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Judgment
The above captioned appeals by the Revenue and Cross Objections by the assessee are preferred against order of the ld. Commissioner of Income Tax (Appeals)-30, New Delhi dated 08.07.2025 under section 250 of the Act arising from the assessment order dated 19.03.2022, passed by the Assessing Officer, DCIT, Central Circle – 30, New Delhi under 153A read with section 143(3) of the Income Tax Act, 1961 (‘the Act’) concerning Assessment Years 2016-17, 2018-19, 2019-20 & 2020-21 respectively.
Since the underlying facts are common in the cross objections of the assessee and appeals of the Revenue and pertain to same assessee, they were heard together and are disposed of by this common order for the sake of convenience and brevity.
The grounds raised by the Revenue are as under :
1.“Whether on the facts and in the circumstances of the case and of the law, the Ld. CIT(A) is correct in allowing the appeal of the appreciating the facts of the case?
2.Whether on the facts and in the circumstances of the case and in the provisions of the law the Ld. CIT(A) is correct in treating the assessment order invalid due to lack of valid prior approval under section 153D.
3.Whether on the facts and in the circumstances of the case and in the provisions of the law, the Ld. CIT(A) is correct in not considering the merits of the case and addition of Rs. 2,75,00,000/- made u/s 69 r.w.s. 115BBE of tle Act.".
4.Whether on the facts and in the circumstances of the case and in the provisions of the law the Ld. CIT(A) is correct in not considering the fact the AO had passed the assessment order after receiving the required approval u/s 153D of the Act and incorporated the details of the approval received u/s 153D of the Act.
5.Whether on the facts and in the circumstances of the case and in the provisions of the law the Ld. CIT(A) is correct in not considering the fact that if the approval u/s 153D of the Act was received after the order passed by the AO, then it would not have been possible for the AO to incorporate the details (date & reference no.) of the approval received u/s 153D of the Act.
6.The grounds of appeals are without prejudice to each other.
7.The appellant craves to add, alter; or amend any/ all of the grounds of appeal before or during the course of hearing of appeal.”
Brief facts of the case are a search took place in the case of the assessee under section 132 of the Act on 26.10.2020. Consequent to the search, assessment under section 153A r.w.s 143(3) of the Act for A.Y. 2018-19 was passed on 19.03.2022. The AO made certain additions. When the matter reached, the CIT(A) quashed the assessment order, treating the assessment order invalid on account of lack of valid prior approval under section 153D of the Act. Aggrieved, Revenue is before us and the assessee has also filed the cross objections.
The substantive issue raised by the Revenue is with regard to quashing of the assessment order due to lack of prior approval u/s 153D.
At the outset, learned Counsel of the assessee stated that though, the approval under section 153D of the Act was granted on 19.03.2022, the said approval was received by the AO on 21.03.2022, two days after the assessment order and the demand notice was issued on 19.03.2022. Since, the receipt of the approval under section 153D of the Act was posterior to the passing of assessment order under section 153D of the Act, the learned Counsel of the assessee vehemently submitted that the same renders the order under section 153A invalid. The ld AR also relied on the order of the coordinate ITAT bench Delhi dated 23.10.2024, pertaining to this Group in the case of M/s Inderjit Mehta Constructions Pvt. Ltd. for assessment years (AY) 2016-17 and 2017-18, wherein same issue was adjudicated in favour of the assessee.
Per contra, learned DR of the Revenue, though could not controvert the factual assertion made by the learned AR, he vehemently contended that the approval u/s 153D dated 19.03.2022 was received on 19.03.2022 itself.
We have heard the rival submissions and perused the material available on record. We find that the CIT(A) has minutely analysed the facts of the case and reached the conclusion that the JCIT’s approval under section 153D of the Act was received by the AO on 21.03.2022, two days after the assessment order was passed on 19.03.2022. We find that in the instant case before us, this factual aspect of the receipt of approval under section 153D of the Act on 21.03.2022, has remained uncontroverted by the learned DR. We were not presented with any cogent material/evidence to consider it otherwise. In such factual matrix, we are of the considered view that the provision of section 153D which mandates prior approval for passing orders u/s 153A, was not adhered to, rendering the entire assessment made under section 153A unsustainable in the eyes of law. We therefore, have no hesitation in holding the order under section 153A read with section 143(3) of the Act as invalid due to the lack of valid prior approval under section 153D of the Act. We find support in the coordinate Delhi bench of ITAT’s order dated 23.10.2024 in the case of group concern M/s Inderjit Mehta Constructions Pvt. Ltd. for assessment years (AY) 2016-17 and 2017-18, wherein identical issue of lack of prior approval u/s 153D, was adjudicated in favour of the assessee. Accordingly, we quash the order under section 153A of the Act. The ground nos. 2, 4 & 5 of Revenue are thus dismissed.
As we have dismissed the Revenue’s appeal on legal grounds, we do not dwell on merits of the case.
Since, the Revenue’s appeals are dismissed, the Cross Objections of the assessee are rendered academic and are dismissed as such.
In the result, all the four appeals of the Revenue as well as four COs of the assessee are dismissed.