at any time. In the result, no question of law arises." 9.11 Similar are the findings of I.T.A.T. Jodhpur Bench in the case of Indra Bansal & Ors. vs. ACIT in to 324 in which the Tribunal held as under: "6. We have heard the rival contentions and have perused the material on record. The main contention of learned Authorised Representative is that reasonable time was not available with the Joint Commissioner for the grant of , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 103 necessary approval as envisaged under section 153D of the Act. We have perused the forwarding letter dt. 30-3- 2013 seeking approval of the draft assessment order. The date of receipt of this letter in the office of Joint Commissioner is indisputably on 31-3-2013 which is apparent from the date stamped on it by the office of the Joint Commissioner. Thus, this leaves no doubt that the letter requesting grant of approval and the granting of approval, both, are within one day of each other. This lends credence to the contention of the learned Authorized Representative that the draft assessment order was approved without much deliberation by the Joint Commissioner. Further, the time of the fax granting approval is 6.56 a.m. on 31-3-2013 which is prior to the office hours and, thus, it brings out a reasonable doubt that the approval was granted even before the letter requesting the approval was received in the office of the Joint Commissioner. Further, the response received by the assessee in response to his application under Right to Information Act, 2005 also establishes the correctness of the claim of the assessee that the assessment records were not before the Joint Commissioner when the approval was granted as the records were with the Range Office in Jodhpur whereas the approval was sent by fax on the morning of 31-3-2013 from Udaipur. Thus, it is our considered opinion that the Joint Commissioner had granted approval in a mechanical manner without examining the case records because the approval has been granted at 6.56 a.m. on 31-3-2013 from Udaipur wherein it has already been mentioned that the assessment records were being returned whereas the draft assessment order along with the assessment records were handed over to the office of the Joint Commissioner on 31-3-2013 and as such it was physically impossible that all the case records along with the draft assessment order were received by the Joint Commissioner at Udaipur. Tribunal, Mumbai Bench in the case of Smt. Shreelekha Damani v. Dy. CIT (2015) 125 DTR (Mumbai)(Trib) 263 : (2015) 173 TTJ (Mumbai) 332 has held that the legislative intent behind the insertion of section 153D of the Act was that the assessments in search and seizure cases should be made with the prior approval of superior authority which means that the superior authorities should apply their mind to the material on the basis of which the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 104 assessing officer is making the assessment. In this case, the Addl. CIT had expressed his inability to analyze the issues of the draft order on merits clearly stating that not much time was left and granted the approval under section 153D of the Act on the same day and Tribunal, Mumbai Bench held that the approval granted by Addl. CIT was mechanical and had been passed without considering the material on record and was, therefore, devoid of any application of mind. The impugned assessment order was annulled. Similarly, Tribunal, Allahabad Bench in Verma Roadways v. Asstt. CIT (2001) 70 TTJ (All) 728; (2000) 75ITD 183 (All) held that while granting approval, Commissioner is required to examine the material before approving the assessment order. In this case, Tribunal, Allahabad Bench was examining the issue of approval under section 158BG of the Act and it opined that the object for entrusting the job of approval to a superior and a very reasonable (sic-responsible) officer of the rank of Commissioner is that he with his ability, experience and maturity of understanding can scrutinize the documents, can appreciate its factual and legal aspects and can properly supervise the entire progress of assessment. Tribunal, Allahabad Bench held that the concerned authority while granting the approval is expected to examine the entire material before approving the assessment order and further that whenever any statutory obligation is cast on any authority, such authority is legally required to discharge the obligation not mechanically, nor formally but by application of mind. Similarly, the Hon'ble Apex Court in the case of Sahara India (Firm) v. CIT & Anr. (2008) 216 CTR (SC) 303 : (2008) 7 DTR (SC) 27: (2008) 300 ITR 403 (SC), while discussing the requirement of prior approval of Chief Commissioner or Commissioner in terms of provision of section 142(2A) of the Act, opined that the requirement of previous approval of the Chief Commissioner or Commissioner in terms of said provision being an inbuilt 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 it that the approval envisaged in the section is not turned into an empty ritual. The Hon'ble Apex Court held , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 105 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. Coming to the facts of the case, it is apparent from the documents on record that the approval was given by the Joint Commissioner in hasty manner without even going through the records as the records were in Jodhpur while the Joint Commissioner was camping at Udaipur. The entire exercise of seeking and granting of approval in all the 2 cases was completed in one single day itself i.e., 31- 3-2013. Thus, it is apparent that the Joint Commissioner did not have adequate time to apply his mind to the material on the basis of which the assessing officer had made the draft assessment orders. Tribunal, Mumbai Bench and Tribunal, Allahabad Bench in their orders, as discussed in the preceding paragraphs, have laid down that the power to grant approval is not to be exercised casually and in routine manner and further the concerned authority, while granting approval, is expected to examine the entire material before approving the assessment order. It has also been laid down that whenever any statutory obligation is cast upon any authority, such authority is legally required to discharge the obligation by application of mind. In all the cases before us, the Department could not demonstrate, by cogent evidence, that the Joint Commissioner had adequate time with him so as to grant approval after duly examining the material prior to approving the assessment order. The circumstances indicate that this exercise was carried out by the Joint Commissioner in a mechanical manner without proper application of mind. Accordingly, respectfully following the ratio of the Co-ordinate Benches of Mumbai and Allahabad as afore-mentioned and also applying the ratio of the judgment of the Hon'ble Apex Court in the case of Sahara India (Firm) v. CIT (supra), we hold that the Joint Commissioner has failed to grant approval in terms of section 153D of the Act i.e., after application of mind but has rather carried out exercise in utmost haste and in a mechanical manner and, therefore, the approval so granted by him is not an approval which can be sustained. Accordingly, assessments in three COs and nineteen appeals of the assessee(s), on identical facts, are liable to be annulled as suffering from the incurable defect of the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 106 approval not being proper. Accordingly, we annul the assessment orders in CO Nos. 8 to 10/Jodh/2016 and to 331/Jodh/2016. Thus, all the three COs and the nineteen appeals of the assessee, as aforesaid, are allowed."

(J.1.6) Moreover, in a Third Member case, order has been passed by Tribunal in the case of Dheeraj Chaudhary vs. ACIT [2025] 178 taxmann.com 360 (Delhi-Trib._ (TM), on the issue of validity of approval u/s 153D of the Act. Also, we are conscious of order in the case of P. C. Puri vs. CIT [1985] 151 ITR 584 (Delhi), in which Hon'ble Delhi High Court held: There is no difference, really speaking, between a full bench of three judges sitting together and this method of referring to the third judge in the case of a difference of opinion , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 107 between the A two judges. Whether the first method is adopted or the second, ""opinion of the majority"" will be decisive. In this case there is a formal reference to a third judge to ascertain his opinion. His is the deciding voice. He turns the scales. The third judge is the full bench. Not alone. But along with two others who first heard the case. Whether the three judges sit at the same time or at different times-two at one time, and the third hearing the matter later on a difference of opinion-does not make much difference. As has happened in this case, the two judges have differed. So the case bag come to me, the third judge. The two judges have expressed their opinion. I, am now called upon to give my opinion. The opinion of the majority will prevail. All that happens is that the third is segregated from the two and does not sit with them. He comes in later on when there is a difference of opinion between them. In all cases it is the theory of numbers which is the foundation of the doctrine of stare decisis. Majority is a term signifying the greater number. Counting of heads underlies the theory'' of judicial precedents as in any majority decision. The constitutional requirement of a constitution court of five judges is based on this theory. Similarly the CPC of 1908 enacts that in case of difference of opinion the matter has to be referred to a third judge. Therefore, the reference was correctly made to the third judge. Relevant portion of the order in the case of Dheeraj Chaudhary is reproduced as under:

(L.1) Coming to the facts and circumstances of the present case; we accept the contention of the learned Counsel for the assessee that the affidavit of Shri M. L. Meena, the Assessing Officer and personal testimony of Shri Agrahari, Departmental Inspector are de void of any credibility; having regard to submissions made by learned Counsel for the assessee as referred to in foregoing paragraph (I) of this order. Further, in view of submissions of learned Counsel for the assessee as referred to in foregoing paragraph (I.1) of this order, we are of the opinion that neither the story presented by Revenue regarding Pen Drive inspires confidence nor, in any case it advances the case of Revenue, in the absence of any description of the contents of the Pen Drive in letter dated 18/07/2017 of the Assessing Officer and in the absence of any reference to Pen Drive in the notes and order sheet of the JCIT, the approving authority. Moreover, it is claimed by Revenue that all relevant records/materials were sent to the Addl. CIT/JCIT along with editable soft copies of the draft assessment order together with letter dated 18/07/2017, but there is no mention of “all relevant records/materials” in the letter dated 18/07/2017. Also, as mentioned earlier, there is no description of the contents of the Pen Drive in , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 114 letter dated 18/07/2017. Besides, we are perplexed at hand written mention of the Pen Drive in the letter. Who writes Pen Drive as “Pen Drib”?. Who writes 1 Piece as “1 pees”? We are not convinced that a Pen Drive was sent with the letter dated 18/07/2017 by the Assessing Officer to the Addl. CIT/JCIT. Notwithstanding, the claim of Revenue that all relevant records/materials; which should consist of assessment records, seized materials, digital data in CPU, HDD and laptop, reports under Rules 9 and 9A of ITSC(P) Rules, assessees’ submissions etc; were available to the JCIT who gave approval u/s 153D of the IT Act in either physical form of digital form, is not borne out from records. Even if it was available, there is nothing on record to show that indeed the JCIT considered all relevant materials before giving approval u/s 153D of the IT Act. Further, having regard to submissions made by learned Counsel for the assessee, as referred to in foregoing paragraphs (F.1.1), (F.1.4, (F.1.4.1), (F.1.5) (I) (I.1) and (I.2) of this order; it is concluded that approval was granted by JCIT in a mechanical way without due application of mind, as an idle formality, and in the manner of rubber stamping; as it was humanly impossible for the JCIT to give approval in a total of 63 assessments; vide aforesaid common approval letter dated 31/07/2017; after due consideration of all relevant materials such as seized materials, appraisal report, digital data, submissions of the assessees, assessment records, reports under Rules 9 and 9A of ITSC(P) Rules, etc; within extremely limited time available to the JCIT. Further, the assessment order is dated 31/07/2017 but there is no mention of return of the assessment record from Varanasi (where JCIT was stationed) to Allahabad (where Assessing Officer was stationed) in any official communication between the two of them; which shows that the assessment records always remained with the Assessing Officer; and the JCIT did not even refer to the assessment records before granting approval u/s 153D of the IT Act. The doctrine of human probabilities in orders of Hon'ble Supreme Court in Durga Prasad More 82 ITR 540 (SC) and Sumati Dayal 214 ITR 801 (SC) operates against Revenue, in the facts and circumstances of the present case.

13.

It was submitted that the aforesaid grounds were pure legal grounds and by virtue of them, the validity of assessment had been challenged in the light of the provisions of section 153D of the Act as well as in the light of settled law. The assessee placed reliance on the decision of the Hon’ble Supreme Court in the case of NTPC Limited vs. CIT 229 ITR 383 (SC). It was submitted that in such cases, the ld. AO, before passing the assessment order,was bound to take, “approval” from the JCIT under section 153D of the Act. For such purposes, the Approving Authority was required to see all such materials, seized documents, appraisal report, enquiries made by the Investigation Wing as well as various enquiries made by the ld. AO in the assessment proceedings as well in compliance to inquiries made by the ld. AO and was required to give the approval after due application of mind to the said material. It was only after approval was given in such a manner, that the ld. AO could , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 118 frame the assessment order. It was submitted that, contrary to the above, in the present case,the ld. AO submitted all the assessment orders pertaining to the assessee for consideration on 25.03.2013. It was submitted that in the said letter, which was placed on page no. 39 of the assessee’s paper book, a total of 290 orders pertaining to 45 assessees had been submitted for approval. Thus, it was submitted that in view of the fact that the reference to the JCIT was made on 25.03.2013and the approval was also given on 26.03.2013, it was humanly impossible for any person to grant approval in so short a period of time, after examining the voluminous details (documents and books etc.) in a single day. Thus, it was argued that it was self-evident that the approval granted on 26.03.2013 was given in a mechanical manner without due application of mind and that the entire proceeding was vitiated on this account. Since the approval under section 153D was the foundation for passing the impugned assessment order dated 30.03.2013, but the same was in fact not an approval in the eyes of law, because it was given mechanically, the said assessment order was rendered illegal and void. The ld. ARs submitted that there was no indication in the letter dated 26.03.2013, issued by the JCIT, that the JCIT had examined the draft order and found that it met the requirements of law. It was submitted that therefore, the approval was not an approval but mere, “rubber stamping” of the assessment order. It was reiterated that these draft assessment orders had been put up to the JCIT (according to the AO on 25.03.2013) at the fag end of the assessment period, thereby not giving the JCIT anytime to go through the voluminous material relating to the search and apply his mind. The approval given by the JCIT did not mention the fact that the JCIT had applied his mind by considering the contents of the draft order and was totally silent on whether he had considered the seized material. It was submitted that it was a settled principle of law that the power of granting approval was not to be exercised in a casual or routine manner, but should be given after examining the entire material. It was further submitted that the Department had failed to produce any evidence justifying the granting of approval in this mechanical manner. The ld. ARs argued that the provisions contained in section 153D as enacted by the Parliament could not be treated as aformality. It required proper application of mind by a senior officer. Since in the present case, the so-called approval did not constitute an approval as envisaged under section 153D, therefore, the impugned assessment order was void and bad in law. It was further submitted that the facts of the assessee’s case were proved by the fact that the Joint Commissioner was stationed at Lucknow, whereas the ld. AO was stationed at Allahabad and the distance between the two places was nearly 200 Kilometers. It was therefore clear that the entire seized material was never placed before the Joint Commissioner at the time of , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 119 granting of approval and therefore, it was a clear-cut case of mechanical approval granted by the superior authority, which could not be said to meet the conditions of an approval as contemplated under section 153D of the Act. The ld. AR invited our attention to the order of the Hon’ble High Court in the case of PCIT vs. Siddhartha Gupta (2023) 450 ITR 534 (All), in which the Hon’ble Allahabad High Court had held that the approval of draft assessment order,being an inbuilt protection against any arbitrary or unjust exercise of power by the ld. AO, cannot 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. The Court had held that prior approval of a superior authority meant that the said authority should appraise the material before it, so as to appreciate the factual and legal aspect to ascertain that the entire material had been examined by the Assessing Authority before preparing the draft assessment order. It held that it was clear that the approval must be granted only on the material available on record and the approval must reflect the application of mind to the facts of the case. Accordingly, it was held that requirement of approval in this manner was not met in the case of thatassessee, where draft assessment orders in 123 cases were placed before the Approving Authorityon 30th December, 2017 and approved by him on 31st December, 2017, as it was impossible to go through records of so many cases in one day so as to apply independent mind to the material before the Approving Authority. After a conjoint reading of sections 153A(1) and section 153D, the Court had held that approval had to be obtained with respect to, “each assessment year” before passing the assessment orders under section 153A and since in that case, they were not so obtained, the Hon’ble High Court had upheld the conclusion drawn by the Tribunal that the approval was a mechanical exercise of power and justified its decision to treat the consequent assessments as void. The ld. ARs also took us through the judgment of the Hon’ble Allahabad High Court in the case of PCIT vs. Sapna Gupta (2023) 147 taxman.com(All), wherein the Hon’ble Allahabad High Court had held that it was 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, therefore it had held that theconclusion drawn by the Tribunal, that it was a mechanical exercise of power, was justified. The ld. ARsplaced further reliance on the decision of the Hon’ble Allahabad Court in the case of PCIT & Ors vs. Subodh Agarwal 450 ITR 526 (2023) (All),wherein the Hon’ble Allahabad High Court had held that it was humanly impossible for the Approving Authority to peruse and apply his mind to appraise the material in one day in respect of 38 assessees, therefore, the conclusion of the Tribunal that the authority under section 153D had been exercised mechanically and that it vitiated the entire proceedings under section , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 120 153A, was neither perverse nor contrary to the material on record. Further the Court had held that the submission of the Department that the grant of approval was an administrative exercise of power and the existence of the approval meant the order could not be vitiated, was a fallacy as prior approval of superior authority required him to appraise the material before him, so as to appreciate the factual and legal aspects of the case and assure himself that it had been examined by the AO before preparing the draft assessment order. Thus, it too had held, that orders passed without such application of mind were vitiated in the eyes of law. The ld. ARs pointed out that the Hon’ble High Court in the said order had referred with approval to the decision of the ITAT Lucknow in the case of Naveen Jain and Others vs. DCIT (2021) 91 ITR-Trib 682 (Lucknow), wherein the Hon’ble Tribunal had held that though the word, “approval” had not been defined in the Income Tax Act, but due to various decisions of the Hon’ble Courts, it had been held to mean that the grant of approval means due application of mind on the subject matter approved, which satisfies all the legal and procedural requirements and if an approval had 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 would be defeated. The Tribunal had held in that case, that the Approving Authority would have to apply its independent mind to the material on record for, “each assessment year” in respect of, “each assessee” separately. The Tribunal had noted that the provisions contained in section 153A to 153D provide for separate notices to be given to the assesseefor each assessment year and for passing of separate assessment orders. Therefore, separate approval of draft assessment orders for each assessment year was required to be obtained under section 153D of the Income Tax Act. The Tribunal in that case had held, that the approval of the Approving Authority serves two purposes i.e. it has to ensure the interest of Revenue by guarding against any omission or negligence by the Assessing Officer and it also had to do justice to the taxpayer by granting protection against arbitrary or baseless tax liability. Therefore, an order passed mechanically, which did not do these, could not be held to be valid. The ld. ARs, thereafter, drew our attention to the decision of the Hon’ble Orissa High Court in the case of CIT vs. Serajuddin and Co. (2023) 453 ITR 312 (Orissa), wherein the Hon’ble Orissa High Court had stated that a letter that simply granted approval without mentioning what the thought process involved was, does not satisfy the requirements of law and since in that case, the approval did not mention the reasons for granting the approval, the approval had been given mechanically, thereby vitiating the assessment order itself. The ld. ARs submitted that subsequently the SLP of the Department against this decision of the Hon’ble Orissa High Court had been dismissed by the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 121 Hon’ble Supreme Court and therefore, this position now stood affirmed by the Hon’ble Supreme Court. Taking cues from these case laws, the ld. ARs pointed out, that in the present case, no discussion between the AO and the JCIT was recorded in the order-sheets and no reasons had been discussed for granting of the approval. The ld. ARs drew reference to the CBDT manual of office procedure that was referred to in the order of the Hon’ble Orissa High Court in the case of CIT vs. Serajuddin& Co. (supra) and submitted that as per the said manual, orders which required approval of the superior authority under section 158BG, were required to be submitted to the Approving Authority, “well in time”. As in the present case, this had not been done, the said order was also violative of the said office procedure manual. In the circumstances, the ld. ARs argued that the order in question was deserving of being quashed.

15.

Further, in response to an affidavit of the JCIT, who had given the approval under section 153D on 26.03.2013, which formed a part of , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 122 the DR’s paper book, the ld. ARs raised an objection, that such affidavit of a retired officer had no sanctity in the eyes of law, firstly because it had been filed after eleven years (it was dated 23.08.2024) and secondly because it was an afterthought and the Department had only filed this affidavit to give life to a dead approval, which could not be permitted in the eyes of law. It was submitted that by filing this affidavit, the ld. DR had contended that the Tribunal had committed error in annulling good assessment orders due to non-application of mind by JCIT under section 153D by ignoring the contention that the JCIT is not required to follow the principles of natural justice. It was submitted that this contention was totally misconceived.In the light of the orders passed by various Courts it was a settled proposition that the JCIT had to grant approval under section 153D after due application of mind as he was acting in his capacity as a quasi-judicial authority. It was also a settled proposition of law, that orders and judgments passed by a Tribunal or Court had binding effect unless set aside by the Hon’ble Supreme Court and for this proposition the ld. ARs placed reliance on the judgment of the Hon’ble Supreme Court in the case of Union of India and Others vs Kamlakshi Finance Corporation Ltd. (1991) 55 ELT 433 (SC), wherein the Hon’ble Apex Court had held that even if the order of a superior court was not acceptable, the lower authority was still bound to follow the orders of the superior judicial authority.It was submitted that the approval dated 26.03.2013 granted by the JCIT under section 153D was without application of mind and now the DRs, with a view to cure the defect, had filed the affidavit dated 23.08.2024, justifying the approval and stating that the same was approved after due application of mind, which is clearly an afterthought. The ld. ARs drew our attention to the decision of the Hon’ble Supreme Court in the case of Mohinder Singh Gill vs. Chief Election Commissioner (1978) 1 SCC 405, in which the Hon’ble Supreme Court had held that when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of an affidavit or otherwise as an order bad in the beginning could not get validated by additional grounds that were later brought out. Therefore, it was submitted that the affidavit of the retired officer was liable to be ignored and justice ought to be provided to the assessee, in the light of settled law and the contention of the Department that a legal issue could not be raised before the Hon’ble Bench, had no force and therefore should be ignored. The ld. ARs also emphasized that the legal issue that had been raised as an additional ground was required to be adjudicated first, keeping other issues on merits pending, until the legal issue had been determined. As per Order XIV Rule 2 of the CPC, it had been laid down in Rule II(2) that where issues of law and of fact arise in the same suit and the court finds that the suit or any part thereof may be disposed , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 123 of on an issue of law only, it may try that suit first. They also drew reference to the decision of the Hon’ble Supreme Court in the case of Major S.S. Khanna vs. Brigadier F.J. Dhillon (AIR 1964) SC 497, where the Hon’ble Supreme Court had held, that the jurisdiction to try an issue of law under Order XIV Rule 2 CPC, may be exercised only where the whole suit or a part thereof could be disposed of on the issue of law alone and relying upon such judgments, the ld. ARs prayed that a decision be first pronounced on the legal issue of the validity of the assessment, in view of their contention that the approval under section 153D, was given without due application of mind.

16.

The Department has opposed the admission of these additional grounds raised for the first time before the ITAT in respect of approval under section 153D, under the provisions of Rule 11, Rule 18 and Rule 29 of the ITAT Rules, 1963. Sh. Amalendu Nath Mishra, CIT DR and Sh. A.K. Singh, Sr. DR (hereinafter referred to as the ld. DRs) argued the matter before the Bench and submitted that the said additional ground had been sought to be raised for the first time before the ITAT. The assessee had not explained why it did not raise this ground before the ld. CIT(A). The ld. DRs submitted that the aforesaid additional grounds were based on the AOs letter dated 25.03.2013, soliciting approval under section 153D and the JCIT’s letter dated 26.03.2013 conveying the approval under section 153D, both of which have been filed by the assessee alongwith its application for admission of additional ground. It was, therefore, self-evident that since the assessee was not a party to the process under section 153D, that these two documents were in the nature of the additional evidences adduced by the assessee and it was on the basis of these additional evidences, that the additional ground was sought to be raised. The ld. DRs pointed out that under Rules 11, 18 and 29, no additional evidences could be adduced and no additional ground could be raised, except with the leave of the Tribunal and for the reasons to be recorded by the Tribunal for allowing the additional evidences and for raising the additional ground. Moreover, asthe issue of approval under section 153D was not the subject matter of appeal before the ld. CIT(A), the ld. CIT(A) had no occasion to record his finding on the said issue. Therefore, the said issue does not emanate out of the order under section 250 of the ld. CIT(A) and was not a subject matter of appeal before the ITAT. In fact, the ld. DRs submitted that the approval under section 153D was not an appealable order and therefore, it did not fall within the jurisdiction of the Tribunal as defined under section 253(1) of the Income Tax Act. It was submitted that the jurisdiction of the ITAT and the powers of the ITAT were two different things. The issue of approval under section 153D, which did not emanate out of the orders of the ld. CIT(A), was beyond the jurisdiction of the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 124 ITAT in the present appeal. The ld. DRs argued that had the issue been within the jurisdiction of the ITAT, (in terms of the subject matter of appeal), then it would have had the widest powers to adjudicate upon the same, but it is not so in the present case. Therefore, since the Tribunal did not enjoy the jurisdiction to rule upon an approval under section 153D dehors of the matter being considered by the ld. CIT(A), where was the question of the Tribunal exercising the power to do so. Thus, it was submitted that the additional ground should not be entertained by the ITAT on account of this.

17.

The ld. DRs also submitted, that the question as to whether in a given case, approval under section 153D has been accorded with due application of mind or not, is essentially a question of fact, which would depend upon the facts of each case and therefore, this was not a legal issue which could be raised as an additional / legal ground for the first time before the ITAT. The ld. DRs questioned the submissions made by the ARs that the issue of approval under section 153D went to the root of the matter, because the AOs jurisdiction or power to assess the income of a searched person is dependent upon the fulfillment of the requirements of section 153A and not on the approval under section 153D. It was, therefore submitted, that the impugned assessment proceedings having been validly initiated and completed under section 153A, after approval under section 153D, cannot be called into question on account of alleged non-application of mind in approval under section 153D, so as to render the impugned assessment order ab initio void as the assessee was trying to make out by means of the said additional / legal ground. It was submitted that the provisions requiring statutory approval under section 153D were analogous to the provisions of section 158BG (for block assessments applicable upto 31.05.2003) and section 274(2) for imposition of penalties, and in the context of the said two analogous provisions requiring approval of the Additional / Joint CIT, the Courts have repeatedly held, that such an approval is only an administrative act, which does not affect the AOs inherent jurisdiction to assess the income of the assessee or to levy penalty upon the assessee. Hence, the reasons being presented by the assessee, firstly for showing that this was a legal ground and secondly for showing that it went to the root of the matter and effected the validity of the assessment, were both misplaced and for the aforesaid reasons, the ld. DRs submitted that the aforesaid legal grounds should not be considered and admitted for adjudication by the Tribunal.

18.

Continuing their arguments, the ld. DR submitted that approval, prior to assessment under section 153D was an administrative act and not a quasi-judicial act. Such administrative acts were believed to , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 125 have been performed in the manner which they were supposed to be performed unless some positive tangible material is brought on record to show that the converse is true. They argued that no such material had been brought on record by the ld. ARs in this case. It was submitted that the Legislature had mandated approval to an assessment under section 153A/153C of the Income Tax Act. The manner and method of the same had not been prescribed. Hence, if the JCIT was satisfied with the assessment as proposed by the ld. AO and had conveyed his approval for the same, the requirement of law was fulfilled. It was argued that if the Hon’ble Tribunal was to venture into whether the approval could have been accorded by the JCIT under certain circumstances or not, it was only creating fetters (which the Legislature did not consider it necessary to do) and thereby exceeding its jurisdiction. The artificial requirement imposed by the Tribunal that the JCIT should go through the entire body of material available on record at the time of according approval was not only harsh but vicious, because by such logic as the final fact-finding authority, the Tribunal was also required to go through the entire body of material available on record and if it did not do so, its decisions ought not to pass muster. There was, therefore, no occasion to annul any assessment on this count,without finding any fault in the assessment, due to which it could be said to be incapableof receiving approval of a person reasonably instructed in law.It was further submitted that the difference between procedural irregularity and judicial defect was well known. While the latter was incurable, the former may not be. In the case in question, the fact that the JCIT had accorded approval was not in dispute and furthermore the approval had been accorded after due deliberations and discussions with the ld. AO, on overall consideration of the entire material on record. However, if the Hon’ble Tribunal felt that something more was needed to be done, it could remand the matter back for fresh consideration of the JCIT and give such directions as it thinks fit under the given circumstances, for appropriate disposal of the case. This was not a case where any prejudice had been caused to the assessee by the alleged so-called deficiency in the approval by the JCIT. The acid test in such cases was whether the assessment order was such, that a person reasonably instructed in law would not approve it ? If the answer was in the affirmative, the approval may be vitiated but even then, it would be a mere procedural irregularity or error of judgment, which could be corrected in appeal. If an assessment was based on improper appreciation of facts, it could be remanded back to the ld. AO for fresh adjudication after removing deficiencies, if any. The question of annulment only arose when a mandatory requirement of law at the time of initiation of the impugned proceedings had not been complied with. That being the benchmark of appeal against deficiencies in assessment, there was no reason why there should be any differential treatment to , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 126 the approval which was part and parcel of assessment proceedings and it was merely a procedural mechanism to avoid glaring arbitrariness or omissions in assessment. The question of nullity of the assessment could possibly arise if the statutory approval was wanting altogether but, in this case, since the statutory approval had been accorded, the ld. DRs argued that there was no case for annulling the assessment on the account that the approval had been accorded for particular number of cases simultaneously.

19.

The ld. DRs then took us through the working of the Central Ranges. It was pointed out that a Central Range was specialized range set up for the assessment of search and seizure cases, where an Assessing Officer is assigned a limited number of cases requiring in depth and coordinated investigation. The main role of the JCIT in a Central Range was to keep on monitoring and supervising the assessment work in his range. The assessment work was conducted under the direct and constant supervision of the JCIT Central, and the draft assessment order was formally submitted to him as and when the order was ready to be made. It was submitted that the view of the Tribunal that the JCIT should go through the entire assessment records (including the seized material etc.) while according approval, was based on the assumption that the JCIT was a stranger to the assessment work until he was provided with the draft assessment order. But that was factually incorrect. It was, therefore unfair and improper to say that the JCIT should go through the voluminous records at the time of recording approval and hold that the same was, “humanly impossible” in the short time that it took for giving an approval, to hold that the said approval had been given without application of mind. The ld. DRs sought to explain the issue by pointing out that the Assessing Officer was expected to make an assessment after thoroughly familiarizing himself with the facts of a case and evaluating the entire body of evidences. He naturally could not make such orders in one day, but kept working throughout the year during which the assessment work went on as work in progress and because of that continuous work, he was able to complete a large number of assessments on a particular day. Ignoring the work in progress of the assessment work, would lead to a conclusion that all assessment orders bearing one common date must have been made without application of mind. It was argued that a similar conclusion had been drawn by other Benches of the Tribunal with regard to approvals granted by JCITs in search cases, butthis ignored the continuous work done by the JCITs in relation to day-to-day monitoring of the progress in cases of the Range. Therefore, merely because the JCIT had accorded approval for a large number of cases in one day and by one letter, this could not be a ground to conclude that he had not applied his mind to the facts of the case or , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 127 acted mechanically. It was further submitted that if the logic of taking the date of order as the only date on which work was done was applied, then superior courts passed orders running into hundreds of pages on a particular day, but it was obvious that the said order was not prepared on that day, but a result of continuous efforts overtime. Similarly, the approval was not accorded by consideration of the matters in one day,but over a period of time and therefore, the fact of simultaneous approval in a large number of cases could not be held to be without application of mind or mechanical.

20.

The ld. DRs thereafter submitted that, without prejudice to their submissions that the consideration of approval under section 153D was beyond the jurisdiction of the Tribunal, that the matter of whether there was due application of mind was a matter of fact and not a matter of law and that even if there was a mechanical approval, it was a procedural irregularity that could be cured by remand rather than meriting annulment of the assessment, they would also demonstrate that, in this particular case, there was no mechanical approval and that the approval had been given with due application of mind. The ld. DRs invited our attention to the CBDT general guidelines for search and seizure assessments in F No.286/161/2006-IT(Inv. II) dated 22.12.2006 contained in Appendix V of the search and seizure manual and stated that the same demonstrated that the ld. AO and the Range Head were jointly involved in the assessment, right from the stage of receipt of appraisal report and the seized material. A copy of the same was filed before us. It was submitted that in a search case, after the conclusion of search, the Investigation Wing prepared an appraisal report with regard to the findings in the search and the documents recovered and sentcopies of the same to the ld. AO, Range Head and Pr. CIT, Central within a period of 60 days. It was submitted that as per para 1.2 of the said guidelines, the seized material should be handed over to the Assessing Officer within a week of sending of the said appraisal report. The Board has laid down that in case of any delay, the CIT, Central is to be informed. The ld. DRs thereafter pointed out, that as per para 1.3 of the said guidelines, after receiving the said appraisal report, the CBDT has directed that the Assessing Officer and Range Head would jointly scrutinize the appraisal report and seized material in order to prepare an examination note to decide where cases were required to be taken up under section 153A, 153C or section 148 and such cases where the seized material pertained to cases other than those which had been centralized with the ld. AO. Thus, it was submitted that the JCIT was acquainted with the seized material and the appraisal report at the very commencement of the assessment. The ld. ARs thereafter invited our attention to para 1.5 of the said guidelines,which directed that an action , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 128 note based upon a comprehensive and methodical examination of the seized material, in addition to the comments in the available appraisal report, should be prepared within 90 days of the receipt of the seized material and that as per para 1.7, this action note had to be sent to the CIT, Central through the Addl. CIT/ Jt. CIT, as part of a compliance report,to enable proper supervision by him. The ld. DRs thereafter submitted,in their capacity as officers of the Court, that in fact the said action notes were usually prepared by the ld. AO and the Range Head in consultation with each other. Thereafter, our attention was invited to para 1.8 of the said guidelines, wherein the Board had laid down that proper satisfaction should be recorded before the issue of notices under section 153C or under section 148, as the case may be, and the Range Heads had been directed to ensure proper action in this regard. It was further pointed out that as per these guidelines, a detailed questionnaire was to be prepared after considering the seized materials and where it was considered necessary, directions under section 144A could be given by the Range head, as laid down in para 2.2 of the said guidelines. The ld. DRs pointed out that,in practice, since the detailed questionnaire was prepared in consultation with the Range Head, it was usually not necessary to issue formal directions under section 144A. The ld. DRs thereafter drew our attention to para 2.10 of the said guidelines and pointed out that the same laid down that after receiving replies of the assessee’son the questionnaire and after gathering further evidence in the case, the instructions could be issued by the Range Head under section 144A, either on his own motion or on a reference by the Assessing Officer. We were also made aware of para 3.2 of the said guidelines which laid down that the final show cause notice in the case should be prepared by the Assessing Officer, in consultation with the Range Head. Finally, the ld. DRs invited our attention to para 3.10 wherein the AO was advised to consult his higher authorities, while making large additions. It was, therefore, submitted that the said guidelines demonstrated that the Range Head (in this case the JCIT who gave the approval under section 153D) had already seen the seized material and participated in the assessment various stages and therefore, the approval under section 153D was only for the purposes of meeting the statutory requirement, so that the assessee should not allege that the order had not been passed in accordance with law. However, as the JCIT had been involved in the assessment process throughout the period of assessment, it was not necessary for him at the stage of granting of approval, to examine the material and records again. He only had to see that the orders had been passed in accordance with the discussions held by him with the Assessing Officer. Thus, any imputation that he did not apply his mind and acted mechanically, only because he did not require a long time to grant such approvals, was unfounded in , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 129 the light of these facts. It was submitted that there is no instrument that could measure application of mind. However, the JCIT was a responsible officer having sufficient experience and therefore would know what is to be seen in which case and no conclusion could be reached regarding non application of mind, only on account of the fact that the approvals had been given within a short period of time. Since the JCIT was familiar with the facts of the case, he was in a position to grant these approvals. It was further submitted that the assessee had not been able to point out even a single instance or issue on which the impugned order could be held to have been made without any basis or without application of mind. Hence, there could not be any allegation of approval under section 153D, given without due application of mind, in such circumstances. The ld. DRs thereafter invited our attention to an affidavit that had been sworn by the then JCIT, Sh. Buddhadeb Mukhopadhyay on 23.08.2024 which reads as under: -

21.

The ld. DRs pointed out that only because these extensive discussions between the Assessing Officer and the Range Head were not recorded in the order-sheet of the assessment folder, it could not be presumed that the said joint examination of seized material or joint consideration of the case over a period of time had not taken place. It was submitted that since the role of the Range Head was in the nature of administrative supervision and the assessee was not involved in the same, JCIT’s devise their own method in order to ensure proper supervision over the case, in accordance with the guidelines. The writing of an order-sheet was just a procedure and not a requirement and it could not be said that if something was not recorded in an order-sheet, the said discussions, did not take place. Drawing reference to the affidavit, the ld. DRs submitted that the then JCIT, who was now a retired Government Servant on pension had sworn an affidavit that he had engaged himself in regular monitoring and supervision of the assessment proceedings, right since the examination of seized materials till the receipt of final reply from the assessee and because he had constantly supervised the proceedings, therefore, at the time of submitting the draft assessment order, he was well acquainted with the facts and finding of the case. The ld. former Range Head had also submitted that he had set up a Camp office at Allahabad time and again during the material time period for this purpose and furthermore, that draft assessment orders were submitted on email, which after diligently , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 131 going through and making corrections or modifications as necessary, he would approve and return by e-mail. The ld. DRs submitted that the said former JCIT, was a retired Government Servant on pension bound by the CCS Pension Rules, 1972. Therefore, he was a responsible person whose statement on oath was worthy of consideration. Countering the objections of the ld. ARs to the submission of this affidavit, it was submitted that by virtue of the affidavit, he had explained his actions and as he was the person whose order was under challenge, his statement was a vital piece of evidence which was required to be considered. It was further submitted that if there was any doubt on the submissions made by him, the AR’s could get him summoned and cross examined. However, without disproving the contents of his affidavit, the affidavit could not be disregarded. With regard to the delay in the submission of the affidavit, it was submitted that the assessee had raised the issue of approval under section 153D for the first time on 1.08.2024 i.e. eleven years after the appeal had been filed. It was therefore natural that the Department would offer evidence to counter this ground only after the issue had been raised by the assessee in appeal. The ld. DRs also drew our attention through the decision of the Hon’ble Supreme Court in the case of Chuharmal vs. CIT 172 ITR 250. It was submitted that in the said case, the Hon’ble Supreme Court had held that there was a presumption in law, specifically section 114(e) of the Evidence Act that Judicial and Official Acts supposed to be performed in a particular manner had actually been performedin the way they were supposed to be conducted. There could not be presumption of illegality. Thus, when the guidelines existed that search assessments had to be carried out in a particular manner and the officer giving the approval had come on record to swear that he had involved himself in the assessment proceedings and given approval after due application of mind, the burden of proof was clearly on the assessee to prove non-application of mind. In the instant case, the assessee had not brought on record a single instance of arbitrariness or unjust behavior, so how could it be proved that the actions of the Assessing Officer and the JCIT were illegal. Since, the fact of approval was not denied, the Department was protected by the said provisions of the Evidence Act and the insinuations of illegality that had been raised by the assessee without any evidence had no basis whatsoever.

22.

With regard to the objections filed by the ld. AR on account of this affidavit citing the case of Mohinder Singh Gill, it was submitted that the said objections had no basis, because the said case law had no application to the facts of the particular case. In the case of Mohinder Singh Gill, the Hon’ble Court had held that an order must speak for itself and cannot be modified by way of any additional document. But in this particular case, the order was not being modified in any way. The , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 132 affidavit was only an assertion by the approving authority that he had applied his mind in the matter that he was required to under the provisions of the Act and thereafter given his approval. Since, it was the actions of this officer which were under challenge by the assessee, the Department had every right to place the response of the concerned officer before the Tribunal to refute and rebut the insinuations levied by the assessee.It was further submitted that in the case of State of Uttaranchal vs. Rajpal Singh Pahwa, the case of Mohinder Singh Gill had been distinguished by the Hon Supreme Court itself on the grounds that an order cannot be modified, but could be explained. It was, therefore, submitted that the objections filed by the assessee had no basis whatsoever and the affidavit deserved to be considered. Our attention was also invited to the decision of the ITAT, Mumbai Bench in the case of Pratibha Pipes and Structural Limited vs. DCIT in to 3826/MUM/2015 dated 8.04.2019 wherein on consideration of the affidavit of the Additional CIT (who had accorded approval under section 153D), the Tribunal dismissed the additional ground taken by the assesseechallenging the validity of the assessment order passed under section 143(3)r.w.s. 153A. It was submitted that this order of the Tribunal had been followed by the ITAT in the case of Usha Satish Salve vs. ACIT in 4237 and 4238/MUM/2023 vide their order dated 23.01.2025, therefore, the ld. DRs submitted that the officer who had given the approvals, having sworn an affidavit which was not disproved by the assessee, there was no reason to hold that the approvals given in the instant case were given in any manner that was violative of the Act.

23.

Without prejudice to this argument, the ld. DRs submitted that even otherwise there was no reason to hold the assessments to be invalid on account of any irregularity in the approval process. It was submitted that cases had come up for decision where there was absolute lack of approval and theretoo the Courts had not held such assessments to be invalid. The lack of approval had been held to be a procedural irregularity that was not fatal to the order passed. Our attention was invited to the judgment of the Hon’ble Karnataka High Court in the case of Gayathri Textiles vs. CIT (2000) 111 taxman 123 (Kar) wherein the ld. CIT(A) had cancelled the penalty levied under section 271(1)(c), holding that the ld. AO had not obtained the previous approval of the IAC as required under section 274(2). On appeal by the Revenue, the Tribunal had reversed the order, holding that the failure to obtain the previous permission from the IAC for imposing penalty under section 271(1)(c) was only a procedural error and it was not fatal to the order of penalty under section 271(1)(c). The Hon’ble High Court held that in the said case, the proceedings were validly initiated and the proceedings under , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 133 section 271(1)(c)(iii) only require prior approval of the IAC for direction for payment of penalty and not for the initiation of proceedings. Therefore, it was a procedural defect and as such the Tribunal was justified in holding that the failure to obtain the previous permission from the IAC for imposing the penalty under section 271(1)(c) was only a procedural error and it was not fatal to the order of penalty passed under section 271(1)(c) and also that the Tribunal was right to remand the matter back to the Department to pass a fresh penalty order. The ld. DRs also invited our attention to the judgment of the ITAT Jodhpur Bench in the case of Ratan Lal Dalmiya vs. ITO (2004) 1 SOT 281 (Johdhpur) in which a similar view had been taken with reference to penalty under section 271(1)(c), the judgment of the Hon’ble Madhya Pradesh High Court in the case of CIT vs. Vijay Dal Mills (1998) 230 ITR 301 (M.P.) where the Hon’ble Madhya Pradesh High Court followed its earlier order in the case of PrabhudayalAmichand vs. CIT (1989) 180 ITR 84 (M.P.) which in turn held that a procedural irregularity not involving the question of jurisdiction can be cured. It was held in that case that there could be no doubt that levy of penalty by the ITO without the previous approval of the IAC was illegal, but the case could go back to the ld. AO for curing the defect,by obtaining the prior approval of IAC. The ld. DRs also referred to the decision of the Hon’ble Kerela High Court in the case of G. Manoharan vs. ACIT (2006) 155 taxman 569 (Ker),the decision of the Hon’ble Kolkata High Court in the case of Sagar Dutta vs. CIT (2014) 44 taxman.com 311 (Calcutta) and the decision of the Hon’ble Supreme Court in the case of Guduthur Bros. vs Income-Tax Officer (1960) 40 ITR 298 (SC), in which the Hon’ble Courts had taken a similar view, that in case an illegality vitiated the proceeding after it was lawfully initiated, the proceedings were to be restored back to the stage at which the illegality occurred and not quashed altogether. The ld. DRs pointed out that in this instant case, the proceedings had been validly and lawfully initiated following a search against the assessee under section 153A. The notice that had been issued had been served upon the assessee. The jurisdiction to assess the assessee arose out of the search under section 132 and the subsequent service of notice under section 153A.It was not dependent upon the approval under section 153D, therefore,it was argued that when the proceedings had been validly and lawfully initiated, the resultant assessment orders could not be voidab initioand therefore could not be nullified. The obtaining of approval in a particular manner could be held to be a procedural irregularity and following the decision of the Hon’ble Supreme Court, as rendered in the case of Guduthur Bros. vs Income-Tax Officer (supra), the proceedings were to continue from the stage of such illegality. Therefore, if the Tribunal was of the opinion, that any irregularity had crept in to the approval process, then the right course of action would be to send it back , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 134 to the JCIT for the removal of lacuna / irregularity. In support of this stance, the ld. DRs further relied upon the judgments of the Hon’ble Madhya Pradesh High Court in the case of PrabhudayalAmichand vs. CIT (1989) 44 taxman 213 (M.P.) and CIT vs. Damodar Das Muralilal (1997) 93 taxman 651 (M.P.), where this principle was that a procedural irregularity can be corrected at the point in which the regularity occurred when it was discovered,was re-affirmed. Acknowledging the fact that Tribunal’s and Courts had taken a different view on the matter on previous occasions, the ld. DRs submitted that the said Tribunal’s and Courts had no occasion to consider the facts and position in law as explained by them, before they had arrived at their conclusion. It was submitted that when a new set of arguments that were not presented before Courts earlier were submitted, then the Tribunal could and was duty bound to apply its mind to the issue afresh. For this proposition, the ld. DRs placed reliance on the decision of the ITAT Cuttack Bench in the case of Orissa State Civil Supplies Corporation Limited vs. DCIT (2003) 130 taxman 218 (Cuttack) (Mad) ,wherein the Tribunal had considered this aspect and held that in the name of adhering to the principles of consistency, it could not leave any scope for perpetuation of errors and therefore, in deserving cases and for cogent reasons to be placed on record, the Tribunal had the liberty of applying its mind afresh to the matter, irrespective of the decision taken in earlier years in the assessee’s own case and even on the same set of facts. The ld. DRs submitted that it had been held by the Hon’ble Supreme Court in the case of CIT vs. Assam Travels Shipping Service (1993) 67 taxman 269 (SC) and Hukum Chand Mills Limited vs. CIT (1967) 63 ITR 232 (SC), that in appropriate cases, the Tribunal had the power to remand the matter back. It was, therefore, prayed that if the ITAT was not convinced that the approval granted in the present case was in accordance with the Act, then it should in the interest of justice remand the matter back to the ld. AO for obtaining approval in the correct manner. Finally, the ld. DRs placed their reliance upon the decision of the Hon’ble Supreme Court in the case of CIT vs. Kanpur Coal Syndicate (1964) 53 ITR 225 (SC) to further reiterate this point.

24.

Continuing their arguments further, the Ld. DRs sought to distinguish the present case from the cases cited by the Ld. ARs. It was submitted that in the case of Subodh Agarwal, approval was accorded to 38 cases on the same day and the approval letter did not even mention the fact of approval. Similarly in the case of Siddhartha Gupta, it was pointed out that in that case, 123 cases had been placed before the Approving Authority on the 31st and approvals had been granted on the same day. In the case of Naveen Jain, 67 cases had been approved on the same day, while in the case of Serajuddin, the approval given by the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 135 Additional Commissioner was not even mentioned in the assessment order. It was submitted that in none of these cases had the Courts been made aware of the CBDT guidelines dated 22.11.2006 nor had the approving authority come forward to refute the assessee’s allegations.Thus, it was submitted that none of these cases were binding precedents in the case of the assessee as they were all based on the different set of facts. Our attention was invited to the reference to the decision of Ashok Kumar Sahu vs. Union of India AIR 2006 SC 2879, wherein the Hon’ble Apex Court had observed that when the power of approval was rested in a higher authority and such authority approves an order of the lower authority, it means that he has gone through the order of the lower authority. The word, ‘Approval’ in the context of an administrative act, does not mean anything more than the aforesaid acts. Therefore, it was submitted that considering the meaning of, ‘approval’ in the context of an administrative act, the consent/confirmation of the draft assessment orders by the approving authority was good and sufficient exercise of power for the purposes intended under the Act. It was further submitted that the process of approval had not been placed before the Hon’ble High Court in those cases and therefore, the Hon’ble High Court had had no occasion to consider it. Therefore, it was argued that when the Hon’ble High Court had no occasion to apply its mind to the particular facts of a case and decide on those issues, its orders could not be regarded as binding, as laid down by the Hon’ble Supreme Court in the case of Union of India& Ors vs. Dhanvanti Devi (1996) 6 SCC 44.

25.

Responding to the arguments of the ld. DRs, the ld. ARs once again invited our decision to the Constitution Bench judgment in the case of Mohinder Singh Gill and pointed out, that as per the same, the affidavit filed by the DCIT was not maintainable to explain the approval. The ld. ARs also sought to counter the arguments of the ld. DRs by drawing reference to the decision of the Delhi Tribunal in the case of Shiv Kumar Nayyar to show that the Tribunal had held that even where a plea was taken of the involvement of the JCIT in the assessment proceedings, the approval that was given had to show application of mind failing which it rendered the approval under section 153D as mechanical and accordingly the assessment was held to be invalid. The ld. ARs once again placed reliance upon the decisions given by the Hon’ble Courts in the cases of Sapna Gupta and Serajuddin. The ld. ARs thereafter, submitted that the Act was very clear that approval had to be granted for each case separately and by the rule of strict interpretation this had to be followed and there had to be independent application of mind for each assessment before granting the approval. As this was not the case in the present matter, the approvals were mechanical and rendered the assessment orders invalid. The ld. ARs also drew reference the judgment , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 136 in the case of Naveen Jain (supra) wherein it had been pointed out that the proceedings under section 153D were a substantive and mandatory provision and a default with regard to the same could not be cured. It was submitted that the doctrine of stare decisis laid down that if a decision is given in respect of a particular case and is not upset, then that has to be followed by the subordinate and co-ordinate Tribunals. Furthermore, it was submitted that even if there was an ambiguity in the section, but if the section had been judicially explained then also it was not required to look into the matter afresh every time. The ld. ARs thereafter proceeded to point out that it had been judicially held that the word ‘Approval’ did not mean writing of one word of approval but natural justice was of wide import and application of mind was required to fulfil it, as the assessee’s rights were affected by non-application of mind .The ld. ARs drew our attention to the principal of Stare Decisis and pointed out that as per the same, judgments which had held the field for a long time should be followed and not unsettled by deviation. Our attention was thereafter invited to the decision of the Hon’ble Supreme Court in the case of Shankar Raju vs. Union of India (2011) 2 SCC 132, in which the Hon’ble Supreme Court had explained the doctrine of stare decisis and pointed out that binding precedents must be followed and must not be disregarded. In this case, the binding precedents laid down that there must not be rubber stamping of assessment orders but independent application of mind to the law.Secondly, it had been laid down that, if approval is there, it must be demonstrative of this application of mind and therefore, these principles of law which had been consistently laid down by the various judgments quoted by the ld. ARs must consistently be applied. Our attention was also invited to the decision of the Hon’ble Allahabad High Court in the case of M/s Johnson Mathhey Chemicals India Pvt. Ltd. with regard to Rule 24 of CPC on the issue of remand, wherein the Hon’ble High Court had held that where all materials were there before the authority then the issue must be decided by that authority. Only where further enquiry was required, could it be sent back to the lower courts. It was argued that a matter could not be sent back to the lower courts to rectify a defect, unless the power to correct the defect was enshrined in the law. The ld. ARs further submitted that the powers of the Tribunal were limited to the scope of the Act and did not extend to sending back such matters for rectification of defects.

26.

On the merits of the issue, the ld. ARs conceded that the JCIT and the AO worked together on the preparation of the action note and that the JCIT was conversant with the facts of the case at the time of the preparation of the action note, but they pointed out that there was no role thereafter for the JCIT until the final show cause notice that was , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 137 prepared in consultation with him or the consultation that was required for making large additions. They argued that the powers of the JCIT had to be exercised under section 144A and the day-to-day interaction did not have much relevance. The ld. ARs also argued that internal guidelines issued by the CBDT were an obiter but they were not a ratio. Therefore, since they were only guidelines and not an instruction, they could not be held to be sacrosanct. The Leaned ARs argued that guidelines overlooked the fact that there should be independent application of mind by the ld. AO and not joint application of mind in any case. Furthermore, it was argued that there was no mention of these guidelines in the affidavit sworn by the Retired JCIT, that he had followed the same. In support of these arguments, the ld. ARs placed reliance on the judgment of the Mumbai Tribunal in the case of Vrushali Sanjay Shinde in wherein the Hon Tribunal had held that the approval process has to indicate the proper procedure and application of mind and that the affidavit filed by the JCIT was an afterthought. They also invited our attention to the judgment by the Jodhpur Bench of the Tribunal in the case of Indira Bansal in ITA numbers 321-324,279 - 281,325-331& 404-404/Jodh/2016 where the Tribunal had reaffirmed that the approval given in similar circumstances to the assessee’s case was mechanical thus vitiating the assessment.They submitted that prior knowledge of the matter, as argued by the learned DRs, had no value. What was essential was proper application of mind to the approval process and since the circumstances indicated that this had not been done in this particular case , the orders were vitiated and deserving of being quashed .Finally, they argued that the judgment of the Supreme Court in the case of Mohinder Singh Gill was rendered by a constitution bench and still held the fort and therefore no credence should be given to the affidavit filed by the JCIT, who was since retired.

27.

We have duly considered the rival arguments raised by the assessee and the Revenue on this matter and in our view, the preliminary question to be decided is whether the additional grounds that have been raised by the assessee are questions of fact or whether they are questions of law that could be raised before the Tribunal for the first time, in view of the judgment of the Hon’ble Supreme Court in the case of NTPC Limited vs. CIT 229 ITR 383 (SC). It has been constantly held by various Courts and Tribunals that the fact of whether approval was exercised in a mechanical way is purely a question of fact to be determined from the facts and circumstances of each individual case. However, the question,as emerges from the grounds of appeal that have been raised are whether, if the approval under section 153D has been given in a mechanical manner and without application of mind, the assessment as framed under section 153A r.w.s. 143(3) of the Act are , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 138 illegal and nonest. It has also been contended that the approval as taken from the JCIT, Central Range, Varanasi is not an approval in the eyes of law and therefore, the assessments are null and void, liable to be declared illegal as they are without jurisdiction. These questions are undoubtedly questions of law that go to the root of the matter as they deal with the validity of the assessment. Time after time, similar questions have been raised before the ITAT on the grounds that they are questions of law and they have repeatedly been admitted as such. In view of our understanding of the issues raised, we are not in doubt that the essential question of whether the assessments are null and void on account of a mechanical approval, which would not be an approval in the eyes of law,are questions of law that deserve to be admitted in view of the judgment of the Hon’ble Supreme Court in the case of NTPC Limited vs. CIT (supra). It has been argued by the ld. DRs that these issues, which could have been raised before the ld. CIT(A), have not been raised and therefore, the ld. CIT(A) has not had occasion to apply his mind to these legal issues. Therefore, these do not emerge out of the orders of the ld. CIT(A) and are therefore, beyond jurisdiction of the Tribunal. One of the cases that has been cited before us by the ld. ARs is the decision of the Hon’ble Allahabad High Court in the case of M/s Johnson Mathhey Chemicals India Pvt. Ltd. (Sales / Trade Tax Revision No.361 of 2022), in which the Hon’ble Allahabad High Court has referred to order XLI of the Code of Civil Procedure, 1908 and perusal of Rule 24 of the said order reveals that the Appellate Court is competent to pronounce judgmentupon an issue to determine the case finally, notwithstanding that the judgment of the Court from whose decree the appeal is preferred has preceded wholly upon some other ground other than on which the Appellate Court proceeds. Furthermore, the Hon’ble Bombay High Court in the case of PCIT vs. Sreelekha Damani(2019)307 CTR 218 (Bom)has held that the question of validity of approval goes to the root of the matter and could have been raised at any time. In these circumstances, and in view of these precedents, we cannot accept the arguments offered by the ld. DRs that the Tribunal does not have the jurisdiction to hear such issues simply because they did not emanate out of the orders of the ld. CIT(A). The ld. DRs have also argued that the assessee could have raised these issues before the ld. CIT(A) so that the CIT(A) could apply his/her mind to the issue, but we observe that the ld. ARs have admitted that it was only when drawing up the grounds of appeal for the appeal before us, that it came to their knowledge that this legal issue had not been raised earlier. We would look at this submission, in the context of the legal developments happening with regard to the approvals under section 153D. It is entirely possible that the assessee realized that he was in a position to take the shelter of law, after certain Tribunals and Courts had rendered their judgments regarding the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 139 validity of assessments if the approval under section 153D was rendered mechanically. Thereafter, once he came to know of the same, he could not be precluded from raising this ground simply because he had not raised this ground earlier before the ld. CIT(A).We accept the argument that whether or not the approval rendered by the JCIT was mechanical, was a question of fact which was required to be looked into before the legal issue could be addressed. However, we note that the Tribunal is the final fact-finding authority, and if all the materials are already available with the Tribunal, then the Tribunal is fully competent to discover the true facts without needing to remand the matter to the ld. CIT(A) or the ld. AO. In the circumstances, we do not find merit in the contentions of the ld. DRs that the Tribunal was necessarily obliged to refer the matter back to the lower authorities before it could proceed on the issue.

28.

The ld. DRs have also raised objections in the context of Rule 11, Rule 18 and Rule 29 of the ITAT Rules, 1963. We observe that the additional grounds that have been raised have been sought to be argued by the assessee with the permission of the Tribunal and the Tribunal has heard the Department before concluding whether such grounds should be admitted or not. Thus, objections to the admission of the grounds on account of Rule 11 are not maintainable. Similarly, under Rule 18, it has been laid down that for submitting supplementary paper books, the leave of the Bench must be sought. We note that in the present case, both parties have filed supplementary paper books on account of the additional grounds that have been raised by the assessee. The admission of these supplementary paper books depends upon the necessity of considering them if the Bench were to admit the additional grounds of appeal. Since we have deemed it fit to admit the additional grounds of appeal on account of reasoning given in the foregoing paragraph, we also admit the supplementary paper books submitted on this account. In any case, the objection to filing of documents subsequent to the filing of the original paper book, being a matter within the discretion of the Tribunal, the objections on such grounds are again held to be not maintainable. Rule 29 deals with the production of the additional evidence. The ld. DRs have argued that since the assessee was not a party to the proceeding between the ld. AO and the ld. JCIT, the letters written by the Assessing Officer to the ld. JCIT seeking his approval and the subsequent approval rendered by the JCIT constitute additional evidences as far as the assessee is concerned and before admitting any such document, the Tribunal must record its reason in writing pointing out that the conditions outlined in Rule 29 have been met. Our observation upon this objection is that documents which form a part of the assessment record cannot be classified as additional evidences merely because they have not been relied upon a previous occasion by either party. Therefore, the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 140 objections raised by the ld. DRs against the admission of the additional grounds are held to be not maintainable and we accordingly admit the additional grounds of appeal for consideration and adjudication. Moreover, as the additional grounds of appeal challenge the very validity of the assessments that are before us, it is appropriate that they must be decided first before proceeding to hear the case on merits.

31.

We may, thereafter, turn our attention to the judgments of the Hon’ble Allahabad High Court which have been cited by the ld. ARs as precedents that, in their opinion would bind us to concluding that the approvals given in the instant case were mechanical and therefore, the assessments were vitiated on that account. It is observed that in the case of PCIT vs. Subodh Agarwal (2023) 450 ITR 526 (Alld), the Hon’ble High Court was hearing a case to determine whether, in view of the undisputed fact of 38 draft assessment orders being approved by the JCIT on the same day that they were put up, whether a substantial question of law arose for their consideration from the finding of the Tribunal that it being humanly impossible to apply the mind to all the materials and facts necessary for granting a considered approval in one day, the orders in question were passed after mechanical approval and therefore vitiated. The Hon’ble High Court after referring to the decisions of the Tribunal in the case of Navin Jain vs. DCIT (2021) 91 ITR (Trib) 682 (Lucknow) held that the approval of the draft assessment order being an inbuilt protection against any arbitrary or unjust power of the ld. AO cannot be a mechanical exercise without application of independent mind by the approving authority on the material placed before him and the reasoning given in the assessment order. It rejected the submission of the Department that the mere fact that approval was in existence on the date of the passing of the assessment order, it could not have been vitiated, by holding that prior approval of a superior authority meant that he must apprise the material before him to appreciate on factual and legal aspects to ascertain that the entire material has been examined by the ld. AO before preparing the draft assessment order. The Hon’ble Court also held that section 153D required that the ld. AO should obtain approval of the JCIT in respect of, ‘each assessment year’ falling within six assessment years and the search year and therefore, on account of failure of the ld. AO to obtain approval with respect to, ‘each assessment year’ but instead by obtaining common , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 142 approval in 38 cases on the last day, made it humanly impossible for the approving authority to apply independent mind to appraise material before approving those orders. Therefore, theHon’ble High Court held that the conclusion drawn by the Tribunal that it was a mechanical exercise of power could not be said to be perverse or contrary to the material and record and it specifically pointed out that as the facts stood admitted, the questions of law framed on factual issues did not give rise to any substantial question of law. In the case of PCIT vs. Siddhartha Gupta (2023) 450 ITR 534 (Alld), the Hon’ble High Court held that the draft assessment orders under section 153A in the case of 123 assessee’s placed before the approving authority on December 30, 2017and December 31, 2017 that were approved under section 153D on December 31, 2017, not only included the case of the assessee but the cases of other groups. Having regard to this fact, the Hon’ble High Court held that it was humanly impossible to go through the records of 123 cases in one day to apply independent mind to appraise the material before the approving authority. Therefore, the conclusion drawn by the Tribunal that it was a mechanical exercise of power by the approving authority was not perverse or contrary to the material on record and no question of law arose for the consideration of the Court. Approvals had to be obtained for, ‘each assessment year’ on the draft assessment orders before the passing of the assessment orders. In the case of PCIT vs. Sapna Gupta, 147 taxmann.com 288, the Hon’ble High Court reiterated its position that the ld. AO was required to obtain prior approval of the Joint Commissioner in respect of, ‘each assessment year’for which assessment was being done under section 153A and that before such approval was granted, the superior authority must appraise the material before it so as to appreciate on the factual and legal aspects as also to ascertain that the entire material has been examined by the ld. AO before preparing the draft assessment order. In the instant case, it held that since the draft assessment orders had been placed before the approving authority on 30.12.2017 and was approved by the approving authority on the very same day which not only included the cases of the assessee but the cases of other groups as well, it was 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 and therefore, the conclusion drawn by the Tribunal that it was a mechanical exercise of power, therefore, could not be said to be perverse or contrary to the material on record. Consequently, the Hon’ble High Court held that no substantial question of law arose for consideration before it.

34.

The next important decision which has been cited before us the decision of ACIT vs. Serajuddin& Co. (2023) 454 ITR 312 (Orissa). In this case, the Hon’ble High Court had observed that the requirement of prior approval under section 153D of the Act was comparable with a similar requirement under section 158BG of the Act and quoting from para 9 of Chapter 3 of Volume -II (Technical) of the manual of office procedure issued by the CBDT in February, 2003 in respect of assessment orders under Chapter XIV-B, it had noted that as per the said manual, the draft assessment order had to be submitted to the Assessing Officer, ‘well in time’, the approval had to be given in writing and the fact that the approvalhad been obtained was to be mentioned in the body of the order. The Hon’ble High Court has observed that in that instant case, the assessment orders were silent about the Assessing Officer having written to the Additional CIT seeking his approval or of the Additional CIT having granted such approval and orders were therefore, not in compliance with the requirements spelt out in para 9 of the manual of office procedure. It further held that since the manual, which was issued as a guideline to Assessing Officers had been issued by the CBDT, it could be traced back to section 119 of the Income Tax Act and was therefore, binding on officers of the Department. The Hon’ble High Court also observed that the approval of the superior officer could not be a mechanical exercise and this had been emphasized in several decisions. It was, therefore, not correct on the part of the Revenue to contend that the approval was not justiciable. Where the approval was granted mechanically, it would vitiate the assessment order itself. Going through the approval letter in that case, the Hon’ble High Court observed that even the bare minimum requirement of the approving authority indicating what thought process was involved was missing in the aforementioned approval order and held that while elaborate reasons were not required, there had to be some indications that the approving authority had examined the draft orders and find that it meets the requirements of law. The Hon’ble High Court held that merely rubber stamping of the letter seeking sanction with an approval would not satisfy the requirements of law.

36.

Another decision cited by the ld. AR as a legally binding precedent is the decision of the Hon’ble Delhi High Court in the case of PCIT vs. Shiv Kumar Nayyar,(2024) 299 Taxman 385. In the said case, the Hon’ble Delhi High Court placed reliance on the orders of the Hon’ble Allahabad High Court in the case of PCIT vs. Sapna Gupta (supra) and on the decision of the Hon’ble Orissa High Court in the case of ACIT vs. Serajuddin& Co. (supra),as also the earlier decision of the Hon’ble Delhi High Court in the case of PCIT vs. Anuj Bansal in wherein it had been held that the exercise of powers under section 153D could not be done mechanically. Noting that in the present case before it, the Additional CIT had granted approvals in 43 cases on the very day they had been submitted for approval and noting that the Additional CIT had granted a single approval for all assessment years put together when section 153D provided for approval to be granted for each assessment year, the ld. High Court observed that the said order failed to make any mention of the fact that the draft assessment orders were perused or perused with an independent application of mind. Therefore, considering that the authority had granted approval for 43 cases in a single day and covered all assessment orders under a single approval, the Hon’ble High Court did not find the existence of any question of law arising out of the orders of the Tribunal to declare the entire search assessment as illegal. The ld. ARs have pointed out that vide this order, the Hon’ble Delhi High Court have affirmed the orders of the Tribunal,which rejected the arguments of the Department that the fact of the ld. Additional CIT getting involved in search assessment proceedings right from the receipt of copy of appraisal report as not material and held that the ld. Additional CIT is supposed to independently apply his mind in a judicious way before drawing any conclusions on the contents of the seized documents while framing the search assessments. The Tribunal had held that the law provides that only the AO can frame the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 146 assessment but checks and balances are provided in the act by conferring powers on the approving authority to grant judicious approval under section 153D of the Act, de hors the conclusions drawn by the Investigation Wing in the appraisal report or by the ld. AO in the draft assessment order. Thus, it has been argued that by implication, the Hon’ble Delhi High Court has debunked the arguments of the Department on joint application of mind being a substitute for independent approval by the JCIT. On the other hand, the ld. DRs have submitted that the Hon’ble Tribunal did not consider the guidelines issued F. No. 286/161/2006-IT(Inv. II) on 22.12.2006 before coming to the conclusions that they had and, in any case, the issue in question was not decided by the Hon’ble Delhi High Court, which upheld the orders of the Tribunal only on the facts of that particular case.

37.

The orders passed by the Hon’ble Allahabad High Court referred to above arose out of the orders of the Lucknow Bench of the ITAT in the cases of Sh. Siddhartha Gupta, Smt. Sapna Gupta and Sh. Subodh Agarwal. In each one their cases, the ITAT Lucknow Bench had held the assessments to be vitiated on account of the fact that no evidence was presented before it to show that the JCIT had examined the material relating to the search and / or the assessment records prior to giving the approval. In all these cases, the ITAT had held that it was humanly impossible for the approving authority to apply his mind to a very large number of cases that were put up to him at the fag end of the assessment period and this implied that the approvals had been given mechanically and without application of mind to the materials, on the basis of which the assessment was conducted, and the orders of the ld. AO. All these orders essentially followed the earlier order of the Lucknow Bench passed in the matter of Sh. Navin Jain vs. DCIT (2021) 91 ITR (Trib) 682 (Lucknow). The order passed in the case of Sh. Navin Jain and Ors has also been quoted by the Hon’ble High Court while holding that no substantial question of law arose in the actions of the Tribunal in holding the approvals granted by the approving authority to be a mechanical exercise of power. Therefore, it would be pertinent to examine the orders of the ITAT Lucknow Bench in the case of Sh. Navin Jain& Ors to understand the gist of the findings of the ITAT in all these cases. In the case of Sh. Navin Jain, the ITAT held that for granting approval under section 153D of the Income Tax Act, the approving authority should apply his independent mind to the material on record for each assessment year in respect of each assessee separately. It held that the rational of the word, ‘each’ specifically referred to in section 153D and 153A deserved to be given effective and proper meaning so that the underlying and legislative intent as per the scheme of assessment of sections 153A to 153D was fulfilled. The Tribunal also , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 147 held that the meaning of, ‘approval’, as contemplated under section 153D of the Act is that the Joint Commissioner was required to verify the issues raised by the ld. AO in the draft assessment order and apply his mind to ascertain as to whether the entire facts had been properly appreciated by the ld. AO. The Joint Commissioner was also required to verify whether or not the required procedure had been followed by the ld. AO in framing the assessment. In that case, the ITAT observed that the Assessing Officer had passed the draft assessment orders on the same day that approval under section 153D was accorded by the Additional Commissioner in 67 cases. It held that the panchnamaprepared by the Revenue authorities consisted of 15,800 pages and the replies filed by the assessees belonging to the group consisted of about 2000 pages.There were also documents belonging to other groups, approvals for which had also been granted by the same approving authority alongwith the assessees on the same day through the same approval letter. Accordingly, the ITAT held that it was humanly impossible for a person to apply his mind on all cases individually and that too on a single day. Therefore, the approval granted by the Additional Commissioner under section 153D was mechanical in nature, without proper application of mind and therefore, it was illegal and non-est. Consequentially, the assessment made on the basis of such approvals were also illegal and deserved to be annulled.

38.

Ongoing through the above decisions rendered by the various Courts and Tribunals, which the assessee has cited as binding precedents which we are obliged to follow, we cannot help but observe that the fact of the approving authority being associated with the assessment procedure right through the process of assessment, has never been brought to the knowledge of the Tribunals or the Hon’ble High Court by the officers and counsels representing the Revenue. Therefore, all these orders are predicated on the belief that prior to the submission of the draft assessment order, the approving authority is a stranger to the proceedings and the materials on the basis of which the assessment orders have been framed. Thus, while the principles of law that have been laid down by the Hon’ble jurisdictional High Court on the issue of the nature of the approval, the requirement of the approving authority to consider the materials judiciously before granting the approval, the need for application of mind to the case of each assessee for each assessment year and the fact that any approval not given in the aforesaid manner would be a mechanical exercise of power which vitiates the assessment process, is binding upon us and must be the test for evaluating any approval given by the approving authority in a proceeding under section 153A, the affirmation of the Tribunal’s findings in particular cases that there was no application of mind because a large number of cases were , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 148 approved on the same day would not create a binding precedence of what constituted mechanical approval if the Revenue were to bring on record material which suggested that the JCIT who had granted the approval under section 153D, was well acquainted with the materials on record that related to the search and actively associated with the assessment proceedings for the entire duration of the proceedings. We are also not in agreement with the ld. ARs that in the aforementioned cases, the Court has laid down any principle of law that all cases of approvals given in a short period of time in a large number of cases are ipso facto cases of mechanical approvals. In fact, the Hon Allahabad High Court while dismissing the appeals of the Department, has done so on the facts of those cases, pointing out that no substantial question of law arises for its’ consideration. In this context, it is worthwhile to consider the case of Anuj Bansal, which is one of the cases cited by the assessee. On similar facts as presented to the Hon’ble Allahabad High Court, the Hon’ble Delhi High Court in its order in ITA 368 of 2023dated 23rd July 2023, upheld the decision of the Tribunal to quash the assessment order. However, subsequently in another assessment year pertaining to the same assessee, Department filed another appeal in which it brought the fact of the Departmental guidelines dated 22.11.2006 (contained in Search and Seizure Manual 2007) and an internal correspondence folder that showed monitoring by the Addl CIT, to the knowledge of the Court. The Hon’ble Court in of 2024, after considering these arguments was pleased to admit the following question of law for consideration;

40.

Coming to the assessee’s case, it has been brought to our notice by the ld. DRs that the CBDT has issued guideline for search and seizure assessments in F. No. 286/161/2006-IT (Inv. II) on 22.12.2006contained in Appendix V of the Search &Seizure Manual , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 150 2007which involves the Range Head in the assessment process right from the stage of receipt of the appraisal report and the seized material to the granting of the final approval. As brought out by the ld. DRs, it is observed that the Range Head (approving authority) is involved in scrutinizing the appraisal report and the seized material at the time of preparation of the examination note to decide which cases were to be taken up under section 153A, 153C or section 148. Subsequently, he was also supposed to vet the action note prepared by the AO within 90 days of receipt ofseized materialafter methodological examination of the seized material and it has been brought to our knowledge by the DRs that usually these action notes are prepared by the ld. AO and the Range Head in consultation with each other. We also observe that the Range Head has been directed to ensure proper satisfaction note are recorded before issuance of notices under section 153C or under section 148. Furthermore, it appears that the Board envisaged that the Range Headwas to be associated with the preparation of the detailed questionnaire and could even give directions under section 144A where it was considered necessary. As has been explained to us by the ld. DRs, since the said questionnaires are prepared in consultation with the Range Head, formal directions under section 144 were usually not required in the matter. It is also observed that the Range Headis also to be involved in examining the final replies of the assessee on the questionnaire and that the final show cause notice in the matters were to be prepared by the ld. AO in consultation with Range Head. As per the said guidelines, the ld. AO has been advised to consult his higher authorities while making large additions. Thus, it appears that the Range Head is not envisaged as merely an approving authority of the actions of the ld. AO but has been assigned the supervisory role in the conduct of the search assessments by way of such guidelines that have been issued by the CBDT. As held by the Hon’ble Orissa High Court in the case of ACIT vs. Serajuddin& Co. (supra), such guidelines are necessarily to be complied with by the officers as they can be said to emerge from the powers granted to the CBDT under section 119 of the Income Tax Act, 1961. Therefore, in view of these specific guidelines, which were not brought to the knowledge of the Co-ordinate Bench of the ITAT in the case of Shiv Kumar Nayyar vs. ACIT (ITA No.1986 & 1987/DEL/2022), the findings of the Tribunal that the Additional CIT while granting approval under section 153D has to independently apply his mind to the conclusions drawn by the Investigation Wing in the appraisal report or the draft assessment order do not appear to account for the association of the Range Head in the conceptualization and drafting of the assessment order itself. After all, if the Range Head is to be involved in the preparation of the questionnaire and thereafter in the preparation of the show cause notice upon receipt of replies from the assesseeand if he , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 151 is to be consulted on major additions, then it is clear that he would have duly appraised all the materials upon which the case of the ld. AO was sought to be made out and the responses of the assessees to the queries made in this regard. Having already familiarized himself with the same material and the line of enquiry being pursued by the ld. AO, with his concurrence, the only action left for the Additional CIT at the time of granting of approval was to ensure that the issues had been marshalled properly while giving the final shape to the assessment order. We are, therefore, unable to agree with the Co-ordinate Bench that the law only provides that the ld. AO will frame the assessment and because, in the aforesaid scheme laid down by the CBDT under the powers drawn by it under section 119 of the Income Tax Act, 1961, the scheme of assessment as envisaged in such guidelines is a cooperative enterprise, in which both the ld. AO and the approving authority are equal participants in the preparation of the final assessment order. Furthermore, it is pertinent to note that it was shortly after the promulgation of these guidelines that the Act was amended to include section 153D and provide for approvals by the Range Head. The guidelines have therefore to be read in the light of the subsequent amendment, as laying down the roadmap regarding exercise of jurisdiction under section 153D. To our mind such guidelines and the subsequent introduction of Section 153D to the Act made it mandatory for the AO to act in concert with the Range head, otherwise his orders would not pass muster. In such circumstances, decisions rendered by Courts with regard to normal assessments or assessments under section 147 relating to the independence of the ld. AO, which have been relied upon by Coordinate Benches, cannot apply to search assessments under section 153A, which have to be conducted by the officers of the Department in accordance with the amended provision of the Act and the guidelines issued by the Board. Thus, the premise that the ld. AO is obliged to act independently prior to the submission of the draft assessment order and the Range Head is required to independently appraise the material only thereafter is a flawed premise in view of the guidelines furnished before us.After consideration of such guidelines, it must be held that the approval given by the Range Head under section 153D, is the culmination of the process of assessment, whereby the ld. approving authority records his final concurrence with the assessment order that has been framed by the ld. AO in consultation with him at various stages. Such approval therefore, in our mind need not separately indicate why the approval was being granted, because the entire line of investigation and the conclusions arrived at after considering of various replies would be under the close supervision of the ld. Range Head and therefore, the approval under section 153D must be viewed as being the final stamp of concurrence, in accordance with the statutory provisions.

, 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 152 Furthermore, since such approval of an assessment framed in accordance with the guidelines issued by the CBDT necessarily presumes familiarity with the materials on record and in fact the entire assessment proceedings that were conducted by the ld. AO, an approval given at the fag end of the process, in a short span of time after the submission of the draft assessment order cannot be held to be mechanical, when such guidelines are considered. It is observed that in none of the cases that were argued before the Lucknow Bench of the ITAT have the facts of the existence of these guidelines and the functioning of the assessment authorities in accordance with them, have ever been brought to the attention of the Tribunal. Accordingly, the same has led to a premise that the approval have been issued in a large number of cases without examination of the materials on record or without considering the issues involved, thereby rendering the said approvals to be mechanical and thereby invalid and vitiating the assessment process itself. Neither were these guidelines brought to the knowledge of the Hon’ble High Court by the Revenue, when the orders of the ITAT were challenged before it. In the circumstances, the conclusions that approvals granted in a large number of cases were mechanical because they did not lead scope for examination of the materials on record for consideration of the issues at hand were arrived at without any submission to the effect that the officers of the Department were functioning in accordance with the guidelines issued by the CBDT, that deeply involve the approving authority in the assessment process itself, right from inception till conclusion. We further note that the search manual of February, 2003, which has been referred to by the Hon’ble Orissa High Court in the case of ACIT vs. Serajuddin& Co. (supra) does not involve a similarly close association of the approving authority in the assessment process, prior to the date of approval. It is in this context that ld. Assessing Officers have been advised to submit the draft assessment order in block assessments to the approving authority” well in time” and it is also in this context that the due opportunity of being heard is required to be given by the Supervisory Officer to the assessee before giving approval to the proposed block assessment. Thus, since the guidelines laid down by the CBDT in respect of search assessments to be conducted under section 153A to 153D are completely different from the guidelines that were in existence for block assessments to be done under Chapter XIV-B, the said guidelines could not be pointer to hold that a search assessment under section 153A or 153C was not in accordance with law if the same conformed to the specific guidelines issued by the Board in F. No. 286/161/2006-IT (Inv. II) on 22.12.2006. As the judgment of the Hon’ble Orissa High Court in the case of Serajuddin& Co. (supra) is not based on consideration of the relevant guidelines, it cannot be held as a valid judicial precedent in the case of the assessee. Similarly, decisions of co- , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 153 ordinate Benches that place reliance on the guidelines of February 2003, cannot be a binding precedent.

42.

Thus, the approving authority has affirmed the fact under oath, that before approving the draft assessment orders submitted by the ld. AO, regular monitoring and supervision of assessment proceedings was done by him since the examination of seized materials till scrutinizing of the final reply and since he had constantly supervised the proceedings, therefore, at the time of submitting the draft assessment order, he was well acquainted with the facts and findings of the case and for this reason the approval process took minimum time. The approving authority has also affirmed that from time to time he set up Camp at Allahabad for this purpose. He submits that in these cases regular monitoring was necessary because the assessees took a long time to respond to queries. He has also submitted that the Assessing Officer and he were regularly exchanging e-mails wherein draft orders were submitted, corrected and returned. The ld. AR have protested to the submission of consideration of this affidavit by the approving authority (since retired) on two counts. Firstly, that in terms of the judgment of the Hon’ble Supreme Court in the case of Mohinder Singh Gill and Anr vs. Chief Election Commissioner, New Delhi & Ors, (1978) 1 SCC 405, an order had to be judged by the reasons stated while making the order and supplementary reasons in the shape of affidavits were to be excluded. It has argued that the affidavit submitted by the approving authority is nothing but an attempt to improve upon the defect of mechanical approval in the existing assessment order and therefore, cannot be accepted as evidence before the Tribunal. It has also been argued that the affidavit having been filed after eleven years of the assessment, had , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 155 no evidentiary value due to the lag of time. It has also been submitted that by filing such an affidavit, the Department was attempting to challenge the wisdom of earlier decision of the Tribunal and finally according to the ld. ARs, the affidavit does not make any mention of having followed the CBDT guidelines as laid down in F. No. 286/161/2006-IT (Inv. II) on 22.12.2006.On the other hand, the ld. DRs have pointed out that the affidavit is not an attempt to improve upon any defect in the order because there was no such defect, it is a statement on oath by the person against whom allegations of mechanical exercise of power have been alleged and represents his rebuttal to the allegation. The ld. DRs have argued that the reason for the affidavit being submitted so long after the assessment was completed was that the assessee had raised the additional ground challenging the approval granted by the ld. JCIT for the first time on 1.08.2024 i.e. nearly eleven years after the assessment had been finalized. It was, therefore, natural that the rebuttal to this allegation would be filed after the allegation was made.

43.

We have duly considered the matter and we find ourselves in agreement with the arguments placed by the ld. DRs. In our view, the case of the assessee is completely different from the case of Mohinder Singh Gill and Anr vs. Chief Election Commissioner, New Delhi & Ors (supra). We noticed that in the case of Mohinder Singh Gill and Anr vs. Chief Election Commissioner, New Delhi & Ors (supra), the Hon’ble Supreme Court had relied upon its earlier order in the case of Commissioner of Police, Bombay vs. Gordhandas Bhanji AIR 1952 SC 16, wherein the Hon’ble Supreme Court had held that public orders, publicly made, in exercise of a statutory authority cannot be construed in the light of explanations subsequently given by the officer making the order of what he meant or what was in his mind or what he intended to do.That such orders must be construed objectively with reference to the language used in the order itself. Following this order, the Hon’ble Supreme Court had held that when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of an affidavit or otherwise. Otherwise, an order bad in the beginning, made by the time it comes to Court on account of a challenge, get validated by additional grounds that were later brought out. The facts of the assessee’s case are totally different. The affidavit filed by the ld. approving authority does not seek to add anything to the order that was passed by the ld. Assessing Officer. The ld. JCIT, by virtue of filing an affidavit has refuted the allegations levelled upon him for the first time on 27.04.2023 that he acted mechanically while giving the approval in the case and he has sought to defend his actions by pointing out that he had done all that he was required to do as a Supervisory Officer and as , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 156 evidence of this, he has referred to his numerous visits to Allahabad for this purpose and the exchange of e-mails with the Assessing Officer.Therefore, in our view, an affidavit filed by the officer refuting the allegations levelled against him cannot be equated with an affidavit supplementing the reasons for a particular course of action in a particular order and accordingly we hold that the challenge to the admission of the affidavit by the assessee has no basis. We also observe that while the ld. Range Head may not have specifically referred to the CBDT guidelines in question, he has pointed out the activities that he undertook during the assessment proceedings which are in consonance with such guidelines. Hence, the affidavit has to be viewed as an assertion by the approving authority that he had performed his role as envisaged in the said CBDT guidelines. We further note that Rule 10 of the ITAT Rules permits facts which cannot be borne out from the record, to be stated in the form of an affidavit.

44.

We have also noticed that the Hon’ble ITAT, Mumbai ‘C’ Bench in the case of Pratibha Pipes &Structural’s Limited vs. DCIT, Central Circle-17 and 28, Mumbai (ITA No.3874/Mum/2015, & dated 10.04.2019) was seized of a similar situation. In that case, as the letter seeking approval and the letter granting approval were not to be found in the assessment folder, the assessee had argued that the assessments were void on account of the absence of approval under section 153D. In that case, affidavits were filed by two senior officers who were in charge of the assessment proceedings. The then AO, who had since retired, had filed an affidavit and stated that the mandatory requirement of approval under section 153B had been obtained. Furthermore, the then Additional CIT had also filed an affidavit and stated that he had granted approval required to be given under section 153D vide letter No. Addl CIT/CR-4/Approval/153D/2012-13 dated 25.03.2013.The ITAT held that the affidavits filed by the officers could not be ignored as not having any evidentiary value. The contents of the affidavits filed by the officers coupled with the circumstantial evidences available in the assessment folders clearly established the fact of obtaining the necessary approval under section 153D. The matter was subsequently considered again by the ITAT Mumbai ‘F’ Bench in the case of Usha Satish Salvi vs. ACIT, (ITA Nos. 42391, 4237 & 4238/MUM/2023 dated 23.01.2025). In that case also the assessee has alleged that the approving authority had not gone through the seized material and the assessment records leading to an allegation of non-application of mind by the approving authority. Affidavits were filed on behalf of the approving authority as well as for the assessment orders in support of the contention that the assessment orders were approved after due , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 157 application of mind. The ld. AO deposed that in that instant case, discussion on various issues between him and the approving authority happened regularly based on the appraisal reports and seized / impounded materials. Similarly, the approving authority also deposed that all the issues involved in the assessment were regularly discussed since the stage of issuing notice for query letter to the stage of making draft assessment order. The ITAT observed that in the affidavits filed before it, it had been unequivocally stated by the ld. AO and the Additional CIT that all the issues involved in the assessments were discussed on regular basis from time to time between the two authorities and each issue dealt with in the draft assessment order had been examined properly and only thereafter had approval been granted. The Tribunal noted that certain modifications were suggested to the ld. AO in the draft assessment order, which had been carried out by the ld. AO in the assessment order that was passed which also showed that the approving authority approved the draft order, not in a mechanical manner, but after due application of mind. The fact of modification suggested in the order showed that the approving authority had gone through the assessment order and analyzed the issue involved therein. The ITAT, thereafter referred to the decision of the Coordinate Bench in the matter of Pratibha Pipes &Structural’s Limited vs. DCIT (supra) and held that the approval was granted by the Addl Commissioner of Income Tax, after due application of mind. Accordingly, the objections raised by the assessee in an additional ground were accordingly rejected. Thus, in view of these judicial precedents and the fact that the said affidavit did not seek to modify the order in any way but was only an assertions by the then Range Head that he had closely involved himself with the assessment proceedings and given the approval after due application of mind, we reject the objections to the assessee against the admission of the said affidavit holding that the decision of the Hon’ble Supreme Court in the case of Mohinder Singh Gill and Anr vs. Chief Election Commissioner, New Delhi & Ors (supra) has no application to the facts of the present case. We also note that while presenting the said affidavit to the Bench, the ld. DRs had suggested that the concerned officer was available for cross examination in respect of the same but no request was made on behalf of the assessee for this. Neither was any counter affidavit filed by the assessee in opposition to the said affidavit. The officer swearing the affidavit is a responsible former Government Servant who is still bound under the CCS Pension Rules to conduct himself in a manner befitting of a Government Servant and therefore, the sworn testimony of such a person against whom the allegations have been levelled cannot be disregarded as having been made for any reasons other than to clarify the actual position. We further observe that the decision of the co-ordinate Bench in Vrushali Sanjay Shinde (ITA No.

45.

Be that as it may, perusal of the letter seeking approval in respect of the assessee’s case and the letter granting the approval under section 153D in respect of the assessee’s case reveals that in neither of the two letters have the approvals been solicited for or granted in respect of,‘each assessee’ for ‘each assessment year’. In fact, it is seen that in his letter dated 26.03.2013 granting the approval for the assessment under section 153D, the ld. JCIT, Central Range, Lucknow has granted approvals in respect of 45 different assessees and in respect of several years assessments together. Due to the fact that we have observed that there exist guidelines which enjoined him to be an active participant in the assessment proceedings right from the stage of receipt of seized material to the preparation of the final show cause notice and directed consultations between him and the ld. AO on all large additions, and in view of affidavit filed by him that before approving the draft assessment orders submitted by the ld. AO regular monitoring and supervision of the assessment proceedings were done by him and therefore he was well acquainted with the facts and findings of the case and furthermore that for the purpose of proper monitoring, he had time and again visited Allahabad to go through the materials as also the submission that draft orders were submitted to him by the ld. AO on , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 159 email and after going through them, he would return the draft orders with necessary corrections and modifications, we cannot hold that the approval was granted without perusal of the materials on record or understanding the issues involved. But at the same time, it is quite clear that the approval has not been granted in respect of ‘each assessee’ separately in respect of ‘each assessment year’ and, as observed by the Hon’ble Allahabad High Court by quoting from the ITAT in the case of Navin Jain vs. DCIT (2021) 91 ITR (Trib) 682 (Lucknow), the provisions of the Act require that each assessment under section 153D in respect of each assessee be approved separately. Thus, the approval granted by the ld. JCIT, Range, Lucknow is clearly not in accordance with the provisions of the Act and therefore, renders the assessment orders as defective or vitiated.

46.

The question that thereafter arises is whether,after observing that the ld. JCIT was involved in the assessment process right since the receipt of seized material till the preparation of the draft assessment order, the failure to give approval in the manner as required under the Act and as laid down by the Hon’ble Allahabad High Courtin its orders in the cases of Sh. Siddhartha Gupta, Smt. Sapna Gupta and Sh. Subodh Agarwal, could render the assessment vitiated to the extent that it was required to be annulled. The ld. ARs have drawn our attention to the orders of the ITAT Lucknow Bench in the cases of Sh. Navin Jain and Ors, Sh. Siddhartha Gupta, Smt. Sapna Gupta and Sh. Subodh Agarwal in which after consideration of orders of various Coordinate Benches, the Lucknow Bench of the Tribunal has annulled all these orderson finding them to be without proper approval that vitiated the entire assessment. They have pointed out that the Hon’ble Allahabad High Court has affirmed the orders passed by the Tribunal and therefore, set a binding precedent that we are obliged to follow. On the contrary, the ld. DRs have submitted that the Hon’ble Supreme Court in the case ofGuduthur Bros. vs Income-Tax Officer (1960) 40 ITR 298 (SC) had observed that in case an illegality vitiated the proceedings after it was lawfully initiated, the proceedings were to be restored back to the stage at which the illegality occurred and not quashed altogether. They have also pointed that the decision to annul the proceedings in the cases of Sh. Navin Jain, Sh. Siddhartha Gupta, Smt. Sapna Gupta and Sh. Subodh Agarwal had been taken on the assumption and premise that the Range Head was a stranger to the assessment proceedings prior to the submission of the draft assessment order and had the fact of the said CBDT guidelines being brought to the knowledge of the Tribunal at that point of time, the results may have been quite different. They have also argued that the Hon’ble Allahabad High Court has merely upheld the decision of the Tribunal to hold that the approval was mechanically granted on the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 160 given facts and circumstances of those cases. It has not passed any order with regard to what should happen if and when the proceedings were vitiated as a result of an illegality having crept in after a proceeding was validly initiated. Nor had any such matter been argued before the Hon’ble Allahabad High Court, therefore, it could not be said that the Hon’ble Allahabad High Court had pronounced any orders on the said subject that required us to annul the proceedings, if we were of the opinion that the approval granted vitiated the assessment proceedings. The ld. DRs have placed reliance on the judgment of the Hon’ble Supreme Court in the case of Union of India & Ors vs. Dhanvanti Devi (1996) 6 SCC 44, wherein the Hon’ble Supreme Court had observed,

48.

We observe, that the co-ordinate Bench in the case of Navin Jain (supra) has held that the defect of improper approval to be incurable and on this basis has annulled the order of the assessees in that case, which has subsequently been repeated by it in the cases of Siddharth Gupta, Sapna Gupta and Subodh Agarwal. However, we observe that such conclusion was not arrived at after any discussion or reasoning on why the defect was incurable. Accordingly, it is a decision sub silentio, which according to the judgment of the Hon’ble Supreme Court in State of U.P. & Another vs. Synthetics and Chemicals Ltd., (1972) 87 STC 289, cannot be a binding precedent. We have also scoured through the judgments filed by the assessee in his paper book.We noticed that in each and every case where a decision had been taken to annul the assessment, there was a corresponding finding by the coordinate bench that the approvals had been rendered mechanically and without examination of the materials on record, while there is no such finding in our case. In the circumstances, we feel that the decisions cited by the ld. DRs are of relevance in helping us to resolve this matter.In the case of Gayatri Textiles vs. CIT (2000) 111 taxman 123 (Karnataka), the Hon’ble Karnataka High Court held in a matter relating to penalty u/s 271(1)(c), that where the proceedings were validly initiated and only required prior approval of the IAC for direction for payment of penalty and not for the initiation of proceedings, the failure to obtain approval was a procedural defect and the Tribunal was justified in holding that the failure to obtain previous permission from , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 162 the IAC was not fatal to the order of penalty passed under section 271(1)(c) and the Tribunal was right to remand the matter back to the Department to pass fresh penalty order. In the case of CIT vs. Vijay Dal Mills (1998) 230 ITR 301 (M.P.), the Hon’ble Madhya Pradesh High Court followed its earlier order in the case of PrabhudayalAmichand vs. CIT (1989) 180 ITR 84 (M.P.) and held that a procedural irregularity not involving the question of jurisdiction can be cured. It held that there could be no doubt that the levy of penalty by the ITO without the previous approval of the IAC was illegal, but the case could go back to the AO for curing the defect by obtaining that prior approval. In the case of CIT vs Damodardas Murarilal (1996) 222 ITR 401 (MP) the Hon High Court held that the procedural irregularity in passing a penalty order without taking the approval of the IAC could be cured by remanding the case to the AO and that such remand would not be affected by the limitations ordinarily prescribed for the levy of penalty.Most importantly, in the case of Guduthur Bros. vs Income-Tax Officer (1960) 40 ITR 298 (SC), the Hon’ble Supreme Court has laid down the principle that a proceeding that is validly initiated cannot be quashed altogether, only because an illegality had vitiated the proceedings after it was lawfully initiated and affirmed the principle that such proceedings were to be restored back to the stage at which the illegality occurred. It could be argued that these decisions have been rendered in the context of penalty orders and not in the context of an assessment under section 153D.However, the moot point is that by virtue of such orders, the Hon’ble Supreme Courthas laid down the law and other courts have affirmed it ,that if a proceeding is validly initiated and an illegality creeps into the proceeding after it has been lawfully initiated, the proceedings cannot be held to be void ab initio and quashed as such but rather should be restored back to the stage at which the illegality occurred for removal of the said illegality. We also observe from going through the paper books furnished by the assessee and the Revenue that there are narrations within orders therein, which suggest that in several matters relating to approvals u/s 158 BG and 153D, the co-ordinate Benches have either felt that any deficiency in the approval process will not invalidate the assessment orrequire that the matter should be restored back to the point at which the illegality occurred. The ITAT Delhi Bench ‘A’ (Special Bench) in Kailash Moudgil vs. DCIT (2000) 72 ITD 97 (Delhi) (SV) held that, “The approval of the Commissioner without recording any reasons in writing for approving the order would not render the order of the Assessing Officer void ab initio and would not invalidate the assessment order. Assuming without admitting that some infirmity is there, it is curable under law, since the order under section 158BG is made , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 163 appealable under section 253(1)(b) of the Income Tax Act, in which the assessee is entitled to canvass all the points available to invalidate any part of the assessment and thus the defect if any existing previously would be completely cured.

“5. The Ld. Authorized Representative for the assessee (Ld. A.R.) submitted that the assessee was challenging the validity of approval granted under section 153D of the Act in all the three appeals and prayed that this ground may be taken up first for hearing. Since the Department did not have any objection to the prayer, the Ld. A.R. proceeded to advance his arguments on the validity of approval under section 153D of the Act. 5.1 The Ld. A.R. invited our attention to the Letter of Approval under section 153D of the Act, dated 27.12.2019 of the Addl. Commissioner of Income Tax, Central Range, Kanpur (copy placed in the paper book) and submitted that the order dated , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 166 31.12.2019 passed by the DCIT, Central Circle-1, Kanpur under section 153A of the Act was based on the approval under section 153D of the Act granted by the ACIT, Central Range, Kanpur by a common order dated 27.12.2019 in cases pertaining to different assessees and different assessment years. He further submitted that the order passed by the DCIT within four days of approval granted by the ACIT, i.e. 27.12.2019, was without application of mind and without appreciating the facts and the same did not follow the mandate of section 153A of the Act. The Ld. A.R. in support of his arguments placed reliance on various case laws, which were placed in paper book. 5.2 Inviting our specific attention to order dated 22.11.2024 by the Co-ordinate Bench of ITAT Lucknow in the cases of M/s Standards Frozen Exports Pvt. Ltd., M/s Standard Agro Vet Pvt. Ltd., Shri Kamal Kant Verma and Shri Sachin Verma in IT(SS)A Nos. 41 to 45/LKW/2022, 46 to 49/LKW/2022, 50 to 53/LKW/2022 and 54 to 59/LKW/2022 respectively, the Ld. A.R. submitted that these appeals were decided in favour of the assessee by holding that the approval(s) granted under section 153D of the Act were done in a mechanical manner without application of mind. He submitted that likewise in the present set of appeals, the approval granted by learned Addl. CIT under section 153D of the Act, for passing the assessment orders was done in a mechanical manner without due application of mind. He drew our attention to approval granted by the Addl. CIT vide the communication dated 27.12.2019 and 28.12.2019 in the case of Satvik Polychem Pvt. Ltd. for assessment years 2017-18, 2015-16 and 2016-17 respectively. He further drew our attention to the contents of the aforesaid approval letters dated 27.12.2019 and 28.12.2019 and submitted that on their perusal, it emerges that the approval was sought by the Assessing Officer on 27.12.2019 and 28.12.2019 itself and the approval was given by the Addl. CIT. He contended that it was humanly impossible for the Addl. CIT to exercise due application of mind before granting approval in such a large number of cases having regard to the enormity of materials for due application of mind on the part of the Addl. CIT within a short span of the same working day. He also contended that the assessments made by the Assessing Officer were vitiated due to approval granted by the Addl. CIT in a mechanical manner without due application of mind. Moreover, he also contended that the absence of due application of mind by the Addl. CIT and the grant of approval in mechanical manner was fatal to the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 167 assessments made in pursuance of the approvals so granted by Addl. CIT. 5.3 The Ld. A.R. also submitted a compilation of copies of approval letters dated 27.12.2019 and 2812.2019 issued by the Addl. CIT, Kanpur and submitted that on these two dates approval was granted in as many as 110 cases (including assessee’s) which would indicate that there was complete non- application of mind while according approval under section 153D of the Act. 5.4 Reliance was also placed on the order dated 07.10.2021 of the Lucknow Bench of the Tribunal in the case of Shri Subodh Agarwal vs. DCIT, Kanpur for assessment year 2015-16 in ITA No.674/LKW/2018. The Ld. A.R. submitted that an identical issue had arisen before the Tribunal wherein, the Tribunal had quashed the assessment order based on the common approval dated 31.12.2017 granted by ACIT, Central Range, Kanpur under section 153D of the Act. He further submitted that against the said order dated 07.10.2021 (supra) of the Tribunal, the Department had filed an appeal before the Hon'ble Allahabad High Court, vide of 2022, which was dismissed by the Hon'ble Court vide order dated 12.12.2022.

, 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 169 8.1 As is apparent from the above two communications, 19 approvals were given in one communication dated 27.12.2019 (including two in the appeals before us) and 12 approvals were given in another communication dated 28.12.2019 (including one , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 170 in the appeal before us). The requirement of prior approval of a superior authority i.e. the AddI. CIT, requires that the Addl. CIT should give due consideration to all relevant materials and appraise them properly in order to appreciate the factual and the legal aspects. It is well settled in law that statutory approval by superior authority must be granted only on the basis of proper consideration of all relevant materials, and further that the approval must reflect the due application of mind to the facts of the case and to the applicable law. 8.2 In the case of Pr. CIT vs. Subodh Agarwal [2023] 149 taxmann.com 373 (Allahabad), it was held by the Hon'ble Jurisdictional High Court that it was humanly impossible to go through the records of 38 cases in one day to apply independent mind to appraise the materials before the approving authority and the Hon'ble Allahabad High Court upheld the conclusion drawn by the Income Tax Appellate Tribunal that it was the mechanical exercise of power. The Hon'ble High Court upheld the order of the Income Tax Appellate Tribunal that the approval given in such a manner vitiated the entire assessment proceedings. Similar view was taken by Hon'ble jurisdictional High Court in the case of Pr. CIT vs. Siddarth Gupta [2023] 147 taxmann.com 305 (Allahabad). In addition to the aforesaid orders of Hon'ble jurisdictional High Court, the issue is also covered in favour of the assessee by the orders of Co-ordinate Bench of the Income Tax Appellate Tribunal, Lucknow in the cases of Sapna Gupta vs. DCIT (order dated 07.10.2021 in I.T.(SS)A.No.424/LKW/2019), Navin Jain vs DCIT (order dated 03.08.2021 in I.T.(SS)A.No.424/Lkw/2019), Rohit Gupta vs. DCIT (order dated 04.07.2022 in M/s Quality Structure Pvt. Ltd. vs. DIT (order dated 30.09.2024 in I.T. (SS)A.No.679 & 680). The SLP filed by Revenue on this issue was dismissed by Hon'ble Supreme Court in [2024] 163 taxmann.com 118 (SC). 8.3 Similar view was taken by ITAT in Kamal Kant Verma vs. DCIT in I.T.(SS)A. No.50 to 53/Lkw/2022, Sachin Verma vs. DCIT in I.T.(SS)A. No.54/Lkw/2022 and Sachin Verma vs DCIT in to 59/Lkw/2022. In fact, the ITAT allowed relief to the assessee in these group of cases on facts identical to the facts in these present group of appeals. The captioned appeals were part of the 110 approvals granted on 27.12.2019 and 28.12.2019 and so were the Standard Frozen Foods Exports Pvt. Ltd., M/s Standard Agro Vet Pvt. Ltd., Shri Kamal Kanth Verma and Shri Sachin Verma group of cases (supra) which have , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 171 already been allowed relief by the ITAT by holding that the approvals granted under section 153D of the Act were granted without due application of mind by the Addl. CIT. The ITAT in these group of cases annulled the assessments by placing reliance on number of judicial precedents viz.: (i) Hon'ble Allahabad High Court in the case of Pr. CIT vs. Subodh Agarwal in of 2022, dated 12.12.2022; (ii) Hon'ble Orissa High Court in the case of ACIT vs. Serajuddin & Co. (2023) 150 taxmann.com 146 (Orissa); (iii) Hon'ble Delhi High Court in the case of Pr. CIT vs. Shiv Kumar Nayyar in ITA No.285/2024. (iv) ITAT Bangalore Bench in the case of Khoday Eshwarsa & Sons vs. DCIT in & 1080/Bang/2024; (v) ITAT Delhi Bench in the case of Sanjay Duggal & Sons in ITA No.1813/Del/2019; and (vi) ITAT Lucknow Bench in the case of Quality Structure Pvt. Ltd. vs. DCIT in IT(SS)A No.679&680/LKW/2019.

(C) There are two aspects of approval given by JCIT u/s 153D of the Act. The first pertains to the consequences that follow if approval given u/s 153D of the Act is found to be invalid. This is a question of law on which we must take guidance from binding precedents and decisions of higher forums. In the aforesaid order dated 30/09/2025 passed by us in the case of Minto Developers Pvt. Ltd. (supra), we have taken guidance from binding precedents of Hon'ble Allahabad High Court in the cases Pr.CIT vs. Sapna Gupta (order dated 12/12/2022 in Income Tax Appeal No. 88 of 2022) reported at Pr.CIT vs. Sapna Gupta 147 taxmann.com 288 (Allahabad) and also in the case of Pr.CIT vs. Siddharth Gupta (order dated 12/12/2022 in Income Tax Appeal No. 90 of 2022) reported at Pr.CIT vs. Siddarth Gupta [2023] 147 taxmann.com 305 (Allahabad). We have also taken guidance from binding precedents in a Third Member case of Income Tax Appellate Tribunal passed in the case of Dheeraj Chaudhary vs. ACIT [2025] 178 taxmann.com 360 (Delhi-Trib.) (TM). We have further taken guidance from the order of Hon'ble Orissa High Court in the case of ACIT vs. M/s Serajuddin & Co. (in order dated 15/03/2023 in – 45 of 2022) reported at ACIT vs. Serajuddin & Co. [2023] taxmann.com (Orissa). The Special Writ Petitions filed by Revenue against the aforesaid order of Hon'ble Allahabad High Court in the case of Siddarth Gupta, and order of Hon'ble Orissa High Court in the case of M/s Serajuddin & Co. have been dismissed by Hon'ble Supreme Court. We have further taken guidance from the order of Hon'ble Delhi High Court in the case of Pr.CIT vs. Shiv Kumar Nayyar (order dated 15/05/2024 in and CM Appeal 28994/2024) reported at [2024] 163 taxmann.com 9 (Delhi). In this case, Hon'ble Delhi High Court duly considered the aforesaid orders of Hon'ble Allahabad High , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 173 Court in the case of Pr.CIT vs. Sapna Gupta (supra) and Hon'ble Orissa High Court in the case of ACIT vs. M/s Serajuddin & Co. (supra), and expressing agreement with the Hon'ble Allahabad High Court and Hon'ble Orissa High Court; Hon'ble Delhi High Court upheld the order of the Income Tax Appellate Tribunal, quashing the assessment order. Further, in the case of Sapna Gupra (supra), Hon'ble Allahabad High Court has approved the order of Income Tax Appellate Tribunal in the case of Navin Jain & Others quashing the assessment order for lack of valid approval under section 153D of the Act. We have also taken guidance from the case of Pr.CIT vs. Anuj Bansal 165 taxmann.com 2 (Delhi)/466 ITR 251 (Delhi) in which Hon'ble Delhi High Court upheld the order of the Income Tax Appellate Tribunal quashing assessment order on the ground that there was absence of application of mind by the approving authority in granting approval under section 153D of the Act. SLP filed by Revenue against this order of Hon'ble Delhi High Court has also dismissed by Hon'ble Supreme Court. Further we have taken guidance from order of Hon'ble Delhi High Court in the case reported at Pr.CIT vs. Pioneer Tour Planner (P.) Ltd. 160 taxmann.com 652/ 465 ITR 356 (Delhi) and in Pr.CIT vs. MDLR Hotels (P.) Ltd. 166 taxmann.com 327 (Delhi); in which similar view was taken. We have, moreover, taken guidance from the order of Hon'ble Allahabad High Court in the case of Pr.CIT vs. Subodh Agarwal [2023] 149 taxmann.com 373 (Allahabad High Court). In all the aforesaid precedents, the quashing of assessment order by ITAT due to lack of valid approval under section 153D of the Act has been upheld by Hon'ble High Courts. We may further point out that the view taken by Income Tax Appellate Tribunal in the case of aforesaid order dated 31/10/2025 in the case of Ramji Vaish (supra) is in complete contrast with order passed in the case of Satvik Polychem Private Limited (supra), relevant portion of which has been reproduced in foregoing paragraph (B.3.1) of this order. In the case of Satvik Polychem Private , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 174 Limited (supra), the Bench of Income Tax Appellate Tribunal has approved the quashing of assessment order for lack of valid approval under section 153D of the Act. However, the same Members of the Tribunal, in the case of Ramji Vaish (supra) have taken a contrasting decision, restoring the matters back to the file of the Assessing Officer for seeking fresh approvals from the range head. In our respectful opinion, the Bench of Tribunal, consisting of the same Members, and falling under the Jurisdiction of the same jurisdictional High Court (i.e. Hon'ble Allahabad High Court) was bound by their own earlier decision in the case of Satvik Polychem Private Limited (supra) wherein they have quashed the assessment orders for lack of valid approval under section 153D of the Act unless they were forced to take a different view on the basis of a stronger precedent. Since the aforesaid order dated 31/10/2025 in the case of Ramji Vaish (supra) is in violation of the binding precedents and precedents of higher forums, as discussed above, we respectfully hold that the aforesaid order dated 31/10/2025 in the case of Ramji Vaish (supra) is not a useful precedent for deciding the present appeals before us.

(C..1) Moreover, in our aforesaid order dated 30/09/2025 in the case of Minto Developers Pvt. Ltd. (supra), we have already rejected the alternate submission made by Revenue to restore the matters regarding approvals under section 153D of the Act to the file of the approving authority, for two reasons. Firstly, because it would amount to providing a second inning to Revenue against mandate of law. Secondly, because it would amount to extending period of limitation available for completing assessment proceedings, which is not permissible in law. We have held already in that order that the limitation period available to Revenue is inclusive of time taken for granting approval under section 153D of the Act and there is no provision of law permitting extension of period of limitation for failure of the approving authority to give valid approval under section 153D of the Act. This view is consistent with the decision of Hon'ble Supreme Court in the case of Hope Textiles Ltd. vs. UOI 73 Taxman 188 (SC) in which it was held that even writ cannot be issued for passing order beyond limitation period. The Hon'ble Supreme Court held in this case that “A writ of mandamus can be issued to a statutory authority to compel it to perform its statutory obligation. It cannot be issued to compel him to pass an order in violation of a statutory provisions. Therefore, the writ cannot be issued to compel the ITO to pass order of assessment beyond period of limitation.” Further, in the case of Pr.CIT vs. Sunrise Finlease (P.) Ltd. [2018] 89 taxmann.com , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 176 (Gujarat), Hon'ble Gujarat High Court held that lack of approval under section 153D of the Act would invalidate the assessment order, and was not a curable defect. The Hon'ble High Court noted that it was well settled that taxing statute had to be strictly construed; and requirement of obtaining approval of JCIT was to be regarded as mandatory in nature. It would be readily inferred that the lack of valid approval under section 153D of the Act was not a curable deficiency and the assessment orders passed in the absence of valid approval under section 153D of the Act would render the assessment order, void ab initio. Same view was taken by Nagpur Bench of the Income Tax Appellate Tribunal in the case of Umesh Sadashiv Thakre vs. ACIT [2025] 175 taxmann.com 951 (Nagpur-Trib.) and in Maheshwari Coal Benefication & Infrastructure (P.) Ltd. vs. DCIT [2025] 175 taxmann.com 615 (Nagpur0Trib) in which the settled position that absence of valid approval under section 153D of the Act was a substantive defect and thus not curable, was emphasized; and it was held that order passed without a valid approval was void ab initio. Further, we once again mention the principles that emerge from various precedents, as noted in paragraph (K) of our aforesaid order dated 30th September, 2025 in the case of Minto Developers Pvt. Ltd. (supra), relevant portion of which is already reproduced in foregoing paragraph (B.2.1) of this order:

(L.1) Coming to the facts and circumstances of the present case; we accept the contention of the learned Counsel for the assessee that the affidavit of Shri M. L. Meena, the Assessing Officer and personal testimony of Shri Agrahari, Departmental Inspector are de void of any credibility; having regard to submissions made by learned Counsel for the assessee as referred to in foregoing paragraph (I) of this order. Further, in view of submissions of learned Counsel for the assessee as referred to in foregoing paragraph (I.1) of this order, we are of the opinion that neither the story presented by Revenue regarding Pen Drive inspires confidence nor, in any case it advances the case of Revenue, in the absence of any description of the contents of the Pen Drive in letter dated 18/07/2017 of the Assessing Officer and in the absence of any reference to Pen Drive in the notes and order sheet of the JCIT, the approving authority. Moreover, it is claimed by Revenue that all relevant records/materials were sent to the Addl. CIT/JCIT along with editable soft copies of the draft assessment order together with letter dated 18/07/2017, but there is no mention of “all relevant records/materials” in the letter dated 18/07/2017. Also, as mentioned earlier, there is no description of the contents of the Pen Drive in letter dated 18/07/2017. Besides, we are perplexed at hand written mention of the Pen Drive in the letter. Who writes Pen Drive as “Pen Drib”?. Who writes 1 Piece as “1 pees”? We are not convinced that a Pen Drive was sent with the letter dated 18/07/2017 by the Assessing Officer to the Addl. CIT/JCIT. Notwithstanding, the claim of Revenue that all relevant records/materials; which should consist of assessment records, seized materials, digital data in CPU, HDD and laptop, reports under Rules 9 and 9A of ITSC(P) Rules, assessees’ submissions etc; were available to the JCIT who gave approval u/s 153D of the IT Act in either physical form of digital form, is not borne out from records. Even if it was available, there is nothing on record to show that indeed the JCIT considered all relevant materials before giving approval u/s 153D of the IT Act. Further, having regard to submissions made by learned Counsel for the assessee, as referred to in foregoing paragraphs (F.1.1), (F.1.4, (F.1.4.1), (F.1.5) (I) (I.1) and (I.2) of this order; it is concluded that approval was granted by JCIT in a mechanical way without due application of mind, as an idle formality, and in the manner of rubber stamping; as it was humanly impossible for the JCIT to give approval in a total of 63 assessments; vide aforesaid common approval letter dated 31/07/2017; after due consideration of all relevant materials such as seized materials, , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 181 appraisal report, digital data, submissions of the assessees, assessment records, reports under Rules 9 and 9A of ITSC(P) Rules, etc; within extremely limited time available to the JCIT. Further, the assessment order is dated 31/07/2017 but there is no mention of return of the assessment record from Varanasi (where JCIT was stationed) to Allahabad (where Assessing Officer was stationed) in any official communication between the two of them; which shows that the assessment records always remained with the Assessing Officer; and the JCIT did not even refer to the assessment records before granting approval u/s 153D of the IT Act. The doctrine of human probabilities in orders of Hon'ble Supreme Court in Durga Prasad More 82 ITR 540 (SC) and Sumati Dayal 214 ITR 801 (SC) operates against Revenue, in the facts and circumstances of the present case.

(C.2.1) As the facts of the present appeals before us are identical to the facts of aforesaid order dated 30/09/2025 in the case of Minto Developers Pvt. Ltd. (supra) to such an extent that approval under section 153D of the Act have been given by the same common approval letter dated 31/07/2017; and as our order in the case of Minto Developers Pvt. Ltd. has been passed after detailed discussion of submissions made by the two sides, careful perusal of materials on record and due consideration of precedents, we are inclined to conclude in the present appeals also that approval given under section 153D of the Act suffered from multiple infirmities because of which approval given under section 153D of the I.T. Act was rendered; and we are further inclined to annul the assessment orders pertaining to the present appeals, also in the like manner. However, we would also like to add further, having regard to materials and submissions brought for our consideration by learned Departmental Representatives at the time of hearing of these appeals. Firstly, we observe that the learned Departmental Representatives wrongly contended at the time of hearing that in the case of order passed by us in Minto Developers Pvt. Ltd. (supra) there was no mention anywhere that approvals were given by JCIT in a mechanical way without due application of mind. We note that in paragraph (L.1) our order in the case of Minto Developers Pvt. Ltd., already reproduced earlier in , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 184 paragraph (B.2.1) of this order; we have categorically concluded that approval was granted by JCIT in a mechanical way without due application of mind as an idle formality and in a manner of rubber stamping. Further, it has been wrongly submitted by learned Departmental Representatives at the time of hearing, that order in the case of Minto Developers Pvt. Ltd. (supra) did not take into consideration the fact that JCIT had given certain directions regarding the first draft of the assessment order submitted alongwith the letter dated 18/07/2017; and that the final drafts, which were approved by JCIT vide aforesaid common approval letter dated 31/07/2017 were slightly different from earlier drafts in some cases. We find that in paragraph (H) of our order in the case of Minto Developers Pvt. Ltd., we have duly taken into consideration the submissions of the learned Departmental Representatives that there was a discussion between the JCIT and the Assessing Officer on 25/07/2017 that after that discussion the JCIT gave certain directions to the Assessing Officer and that the Assessing Officer forwarded the second draft assessment order along with the letter dated 28/07/2017. Moreover, we are disturbed by the contention of the learned Departmental Representatives that the Assessing Officer and the JCIT giving approval under section 153D of the Act were not required to peruse all the materials found/seized at the time of search under section 132 of the Act. The learned Departmental Representatives have contended that it was sufficient for the Assessing Officer and the JCIT to start their work with appraisal report (prepared by Investigation Wing of the Income Tax Department) as the basis. It amounts to admission that neither the Assessing Officer nor the JCIT applied their minds to materials found/seized in the course of search under section 132 of the Act and they were relying on appraisal of these materials by the Investigation Wing. This is tantamount to accepting that there was non application of mind by not only the JCIT giving approval under section 153D of the Act but also by the , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 185 Assessing Officer; to material facts of the case; that they relied on borrowed appraisal of material facts as prepared by Investigation Wing. On this basis alone, the assessment orders deserve to be annulled.

(C.4) The learned Departmental Representatives have also strongly contended that there was prior discussion between the Assessing Officer and the JCIT because of which it cannot be said that JCIT gave approval under section 153D of the Act without due application of mind. In our order in the case of Minto Developers Pvt. Ltd., we have discussed how , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 186 consultation, between the JCIT and Assessing Officer prior to approval under section 153D of the Act was not only irrelevant for deciding whether the approval was valid; but also was fatal to the assessment order itself due to interference of JCIT during pendency of assessment proceedings before the Assessing Officer. The relevant discussion is in paragraph (K) of our order in the case of Minto Developers Pvt. Ltd. In this regard, we would like to add further that the meaning of approval was explained by Hon'ble Supreme Court in the case of Lord Krishna Textiles Ltd. vs. Its Workmen [1961] 1 LLJ 211 (SC). The Hon'ble Supreme Court noted that approval, according to dictionary meaning, suggests that what has to be approved has already taken place; it is in the nature of ratification of what has already taken place. The word ‘approval’ in contradiction to the ‘prior permission’ shows that the action is taken first and ‘approval’ is to be obtained afterwards. It would logically imply that any role of JCIT in his association with the Assessing Officer, is de hors, his role and association as an approving authority under section 153D of the IT Act. His role prior to that of approval u/s 153D of the Act is that of general supervision of Assessing Officer; and it precludes interference in process of assessment. His legitimate role in the assessment is only as approving authority which begins only after the final draft of assessment order (eventually approved) is received at his end. Moreover, Hon'ble Punjab & Haryana High Court in a recent case reported at Findoc Finvest (P.) Ltd. vs. DCIT [2025] 172 taxmann.com 773 (Punjab & Haryana), held that where Assessing Officer was influenced by consultation and discussion with superior officer, assessment order could not be result of an independent application of mind but an order passed under influence and directions of superior officer. The assessment order was to be set aside. We also take guidance from case of DCIT vs. Surendra Kumar Jain (dead) through legal heir (neutral citation 2024: CGHC:25811-DB) in of 2005, vide order delivered on , 114, 115 & 129/Alld/2025 Assessment Years:2011-12 to 13-14 187 18/07/2024 in which Hon'ble Chhatisgarh High Court, after detailed discussion of numerous orders of Hon'ble Supreme Court and Hon'ble High Courts, upheld the quashing of assessment order by ITAT, and held that (i) In democracy like ours, every authority may, however high, should function within four corners of law because the rule of law requires that all the machinery of state must function according to mandate of statute (ii) Statutory authority cannot permit its decision to be influenced by dictation of superior as same would amount to surrendering of discretion (iii) General power of superintendence must be distinguished from the interference in the adjudication process (iv) The true test of bias is not whether the judge is actually biased or not, but whether there is a real danger of bias from view point of fair minded and informed observer.

JYOTI MEDISERVICES PRIVATE LIMITED,ALLAHABAD vs. DCIT, CENTRAL CIRCLE, ALLAHABAD, ALLAHABAD