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2014 (8) TMI 898 - HC - Income Tax
Notice u/s 153C – Search and seizure u/s 132(1) – Satisfaction note - Whether the AO of the searched person (the Jaipuria Group) could be said to have arrived at a satisfaction that the documents mentioned above belonged to the petitioners – Held that:- Relying upon Pepsi Foods Pvt. Ltd. Versus. Assistant Commissioner of Income Tax [2014 (8) TMI 425 - DELHI HIGH COURT] it has been rightly held that before the provisions of Section 153C of the said Act can be invoked, the AO of the searched person must be satisfied that the seized material (which includes documents) does not belong to the person referred to in Section 153A (i.e., the searched person) - In the Satisfaction Note, there is nothing therein to indicate that the seized documents do not belong to the Jaipuria Group - This is even apart from the fact that there is no disclaimer on the part of the Jaipuria Group insofar as these documents are concerned.
The finding of photocopies in the possession of a searched person does not necessarily mean and imply that they “belong” to the person who holds the originals - Possession of documents and possession of photocopies of documents are two separate things - While the Jaipuria Group may be the owner of the photocopies of the documents it is quite possible that the originals may be owned by some other person - unless it is established that the documents do not belong to the searched person, the question of invoking Section 153C of the said Act does not arise.
The AO should not confuse the expression “belongs to” with the expressions “relates to” or “refers to” - none of the three sets of documents – copies of preference shares, unsigned leaves of cheque books and the copy of the supply and loan agreement – can be said to “belong to” the petitioner - the ingredients of Section 153C of the Act have not been satisfied - thus, the notice issued u/s 153C is set aside – Decided in favour of Assessee.