Case Law Details
ABC Sales Corporation Vs ITO (ITAT Cochin)
ITAT Cochin held that treating section 153D of the Income Tax Act as pari-materia to section 148 mechanism without any such indication in the Act is unjustified and hence matter remanded back to CIT(A).
Facts- Apart from various other issues; the assessee had argued in the lower appellate proceedings that the impugned assessment had not been framed in due compliance to sec.153D of the Act requiring the Assessing Officer to obtain the statutory approval from the prescribed authority(ies).
Conclusion- Held that we find there is not even an indication as to how and in what manner, the prescribed authority had applied his mind since it has treated sec.153D as pari-materia to sec.148 mechanism without any such indication in the Act. We accordingly deem it appropriate in these facts and circumstances and in larger interest of justice that the instant fundamental issue; along with all other substantive grounds herein, deserves to be adjudicated by the learned CIT(A) as per law.
Held that we are informed that all these cases arise from the department’s sec.132 search action in M/s. ABC group of concerns carried-out on 17.02.2020 wherein various inter-connected issues are raised at these assessees’ behest. We thus deem it appropriate for the sake of brevity that all these other appeals raising inter-connected issues, and more particularly, those involving sec.153A and 153C assessments, need to be re-adjudicated by the learned CIT(A) without getting influenced by his earlier lower findings.
FULL TEXT OF THE ORDER OF ITAT COCHIN
The instant batch of 49 appeals along with as many as corresponding 47 stay applications therein; pertains to nine assessees herein namely ABC Sales Corporation; ABC Buildware India (P) Ld.,; Kakkottakath Naduvilapurayil Junaid-ABC Sales Corporation; Shri K. Abdul Vaheed-ABC Sales Corporation; Ruchit Parimal Ashar, Gujarat, Shri Keeran Muhammed Basheer-ABC Buildware India Private Limited; Shri Abdul Gafoor Muhammed; Shri Muhammed Jabir-ABC Sales Corporation and Shri Kodiyal Muhammed Madani, Partner-ABC Sales Corporation. All other relevant details already stand tabulated hereinabove.
Cases called twice. None appears at the assessees’ behest. They are therefore, proceeded ex-parte.
2. It prima facie emerges during the course of hearing with the able assistance coming from the Revenue represented by the learned CIT-DR that although the CIT(A) herein has indeed passed a very detailed order running into 56 pages in ITA.No.441/COCH./2024 [treated as the “lead” appeal]; the fact remains that some of the fundamental issues raised therein have not been decided as contemplated u/sec.250(6) of the Act requiring him to frame points of determination followed by a detailed adjudication.
3. When we invited learned CIT-DR’s attention to the above “lead” appeal; he vehemently argued that the CIT(A) has duly considered the entire factual matrix whilst rejecting the assessee’s corresponding substantive grounds. Faced with this situation, we note that apart from various other issues; the assessee had argued in the lower appellate proceedings that the impugned assessment had not been framed in due compliance to sec.153D of the Act requiring the Assessing Officer to obtain the statutory approval from the prescribed authority(ies). Various recent landmark judicial precedents i.e., PCIT vs. Sapna Gupta [2023] 147 com 288 (Allahabad); ACIT vs. Serazuddin, & Co. 2023-SCC-Online-Ori-992 and PCIT vs. Anju Bansal 2023-SCC-Online-Del-4159 have rejected the Revenue’s identical contentions thereby concluding that such an “approval could not simply be treated as a mechanical one but must contain the due application of mind by the authority concerned.”
4. Learned CIT-DR at this stage takes us to page-43 para- 56 in the lower appellate discussion wherein the CIT(A) appears to have rejected the assessee’s corresponding substantive ground(s). We find there is not even an indication as to how and in what manner, the prescribed authority had applied his mind since it has treated sec.153D as pari-materia to sec.148 mechanism without any such indication in the Act. We accordingly deem it appropriate in these facts and circumstances and in larger interest of justice that the instant fundamental issue; along with all other substantive grounds herein, deserves to be adjudicated by the learned CIT(A) as per law. We wish to emphasize here that once we are setting aside the above fundamental issue(s); all other grounds must also follow the suit so as to avoid multiplicity of proceedings. This assessee’s “lead” appeal ITA.No.441/COCH./2024 is accepted for statistical purposes in above terms.
5. The next equally important question which invites our apt adjudication is the course of action to be adopted for all the remaining appeals. It is at this stage that we are informed that all these cases arise from the department’s sec.132 search action in M/s. ABC group of concerns carried-out on 17.02.2020 wherein various inter-connected issues are raised at these assessees’ behest. We thus deem it appropriate for the sake of brevity that all these other appeals raising inter-connected issues, and more particularly, those involving sec.153A and 153C assessments (supra), need to be re-adjudicated by the learned CIT(A) without getting influenced by his earlier lower findings. It is further clarified that all these assessees’ shall indeed be at liberty to raise all their legal and factual arguments in consequential proceedings which would be dealt with in accordance with law. Ordered accordingly.
7. To sum-up, these nine assessee’s instant forty nine (49) appeals are allowed for statistical purposes in above terms. Their corresponding forty seven (47) stay applications stand rendered infructuous. A copy of this common order be placed in the respective case files.
Order pronounced in the open Court on 23.08.2024.
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