2019 (4) TMI 54
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....ed income belongs to any person, other than the person with respect to whom search was made under Section 132 of the Act? This is the substantial question of law that needs to be answered in this appeal filed by the assessee. 2. The authorities under the Act conducted a search on 18.04.2002 in a jewellery at Ernakulam. During the search, copies of the first pages of two agreements executed by the appellant regarding purchase of shop rooms were seized. On the reverse side of the agreements, there were endorsements made regarding payment of money by the appellant. The statement of the appellant was recorded on 18.04.2002 itself by the Additional Director of Income Tax. The statement revealed that the appellant had paid a total amount of Rs. ....
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....nt case and since the Assessing Officer did not record his satisfaction regarding the undisclosed income of the appellant, the entire proceedings initiated against the appellant are vitiated. 6. Section 158BD of the Act reads as follows: "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 such other person and that Assessing Officer shall proceed under Section 158 BC against such o....
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....st the searched person under Section 158BC of the Act; (b) along with the assessment proceedings under Section 158BC of the Act; and (c) immediately after the assessment proceedings are completed under Section 158BC of the Act of the searched person". (emphasis supplied). 9. The decisions of the Apex Court referred to above categorically lay down that preparation of a satisfaction note by the Assessing Officer regarding the undisclosed income of the person other than the person in respect of whom the search was conducted is sine qua non before proceeding against such other person. It is necessary that the Assessing Officer shall not merely reach a satisfaction about the undisclosed income of the other person but he has to record his satis....