Brij Kishore Sabharwal Vs ACIT (ITAT Delhi)
Section 153D Approval Must Be Year-Specific & Assessee-Specific – Common Approval Held Void, Entire Block Scrapped; Section 153D Approval Must Be Independent for Each Year – Mechanical Approval Vitiates Assessment; “Rubber-Stamped” 153D Sanction Invalid – ITAT Strikes Down Four Years’ Assessments; ITAT: One Approval Can’t Cover All – Common 153D Nod for Two Assessees Declared Illegal; Jurisdictional Safeguard Ignored – Common 153D Approval Quashed by ITAT Delhi
A search u/s 132 was conducted in the case of Pankaj Kumar Group, during which certain documents were found allegedly showing Assessee’s involvement in providing bogus LTCG entries. Based on this, satisfaction was recorded u/s 153C & assessments were completed u/s 153C/143(3) for AYs 2013-14 to 2016-17, making additions. Assessee challenged the assessments on the legal ground that the approval u/s 153D was mechanical, perfunctory & without application of mind, thereby rendering the entire proceedings invalid.
It was shown that a single approval letter dated 29.12.2018 was issued by the Additional CIT, Central Range-4, New Delhi, granting a common approval for 14 assessment years relating to two different assessees, without any reference to seized materials or draft orders examined. Assessee relied on Delhi High Court judgment in PCIT vs Shiv Kumar Nayyar (163 taxmann.com 9), Allahabad High Court in PCIT vs Sapna Gupta, Orissa High Court in ACIT vs Serajuddin & Co., & PCIT vs Anuj Bansal, all holding that approval u/s 153D must be year-wise & assessee-wise, reflecting independent application of mind. The Department argued that the approval was validly granted after examining the draft assessment orders.
