TaxTMI 
TaxTMI 
2020 (1) TMI 85
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....er and they are being disposed of through this a common order for the sake of convenience. 2.0 The brief facts of the case are that the assessee is a company engaged in the business of Real Estate Development. On 31st January, 2008 one Sh. Vipin Verma, an employee of the assessee was intercepted by the Police at Rajpura while he was travelling to Amritsar. Rs. 1.98 Crores in cash along with an unsigned photocopied agreement dated 30.09.2006, which was alleged to have been executed between the assessee and one M/s V.M. Reality, were seized from his possession. As per this unsigned photocopied agreement, the assessee company had made payment of Rs. 5 Crores to M/s V.M. Reality towards transactions of land and a cash payment of Rs. 70 lacs was also alleged to have been made. This agreement was signed by Sh. Hira, the Managing Director of M/s. V.M. Reality and name of one Sh. Hemant Kapoor was mentioned as being the authorized signatory on behalf of the assessee company. However, nobody had signed on behalf of the assessee company. It is the assessee company's contention that Sh. Hemant Kapoor as neither an employee of the company nor he was authorized by the assessee company to ....
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.... the case of CIT v kulwant Rai 291 ITR 36 (Del). Consequently, the alleged agreement could not be treated as a evidence against the assessee. Hence, no addition could be made solely on the basis of the alleged agreement. 3. That the presumption raised by the lower authorities against the assessee to the effect that the said agreement belong to assessee is illegal since presumption, if any, can be raised only against Shri Vipin Verma from whose possession the said agreement was taken in to custody by the police as per the provisions of section 292C of the Act which are applicable in the present case. No question was ever asked from Mr Vipin Verma in respect of such document and therefore, in the absence of any corroborating evidence, question of holding that this document belongs to assessee does not arise. Consequently, question of making any addition solely on the basis of such document does not arise. 4. Through the onus was on revenue to prove the genuineness of the agreement, the assessee produced the Balance sheet of M/s V.M. Reality by way of additional evidence under Rule 46A which should have been admitted in the interest of justice. The CIT(A) was not jus....
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....f any responsible person was recorded and entries were found duly recorded when the tax officials made enquiries on 2.2.08. C) It is for the businessman to decide in what manner the business is to be carried on and not for the tax authorities to decide as to how the business is to be carried on. Hence, AO was not justified in observing that there was no necessity for sending the cash to Amritsar for purchasing the property. D) That no adequate opportunity was provided to assessee for producing the cash creditors since for the first time on 9.12.2009, the assessee was asked to produce them onl4.12.2009. Despite the paucity of time, the assessee did produce two of the creditors on 14.12.09 who were examined by the AO. Both of them admitted that cash payments were made after making withdrawals from books/bank. Rajesh Bhalla as well as Hemant Kapoor had clearly stated in their statements that cash withdrawals were duly recoded in their books of account but the AO arbitrarily rejected their explanations without asking them to produce the relevant books or the bank statements. Such action of AO was not legally justified. Further, no proper opportunity was given to produ....
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....ard to the appellant." In ITA No.1508/Del/2014 for Asst. Year: 2008-09 "1) That the Hon'ble Commissioner of Income Tax (Appeals) has erred in law as much as on the facts of the case by upholding the findings of the learned Assessing Officer in not keeping in abeyance the penalty under "proviso" to section 275(1A) of the Income Tax Act, 1961 till the disposal of appeal filed by the appellant on quantum additions before the Hon'ble Income Tax Appellate Tribunal, New Delhi. 2) He has also further erred in law in rejecting the request of the appellant to keep the appellate proceedings pending against the impugned penalty appeal filed before him to avoid multiplicity of legal proceedings and undue harassment to the appellant but the same was arbitrary rejected by him without giving any cogent reasons which is bad in law. 3) That the Hon'ble Commissioner of Income Tax (Appeals) has further erred in law as much as on the facts of the case by upholding the levy of penalty u/sec. 271(1)(c) of the Act by the learned Assessing Officer by not giving any opportunity of being heard to the appellant on receipt of the reply on merits of the case from the appella....
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....led law that notice u/s 153C cannot precede notice u/s 153A and, therefore, the notice issued u/s 153C in the case of the assessee company was unlawful making the assessment null and void. The learned AR placed reliance on the judgment of the Hon'ble Apex Court in the case of CIT vs. Calcutta Knitwears reported in [2014] 43 Taxmann.com 446 (SC) to buttress his argument that satisfaction note could not be prepared prior to the issuance of notice against the searched persons. Reliance was also placed on CBDT Circular No.24/2015 dated 31.12.2015 wherein the CBDT had clarified that the judgment of the Hon'ble Apex Court laying down the guidelines for assessments u/s 158 BD (in the case of CIT vs. Calcutta Knitwears (supra)) is also be applicable to proceedings u/s 153C. Reliance was also placed on certain other judicial precedents from the Tribunal on the same issue. 3.1 With respect to assessee's appeal for Assessment Year 2008-09, the learned AR submitted that in this year, the assessment year deserved to be quashed on the ground of non-issuance and non-service of the mandatory notice u/s 153C of the Act to the assesse. The Ld. AR submitted that in this case the search was initiat....
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....ary, it could not be held that agreement was not genuine. The learned CIT-DR vehemently argued that the assessee's appeals should be heard on merits also and relief should not be give to the assessee on mere technicalities. 5.0 We have heard the rival submissions and have also perused the material available on record. As far as assessment year 2007-08 is concerned, we have also perused the notice issued u/s 153A of the Act in the case of Sh. Vipin Verma i.e., the searched person from whom the cash was seized. This notice is undisputedly dated 6th January, 2009. We also note that in the case of the assessee, the notice u/s 153C was issued on 27.11.2008 right after the receipt of the satisfaction note dated 27.11.2008 from the Assessing Officer of the searched person i.e., Sh. Vipin Verma. The assessment order was passed on 31.12.2009 in the case of the assessee whereas and in the case of the Sh. Vipin Verma i.e., the searched person the notice u/s 153A was issued on 06.01.2009 and the assessment was completed on 31.12.2009. Thus, admittedly and undisputedly the notice u/s 153C in the case of the assessee was issued prior to the issuance of notice u/s 153A in the case of the searc....