TMI Blog2017 (2) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... to the legal position explained by the Hon'ble Delhi High Court in the case of Pepsico India Holdings (P.) Ltd (2014 (8) TMI 898 - DELHI HIGH COURT) wherein it is held that the expression “relates to” cannot be equated to the expression “belongs to” which finds a mention in section 153C of the Act. Therefore, considering that Revenue has failed to establish that the documents in question do not belong to the searched person, the question of invoking of section 153C of the Act in the hands of the assessee company merely on the strength that the documents being related to it, cannot be justified. We uphold the ultimate conclusion of the CIT(A) annulling the assessment, albeit on the ground that above discussed ingredients of section 153C of the Act have not been satisfied in this case. - ITA No. 1640/Mum/2013, C.O. No. 91/Mum/13 - - - Dated:- 27-1-2017 - Shri G. S. Pannu, Accountant Member And Shri Sanjay Garg, Judicial Member Revenue by : Ms. Bharti Singh Respondent by : S/ShriRakesh Joshi/ Manish Pipara ORDER Per G. S. Pannu, A. M The captioned appeal filed by the Revenue and Cross Objection by the assessee pertaining to assessment year 2004-05 are dire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peal before the CIT(A) on facts and in law. On the point of law, assessee contended that the notice issued under section 153C of the Act was bad in law. Firstly, it was contended that there was no satisfaction recorded prior to the issue of notice under section 153C of the Act; secondly, that a search action in the case of Bharat Shah Group did not reveal any document or material or books of account which belonged to the assessee and, therefore, the initiation of proceedings under section 153C of the Act was bad in law; and thirdly, that search action was conducted on Bharat Shah Group on 15/03/2008, whereas the notice under section 153C was issued on 09/09/2010 i.e. almost after two years and six months, which is beyond a reasonable time, therefore, the same was bad in law. The CIT(A) has since upheld the stand of the assessee and concluded that conditions precedent for issuance of notice under section 153C r.w.s. 153A of the Act are not fulfilled in the present case and, therefore, according to him the consequent assessment u/s 153C of the Act stands nullified. Accordingly, he has annulled the assessment. Against such decision of the CIT(A), Revenue is in appeal before us. 4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of P.Srinivas Naik V/s ACIT (2009) 117 ITD 201(Bang) has held that the language used in sec. 153C is materially different from the language used in section 153BD. The expression belonging to the assessee cannotes both the complete ownership and limited ownership or interest. However, there should be some limited ownership of interest if it is to be permitted that the assets belongs to the assessee. In the instant case, documents or books of account found during the course of search and seized cannot be termed to be indicating any limited interest of the ownership of the assessee in such books of account or documents. 8.1 Central issue in the present case is, can it be stated that any money, bullion, jewellery or other valuable article or thing or books of account or documents seized from the premises of Shri Bharat Shah or its group of cases during search operations belonged to the present appellant. Secondly, can it be stated that such bullion, jewellery or other valuable article or thing or books of account or documents belonging to the present appellant were handed over to the present appellant before issuing the notice under section 153C of the Act . The LAO has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bharat Shah or its group of cases during the search operations belonged to the present appellant. (ii) Such books of accounts or the documents or assets seized and belonging to the present appellant were required to be handed over to the present LAO before issuance of notice under section. 153C of the Act in the present case. 8.3 No material nor any evidences were placed before me, neither by the appellant nor by the LAO, to prove that the aforesaid mandatory conditions were fulfilled in the present case. In view of the above and in the light of previously mentioned judicial decisions and in accordance with the provisions of sec.153C of the Act the assessment framed under section 153C of the Act is annulled in this case. Therefore, ground of appeal No.1(2) is allowed. 7. We have carefully considered the rival submissions. Factually speaking, it is quite clear that the present proceedings have been initiated by the Assessing Officer on the strength of section 153C of the Act. It is also clear that the recourse to section 153C of the Act has been taken by the Assessing Officer based on the search action under section 132(1) of the Act, which had taken place in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itioned belongs to a person other than the searched person. The phraseology of section 153C of the Act further prescribes that only after such satisfaction, the Assessing Officer of the searched person can hand over such documents to the Assessing Officer having jurisdiction of such other person. Furthermore, the Assessing Officer of such other person can issue a notice to that person to assess or reassess his income under section 153C of the Act only after such handing over from the Assessing Officer of the searched person. Be that as it may, coming to the facts of the present case, at the time of hearing the Ld. Departmental Representative also furnished a note dated 06/09/2010 prepared by the Assessing Officer of the instant assessee, which reads as under:- M/s. Layer Exports Pvt. Ltd. is one of the group companies of Bharat Shah, in whose case Search Seizure action was conducted on 15.03.2008. Information has been received that M/s. Mangalam Gems Pvt. Ltd. an assessee of this charge, has purchased property from Layer Exports Pvt. Ltd. and the payments towards the said property include cash elements also. In this regard copy of seized loose papers 1 to 19 has been forward ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'ble Delhi High Court noted that the registered sale deed belongs to the purchaser of the property although it would relate to or refer to the vender also. According to the Hon'ble Delhi High Court, if purchaser s premises are searched and the registered sale deed is seized, it cannot be said that it belongs to the vendor just because his name is mentioned in the document. In the converse, it was noted by the Hon'ble Delhi High Court, that if vendor s premises are searched and copy of the sale deed is seized, it cannot be said that the copy belongs to the purchaser just because it refers to him and he holds the original sale deed. In our considered opinion, the aforesaid legal position explained by the Hon'ble Delhi High Court in the context of section 153C of the Act is quite pertinent in the present case also. 7.2 In the present case, the information sent by the Assessing Officer of the searched person to the Assessing Officer of the assessee was based on certain notings on a loose paper found in the premises of Bharat Shah Group of cases. Quite clearly, even the Assessing Officer of the searched person, as manifested by the information sent to the instant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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