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TMI Blog2025 (1) TMI 567X X X X Extracts X X X X X X X X Extracts X X X X ..... se Asst. Order itself in invalid: Tht impugned revision order passd u/s 263 of 1961 Act by PCIT central Gurgaon is non est and nullity because it is founded on underlying assessment order passed u/s 153C which itself is nullity and totally invalid and is passed without authority of law. 1.1 That impugned revision order u/s 263 is nullity and void ab initio because for present 'unabated 'year there is total lack of valid / requisite incriminating material for making valid assessment u/s 153C of 1961 Act so impugned asst. Is also invalid. 1.2 That impugned revision order u/s 263 is nullity and void ab initio because impugned assessment without doubting audited / regular books u/s 145(3) and without appreciating factum of sales / trading receipts has arbitrarily disallowed entire purchases as alleged 'bogus' purchases which is totally impermissible; 1.3 That impugned revision order u/s 63 is nullify and void ab initio because underlying asst. order is founded on invalid / mechanical approval u/s 153D of 1961 Act. 1.4 That impugned revision order u/s 263 is nullity and void ab initito because underlying assessment is made totally contrary to provisions of 1961 Act and applicabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epresentative (DR) agreed with the contention of the Ld. Counsel for Assessee that the issue in dispute is covered in favour of assessee's own case by orders of Co-ordinate Benches of ITAT, Delhi, as mentioned above. 6. We have heard both sides carefully and perused the material available on record. There is no dispute between the two sides that the facts in the case of the Assessee in these years are identical to the facts of the assessee's case for Assessment Years 2012-13 to 2016-17. As both sides agree, that the issue in dispute is covered in favour of the Assessee by the aforesaid order of Co-ordinate Benches of ITAT, Delhi. 7. Heard rival submissions and carefully scanned the material available on record. 8. At the outset and reiterating the grounds regarding jurisdiction and validity of proceedings in question the learned AR submitted that impugned order u/s 263 of the Act is null and void ab initio because underlined assessment order is founded on invalid/mechanical approval u/s 153D of the Act and also vehemently submitted in this regard that underlined assessment order admittedly passed without statutory approval u/s 153D cannot be revised u/s 263 of the Act in the rev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amento Cadit Opus, meaning thereby, that in case the foundation is removed, the super structure falls. Since the foundation, i.e. the order u/s 153C has been removed, the super structure i.e. the order u/s 263 must fall." 12. The learned AR also referred to the judgment passed by the Hon'ble Orrisa High Court in the case of PCIT v. Badal Prakash Jindal HUF 334 CTR 164/ 457 ITR 345, wherein the Hon'ble High Court has held that even original reassessment order itself was not validly passed, the subsequent revisional order by the PCIT was required to be held invalid. 13. So far regarding validity of impugned assessment order u/s 153A of the Act, it is submitted that same is invalid on the reason that questioned approval u/s 153D dated 17.08.2021 is mechanical in nature even on the face of it. 14. Per contra, learned DR relied upon the impugned order passed by the competent authority u/s 273 of the Act by stating that the draft assessment was submitted by the learned AO vide letter dated 28.07.2021 and the approval was granted on 17.08.2021, so the draft order was submitted well in time. He also submitted that finally the approval was granted in writing and fact regarding obtaining ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... even formally but after due application of mind. Thus, the obligation of granting Approval acts as an inbuilt protection to the taxpayer against arbitrary or unjust exercise of discretion by the AO. The approval granted under section 153D of the Act should necessarily reflect due application of mind and if the same is subjected to judicial scrutiny, it should stand for itself and should be self-defending. There are long line of judicial precedents which provides guidance in applying the law in this regard. 13. At the cost of repetition, it may be reiterated that in the instant case, approving authority did not mention anything in the approval memo towards his/her process of deriving satisfaction so as to exhibit his/her due application of mind. We may observe that the above approval letter issued by the Addl. Commissioner says that the approval has been granted subject to certain conditions. 14. Plain reading of the letter of approval granted by the Addl. Commissioner, clearly depicts that the Addl. CIT had routinely given approval to the AO to pass the order only on the basis of letter of the Ld. A.O. without any application of mind. From the said approval, it can be easily in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , in the context of Section 142 (2-A) which empowers an AO to direct a special audit. The obtaining of the prior approval was held to be mandatory. The Supreme Court in Rajesh Kumar v. Dy. CIT (2007) 2 SCC 181 observed as under: "58. An order of approval is also not to be mechanically granted. The same should be done having regard to the materials on record. The explanation given by the assessee, if any, would be a relevant factor. The approving authority was required to go through it. He could have arrived at a different opinion. He in a situation of this nature could have corrected the assessing officer if he was found to have adopted a wrong approach or posed a wrong question unto himself. He could have been asked to complete the process of the assessment within the specified time so as to save the Revenue from suffering any loss. The same purpose might have been achieved upon production of some materials for understanding the books of accounts and/or the entries made therein. While exercising its power, the assessing officer has to form an opinion. It is final so far he is concerned albeit subject to approval of the Chief Commissioner or the Commissioner, as the case may be. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ft assessment order was presented before the competent authority; even not any word is mentioned in the approval order as to whether draft assessment order was perused or not; and also in five cases same/ similar stereo type approval is granted; and by only this ground it is clearly manifested that it was clerical or mechanical approach adopted by the concerned authority. 21. It is established by law that provision of section 153D is mandatory to initiate assessment or reassessment u/s 153C and in section 263 "any order" does not include an order which is void ab initio. The submission of appellant that approval is mechanical and without application of mind, at best on such approval if any proceeding is initiated it will have null and void effect in the eye of law and will have no relevancy; and that it is not subject to revision. It is also submitted that in the above circumstances any order passed under revisional authority remains unsustainable. The relevant approval dated 17.08.2021 is reproduced as under: "1. Please refer to your letter number: आ.उ.आ/के.वृ./करनाल/2021-22/478. dated 28.07.2021, under whi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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