ACIT vs Chander Mohan Sethi

“1.

On the facts and in law, the Ld. CIT(A)/NFAC erred in deleting the addition of Rs. 2,94,70,000/-made by the Assessing Officer u/s 68, by wrongly relying upon screenshots/pages of Annexure A-8 that were never part of the assessment record, ignoring that the AO had relied upon different specific pages of Annexure A-8 containing dated entries relatable to A.Υ. 2011

2.

The Ld. CIT(A)/NFAC erred in law in ignoring the settled legal principle laid down by the Hon'ble Supreme Court and High Courts in Common Cause v. UOI (394 ITR 220), CIT v. P.V. Kalyanasundaram (294 ITR 49), CIT v. Girish Chaudhary (296 ITR 619) that a seized document must be read as it is, and the entries therein carry independent evidentiary value, which the CIT(A) failed to appreciate while deleting the addition.

3.

The Ld. CIT(A) erred in law and on facts in holding that Annexure A-8 pertains to earlier years, without appreciating that the dated entries relied upon by the AO clearly relate to F.Y. 2010-11 relevant to A.Y. 2011-12, and that the assessee had failed to explain these entries either during assessment or remand proceedings. The CIT(A) misread the seized material by selectively relying only on pages favourable to the assessee, ignoring the actual evidentiary pages used in the assessment order.

4.

The Ld. CIT(A) further erred in directing the AO to assess the alleged cash receipts in some other assessment year, despite the clear presence of year-specific dated entries on the seized page relied upon in the assessment order, thereby travelling beyond the scope of appellate jurisdiction u/s 250 to issue such a direction.”

“A technical approval is accorded to pass assessment orders in the above cases on the basis of drafts assessment orders submitted for the assessment years in reference years. You are directed to cast taking into account the seized documents/papers and comments in the appraisal report pertaining to V The fact of initiation of penalty proceedings, wherever, applicable, must also be incorporated in the para of the order. The initiation of correct penalty provisions of L.T. Act u/s 271(1)(c)/ 271AAB.A”

“13.

The Income Tax Act envisages prior approval of the JCIT before passing the assessment order. The provisions read as under:

"no order of assessment or reassessment shall be passed by the assessing officer below the rant of Joint Commissioner in respect of each assessment year referred to in clause (b) of sub-section (1) of Section 153A or assessment year referred to in clause (b) of sub-section (1) of Section 1538 except with the prior approval of Joint Commissioner."

14.

When the approval given by the JCIT, Meerut is juxtaposed against the directions and provisions of the Income Tax Act pertaining to completion to assessment u/s 153B(1) of the Act, it can be said that the approval given by the JCIT is invalid. The Act envisages that the JCIT's approval before passing of the final order. There is no provision to alter, change, modify, adjust, amend or rework the order once the approval has been accorded. The approval to be given is statutory in nature and legally binding. In the instant case, the approving authority has clearly mentioned that the approval given is a technical approval. Moreover, he has directed the DCIT to ensure the seized materials and the findings of the appraisal report to be incorporated in the final assessment order. This clearly goes to proves that the approval given by the JCIT is not a final approval as required u/s 153D of the Act but a conditional approval subjected to modifications by the DCIT after receiving of the approval which makes it an invalid, qualified, uncertain approval. This is not the mandate of the Act. It has also been laid down that whenever any statutory obligation is cast upon any authority, such authority is legally required to discharge the obligation by application of mind. The approval has to be statutory nature after due application of mind, it should be neither technical nor proforma approval which is envisaged u/s 153D of the Act. Reliance is placed the judgment of Coordinate Bench in the case of M3M India Holdings (ITA 2691/2018). And the judgment of Hon'ble High Court of Bombay in the case of Pr CIT vs. Smt. Shreelekha Damani”

Cross objection No. 290/Del/2026 (A.Y. 2011-12)

“1.

That the learned CIT(A) manifestly erred in law and on facts in upholding the assessment order passed under section 153A, based on an common illegal approval u/s 153D dt. 30.12.16 given in 112 case mechanically even without specifying any seized material and even overlooking order of hon'ble ITAT order dt. 04.07.2019 quashing orders based on above approval mentioning name of assessee therein.

2.

That Id CIT(A) erred in sustaining the proceedings initiated under section 153A, despite the fact that no incriminating material was found or seized during the search conducted in the case of the Appellant and that the proceedings were based solely on alleged material recovered during the search of another person, proceedings, if at all permissible, could only have been initiated under section 153C, and therefore the assumption of jurisdiction under section 153A is illegal and liable to be quashed. Rs. 1,00,16,853/-

3.

That, no valid jurisdictional notice u/s 143(2) is issued on the return dated 28.10.2016 filed by the assessee in compliance to notice u/s.153A (143(2) dated 07.10.2016 issued even prior to return is non est), thus order u/s.153A / 143 (3) is illegal being beyond jurisdiction.”