TaxTMI 
TaxTMI 
TaxTMI 
2016 (11) TMI 1241
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.... 30.04.2012 143(3) r.w.s 153C 2 1125/PN/2012 M/s. Aswani Associates, MZSK & Associates, (Formerly Shah Khandelwal Jain & Associates) Chartered Accountants, Level 3, Business Bay, Plot No.84, Wellesley Road, Near RTO, Pune - 411001 PAN: A AMFA4202C DCIT, Central Circle 1(1), Pune 2007-08 15.12.2011 143(3) r.w.s. 153C 3 1126/PN/2012 -do- -do- 2008-09 15.12.2011 143(3) r.w.s. 153C 4 1473/PN/2012 DCIT, Central Circle 1(1), Pune M/s. Aswani Associates, MZSK & Associates, (Formerly Shah Khandelwal Jain & Associates) Chartered Accountants, Level 3, Business Bay, Plot No.84, Wellesley Road, Near RTO, Pune - 411001 PAN: AAMFA4202C 2008-09 15.12.2011 143(3) r.w.s. 153C 5 1123/PN/2012 Rajkumar Aswani, MZSK & Associates, (Formerly Shah Khandelwal Jain & Associates) Chartered Accountants, Level 3, Business Bay, Plot No.84, Wellesley Road, Near RTO, Pune - 411001 PAN: AEXPA7340C DCIT, Central Circle 1(1), Pune 2007-08 15.12.2011 143(3) r.w.s. 153A 6 1127/PN/2012 Shrichand Aswani MZSK & Associates, (Formerly Shah Khandelwal Jain & Associates) Chartered Accountants, Level 3, Business Bay, Plot No.84, Wellesley Road, Near RTO, Pune - 411001 PAN:AEHPA1627G DCIT, Cent....
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....under section 153C of the Act was issued to the assessee, in response to which proceedings were taken up against the assessee. However, the Assessing Officer of the searched person, has failed to record satisfaction before initiating proceedings under section 153C of the Act. He fairly admitted that the Assessing Officer of the searched person i.e. the partner of assessee firm and the assessee firm was the same, but since certain documents were impounded during the course of search against partner of the firm, then it was incumbent upon the Assessing Officer to record satisfaction note before proceeding against the assessee firm perse. In this regard, the learned Authorized Representative for the assessee placed reliance on the order of Hon'ble Supreme Court in CIT Vs. Calcutta Knitwears (2014) 43 taxmann.com 446 (SC). It was further pointed out by him that though the decision of Hon'ble Supreme Court was in relation to section 158BD of the Act, but same principle has been applied by the Delhi Bench of Tribunal in Bhawna Bhalla & Anr. Vs. ACIT & Anr. (2016) 46 CCH 577 (Del - Trib), where the proceedings were initiated under section 153C of the Act. He further stated that even CBDT ....
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....erson, then where the Assessing Officer is satisfied that such assets or documents seized belongs to any person, other than the person searched, then such documents or assets seized would be handed over to the Assessing Officer having jurisdiction over such other person and that Assessing Officer shall proceed under section 153C of the Act against such other person and the provisions of Chapter shall apply accordingly. In other words, in case during the course of search on a person 'A' certain documents, books of account or assets are found and / or seized, which do not belong to searched person but belong to third party, then in case the Assessing Officer of searched person is satisfied that such assets or documents seized belongs to such other person, then the documents, books of account or assets would be handed over to such Assessing Officer having jurisdiction over other person, who shall proceed against such other person. 8. The Hon'ble Supreme Court in CIT Vs. Calcutta Knitwears (supra) have laid down the ratio in relation to exercise of jurisdiction under section 158BD of the Act. The Hon'ble Supreme Court held that for the purpose of section 158BD, satisfaction note is si....
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....has been accepted by CBDT. 4. The guidelines of the Hon'ble Supreme Court as referred to in para 2 above, with regard to recording of satisfaction note, may be brought to the notice of all for strict compliance. It is further clarified that even if the AO of the searched person and the "other person" is one and the same, then also he is required to record his satisfaction as has been held by the Courts 5. In view of the above, filing of appeals on the issue of recording of satisfaction note should also be decided in the light of the above judgement. Accordingly, the Board hereby directs that pending litigation with regard to recording of satisfaction note under section 158BD / 153C should be withdrawn/not pressed if it does not meet the guidelines laid down by the Apex Court." 10. The Circular issued by the CBDT has recognized that the satisfaction note is a pre-requisite for initiating proceedings under section 158BD of the Act, which is to be prepared by the Assessing Officer before he transmits the record to other Assessing Officer, who has jurisdiction over such other person under section 158BD of the Act. It is also provided in the said Circular that where the Assess....
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....ct, the assessee was asked to furnish the return of income in respect of each of the assessment year falling within six assessment years immediately preceding the assessment year relevant to the previous year in which search action was conducted. The assessee in this regard was issued show cause notice. Admittedly, the assessee has filed return of income in response to the said notice issued under section 153C of the Act. However, the assessee now before us has raised the issue of non-recording of satisfaction by the Assessing Officer who was in-charge of the searched person, before handing over the documents to the Assessing Officer of the assessee before us. No doubt, the Assessing Officer of the searched person and the assessee to whom the documents related, which were found during the course of search on Aswani group were the same, but the dictate of the Hon'ble Supreme Court in CIT Vs. Calcutta Knitwears (supra) was that there is requirement to record satisfaction before handing over the documents to the Assessing Officer, even in cases where the Assessing Officer of the searched person and the other person is same. Admittedly, in the present case before us, no such satisfacti....