Section 153D: Approval must be self-contained piece of evidence demonstrating that due process of law is followed in approving
The Hon’ble Tribunal held that Section 254(1) of the Act and Rule 11 of the ITAT Rules make it clear that the Tribunal is competent to consider any ground or issue not taken by either of the parties, if the same is found relevant to decide the appeal pending before it, irrespective of the fact that the Assessee Respondent had not preferred a CO in the appeal filed by the Revenue.
The ITAT allowed the Assessee to raise a jurisdictional ground by invoking Rule 27 of the ITAT Rules, even though the ground was not raised before the CIT(A).
The ITAT quashed the assessment order as the approval under Section 153D was invalid on the following grounds:
-The approval was first granted for protective addition in the hands of the director and subsequently for substantive addition in the case of the company.
-Approval was granted on the same day it was requested.
-A common approval was sought and granted for multiple assessees and multiple AYs, rather than granting separate approval for each AY and each assessee individually.
-On the same day, approvals were also granted for assessment orders of other assesses by the same JCIT through a common letter, which was verbatim in content with the approval granted in the case of the respondent.
-Only draft assessment orders were sent to the JCIT without any assessment or search records.
-The approving authority granted approvals without recording any reasons or demonstrating application of mind to the issue involved and the material relied upon by the AO
The ITAT also held that, not only as a quasi-judicial authority but even in an administrative capacity, if an approval is required under a statute for initiating quasi-judicial proceedings, such approval must be self-contained piece of evidence demonstrating that due process of law was followed in approving.
The Copy Of the order is as under:
