TaxTMI 
TaxTMI 
2015 (9) TMI 1013
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....n for condonation of delay supported with the affidavit. It is explained that since all the bank accounts of the assessee were attached by the Income-tax Department, the assessee did not have the money to deposit the Tribunal fee of Rs. 70,000/-, i.e., Rs. 10,000/- each for 7 years. He borrowed the sum of Rs. 70,000/- from his three relatives and then deposited the fees of Rs. 70,000/- and immediately filed the appeals. He submitted that there is a nominal delay of 21 days for which there was a reasonable cause. Therefore, the delay in filing of the appeals should be condoned. The ld. CIT-DR opposed the condonation of delay. 3. After considering the facts of the case and arguments of both the sides and considering the nominal delay of 21 days, we are of the opinion that it would be in the interest of justice to condone the delay in filing of the appeals. We, therefore, condone the delay in filing of the appeals by the assessee and admit the appeals for hearing on merit. ITA Nos 3088 to 3093/Ahd/2008 - Assessee's appeals : AYs 1999-00 to 2004-05 4. The Ground No.1.1 in assessee's appeal in all the years is against the validity of notice u/s 153C which reads as under:- "1.1 The ....
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....hat Section 153C has been modified by the Finance Act, 2015 whereby the word "belongs to" has been used with reference to money, bullion, jewellery or any other valuable article or thing. But the word "pertaining to" has been used with reference to books of accounts or documents. That in the satisfaction note, the Assessing Officer himself has mentioned that the document (cheque) found from Kabhai Chauhan Group of cases pertained to the assessee i.e. Smt. Rekhaben Thakkar. That the proceedings u/s 153C can be validly initiated against the person if the document pertaining to him is seized with some other person from Assessment Year 2015-16 onwards and not for earlier years. In view of these facts, it is submitted by the ld. Counsel that the assumption of jurisdiction u/s 153C by the Assessing Officer is illegal and therefore, the notice issued u/s 153C should be quashed. 7. The ld. Departmental Representative, on the other hand, relied upon the orders of the authorities below. He submitted that the assessee is carrying on activities of issuing cheque to third parties so as to facilitate them to carry on un-recorded transactions. Such activities were carried on by the assessee in a....
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....ything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that any money, bullion, jewellery or other valuable article or thing or books of account or documents seized or requisitioned belongs or belong to a person other than the person referred to in section 153A, then the books of account or documents or assets seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person and that Assessing Officer shall proceed against each such other person and issue such other person notice and assess or reassess income of such other person in accordance with the provisions of section 153A:]." 9. From the above, it is evident that action under Section 153C can be taken in respect of any other person than the person searched if the Assessing Officer of the person searched is satisfied that any money, bullion, jewellery or other valuable article or thing or books of account or documents belong to a person other than the person searched. In such circumstances, he shall hand over to the Assessing Officer of such other person money, bullion, jewellery or other val....
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.... other than the person whose premises had been searched or whose documents and other assets had been requisitioned under section 132A of the Act." 11. Though the above decision was given by their Lordships of the Hon'ble Apex Court with reference to Section 158BD of the Income-tax Act; however, the language of Section 158BD and Section 153C of the Income-tax Act are almost similar. Therefore, in our opinion, the ratio of the decision given with reference to Section 158BD would be squarely applicable while interpreting Section 153C. 12. In the above legal background, let us now examine the facts of the assessee's case so as to find out whether the jurisdiction assumed u/s 153C is valid. The satisfaction note recorded by the Assessing Officer reads as under:- "Name of the assessee : Smt. Rekhaben K. Thakkar Prop. M/s. Durga Finance A.Y. : 1999-00 to 2004-05 Satisfaction Note for Issuing Notice u/s 153C of the Act Search and seizure proceedings U/s were carried out on 04.03.2005 at the residential / business premises in the Kabhai Chauhan Group of cases. During the course of search, certain incriminating documents were found and seized. On scrutiny of the documents ....
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....Officer has to issue the notice under Section 153C. The Assessing Officer of the person searched and such other person may be the same but these are two different assessees and, therefore, the Assessing Officer has to carry out the dual exercise, first as the Assessing Officer of the person searched in which he has to record the satisfaction, during the course of assessment proceedings of the person searched. After recording such satisfaction note in the file of the person searched, the same is to be placed in the file of such other person. Then, in his capacity as the Assessing Officer of such other person, he should take cognizance of such satisfaction note and thereafter issue notice under Section 153C. In this case, this exercise of recording the satisfaction during the assessment proceedings of the person searched has not been carried out. On the other hand, the Assessing Officer recorded the satisfaction in the case of such other person which does not satisfy the condition of assuming jurisdiction under Section 153C. 14. Notices u/s 153C have been issued for Assessment Year 1999-2000 to 2004-2005. The only document on the basis of which the notices have been issued is an und....
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....ly, during the course of search at the premises of 'S', certain documents including the sale deed as well as an agreement between the tenant and the assessee was found. The agreement between the assessee and the tenant was relating to the vacation of the plot of land on certain payment made by the assessee. Their Lordships of the jurisdictional High Court have held "agreement between tenants of the petitioner would certainly satisfy the requirement of Section 153C of the Act." Thus, the agreement between the tenant and the petitioner found from 'S' was held to be belonging to the assessee because it was not belonging to the person searched. However, cheque issued by the assessee was in the name of Vijay K. Chauhan i.e., the person of the Group which was searched. The cheque was found from the person upon whom the cheque was drawn. Therefore, in our opinion, the cheque "belongs to" the person upon whom it was drawn and cannot be said to be continued to "belonging to" the person who issued the cheque. Therefore, in our opinion, the conditions for issue of notice u/s 153C were not satisfied. For ready reference, we may summarize the reasons on the basis of which we form opinion that t....