ACIT Vs Vishwambhar Dayal Agarwal (ITAT Agra)
Common 153D Approval = Common Fatality: 98 Approvals in One Day? ITAT Says Mechanical 153D- Agra ITAT Quashes Entire 153C Assessment
Search u/s 132 on Pushpanjali Group (15–17.10.2014) led AO to make additions for alleged unrecorded land advances (Rs. 11.03 cr in Shri V.D. Agarwal, Rs. 15.20 cr in Shri Mayank Agarwal, Rs. 10.66 cr in Shri Puneet Agarwal), family jewellery (Rs. 99.31 lakh substantive in Shri V.D. Agarwal), & cash (Rs. 42 lakh).
CIT(A) deleted the major additions, held jewellery explained & held that proceedings ought to have been u/s 153C since incriminating papers came from company premises after conclusion of search at residence, but sustained Rs. 42 lakh cash addition.
Before Tribunal, assessee raised a legal ground: the AO obtained a single composite approval u/s 153D for 98 cases on the same day (28.12.2016) though AO was in Agra & JCIT was in Kanpur 400 km away. CIT(A) order & the assessment record show one letter seeking approval & one common sanction for multiple assessees & multiple AYs. The approval nowhere shows independent application of mind for “each assessment year” as mandated u/s 153D.
Tribunal noted that identical approvals of Pushpanjali Group were already held invalid in Pushpanjali Construction Co. Ltd (Del ITAT) & applied the binding ratio of Allahabad HC in PCIT vs Siddharth Gupta, Delhi HC in PCIT vs Shiv Kumar Nayyar, & Bombay HC in Shreelekha Damani. All these hold that 153D approval cannot be mechanical, composite, or ritualistic; it must reflect individual application of mind for each AY.
