Section 158BD notice remains valid where material shows receipt of consideration and warrants inquiry into the real beneficiary.

A satisfaction note under Section 158BD is not invalid merely because it indicates that the property belonged to another person or that the assessee may have acted on that person's behalf, if the material shows receipt of consideration and justifies further inquiry into the recipient and the real beneficiary. On the facts, the receipt signed by the assessee recorded a total consideration far above the amount disclosed by the searched party, and the Revenue was entitled to investigate whether the sum was received by the assessee and on whose behalf. The High Court held that the notice was valid and set aside the Tribunal's contrary view.

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Issues: Whether the satisfaction note and the consequential notice issued under Section 158BD of the Income-tax Act, 1961 were invalid on the ground that the assessee was shown to have received the consideration on behalf of his father and the property was not owned by the assessee.

Analysis: The receipt signed by the assessee showed a total consideration of Rs. 33 lakhs, while the searched party had disclosed only a fraction of that amount. The material showed that the amount had in fact been received, and the Revenue was entitled to issue notice to ascertain whether the sum was received by the assessee and, if so, on whose behalf. The fact that the satisfaction note prima facie referred to the assessee's father as owner of the property did not, in the circumstances, by itself invalidate the notice. The Tribunal's view that the notice failed because the satisfaction note did not finally establish undisclosed income in the assessee's hands was not sustainable on these facts.

Conclusion: The notice under Section 158BD was valid and the Tribunal's order holding it invalid was set aside.

Ratio Decidendi: A satisfaction note under Section 158BD is not invalid merely because it indicates that the property belonged to another person or that the assessee acted on another's behalf, if the material discloses receipt of consideration and warrants further inquiry into the recipient and the real beneficiary.

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