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2017 (2) TMI 553 - BOMBAY HIGH COURT

2017 (2) TMI 553 - BOMBAY HIGH COURT - TMI - Validity of proceedings under Section 153C - addition u/s 69C - Held that:- The Revenue has to strictly comply with Section 153C of the Act. We are of the view that non satisfaction of the condition precedent viz. the seized document must belong to the respondent assessee is a jurisdictional issue and non satisfaction thereof would make the entire proceedings taken thereunder null and void. The issue of Section 69C of the Act can only arise for cons .....

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S. Sanklecha And A. K. Menon, JJ. Mr. Ashok Kotangale with Ms.Padma Divakar for the appellant Mr. J.D. Mistri with Mr.P.C. Tripathi i/b Raj Darak for the respondent ORDER P. C. 1. These two Appeals under Section 260A of the Income Tax Act, 1961 (the Act) challenges the common impugned order dated 22nd March, 2013 passed by the Income Tax Appellate Tribunal (the Tribunal). The common impugned order disposed of 67 appeals pertaining to 52 different assessees, amongst them were the present two res .....

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rges only following question of law for our consideration : (i) Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in ignoring crucial evidence and surrounding circumstances and proceeding to interpret Section 153C of the Act, narrowly and mechanically, and deleting the additions made under Section 69C of the Act both on merits and point of law ? 3. The undisputed facts before us are that in search and seizure action under Section 132 of the Act was .....

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efore us. 4. The Tribunal by the impugned order found that the documents seized from possession of Mr.Dilip Dherai did not belong to the assessee. Consequently, it held that the Assessing Officer did not have jurisdiction to initiate proceedings under Section 153C of the Act, as at the relevant time jurisdiction of Assessing Officer to proceed consequent to the search is only when money, bullion, jewellery or other valuable article or thing or books of accounts or documents seized or requisition .....

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before us, consequently, the Assessing Officer did not have jurisdiction under Section 153C of the Act to issue notice to the respondents - assessees. Consequently, the Tribunal also held that satisfaction recorded by the Assessing Officer before initiating assessment proceedings in respect of two respondents - assessees before us were also not sustainable. In the above view, the impugned order of the Tribunal held that the Assessing Officer did not have jurisdiction to initiate proceedings und .....

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note that in terms of Section 153C of the Act at the relevant time i.e. prior to 1st June, 2015 the proceedings under Section 153C of the Act could only be initiated/proceeded against a party - assessee if the document seized during the search and seizure proceedings of another person belonged to the party - assessee concerned. The impugned order records a finding of fact that the seized documents which formed the basis of initiation of proceedings against the respondent assessees do not belong .....

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l for the respondent - assessee that the above decision was reversed by the Supreme Court in CIT vs. Vijaybhai N. Chandrani (2013) 357 ITR 713. However, we find that the Apex Court reversed the view of Gujarat High Court on the ground that efficacious alternative remedy was available to the petitioner to raise its objections before the authorities under the Act. Therefore, the Gujarat High Court should not have exercised its extra ordinary writ jurisdiction to entertain the petition. However, th .....

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