TaxTMI 
TaxTMI 
2021 (5) TMI 547
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.... discussion to this effect reads as follows: 5. Validity of assessment u/s. 153C: 5.1 The plea taken by the appellant's AR, in the written submissions furnished during the course of appellate proceedings, and in the additional grounds filed, is that assessment u/s. 153C is invalid due to the following reasons: "The appellant submits that the appellants have made an application under RTI Act for copies of order sheets and also copies of information with respect to satisfaction note from the files of Sri M. Srinivasa Reddy and M/s. MSR Constructions. Copies of of order sheets and satisfaction note obtained are enclosed. The Appellant submits that the following satisfaction note was found in the file of the Appellant: Satisfaction note u/s. 153C of IT Act. In the case of M/s. MSR Constructions for A.Y. 2014-15 A search & seizure operation u/s. 132 has been conducted on 14-12-2015 in the residence of Sri Mogili Srinivasa Reddy by the DDIT (Inv.), Unit-IV(1) Vijayawada after obtaining warrant of authorization from the Pr. Director of Income Tax. (Inv.), Hyderabad. During the course of search proceedings, dairy containing....
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.... the AY 2014-15 is as under: Satisfaction note U/s. 153C of the IT Act, in the case of M/s. MSR Constructions for the AY 2014-15 "A search & seizure operation U/s. 132 has been conducted on 14-12-2015 in the residence of Sri Mogili srinivasa reddy by the DDIT(inv), Unit-IV(1) Vijayawada after obtaining warrant of authorization from the Pr. Director of Income Tax (inv), Hyderabad. During the course of search proceedings, dairy containing details of various payments made in cash by assessee firm was found at the residence of managing partner Sri Mogili Srinivasa Reddy. The same was seized vide annexure-A/MSR(Res)/01 to 7. These payments are not recorded in audited books of accounts. Therefore I am satisfied that above mentioned document seized from the premises of Sri Mogili Srinivasa Reddy relate to M/s. MSR constructions and has bearing on the income of M/s. MSR constructions for the AY 2014-15." The satisfaction note placed on record of M/s. MSR Constructions (the assessee) for the AY 2014-15 is as under: Satisfaction note U/s. 153C of the IT Act, in the case of M/s. MSR Constructions for the AY 2014-15 "A search & seizure oper....
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....of account or documents seized or requisitioned belongs or belong to a person other than the person referred to in section 153A. Thereafter, the Assessing Officer having jurisdiction over third party on receipt of the seized material or books of account or document being handed over to him shall record his own satisfaction after examining the same independently without being influenced by the satisfaction of the seizing officer. In other words, it is not an automatic action. Satisfaction of two officers is missing. ... The aforesaid section mandates recording of satisfaction of the Assessing Officer(s) is a pre-condition for invoking jurisdiction and it is not a mere formality because recording of satisfaction postulates application of mind consciously as the documents seized must be belonging to the any other person other than the person referred to in section 153A It was contended that the same Assessing Officer was involved in the matter. This fact does not dispense with above requirement. It is settled position of law that when a thing is to be done in one particular manner under law this has to be done in that manner alone and not other way. The Trib....
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....3) rws 153C, on the ground that there is no satisfaction recorded by the A.O. of the searched party. The relevant portion of the Hon'ble ITAT's order is reproduced herewith: "In order to verify the facts regarding the issues raised in the additional grounds of appeal, the DR was directed to verify whether any satisfaction was recorded U/S. 153A of the Act in the case of the person searched in order to initiate proceedings u/s. 153C of the Act in the case of the assessee. The learned DR has filed before us a copy of the letter of the DOT Central Cirlce-2(1) Hyderabad dated 29.01.2016 which is as under: "Office of the Dy. Commissioner of Income Tax, Central Circle-2(1), Room No. 612, 6thfloor, Aayakar Bhavan, Basheer Bagh, Hyderabad. F. No. DCIT/CC2(11/Satisfaction Note/2016-17. Date: 29/12/16. The Senior Authorised Representative II Income Tax Appellate Tribunal A - Bench, Hyderabad. Sub: Appeal in the case of M/s. Madhucon Infra Limited - PAN: AAECM6443Q-for the assessment years 2010-11 - ITA No. 266/HI 15 - submission Report _ Regarding, Ref. 1) Letter in F. No. Sr. AR-II/ITAT/A-Bench/2661-15/2016-17, dated 05.....
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....ference does not survive with no valid satisfaction/reasons recorded by the Assessing Officer of the searched party. As such, the proceedings u/s. 153C are held to be annulled, on the ratio and the similar facts of the decisions by the jurisdictional High Court and the jurisdictional ITAT, as referred to in this order. Since the order under reference is held to be non-existent, the other grounds of appeal do not require separate adjudication. On these lines, the appeal of the assessee against the order u/s. 143(3) rws 153C, is treated as allowed, subject to the condition that the assessed income will not go below the returned/admitted income shown in return of income filed by the assessee, in pursuance of notice u/s. 153C. The grounds related to this issue are therefore ALLOWED. 6.0 In the result, the appeal of the appellant for the A.Y. 2014-15 is ALLOWED. 3. We have heard rival submissions against and in support of the CIT(A)'s impugned action quashing Section 153C assessment in the instant three cases. The Revenue's vehement contention is that since the assessing authority herein is common for both the searched as well as the instant assessee, the twin satisfaction....
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....other provisions of Chapter XIV-B shall apply. 6.1 It cannot be disputed that the aforesaid requirements are held to be mandatorily complied with. There can be two eventualities. It may so happen that the Assessing Officer of the searched person is different from the Assessing Officer of the other person and in the second eventuality, the Assessing Officer of the searched person and the other person is the same. Where the Assessing Officer of the searched person is different from the Assessing Officer of the other person, there shall be a satisfaction note by the Assessing Officer of the searched person and as observed hereinabove that thereafter the Assessing Officer of the searched person is required to transmit the documents so seized to the Assessing Officer of the other person. The Assessing Officer of the searched person simultaneously while transmitting the documents shall forward his satisfaction note to the Assessing Officer of the other person and is also required to make a note in the file of a searched person that he has done so. However, as rightly observed and held by the Delhi High Court in the case of Ganpati Fincap (supra), the same is for the administrati....
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....i Bagh, New Delhi under Section 153C of the Income Tax Act, 1961. The jurisdiction of this case has been assigned to this Office u/s. 127 of the Income Tax Act, 1961 by the worthy Commissioner of Income Tax-III New Delhi vide order F. No. CITIII/Delhi/Centralization/10121312455 dated 15.01.2013. By virtue of the authorization of the Director of Income Tax (Investigation), Chandigarh, a search & seizure operation u/s. 132(1) of the Act was carried out on 08/09.04.2010 at the residential/business premises of Sh. Tejwant Singh & Sh. Ved Parkash Bharti Group of cases, Karnal, Panipat & Delhi and a survey u/s. 133A of the IT. Act, 1961 was also carried out at the business premises of M/s. Super Mall (P) Ltd. Karnal & New Delhi. During the course of search on 08/09.04.2010 at residence of Sh. Ved Parkash Bharti who is a Director in the assessee company M/s. Super Mall (P) Ltd., Pen drives were found and seized as per Annexure-3 from vehicle No. HR06N-0063 parked in front of the residence of Sh. Ved Parkash Bharti. Some documents as per Annexure A-1 were seized after taking print out of the above said pen drives. These documents contain the details of cash receipt on sale of shop....