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2020 (7) TMI 657 - ITAT RAJKOTValidity of notice issued u/s 153C - whether the document found from the premises of the 3rd party belongs to the assessee as provided under section 153C prior to the amendment therein which is effective from 1stJune 2015? - Document found from the premises of the 3rd party - HELD THAT:- It is transpired that the document found during the search at the place of searched party must belong to the assessee for initiating the proceedings under section 153C of the Act. The word belong used in section 153C requires that there has to be control and possession of the assessee (person other than searched person) on such document even though the assessee is not legal owner. As such the document found in the case on hand from the premises of the 3rd party, the assessee had no control of whatsoever on such document. Therefore in our considered view such document cannot be termed as belonging to the assessee. Once a document does not belong to the assessee as mandated under the provisions of section 153C of the Act, prior to the amendment, does not authorize the AO to initiate the proceedings against the assessee - See PEPSICO INDIA HOLDINGS PRIVATE LIMITED [2014 (8) TMI 898 - DELHI HIGH COURT]. There cannot be any question of initiating the proceedings under section 153C of the Act, until and unless the documents found during the course of search from the premises of the 3rd party belongs to the assessee. Whether the amendment brought under the provisions of section 153C where the word ‘belong’ was replaced with the word ‘pertain’ is applicable for the year under consideration? - Provisions of section 153C as applicable on the date of search will be applied to the proceedings initiated therein. Thus there remains no ambiguity to the fact that the provisions of section 153C of the Act prior to the amendment therein, will be applicable in the case on hand which requires the AO to arrive at a satisfaction that the documents found from the premises of the 3rd party in the course of search belongs to the assessee. We have already explained the meaning of the word belongs in the preceding paragraph. In view of the above, we are conscious to the fact that the seized material found from the premises of the 3rd party in the course of search does not belong to the assessee. Thus in our considered view the proceedings under section 153C of the Act, cannot be initiated. Addition on account on-money paid against purchase of agricultural land - HELD THAT:- There was no mention/reference of survey No. 1242 in the excel sheet found during the course of search, therefore we are of the view that there cannot be any addition on account of on money. It is because there was no iota of evidence available with the AO suggesting that there was any on money paid by the assessee. Regarding the land bearing survey No. 1223, we note that this impugned survey number was very much mentioned in the excel sheet found from the 3rd party as discussed above. However that information cannot be the basis of making any addition to the total income of the assessee. It is because it does not suggest that any on money has been paid by the assessee. Furthermore it is a piece of information found from the 3rd party which has no dealing of whatsoever with the assessee. Moreover, no fact has been brought on record by the AO except that the relatives of the assessee has purchased some flats property constructed by ADPL which is not sufficient enough to draw any inference against the assessee based on such excel sheet. Thus in the absence of any documentary evidence about the payment of on money, we hold that there cannot be any addition to the total income of the assessee. Case followed JAWAHARBHAI ATMARAM HATHIWALA VERSUS INCOME-TAX OFFICER [2009 (10) TMI 900 - ITAT AHMEDABAD].
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