s.153D — Prior approval for search assessments
The requirement that a search assessment be approved before it is passed — and the consequences of that approval being mechanical.
Governs assessments under sections 153A and 153C — that is, searches initiated up to 31 March 2021. It has no role in a reassessment (searches 1 April 2021 to 31 August 2024). Under the block assessment scheme the approval requirement sits in section 158BG (section 299(2) in the Income-tax Act, 2025) and attaches to a single order.
Income-tax Act, 1961
s.153D
Income-tax Act, 2025
s.299(2) — approval of the block order
In force from 1 April 2026, but s.536(2)(c) preserves the 1961 Act for tax years beginning before that date.
In short
Section 153D of the Income-tax Act, 1961 required that no order of assessment or reassessment under section 153A or section 153C be passed by an officer below the rank of Joint Commissioner except with the prior approval of the Joint Commissioner. Because the approval was required for each assessment year, omnibus approvals covering many years and many assessees in a single sentence — often granted on the day the orders were time-barred — have been a productive ground of challenge, the argument being that an approval given without application of mind is no approval at all. Under the block assessment scheme the equivalent requirement is in section 299(2), where approval attaches to the single block order.
What the provision does
Made the validity of a search assessment conditional on prior approval by a superior officer, as a safeguard against orders passed without supervisory scrutiny. By its proviso, the requirement does not apply where the order already requires the prior approval of the Principal Commissioner or Commissioner under section 144BA(12).
Threshold questions
- Does the approval exist on the record, and is it dated
- Was it granted before the assessment order was passed
- Does it deal with each assessment year, or is it a single omnibus line
- Is there anything showing the approving authority saw the draft order or the record
- How many approvals were granted on the same day, and to how many assessees
In practice
The recurring disputes.
Mechanical and omnibus approval
An approval reciting only that approval is accorded, covering dozens of orders across many years and assessees, granted on the limitation date, invites the inference that no mind was applied. Whether the consequence is that the assessment is void or merely irregular has been contested.
Obtaining the approval on the record
The approval is frequently not in the assessment folder given to the assessee. It is obtained by specific request, and where necessary under the Right to Information Act, before the ground can be argued with a foundation.
Whether the ground is jurisdictional
Since the point goes to the competence to pass the order rather than to its merits, it is ordinarily capable of being raised as an additional ground under section 250(5) even if omitted from the original grounds.