Mahagun India Pvt. Ltd. Vs ACIT (ITAT Delhi)
ITAT Delhi Quashes Assessments in Mahagun Group – Mechanical Approval u/s 153D Held Invalid Delhi Tribunal annulled assessments framed u/s 153A/143(3) on the ground that the mandatory approval u/s 153D was granted in a mechanical manner, without application of mind.
Assessee raised additional grounds challenging the validity of approval u/s 153D. It was pointed out that a common consolidated approval was given by Addl. CIT, Delhi for multiple assessment years vide letter dated 10.08.2011, without reference to seized material, nature of additions, or even the special audit conducted u/s 142(2A). It was argued that such approval was merely a ritualistic formality & not a conscious exercise of quasi-judicial power.
Tribunal noted that authorities under the Act exercise quasi-judicial functions & orders of approval must reflect due application of mind. In this case, the approval letter was a stereotyped response to AO’s request, with no indication of examination of assessment records or seized material. Relying on Delhi High Court rulings in PCIT Vs Shiv Kumar Nayyar [2024 (6) TMI 29], Anuj Bansal [2023], Allahabad HC in Sapna Gupta & Subodh Agarwal, Orissa HC in Serajjudin & Co. [SCC OnLine Ori 992, approved by SC 28.11.2023], & coordinate bench rulings in Skylark Hatcheries Pvt. Ltd. (2025) & Sant Lal Aggarwal (2025), ITAT held that consolidated or blanket approvals covering multiple years & multiple assessees are invalid.
