TaxTMI 
TaxTMI 
2020 (12) TMI 54
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.... and 2153/Chny/2018 on the file of the Income Tax Appellate Tribunal, Chennai, 'C' Bench ('the Tribunal' for brevity) respectively for the assessment years 2009-10 to 2015-16. 2. The above appeals were admitted on the following substantial questions of law: "i. Whether, in the facts and circumstances of the case, the Tribunal is right in law in holding that the Assessing Officer ought not to have assumed the jurisdiction under Section 153C of the Act ? ii. Whether, in the facts and circumstances of the case, the Tribunal erred in not appreciating the fact that not bringing on record the incriminating material in the assessment order is only procedural lapse and on account of such procedural lapse, substa....
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.... of the assessee, which established and is administering a multi specialty hospital at Madurai. Simultaneously, the search action was conducted in the case of one Mr.T.John Rajasekhar, who is stated to be the supplier of medical and surgical equipment and other accessories to the hospital. The Department was of the prima facie view pursuant to the search that the funds were siphoned off through the said Mr.T. John Rajasekhar allegedly resorting to huge inflation of expenses through salaries paid to staff members by transfer of funds to the bank accounts of the employees as if salaries were paid to them. 5. Based on the seized documents, a notice under Section 153 of the Act was issued for the assessment years under consideration in the c....
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....4 Taxmann.com 290] wherein the Hon'ble Supreme Court held that where loose papers found and seized from the residence of the President of the assessee, an educational institution, indicating capitation fees received by various institutions run by the assessee did not establish correlation document-wise with the assessment years in question, the notice issued under Section 153C of the Act has to be quashed. The findings of the Hon'ble Supreme Court in this regard are as follows : "18. The ITAT permitted this additional ground by giving a reason that it was a jurisdictional issue taken up on the basis of facts already on the record and, therefore, could be raised. In this behalf, it was noted by the ITAT that as per the provi....
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....ed by the CIT(A) has been referred to and quoted by the Tribunal in the impugned common order. 9. At this juncture, it has to be pointed out that on facts, the CIT(A) and the Tribunal held that there was no material brought on record to prove the nexus between withdrawal of the amount from the bank account of the said Mr.T.John Rajasekhar and the deposits made in the bank accounts of Dr.Gurusankar, managing trustee of the assessee trust. Further, the CIT(A) and the Tribunal noted that the said Mr.T.John Rajasekhar had not admitted that money was paid back to the managing trustee of the assessee trust. Furthermore, on facts, it was found that the materials seized did not indicate any inflation of purchase by the assessee trust and that th....