TaxTMI 
TaxTMI 
2010 (11) TMI 631
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....Since, these two assessees were the third person i.e. the persons other than those whose premises were searched, after the search, statement of Mr. Sunil Bhala, a Chartered Accountant by profession, was also recorded. The Assessing Officer in the case of M/s. GCB Capital completed the assessment, forwarded the assessment order pertaining to M/s. GCB Capital as well as statement of Mr. Sunil Bhala recorded after the search and seizure operation, to the Assessing Officer of Sunil Bhala and M/s. RajGul Credit for necessary action. The exact communication addressed by the Assessing Officer of M/s. GCB Capital to the Assessing Officer of these two assessees reads as under:- "F.No. DCIT/Cir.12(1)/2001-02/ Office of the DCIT, Circle 12 (1), To ....
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....tion recorded by the Assessing Officer of M/s. GCB Capital while forwarding the case to the Assessing Officer of these two assessees, and (ii) he did not also forward the necessary records seized during the search and seizure operation. 3. Section 158BD of the Act reads as under:- "158BD. Undisclosed income of any other person.-Where the Assessing Officer is satisfied that any undisclosed income belongs to any person, other than the person with respect to whom search was made under section 132 or whose books of account or other documents or any assets were requisitioned under section 132A, then, the books of account, other documents or assets seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over su....
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....sing Officer of these assessees and during the assessment proceedings of M/s. GCB Capital. We have found that Mr. Sunil Bhala in his statement has stated that some of the documents seized during the search operation either related to Mr. Sunil Bhala himself or to M/s. RajGul (P.) Ltd. However, that would not meet the requirement of recording the satisfaction. Merely stating that some of the documents belonged to these two assessees would not suffice. It was necessary for the Assessing Officer while forwarding the case, to record satisfaction to the effect that there was undisclosed income belonging to those assessees. As pointed out above, there was no such statement recorded in the forwarding letter, even from the statement of Mr. Sunil Bh....
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....essing Officer of the assessee company. It is obvious that the essential pre-conditions which needed to be satisfied for the purposes of invoking the provisions of section 158BD have not been fulfilled. 15. An argument was sought to be raised on behalf of the learned Counsel for the appellant that section 158BD nowhere specifies that the satisfaction is to be of the Assessing Officer of the searched party and not of the Assessing Officer of the assessee. We fail to appreciate this argument because the plain reading of the provision makes it clear that unless and until the Assessing Officer of the person who is searched is satisfied that there is any undisclosed income belonging to any person, other than the person with respect to whom sear....