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Income Tax Appellate Tribunal, PUNE “B” BENCH : PUNE
Before: SHRI RAMA KANTA PANDA & SHRI SATBEER SINGH GODARA
2 IT(SS)A.Nos.21 to 26/PUN./2021; ITA.No.60/PUN./2022 And IT(SS)A.Nos.03 to 09/PUN./2022 each, arise against the respective order(s) of the learned CIT(A), Pune-12, Pune as tabulated in the above cause title with all the relevant details.
Heard both the parties. Case files perused.
2. Both the sides are indeed ad-idem during the course of hearing that all these cases involve sec.153A assessment(s) framed by the department in furtherance to it’s sec.132 search action dated 27.09.2013 in assessee’s and related parties.
Learned counsel submits in this factual backdrop that the assessee’s first and foremost plea challenges validity of sec.153D approval(s) herein going to root of the matter and therefore, the same is taken-up for adjudication being a fundamental issue.
3. Learned CIT-DR submits that the department has filed it’s paper book/written submissions wherein we find at page-62 that the learned JCIT, Central Range, herein had granted only a conditional approval dated 18.03.2016 to the Assessing Officer as under :
“Sub: Approval of draft orders in the case of Shri Santosh 5 Mukta, PAN AJRPM7166R for the Assessment Years 2008-09 to 2014-15-regarding Ref: Your letter dated 17.02.16 -------- Please refer to the above.
3 IT(SS)A.Nos.21 to 26/PUN./2021; ITA.No.60/PUN./2022 And IT(SS)A.Nos.03 to 09/PUN./2022
Approval u/s 153D of the LT. Act, is granted subject
to the compliance of following – a) The order sheet is to be completed properly. b) All submissions made by the assessee are to be placed in the respective folders for the respective assessment years. c) A detailed office note shall be written elaborating the sues raised in the appraisal report, the additions proposed in the appraisal report, the verifications carried out on the issue and the final finding if the AO has decided not to make additions on that issue. d) If the A.O. has made references on any issue in accordance with the instructions of the CBDT issued from F.No.256/161/2006/IT Inv.II) dated 22.12.2006.
The replies received should be kept on record. A noting on all such issues should be made in the office note. e) All the office notes (not for assessee) along with the copies of the final assessment orders issued be forwarded to the office for records. f) All references contemplated u/s.153C of the L. T. Act promptly be forwarded to the Assessing Officer having jurisdiction over such other person along with the 4 IT(SS)A.Nos.21 to 26/PUN./2021; ITA.No.60/PUN./2022 And IT(SS)A.Nos.03 to 09/PUN./2022 respective books of accounts, documents or assets seized or requisitioned under intimation to this office. g) Wherever, penalty proceedings u/s.271(1)(c) ate initiated, proper explanation below that section shall be invoked. In case penalties initiated u/s.271AAA, the same should be invoked under the respective issue itself as well as at the bottom of the order. h) The Computation interest u/s 234A, 234B, 234C will be a part of the assessment order itself. i) Wherever, the A.O. found the provisions of the section 269SS/269T are violated, separate proposal for initiation of penalty proceedings u/s.271D/271E should be submitted. j) Wherever, necessary, A.O. should forward third party information to the A.O. of such party.
The orders along with the demand notice and penalty notices may be served on the assessee before the last date prescribed for completion of assessment and acknowledgement to that effect shall be kept on record.”
The Revenue could hardly rebut the clinching fact that not only the above extracted approval is a “conditional” one in nature u/sec.153D of the Act, but also it is found to be a common one for all the impugned assessment years from 2008-2009 to 2014-2015 (supra). That being the clinching
5 IT(SS)A.Nos.21 to 26/PUN./2021; ITA.No.60/PUN./2022 And IT(SS)A.Nos.03 to 09/PUN./2022 fact, we quote case law Pr. CIT vs. Sapna Gupta [2023] 147 taxmann.com 288 (All.); PCIT vs. Siddharth Gupta [2023] 450 ITR 534 (All.) and PCIT vs. Shiv Kumar Nayyar [2024] 163 taxmann.com 9 (Del.) that such a sec.153D approval has to be granted on standalone basis after perusing the entire records for each assessment year instead of treating it as a mere mechanical exercise. This tribunal’s recent coordinate bench’s order in SMW Ispat (P.) Ltd., vs. ACIT [2014] 112 ITR (Trib.)
224 (Pune) has rejected the Revenue’s arguments whilst concluding that a conditional approval than an absolute one is not sustainable in law and therefore, the corresponding assessment(s) framed u/sec.153A of the Act is null and void as under :
6 IT(SS)A.Nos.21 to 26/PUN./2021; ITA.No.60/PUN./2022 And IT(SS)A.Nos.03 to 09/PUN./2022
7 IT(SS)A.Nos.21 to 26/PUN./2021; ITA.No.60/PUN./2022 And IT(SS)A.Nos.03 to 09/PUN./2022
8 IT(SS)A.Nos.21 to 26/PUN./2021; ITA.No.60/PUN./2022 And IT(SS)A.Nos.03 to 09/PUN./2022
9 IT(SS)A.Nos.21 to 26/PUN./2021; ITA.No.60/PUN./2022 And IT(SS)A.Nos.03 to 09/PUN./2022 4.1. It lastly emerges that case law ACIT vs. Serajuddin & Co. [2023] 454 ITR 312 (Orissa) has further settled the issue in assessee’s favour and against the department that an assessment framed post-facto sec.153D invalid approval deserves to be quashed only. We accordingly hold in light of all the foregoing facts as well as various judicial precedents that all the impugned sec.153A assessments herein, all dated 22.03.2016, are not sustainable in law and therefore, the same stand quashed in very terms since not framed after a valid approval u/sec.153D of the Act. Ordered accordingly.
All other pleadings on merits stand rendered academic in these cases.
These instant twin assessee’s all cases; except ITA.No.60/PUN./2021 are accepted in very terms. This remaining appeal [ITA.No.60/PUN./2021] involving sec.271 penalty proceedings also follows the suit as this penal action has no legs to stand to anymore as we have quashed the quantum assessment itself. Ordered accordingly.
To sum-up, these twin assessee’s seven appeals each i.e., I.T.(S.S)A. Nos.21, 22, 23, 24, 25, 26/PUN./2021 and ITA.No.60/PUN./2022; I.T.(S.S.)A.Nos.03 to 09/PUN./2022 are allowed in above terms. A copy of this common order be placed in the respective case files.
10 IT(SS)A.Nos.21 to 26/PUN./2021; ITA.No.60/PUN./2022 And IT(SS)A.Nos.03 to 09/PUN./2022 Order pronounced in the open Court on 25.09.2024.