TaxTMI 
TaxTMI 
2016 (8) TMI 49
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....ays that the order of the CIT(A) on the above ground be set aside and that of the Assessing Officer be restored." Grounds in Assessee's appeals. "1. The CIT(A)-VI, Hyderabad erred while passing the order for the A.Y. 2003-04, wherein the grounds filed for the following different grounds made towards the additions made had not been adjudicated which is not correct and not justified and bad in law. 2. The CIT(A)-VI, Hyderabad passed the appellate order only on technical grounds and the following grounds has not been considered which is not correct and bad in law. 3. The CIT(A)-VI, Hyderabad ought to have adjudicated all the grounds which are on merits against the order passed U/s 143(3) r.w.s. 153C of the Income Tax Act, 1961 towards the additions/disallowances made for the A.Y. 2003-4 which is not correct, not justified and bad in law. 4. The CIT(A)-VI, Hyderabad erred while passing the order wherein the order of the A.O. is erroneous, unjust and contrary to the facts of the case and the grounds submitted has not been adjudicated. 5. During the time of search, no incremental materials has been found out or detected and the assessee has....
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....ng the order wherein the A.O. has erred while initiating penalty proceedings U/s 271(1)(c) of the I.T. Act, 1961 on the contention that the assessee company has concealed income which is not correct and not justified. 15. The CIT(A) -VI, Hyderabad erred while passing the order wherein the assessee company has not concealed any income or furnished inaccurate particulars of information. Hence, penalty proceedings U/s 271(1)(c) is not correct and not justified. 16. The CIT(A) -VI, Hyderabad erred while passing the order wherein only the additional grounds regarding no incriminating seized materials found has been considered and other above stated grounds have not been considered which is not correct and not justified and bad in law. 17. The assessee may add, alter or modify or substitute any other points to the grounds of appeal at any time before or at the time of hearing of the appeal. Additional ground of appeal 18. We would like to submit that as per the ration laid down by the Hon'ble Supreme Court of India in the case of National Thermal Power Co. Ltd. Vs CIT (1998) 229 ITR 383 (SC) the ITAT has jurisdiction to examine the question of....
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....to the said notice, the appellant filed its return of income for the A.Y. 2003-04 and other assessment years on 26/10/2010. For the A.Y. 2003-04, a total income of Rs. 1,24,72,846/- was filed consequent to return filed U/s 153C of the Act. The ld A.O. issued notice U/s 143(2) and 142(1) of the Act alongwith questionnaire. It is the case of the assessee during the search contended in the premises of M/s Midwest Granites Pvt. Ltd., no incriminating material was found or connected material with the assessee. The assessee has submitted that the assessee has furnished all the details to the ldA.O.. The ld A.O. referred the matter for the special audit U/s 142(2A) of the Act for the year under consideration (2003-04) with a view to safeguard the interest of revenue and also for other Assessment Years. The special audit submits its report on 24/6/2010. On the basis of the said report of the Special audit, the ld A.O. issued summons U/s 131 of the Act on dated 01/7/2011 and also issued fresh notice U/s 142(1) of the Act. The assessee submitted the details and produced all the information and books of account for the year under consideration. However, the ld A.O. was not satisfies and there....
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....ed on legal issue has been decided in favour of the appellant, it is reasonable to hold that it is not necessary to adjudicate on the various additions made in assessment order, on merit. 4. Now the revenue as well as the assessee are in appeal before us. In fact during the course of argument, basic ground which has been taken by the ld AR for the assessee was that: The ld A.O. was erred in invoking the provisions of Section 153C of the Act without there being any satisfaction recorded by him as well as by the ld. A.O. having jurisdiction over the company searched, in view of the judgment of the Hon'ble A.P. High Court in the case of CIT Vs M/s Shettys Pharmaceuticals &Biologicals Ltd. in ITA No. 662 of 2014 dated 26/11/2014. 4.1 The ld DR vide order dated 19-21/07/2016 has directed to file the copy of the ordersheet of the A.O. for issuance of the notice U/s 153C of the Act for the A.Y. 2003-04 to 2009-10. In pursuance thereto, the ld DR has produced entire ordersheet. The satisfaction recorded in the ordersheet by the ld DCIT CC-7, Hyderabad wasas under:- "Search and seizure operations were conducted in case of M/s Midwest Granites Pvt. Ltd. Grou on 24/07/....
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....the Assessing Officer of the person to whom the said document "belongs". In the present cases it has been urged on behalf of the petitioner that the first step itself has not been fulfilled. For this purpose it would be necessary to examine the provisions of presumptions as indicated above. Section 132(4A)(i) clearly stipulates that when inter alia any document is found in the possession or control of any person in the course of a search it may be presumed that such document belongs to such person. It is similarly provided in Section 292C(1)(i). In other words, whenever a document is found from a person who is being searched the normal presumption is that the said document belongs to that person. It is for the Assessing Officer to rebut that presumption and come to a conclusion or "satisfaction" that the document in fact belongs to somebody else. There must be some cogent material available with the Assessing Officer before he/she arrives at the satisfaction that the seized document does not belong to the searched person but to somebody else. Surmise and conjecture cannot take the place of "satisfaction". 7. This would be the appropriate stage to consider the decisions ref....
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....of account or documents seized or requisitioned belongs or belong to a person other than the person referred to in Section 153A of the Act. Thereafter, the Assessing Officer having jurisdiction over third party on receipt of the seized material or books of accounts or document being handed over to him shall record his own satisfaction after examining the same independently without being influenced by the satisfaction of the Seizing Officer. In other words it is not an automatic action. We find satisfaction of two officers is missing. In this connection we set out the text of the order of the Assessing Officer which is as follows: "A search and seizure operation u/s. 132 was carried out in the group case of Dr. T. YadhaiahGoud and others on 25.3.2010. During the course of search operation documents belonging to SHETTY PHARMACEUTICALS & BIOLOGICAL LTD., has been seized. Hence it is considered to initiate proceeding u/s. 153C of the I.T. Act." 7. The aforesaid Section mandates recording of satisfaction of the Assessing Officer(s) is a pre-condition for invoking jurisdiction and it is not a mere formality because recording of satisfaction postulates application of min....
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.... and perused the material available on the record and the law cited before us. The Hon'ble Jurisdictional High Court in the case of SHETTY PHARMACEUTICALS & BIOLOGICAL LTD. (supra) has clearly held that the recording of satisfaction by the A.O. is precondition for invoking the provisions and is not a mere formality because the recording of satisfaction postulate the application of mind, consciously as to the documents seized must be belonging to any other persons other than the persons referred to in Section 153A of the Act. Similarly, the Hon'ble Delhi High Court in the case of Pepsi Foods P. Ltd. Vs. ACIT (supra) has held that as per law, once the documents are seized from the premises of a person then the presumption is that the documents/materials belong to the persons searched, therefore, it is for the A.O. to rebut the presumption which are normal to be raised in favour of the persons searched but belongs to any other person. This satisfaction must be displayed from the reasons or the basis for conclusion of the A.O. that the documents searched belongs to the other than the searched person. If we examine the satisfaction/ordersheet produced before us (reproduced hereinabove),....