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2015 (4) TMI 44

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..... essment order in accordance with law. Since we have set-aside the matter back to the file of the Assessing Officer on the preliminarily ground, the merits of the impugned addition of ₹ 39,55,062/- have not been examined by us, which would be re-visited by the Assessing Officer in accordance with law in the ensuing proceedings. - Decided in favour of assessee for statistical purposes. - ITA No.1705/PN/2013, ITA No.1949/PN/2013, ITA No.1950/PN/2013 - - - Dated:- 18-3-2015 - Shri G.S. Pannu And Ms. Sushma Chowla JJ. For the Appellant : Mr. M. K. Kulkarni For the Respondent : Mr. Rajesh Damor ORDER Per G. S. Pannu, AM The captioned three appeals were heard together as the assessment in all the three cases have arisen on account of a search action u/s 132(1) of the Income Tax Act, 1961 (in short the Act ) carried out in the case of M/s Rajashree Enterprises, Prop. Shri Ramanlal Shah and M/s Maheshwari Financiers, Pro. Shri Mahendra Shah at Adoni, Andhra Pradesh. It was submitted by the Ld. Representative that appeals involve common issues and therefore they have been clubbed and heard together and a consolidated order is being passed for the sake .....

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..... he Act were finalized in the cases of Shri Ramanlal Shah, and Shri Mahendra Shah. The claim of the appellant is that the provisions of section 158BD of the Act could be invoked in the hands of the assessee only after recording the mandated satisfaction. It is pointed out that the assessee has not been provided with copy of the satisfaction Note and therefore the assessment completed by the Assessing Officer suffers from a legal defect. Justifying the admission of the said Additional Ground of Appeal, the Ld. Representative submitted that the same is a legal issue and the necessary facts are emerging from record and therefore it should be admitted for adjudication. The Ld. Representative also pointed out that under identical circumstances in the case of M/s Bhagyashree Steel Center vs. DCIT, vide ITA No.1706/PN/2013 dated 21.01.2015 the Pune Bench of the Tribunal has admitted similar Additional Ground of Appeal and restored the matter back to the file of Assessing Officer following the judgement of the Hon ble Delhi High Court in the case of Janki Exports International vs. Union of India, 278 ITR 296 (Delhi), a copy of the said order has also been placed on record. 5. On the oth .....

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..... cted on 12.10.2001. The covering letter is accompanied by a satisfaction note running into 10 pages which details the books of accounts, documents, bank pass books etc. that was seized and verified during the course of search and the enquiries that were conducted post-search. It details the modus operandi adopted by various parties including the appellant, in collusion with Rajashree Enterprises and Maheshwari Financiers to route their unaccounted money through that concern in the garb of loan. Therefore, the satisfaction of the Assessing Officer who has jurisdiction over the searched persons viz. Maheshwari Financiers and Rajashree Enterprises is found to be clearly recorded that the undisclosed income found in the books belongs to the appellant. The extract of the books of accounts including the loan amounts and interest thereon have been duly reproduced in the satisfaction note and therefore, the requirement of sec. 158BD that the books of accounts, other documents or assets seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person, is seen to have been met. Therefore, although the appellant has not been provided a copy of s .....

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..... ons for issuing notices. The Assessing Officer is bound to furnish reasons within a reasonable time. On receipt of reasons, the noticee is entitled to file objections to issuance of notice and the Assessing Officer is bound to dispose of the same by passing a speaking order. 7. Using the same parity of reasoning, we direct the Assessing Officer to supply the reason recorded for arriving at a satisfaction to the petitioner within a reasonable time upon the petitioner filing a return as required by the impugned notice. On receipt of the same, the petitioner would be entitled to file objections to the issuance of the notice and the Assessing Officer shall dispose of the same by passing a speaking order. It will be open for the petitioner to take the objection with regard to limitation and it will be for the Assessing Officer to pass a speaking order. After such speaking order is passed, the Assessing Officer shall proceed further in accordance with law. 8. The aforesaid discussion by the Hon ble High Court reveals that the provisions of section 158BD of the Act has been found to be somewhat analogous to section 147 of the Act. On that basis, it has been explained by the Hon bl .....

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..... faction of the Assessing Officer which has been recorded and that such person must be given a reasonable opportunity to put-forth his objection to the same. In the present case, the Ld. Representative for the assessee pointed out that such satisfaction note has not been put across to the assessee which is clearly emerging from following discussion made by the CIT(A) in the impugned order :- 4.1 I have also perused the satisfaction note of the Assessing Officer (ACIT, Central Circle 2(3), Pune) of Rajashree Enterprises/ Maheshwari Financiers which was enclosed by way of a covering letter dated 24.05.2004. This covering letter clearly shows that the loan transactions amounting to ₹ 32,00,000/- were shown in the books of accounts of Rajashree Enterprises and Maheshwari Financiers against whom search and seizure was conducted on 12.10.2001. The covering letter is accompanied by a satisfaction note running into 10 pages which details the books of accounts, documents, bank pass books etc. that was seized and verified during the course of search and the enquiries that were conducted post-search. It details the modus operandi adopted by various parties including the appellant, in .....

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..... the merits of the impugned addition of ₹ 39,55,062/- have not been examined by us, which would be re-visited by the Assessing Officer in accordance with law in the ensuing proceedings. 11. In the result, the appeal of the assessee is allowed for statistical purposes. 12. At the time of hearing, it was common point between the parties that the facts and circumstances in the other two captioned cases, namely, (i) Rikabchand R. Oswal; and, (ii) Kokila Rikabchand Oswal are pari-materia to those considered by us in the case of M/s Manoj Himmatlal Shah (supra) in the earlier paras. Therefore, our decision in the case of M/s Manoj Himmatlal Shah (supra) shall apply mutatis-mutandis in the other two captioned appeals also. Accordingly, in the other two captioned appeals, the impugned orders of the lower authorities are set-aside and the matter is restored back to the file of the Assessing Officer who shall supply the reasons recorded for arriving at the satisfaction for invoking section 158D of the Act to the assessee. On receipt of such reasons, assessee shall be entitled to file objections which shall be disposed-off by the Assessing Officer by way of a speaking order and onl .....

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