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2021 (8) TMI 76 - AT - Income TaxValidity of initiation of proceedings u/s 153C - validity of satisfaction note - whether seized documents “belong to” the assessee? - HELD THAT:- A careful perusal of the satisfaction notes show that the assessing officer has recorded the fact of conducting of search in the premises of the assessees herein and seizure of certain documents - the search in the premises of the assessee is on the basis of warrant issued in the name of Sri B Nagendra. Hence the assessees herein are “Other persons”, as referred to in sec.153C - In none of the satisfaction notes, the AO has recorded a finding that the seized documents “belong to” the assessees herein. Hon’ble Supreme Court has held in the case of Super Malls Private Limited [2020 (3) TMI 361 - SUPREME COURT] that the AO must be conscious and satisfied that the documents seized/recovered from the searched person belonged to the other person. Hence, it is the duty of the AO to apply his mind and should consciously and mandatorily state in the satisfaction note that the seized documents belong to “other person”. Without recording such a satisfaction, it cannot be presumed that the seized materials belong to “other persons”, in which case the AO could not have initiated proceedings against the “other persons” u/s 153C of the Act. Initiation of proceedings u/s 153C of the Act in the instant cases is bad in law - Decided in favour of assessee.
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