Satish Kumar Pawa Vs ACIT (ITAT Delhi)
ITAT Delhi Quashes Mechanical 153D Approvals – Common Sanction for Multiple Assessees Held Void- Rule 27 Invoked Successfully – Tribunal Allows Assessees to Raise Jurisdictional Plea
ITAT Delhi has held that consolidated approval u/s 153D granted for multiple assessees & years through a single letter was mechanical & invalid. Consequently, the assessments framed pursuant to such approval were quashed, & penalty appeals under section 271(1)(c) also stood deleted.
Assessees invoked Rule 27 of ITAT Rules to raise an additional legal ground that approval u/s 153D was mechanical. Revenue objected that such a ground could not be raised at this stage. The Tribunal, however, relied on Delhi High Court ruling in Sanjay Sawhney Vs. PCIT [116 taxmann.com 701] & earlier coordinate bench rulings, & admitted the legal ground, holding that Rule 27 permits respondents to challenge jurisdictional issues even if not raised before CIT(A).
On merits, ITAT noted that approval letter dated 28.03.2013 (No.153D/CC-09/Jagat Group/2012-13/996) covered multiple assessees of Jagat Group for several years in one consolidated sanction. Relying on precedents including PCIT Vs. Shiv Kumar Nayyar [163 taxmann.com 9 (Del HC)], PCIT Vs. Sapna Gupta [147 taxmann.com 288 (All HC)], PCIT Vs. Sidharath Gupta [147 taxmann.com 305 (All HC)], & ACIT Vs. Serajuddin & Co. [150 taxmann.com 146 (Ori HC), affirmed by SC], the Tribunal held that section 153D requires separate approval for each assessee & each year with independent application of mind. Grant of a common approval for dozens of cases in one day was clearly mechanical, rendering assessments void.
