Use of search material despite invalid search was recognized, while the search's validity remained undecided and appeals were expedited.

Material gathered during a search may still be relied upon by the Revenue in an appropriate proceeding, even if the search is held invalid, to the extent permissible in law. The order notes that the Revenue did not have the satisfaction note, but it did not finally adjudicate the search's validity. Instead, it recognized that such material could be used for making an adjustment to the assessee's income if advised and within legal limits, and directed the ITAT to dispose of the pending appeals within twelve weeks.

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Issues: Whether material gathered during a search could be relied upon in an appropriate proceeding even if the search was held invalid, and whether the pending appeals should be decided accordingly.

Analysis: The order records that the Revenue did not have the satisfaction note. It further states that even if the search is invalid, the information or material gathered during the search may still be relied upon by the Revenue for making adjustment to the assessee's income in an appropriate proceeding, if so advised, to the extent permissible in law. The ITAT was directed to dispose of the pending appeals within twelve weeks in terms of the order.

Conclusion: The validity of the search was not finally adjudicated, but the Revenue's ability to use the material in a permissible proceeding was recognized, and the pending appeals were directed to be disposed of by the ITAT.

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