TaxTMI 
TaxTMI 
TaxTMI 
2018 (3) TMI 1512
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.... this assessee has raised the following ground in its CO: - "On the facts and circumstances of the case and in law the learned Commissioner of Income Tax (Appeals) XXVII, Mumbai erred in not holding that the assessment order was illegal, bad in law and void ab initio is as much as conditions to invoke section 158BD did not exist." 3. Brief facts are that a search and seizure operation was carried out under section 132 of the act on the residential and business premises of Keystone Realtors Pvt. Ltd and its group of companies. Credence Properties Developers Pvt. ('CPDPL') Ltd is one of the group companies of Key Stone Group engaged in the business of real estate. Block assessment was framed in the case of CPDPL under section 143(3) read with section 158BD by DCIT, Central Circle-10, Mumbai on 31-03-2005. During the course of search, according to AO, evidence were found and seized as annexure A-3 page No. 1 to 5 from the office of Keystone Realtors Pvt. Ltd, Rustomjee Acres, Dahisar (W), Mumbai. The AO further noted that in the block assessment order of CPDPL, the AO vide order dated 31-03-2005 held that a sum of Rs. 1,25,98,175/- had been received as own money at the time of allo....
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....on whether any payment in respect of on money has been made to the appellant in cash but has merely stated the above facts with regard to the development agreement. It is fact that the on money transactions is out of books of accounts. No question was asked to Shri Boman Irani in respect of payment of on money to the appellant at the same percentage as in the Development agreement as the development agreement will never include a clause to refer any transaction like on money sharing which is outside the books of accounts. Further, based on the facts of the above statements as mentioned in the assessment order no addition can be made as there is no confirmation as to the payment of alleged on money and simultaneously there is no evidence that cash was received by the appellant, straight from the statements of Shri Boman Irani or from the papers found from the premises of Credence Property Developers. Hence, there is no evidence to prove and lead that the appellant had received a sum of Rs. 32,75,525/- in as much as the document, which is relied upon by the Assessing officer, also does not state the fact of receipt of the sum of Rs. 32,75,525/- anywhere. In the statement recorded....
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....al recorded the order as under: -. "09/03/2O17 Present for the Department: Ms. Sunita Bilia, Learned CIT(DR) Present for the Assessee: Shri Deepak Tralashawale We note that this appeal was filed by the department on 17/10/2008, as is evident form order sheet entry dated 29/01/2009. On 28/08/2009, the learned DR was directed to ascertain as to what happened in the cases of other connected parties and thus, the appeal was adjourned to 13/10/2009. On 17/12/2009, again the appeal was adjourned at the request of the teamed DR. Again 'on 01/06/2010, the appeal was adjourned at the request of the learned DR. On 29/09/2010, the learned DR sought time and the appeal was adjourned to 25/11/2010. Again the appeal is adjourned to 25/01/2011 and the learned DR was directed to produce the record. Again on 12/04/2011, the appeal was adjourned to 23/05/2011 and the learned DR was directed to find out the status of the case of CPDPL. as well as other co-owners. On 21/07/2011, the appeal was adjourned. On 04/10/2011, the hearing was adjourned to 29/11/2011 and the learned DR was directed to produce the seized material. Again on 29/11/2011, the learned DR was directed to produce the seize....
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....39;ble Bench noted that on earlier hearing on 30.03.2016, the Hon'ble Bench directed the department to inform the status of the additions in case of co-owners and also to produce the records and seized materials. Again / oil the Bench has categorically recorded about the several opportunities given to the department to comply with the earlier directions of the Bench and failure of the department to do so. Therefore, a final opportunity was given to the department to make necessary compliance. However, subsequently oil occasions the department has failed to comply with the directions of the Bench. The Hon'ble bench has directed to the CIT in charge to file a comprehensive affidavit about the status the additions at the hands of co-owners and also regarding the production of seized materials. 3. A copy of the above order sheet from the file of the Hon'ble Members ITAT C Bench in the case of the assessee is enclosed for perusal and necessary action. 4. The next date of hearing in this case is fixed on 01.11.2017. In view of the above, it is requested that the AO/AOs concerned may he directed to be present in the court oil date of hearing i.e. 01.11.2017 at 10 A.M. with ori....
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....-17 addressed to CIT DR . It means that no satisfaction was recorded in the case of searched person such as Keystone Realtors Pvt. Ltd. 9. We find that Hon'ble Supreme Court in the case of CIT vs. Calcutta Knitwears (2014) 362 ITR 673 (SC) has held that it is clear from the provisions of section 153C of the Act that where the AO of the person searched is satisfied that any money, bullion, jewellery, books of account or other documents etc., belong to a person other than the person searched, then, such documents or assets, etc., shall be handed over to the AO of the 'other person' and the later AO shall proceed against such 'other person' to assess or reassess his income. A bare perusal of the provision indicates that before handing over such documents etc. to the AO of the 'other person', a 'satisfaction' has to be recorded by the AO of the person searched that money, bullion or jewellery, etc., found from the person searched belong to the 'other person'. Only when such 'satisfaction' is recorded by the AO of the person searched and such documents or assets seized, etc., are handed over to the AO of the 'other person', that t....
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....provisions of section 158BD of the Act and therefore, the above guidelines of the Hon'ble SC, apply to proceedings u/s 153C of the IT Act, for the purposes of assessment of income of other than the searched person. This view 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 he decided in the light of the above judgment. 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." 11. The argument of the learned CIT Departmental Representative (in short DR) that the searched person and the assessee are being assessed by the same AO, the learned Counsel f....