“mechanical approval”

ReassessmentSection 151Section 1511,395 judgments

The decision most relied on for mechanical approval is PCIT v. Shiv Kumar Nayyar (163 Taxmann.com 9), cited in 597 judgments on BharatTax.

Leading authorities on mechanical approval

PCIT v. Shiv Kumar Nayyar

163 Taxmann.com 9 · 2024 · High Court

597

citing judgments

Approval under Section 153D for search assessments is invalid if granted mechanically, hastily, or without due application of mind, such as on the same day as the proposal or in a bunched manner. Such an invalid approval renders the consequential assessment order under Section 153A void ab initio.

CIT v. S. Goyanka Lime & Chemical Ltd.

64 Taxmann.com 313 · 2015 · Supreme Court

340

citing judgments

A mechanical approval by the prescribed authority under Section 151, made without independent application of mind, vitiates and renders the entire reassessment proceedings invalid. Such approvals, often indicated by brief, unreasoned endorsements, lead to the quashing of the reopening of assessment.

ACIT v. Sirajuddin& Co.

150 Taxmann.com 146 · 2023 · High Court

288

citing judgments

An approval under Section 153D of the Income Tax Act must demonstrate that the approving authority applied its mind to the draft assessment order, and a perfunctory or mechanical approval invalidates subsequent adjustments.

Shreelekha Damani v. DCIT

173 TTJ 332 · 2015 · ITAT

236

citing judgments

Approval granted by a superior authority under Section 153D in a mechanical or perfunctory manner, without proper application of mind, lacks legal sanctity and renders the subsequent assessment order null and void.

Principal Commissioner of Income-tax v. Subodh Agarwal

149 Taxmann.com 373 · 2023 · High Court

194

citing judgments

Approval of draft assessment orders under Section 153D must be granted with due application of mind, not mechanically. Approving multiple cases, such as 38 in a single day, without proper scrutiny amounts to mechanical approval, rendering the assessment invalid.

Madhya Pradesh in CIT v. S. Goyanka Lime & Chemicals Ltd.

56 Taxmann.com 390 · 2015 · High Court

188

citing judgments

A sanction for issuing a notice under section 148 is invalid if the sanctioning authority grants approval mechanically, merely recording 'Yes, I am satisfied' without proper application of mind to the reasons for reassessment. The authority must demonstrate proper consideration to fulfill the statutory obligation under section 151.

PCIT v. Anuj Bansal

165 Taxmann.com 2 · 2024 · High Court

181

citing judgments

An approval under Section 153D of the Income Tax Act, 1961, is considered mechanical and invalid if granted without application of mind and without perusing relevant assessment records, including seized material. This principle has been affirmed by multiple High Courts and the Supreme Court.

Vijayadevi Naval Kishore Bharatia v. Land Acquisition Officer

5 SCC 83 · 2003 · Supreme Court

167

citing judgments

Statutory approvals required under the Income Tax Act, particularly for assessments, must reflect a genuine application of mind by the approving authority and cannot be mechanical or granted without due consideration.

Judgments citing mechanical approval

Vijayshree Food Products P.Ltd, New Delhi vs. ACIT, Central Circle-30, New Delhi

In the result, both these appeals are partly allowed

ITA 587/DEL/2019[2014-15]Status: DisposedITAT Delhi06 Dec 2021AY 2014-15

Bench: Shri R.K. Panda & Ms Suchitra Kambleassessment Year: 2014-15 Vijayshree Food Products P. Ltd., Vs. Acit, C/O Ravi Gupta, Advocate, Central Circle-30, E-6A, Kailash Colony, New Delhi. New Delhi. Pan: Aaccv4721C (Appellant) (Respondent) Assessee By : Shri P.C. Yadav, Advocate Revenue By : Shri Prakash Dubey, Sr.Dr Date Of Hearing : 09.09.2021 Date Of Pronouncement : 06.12.2021 Order Per R.K. Panda, Am: This Appeal Filed By The Assessee Is Directed Against The Order Dated 28Th December, 2018 Of The Cit(A)-30, New Delhi, Relating To Assessment Year 2014-15. 2. Facts Of The Case, In Brief, Are That The Assessee Is A Company Engaged In The Business Of Manufacturing & Export Of Tobacco Products. It Filed Its Return Of Income On 30Th September, 2014 Declaring The Loss Of Rs.18,78,467/-. The Return Was Processed U/S 143(1) Of The Act On 26Th November, 2014 At The Returned Income. Subsequently, The Ao Reopened The Assessment As Per The Provisions Of Section 147 Of The Act By Recording The Following Reasons:-

For Appellant: Shri P.C. Yadav, AdvocateFor Respondent: Shri Prakash Dubey, Sr.DR

Section 131Section 131(1)(d)Section 132Section 132(4)Section 143(1)Section 147Section 148Section 68

then he would have certainly asked the AO to correct the mistakes committed by him in the reasons recorded. For the above proposition of mechanical approval, he relied on the following decisions:- 13 (A) Central India Electric Supply

ACIT, New Delhi vs. M/S. Maharaji Education Trust, Ghaziabad

The appeal are dismissed

ITA 5138/DEL/2016[2007-08]Status: DisposedITAT Delhi13 Oct 2021AY 2007-08

Bench: Shri Kuldip Singh & Shri Prashant Maharishi(Through Video Conferencing)

For Appellant: Shri Suresh Gupta, C. AFor Respondent: Ms. Paramita M. Biswas[CIT]–

Section 11Section 12ASection 132Section 133ASection 143(1)Section 143(2)Section 143(3)Section 68Section 69Section 69C

been held that the reason to belief have to be self-explanatory. 25. He further referred to the fact that there is mechanical approval granted by the CIT as inconsistency and omissions already pointed out. This should have been corrected before the approval was accorded. As they were not corrected

Kapil Mehta, Delhi vs. PCIT(Central)-3, New Delhi

The appeal of the assessee stands dismissed

ITA 533/DEL/2021[2017-18]Status: FixedITAT Delhi11 Oct 2021AY 2017-18

Bench: The Assessing Officer

Section 131Section 132Section 143(3)Section 153ASection 263Section 263(1)

circumstances of the case, the order of the AO was void-ab-initio as the same has been passed in pursuance to a mechanical approval of Add CIT u/s 153D and hence the consequential proceedings would also be a nullity. 4. On the facts and under the circumstances ... fact the draft approvals were sent on the same day when the approval was accorded, would prove beyond doubt that the approval was mechanical approval. 5. On the facts and under the circumstances of the case & having regard to the fact that the approving authority has granted a consolidated approval

Shri Subodh Agarwal, Kanpur vs. Deputy Commissioner of Income Tax, Central Circle- 1, Kanpur

In the result, the appeal of the assessee stands allowed

ITA 674/LKW/2018[2015-16]Status: DisposedITAT Lucknow07 Oct 2021AY 2015-16

Bench: Shri A. D. Jain & Shri T. S. Kapoor

Section 132Section 153ASection 153D

Counsel for the assessee further submitted that all the above facts clearly show that the assessee's cases are prejudiced due to the mechanical approval under section 153D of the Income Tax Act, 1961 granted by the Joint Commissioner of Income Tax (Central Range) Kanpur, that such approval is unsustainable ... supra) has been followed, the I.T.(SS)A. No.674/Lkw/2018 Assessment Year:2015-16 31 Tribunal has held to the effect that granting of a mechanical approval u/s 153D of the Act vitiates the entire proceedings. It is on this basis that the issue was decided in favour of the assessee

Treta E Technologies Company Pvt Ltd, Gurgaon vs. ACIT Circle-25(2), New Delhi

In the result, the appeal is partly allowed for statistical purposes

ITA 9734/DEL/2019[2010-11]Status: DisposedITAT Delhi24 Sept 2021AY 2010-11

Bench: Shri R.K. Panda & Shri Vijay Pal Raoआ.अ.सं/.I.T.A No.9734/Del/2019 िनधा"रणवष"/Assessment Year:2010-11 बनाम Treta E Technologies Company Pvt. Ltd. Acit Ca M.R. Sahu, M Sahu & Associates, Ca Vs. Circle 25(2) H.No. 651, Ff, Sector-10A, Room No. 196A, Near Meenakshi Public School, C.R. Building, Gurgaon, Haryana. New Delhi. Pan No. Aadct1733B अपीलाथ" Appellant ""यथ"/Respondent

Section 147Section 148Section 151

Supreme Court in the case of CIT Vs. S Goenka Lime & Chemicals Ltd. 62 taxmann.com 313. The second limb of his argument is mechanical approval granted by the CIT(A) without application of mind. In support of his contention he has relied upon the judgment of Hon’ble Madhya Pradesh ... moved through the office of the ACIT and in this process the Addl. CIT has also recorded his satisfaction. As regards the objection of mechanical approval granted by the Pr. CIT the Ld. DR has submitted that the Pr. CIT has duly recorded his satisfaction in clear terms and, therefore

Shri Satya Narayan Bairwa, Jaipur vs. Income Tax Officer, Ward-2(4), Jaipur

In the result, both these appeals of the assessee are allowed

ITA 869/JPR/2018[2009-10]Status: DisposedITAT Jaipur15 Sept 2021AY 2009-10

Bench: Shri Sandeep Gosain, Jm & Shri Vikram Singh Yadav, Am Vk;Dj Vihy La-@Ita No. 867 & 869/Jp/2018 Fu/Kzkj.K O"Kz@Assessment Years :2008-09 & 2009-10 Cuke Shri Satya Narayan Bairwa, I.T.O., Vs. 97/77, Shipra Path, Ward-2(4), Mansarovar, Jaipur (Raj). Jaipur. Lfkk;H Ys[Kk La-@Thvkbzvkj La-@Pan/Gir No.: Ahppb 0077 J Vihykfkhz@Appellant Izr;Fkhz@Respondent Fu/Kzkfjrh Dh Vksj Ls@ Assessee By : Shri Shravan Kumar Gupta (Adv.) Jktlo Dh Vksj Ls@ Revenue By : Smt. Runi Pal (Addl.Cit) Lquokbz Dh Rkjh[K@ Date Of Hearing : 20/07/2021 Mn?Kks"K.Kk Dh Rkjh[K@ Date Of Pronouncement : 15/09/2021 Vkns'K@ Order

For Appellant: Shri Shravan Kumar Gupta (Adv.)For Respondent: Smt. Runi Pal (Addl.CIT)

Section 147Section 151Section 234ASection 69A

wherein, AO’s action was accepted—Assessee contended that AO had erred in assumption of jurisdiction u/s 147/148 based on invalid and mechanical approval granted by Addl. CIT—Held, approval granted by Addl. CIT was a mechanical and without application of mind, which was not valid for initiating re-assessment

Shri Satya Narayan Bairwa, Jaipur vs. Income Tax Officer, Ward-2(4), Jaipur

In the result, both these appeals of the assessee are allowed

ITA 867/JPR/2018[2008-09]Status: DisposedITAT Jaipur15 Sept 2021AY 2008-09

For Appellant: Shri Shravan Kumar Gupta (Adv.)For Respondent: Smt. Runi Pal (Addl.CIT)

Section 147Section 151Section 234ASection 69A

Rajan Diwan, New Delhi vs. ITO Ward - 35(2), New Delhi

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 339/DEL/2020[2011-12]Status: DisposedITAT Delhi09 Sept 2021AY 2011-12

Bench: Shri R.K. Pandaassessment Year: 2011-12 Rajan Diwan, Vs. Ito, 8/4, Roop Nagar, Ward-35(2), New Delhi. New Delhi. Pan: Agjpd8675P (Appellant) (Respondent) Assessee By : Shri Suresh K. Gupta, Ca Revenue By : Shri R.K. Gupta, Sr. Dr Date Of Hearing : 02.08.2021 Date Of Pronouncement : 09.09.2021 Order

For Appellant: Shri Suresh K. Gupta, CAFor Respondent: Shri R.K. Gupta, Sr. DR

Section 133(6)Section 142(1)Section 143(2)Section 144Section 147Section 148Section 151Section 68

reassessment proceedings ignoring the fact that the sanction u/s 151 of IT Act shows mechanical satisfaction by the Pr CIT, New Delhi and such mechanical approval vitiates the reassessment proceedings. 5. The assessing officer has erred both in law and in facts of the case in making addition/s

Shri Madal Lal, Jalandhar vs. Deputy Commissioner of Income Tax, Central Circle-1, Jalandhar

In the result, all the appeals of the Assessee are allowed

ITA 112/ASR/2018[2007-08]Status: DisposedITAT Amritsar16 Aug 2021AY 2007-08

Bench: : Shri Laliet Kumar & Dr. Mitha Lal Meena

Section 153B(1)Section 153D

letter and remand report submitted by the AO before CIT(A). On the basis of the above it was submitted that the approval being mechanical approval , without ITA Nos. 112 to 118/Asr/2018 17 application of mind therefore it was not an approval in the eyes of law, hence the assessment

R.N. Khemka Enterprises (P) Ltd., Delhi vs. ITO Ward- 20(3), New Delhi

In the result, the appeal filed by the assessee is

ITA 7244/DEL/2019[2011-12]Status: DisposedITAT Delhi12 Aug 2021AY 2011-12

Bench: Shri R.K. Panda & Ms. Suchitra Kamble[Assessment Year: 2011-12]

Section 131Section 139Section 142(1)Section 143(1)Section 143(2)Section 147Section 148Section 68

learned counsel for the assessee also challenged the validity of reassessment proceedings on account of error in quantification of income escaping assessment and mechanically approved by the Pr. CIT by simply stating “Yes, it is a fit case of issue of notice u/s 148 r.w.s ... Referring to various decisions, he submitted that such error in quantification of income escaping assessment and mechanical approval by the Pr. CIT makes such reassessment a nullity. 19. So far as, the merits of the case is concerned, the learned counsel for the assessee submitted that to prove the identity

Sjm International Ltd., New Delhi vs. DCIT, Circle- 24(20, New Delhi

ITA 3762/DEL/2018[2009-10]Status: DisposedITAT Delhi09 Aug 2021AY 2009-10

Bench: Shri Anil Chaturvedi & Shri Kuldip Singh

For Appellant: Shri P.C. Yadav, AdvocateFor Respondent: Shri Prakash Dubey, Senior DR

Section 131Section 139(1)Section 143Section 143(3)Section 147Section 148Section 151Section 234BSection 68

material facts fully and truly during the assessment proceedings; that the ld. CIT (A) has also not applied his independent mind rather accorded mechanical approval; that reopening in this case amounts to “change of opinion” and relied upon the decisions rendered by Hon’ble Supreme Court, Hon’ble High Courts ... grant of approval, the approval would not have been granted. In these circumstances, we are of the considered view that mechanical approval granted by the CIT makes the entire assessment proceedings nullity. 16. As discussed in the preceding paras, the issue in question that assessee company has received accommodation entry

Sh.Baljit Singh Bachal, Ambala vs. ITO, W-1, Amabal

In the result, the appeal filed by the assessee is allowed

ITA 12/CHANDI/2020[2012-13]Status: DisposedITAT Chandigarh30 Jul 2021AY 2012-13

Bench: Shri N.K. Saini & Shri R.L Negiआयकरअपीलसं./Ita No.12/Chd/2020 "नधा"रणवष" / Assessment Year :2012-13 Sh. Baljit Singh Bachal, बनाम The Ito, Vpo-Panjokhera Sahib, Ward-1, Ambala 134011 Ambala "थायीलेखासं./Pan No: Banpb3278H अपीलाथ"/Appellant ""यथ"/Respondent Hearing Through Video Conferencing "नधा"रतीक"ओरसे/Assessee By : Sh. Sudhir Sehgal, Advocate राज"वक"ओरसे/ Revenue By : Smt. Meenahkshi Vohra, Addl. Cit सुनवाईक"तार"ख/Date Of Hearing : 04.05.2021 उदघोषणाक"तार"ख/Date Of Pronouncement : 30. 07.2021 आदेश/Order Perr.L. Negi:

For Appellant: Sh. Sudhir Sehgal, AdvocateFor Respondent: Smt. Meenahkshi Vohra, Addl. CIT

Section 142(1)Section 143(2)Section 144Section 147Section 148

income of the assessee has escaped assessment. 2. That no proper service of the notice U/s 148 had been made and also there is mechanical approval by the higher authorities with regard to reopening the case u/s 147and, thus, there being no application of mind, the reopening

Shri Nachhater Singh S/O Shri Gurbaksh Singh, Bathinda vs. Income Tax Officeer, Bathinda

In the result all the appeals of the assessee are allowed for statistical purposes

ITA 164/ASR/2019[2010-11]Status: DisposedITAT Amritsar20 Jul 2021AY 2010-11

Bench: Sh. Laliet Kumar & Dr. M. L. Meena

Section 148Section 151Section 546Section 54B

said satisfaction as recorded by the Ld. PCIT, it is absolutely clear that, he has not applied his mind and has only given a ‘mechanical approval’, which is not permitted as per law and this is further evident from the copy placed at pages 11 to 13 of Paper Book ... followed by the different Benches of the ITATs and High Courts and though, the gist of the cases on the above said issues of ‘mechanical approval’ have been enclosed in the paper book at pages 43 to 47, where the judgment of Hon’ble Apex Court in the case

Shri Babbu Singh S/O Shri Nachhater Singh, Bathinda vs. Income Tax Officeer Ward-2(1), Bathinda

In the result all the appeals of the assessee are allowed for statistical purposes

ITA 163/ASR/2019[2010-11]Status: DisposedITAT Amritsar20 Jul 2021AY 2010-11

Bench: Sh. Laliet Kumar & Dr. M. L. Meena

Section 148Section 151Section 546Section 54B

Shri.Boota Singh S/O. Sh. Nachater Singh, Bathinda vs. Income Tax Officer Ward-2(1), Bathinda

In the result all the appeals of the assessee are allowed for statistical purposes

ITA 162/ASR/2019[2010-11]Status: DisposedITAT Amritsar20 Jul 2021AY 2010-11

Bench: Sh. Laliet Kumar & Dr. M. L. Meena

Section 148Section 151Section 546Section 54B

M/S. United Engineers, Rajkot vs. The Deputy Commissioner of Income Tax, Central Circle, Rajkot

In the result, the above appeals of the assessee are partly allowed

ITA 305/RJT/2018[2012-13]Status: DisposedITAT Rajkot08 Jul 2021AY 2012-13

Bench: Shri Mahavir Prasad & Shri Waseem Ahmed

For Appellant: Shri P.C. Yadav, with Shri Dinesh Ruprelia, A.RsFor Respondent: Shri Om Prakash Singh, CIT, D.R

Section 153DSection 254Section 271(1)(C)Section 271(1)(c)Section 274

pursuance to an order of assessment, dated 27.12.2016, which itself was a nullity, as the approval granted u/s 153D of the Act is mechanical approval. b) On the facts and under the circumstances of the case the penalty levied under section 271(1)(C) of the Act is void

Shri Narotam Singh, Mansa vs. Income Tax Officer Ward -1(4), Mansa

In the result, both the appeals of the assessees are allowed

ITA 307/ASR/2019[2012-13]Status: DisposedITAT Amritsar30 Jun 2021AY 2012-13

For Appellant: Shri Tejmohan Singh, AdvocateFor Respondent: K.S. Bains, CIT DR

Section 143(3)Section 147Section 148Section 151Section 45(3)

Court in the aforesaid referred to case, are of the view that the reopening under section 148 of the Act on the basis of mechanical approval without applying the mind by the Ld. Pr.CIT was not valid. Therefore, in the present case, the reopening of the assessment on the basis ... reopened the assessment under section 147 of the Act by issuing the notice under section 148 of the Act, on the basis of mechanical approval, without applying his mind, therefore the said approval was not valid and consequently the reopening of the assessment on the basis of said approval

Shri Tarlochan Singh, Mansa vs. Income Tax Officer Ward-1(4), Mansa

In the result, both the appeals of the assessees are allowed

ITA 306/ASR/2019[2012-13]Status: DisposedITAT Amritsar30 Jun 2021AY 2012-13

For Appellant: Shri Tejmohan Singh, AdvocateFor Respondent: K.S. Bains, CIT DR

Section 143(3)Section 147Section 148Section 151Section 45(3)

Shri Satnam Singh, Jalandhar vs. Income Tax Officer Ward - 1 (4), Jalandhar

In the result, appeal of the assessee is allowed

ITA 579/ASR/2019[2013-14]Status: DisposedITAT Amritsar29 Jun 2021AY 2013-14

For Appellant: Shri Ashray Sarna, C.AFor Respondent: Shri G.S. Bali, D.R

Section 143(3)Section 147Section 151

recorded by the Ld. JCIT while granting the approval to the A.O. for reopening of the assessment, therefore on the basis of the mechanical approval the reopening by the A.O. under section 147 of the Act was not valid approval. The reliance was placed on the decision of the ITAT ... Court in the aforesaid referred to case, are of the view that the reopening under section 148 of the Act on the basis of mechanical approval without applying the mind by the Ld. Pr.CIT was not valid. Therefore, in the present case, the reopening of the assessment on the basis

Sh. Jeet Singh, Gurgaon vs. ITO, Gurgaon

In the result, appeal of the Assessee allowed

ITA 3068/DEL/2017[2008-09]Status: DisposedITAT Delhi24 Jun 2021AY 2008-09

Bench: Shri R.K. Panda & Shri Sudhanshu Srivastava

For Appellant: Shri Mahavir Singh, C.AFor Respondent: Ms. Anima, Sr. D.R

Section 147Section 148

legal ground, the other grounds challenging the addition on merits and the additional grounds challenging validity of the re- assessment proceedings on account of mechanical approval, borrowed satisfaction etc., become academic in nature and, therefore, are not being adjudicated. 8. In the result, appeal of the Assessee allowed. Order pronounced