TMI Blog2015 (10) TMI 2015X X X X Extracts X X X X X X X X Extracts X X X X ..... ve, we respectfully following the decision of Hon’ble Apex Court in the case of Manish Maheshwari (2007 (2) TMI 148 - SUPREME COURT OF INDIA) and decision of Lalitkumar M. Patel (2013 (7) TMI 778 - GUJARAT HIGH COURT), hold that the notices issued u/s 153C were invalid; accordingly the same are quashed. Consequently, the assessment orders framed u/s 153C r.w.s. 153A are also quashed. Since the assessment order itself has been quashed, the other grounds of the assessee’s appeal which is with regard to determination of the income of the assessee needs no adjudication. - Decided in favour of assessee. - 68 to 73/Ahd/2012, 28 to 31/Ahd/2012, 32 to 35/Ahd/2012, 36 to 41/Ahd/2012, 42 to 47/Ahd/2012, 48 to 52/Ahd/2012, 53 to 56/Ahd/2012, 57 & 58/Ahd/2012, 60 to 63/Ahd/2012, 64 to 67/Ahd/2012 - - - Dated:- 11-9-2015 - SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI KUL BHARAT, JUDICIAL MEMBER For The Assessee : Shri S.N. Soparkar with Shri P.M. Mehta, AR For The Revenue : Shri R.I. Patel, CIT-DR ORDER PER BENCH : This bunch of appeals by different assessees have been filed against different orders of the learned Commissioner of Income-tax (Appeals)-IV, Ahmedabad. Si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bullion, jewellery or other valuable article/thing or books of account/documents seized from the person searched belongs to the assessee. He submitted that, admittedly, the laptop was belonging to Shri Rameshbhai B. Shah. Therefore, any data recorded in such laptop also belongs to Shri Rameshbhai B. Shah and not to the assessee. Such data may be relating to different persons, but it cannot be said to belonging to various different persons. He also referred to the reply of the Departmental Representative dated 06.07.2015 alongwith which the Departmental Representative has enclosed the reply of the Assessing Officer dated 06.07.2015. In such reply, the Assessing Officer has referred an affidavit of Shri Rameshbhai B. Shah in support of his contention that the material seized from him was pertaining to various entities and he has also offered the additional income of ₹ 6.5 crores on behalf of the entire Group. He pointed out from the affidavit, especially paragraph Nos. 5.1 and 5.2; and stated that in the affidavit Shri Rameshbhai B. Shah has clearly mentioned that the digital data of total 65 entities found from his laptop were in respect of cash management done by him and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Properties (P) Ltd vs. DCIT, (2013) 60 SOT 088 (Delhi) 5. The ld. Departmental Representative, on the other hand, relied upon the orders of the authorities below. He filed written submissions dated 06.07.2015 accompanied by the written submissions of the Assessing Officer, copy of the notice issued u/s 153C and affidavit of Shri Rameshbhai B. Shah. He again filed another written submissions in which he has contended that the satisfaction has duly been recorded by the Assessing Officer in the notice issued u/s 153C. He referred to the notice and pointed out that in the notice the Assessing Officer has duly mentioned that I am satisfied that money/bullion/jewellery/other valuable articles or things / books of accounts / documents seized belong(s) to you. Therefore, your income of six assessment years immediately preceding the assessment year relevant to previous year in which the aforesaid search was conducted was made i.e. from A.Ys. 2003-04 to 2008-09 is required to be assessed / re-assessed, in accordance with the provisions of section 153A r.w.s. 153C of the Act. 6. He further submitted that even if there are some procedural irregularities, the same is curable, in view o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supra). The ITAT, Ahmedabad Bench mainly followed the decision of Hon ble Kerala High Court in the case of Panchajanyam Management Agencies and Services (supra) which is subsequently not accepted by Kerala High Court itself. He, therefore, reiterated that the notice issued u/s 153C for all the years may be quashed. 8. We have carefully considered the arguments of both the sides and perused the material placed before us. Section 153C of the Incometax Act, 1961 reads as under:- 153C. [(1)] Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that any money, bullion, jewellery or other valuable article or thing or books of account or documents seized or requisitioned belongs or belong to a person other than the person referred to in section 153A, then the books of account or documents or assets seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person and that Assessing Officer shall proceed against each such other person and issue such other person notice and assess or reassess income of such other person in accordan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the provisions of the said Chapter are applied in relation to any person other than the person whose premises had been searched or whose documents and other assets had been requisitioned under section 132A of the Act. 10. Though the above decision of Hon ble Apex Court is with regard to issuance of notice u/s 158BD; however, the language of Section 153C and 158BD is similar; therefore, the above decision of Hon ble Apex Court would be squarely applicable while considering the validity of issuance of notice u/s 158BC. 11. We find that Hon'ble Gujarat High Court, in the case of CIT Vs. Meghmani Organics Limited vide Tax Appeal No.2077 of 2009, compared the language of Section 153C and Section 158BD at internal page 6 of their order and held as under:- Section 153C which is similarly worded to section 158BD of the Act, provides that where the Assessing Officer is satisfied that any money, bullion, jewellery or other valuable article or thing or books of account or documents seized or requisitioned belongs or belong to a person other than the person referred to in Section 153-A he shall proceed against each such other person and issue such other person notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the earlier decision in the case of Panchjanyam Management Agencies and Services (supra). The decision of ITAT, Ahmedabad Benches relied upon by the ld. CIT-DR in the case of Bharat Ginning Pressing Factory (supra) also followed the decision of Hon ble Kerala High Court in the case of Panchjanyam Management Agencies and Services (supra). We find that subsequently the Hon ble Kerala High Court in the case of Dr. T.M. Kuriachan, [2012] 23 taxmann.com 28 (Kerala), considered the decision of earlier Division Bench in the case of Panchjanyam Management Agencies and Services (supra) and did not agree with the view expressed therein. The relevant finding of their Lordships in paragraph No.6 of the report, i.e., [2012] 23 taxmann.com 28 (Kerala), reads as under:- 6. The Revenue has brought to our notice the decision of this Court in Commissioner of Income Tax v. Panchajanyam Management Agencies Services, reported in [2011] 333 ITR 281 (Ker.), wherein the Division Bench of this Court of which one of us (CNR(J)) is a member, has taken the view that the satisfaction under Section 158BD is only about evidence of undisclosed income of a person other than the assessee searched and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see under Section 158BC or not. So much so, the satisfaction for transferring a file by one Officer to another is only prima facie satisfaction on jurisdiction and on identifying the Assessing Officer, who has the jurisdiction over the other assessee, the materials and evidence collected in search or requisition are transferred. The satisfaction for initiation and completion of assessment under Section 158BD is obviously that of the Assessing Officer to whom transfer is made by the Officer who conducted search. Even though the above is our view and we have taken such a view in the decision above referred, the learned counsel for the respondent assessee has referred to the decision of the Supreme Court in Manish Maheshwari v. Asst. Commissioner of Income Tax Another, reported in 289 ITR 341, wherein the Supreme Court has taken the view that if satisfaction is not recorded by the Assessing Officer for transferring the file under Section 158BD, the assessment made under Section 158BC is invalid. Since the decision of the Supreme Court above referred is binding on us, we have to only dismiss the Departmental Appeal. We, accordingly, dismiss the appeal filed by the Revenue. 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been fulfilled. He further urged that the Tribunal while dealing with the issue in question has appropriately scanned the entire materials and has rightly arrived at a correct decision which calls for no intervention. 8. On thus hearing both the sides and on examination of the order impugned and the materials produced before us, for the reasons to follow herein-in-after, we are of the opinion that this appeal merits no consideration and deserves dismissal. 15. Their Lordships reiterated the same views again in paragraph Nos. 11 to 14 of the judgment which reads as under:- 11. Thus the law laid down on the subject is very clear that for taking recourse to block assessment under section 158BC in relation to the person not searched, whenever search has been conducted under section 132 or the documents have been requisitioned under section 132A, the Assessing Officer of the searched person needs to record his satisfaction that undisclosed income belongs to the person, other than the person with respect to whom search was carried out under Section 132 of the Act. He is also required to hand over the books of account or other documents or assets seized, to the Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficer of the persons searched; (2) After recording the satisfaction, Assessing Officer of person searched should handover the seized material to the Assessing Officer of such other person; (3) Thereafter, the Assessing Officer of such other person should issue notice u/s 153C. 17. In the case under appeal before us, admittedly, no satisfaction is recorded by the Assessing Officer of the person searched. In fact, no satisfaction is recorded by the Assessing Officer of the assessee under appeal before us, prior to issuing notice u/s 153C. Only in the notice u/s 153C, satisfaction is claimed to have been recorded. For ready reference, we reproduce herein below the copy of the notice issued for Assessment Year 2003-04. NOTICE UNDER SECTION 153 r.w.s. 153a OF THE INCOMETAX ACT, 1961 Date : 29.08.2008 PAN : AACFP 3995 R AY 2003-04 To M/s. Parshwa Corporation Jaldhara Apartment Opp. Maha Gujarat Hospital, College Road, Nadiad A search u/s 132 of the Income-tax Act was conducted/requisition made u/s 132A of the Income-tax Act in the group cases of Rameshbhai Babubhai Shah other group of cases on 03.04.2008. I am satisfied t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under:- 292B. No return of income, assessment, notice, summons or other proceeding, furnished or made or issued or taken or purported to have been furnished or made or issued or taken in pursuance of any of the provisions of this Act shall be invalid or shall be deemed to be invalid merely by reason of any mistake, defect or omission in such return of income, assessment, notice, summons or other proceeding if such return of income, assessment, notice, summons or other proceeding is in substance and effect in conformity with or according to the intent and purpose of this Act. 20. From the above, it is evident that as per Section 292B, any notice, summons or other proceeding would not be invalid merely by reason of any mistake, defect or omission in such return of income, assessment, notice, summons or other proceeding provided such return of income, assessment, notice, summons or other proceeding is in substance and effect in conformity with or according to the intent and purpose of this Act. However, before issuing of notice u/s 153C, the satisfaction of the Assessing Officer of the person searched is essential for assuming the jurisdiction u/s 153C by the Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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