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2014 (9) TMI 212 - AT - Income TaxValidity of assessment proceedings initiated u/s 153C – Proceedings initiated on seized material – Seized documents belonging to assessee or not - Held that:- The AO could not have initiated proceedings u/s 153C of the Act solely on the basis of the loose sheets - Reading of section 153C of the Act makes it clear that the primary condition for initiating proceedings u/s 153C, the AO must be satisfied that jewellery and other valuable articles or books of accounts or documents seized belongs to a person other than the person referred to in section 153A of the Act - the so called seized material on the basis of which the AO has initiated proceedings u/s 153C of the Act was admittedly not seized from the possession of the assessee but a third person Sri D. Nagarjuna Rao against whom the search and seizure operation was carried out u/s 132 of the Act - merely because D. Nagarjuna Rao has stated that he has received the amount from Tirumala Rao towards sale of the property it cannot be inferred on that basis alone, that the assessee has paid the amount towards purchase of the property - both the assessee and Tirumala Rao have denied of making the said payment to B. Nagarjuna Rao – thus, the seized document on the basis of which proceeding u/s 153C was initiated cannot be said to be belonging to the assessee - the assumption of jurisdiction u/s 153C has to be held as invalid and the assessment order passed must be declared as without jurisdiction - since the seized material has no reference to the assessee, it cannot be considered to be belonging to the assessee for enabling the initiation of proceedings u/s 153C of the Act – Decided in favour of assessee.
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