TMI Blog2019 (2) TMI 155X X X X Extracts X X X X X X X X Extracts X X X X ..... satisfaction note was recorded by the Assessing Officer. Even the CIT(DR) also filed copies of the ordersheet entries, wherein, no satisfaction note was recorded. Therefore, this material conclusively established that the Assessing Officer has no jurisdiction to proceed against the appellant under the provisions of Sec.153C of the Act. Thus, in the interest of advancing substantial justice to the appellant, the delay of 2969 days can be condoned accordingly. Jurisdiction of AO u/s.153C - no satisfaction note was recorded by the AO as well as the Assessing Officer of searched person saying that the incriminating material belonging to the appellant were found during the course of search and seizure proceedings in the case of Shri D. Mayandi & others - Held that:- We must mention here that though the Ld.CIT(DR) in his covering letter had stated that copy of the satisfaction note is furnished, in fact, what is furnished is only a copies of ordersheet entries of Assessing Officer which are same as furnished by the appellant. Therefore, keeping in view the CBDT Circular No.24/2015 dated 31.12.2015 and the judgment of the Hon’ble Supreme Court in the case of Calcutta Knitwears, supra, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer lacks in jurisdiction to make additions on any other issues and thus assessment needs to be annulled. 6. The CIT(A) further failed to appreciate that recording of satisfaction by the officer as to the undisclosed nature of the incriminating material found in the search was paramount and there being no such recording, the assessment framed u/s.153C stands vitiated and needs to be cancelled. MERITS:- 7. The CIT(A) ought to have appreciated that there was lack of sufficient opportunity to the assessee and completion of assessment under sec.144 was unjustified. 8. The CLT(A) further failed to appreciate that the additions for the A.Y.s 2001-02 to 2007- 08 on account income from plying of buses was estimated by officer at 5% of gross collections as against the books maintained by assessee and was not justified in confirming the estimated addition of 3.5% in the proceedings under sec.153C of the Act and ought to have deleted the additions entirely. 9. The C1T(A) further failed to appreciate that income from Jeyam theatre for A.Y.s 2005- 06, 06-07 07-08 were added without rejection of the books maintained and hence was not justified in sustaining addition of 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an appeal. It is further stated that the AO had not recorded any satisfaction as required under the provisions of Sec.153C of the Act which is a condition precedent for invoking the provisions of Sec.153C of the Act. In support of this, he has also filed a copy of order sheet of the AO obtained under RTI Act to say that no satisfaction was recorded by the AO. He further submitted that the technicalities such as delay should not come in the way of rendering the substantial justice when the assessee had a strong case on merits. He further submitted that the delay on account of negligence on the part of Counsel constitutes a reasonable cause for condonation of the delay. In support of this he placed reliance on the decision of the Hon ble Supreme Court reported in AIR 1979 SC 1666 (M/s. Concord of India Insurance Co. Ltd. Vs. Smt. Nirmala Devi and others) and also the Hon ble Jurisdictional High Court in the case of M/s.Hosanna Ministries Vs. The ITO (Exemptions), Tirunelveli reported in 2017 (3) TMI 1387 and also the Hon ble Bombay High Court in the case of Vijay Vishin Meghani Vs. The DCIT, Circle-23 (2), reported in 2017 (10) TMI 248. 6. On the other hand, Ld.DR vehemently oppo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reading of the situation. The High Court took the view that Mr. Raizada being an Advocate of 34 years' standing could not possibly make the mistake in view of the clear provisions on the subject of appeals existing under Section 39(1) of the Punjab Courts Act and therefore, his advice to file the appeal before the District Court would not come to the rescue of the appellant under Section 5 of the Limitation Act. The Supreme Court upset this approach. I am of the view that legal advice given by the members of the legal profession may sometimes be wrong even as pronouncement on questions of law by courts are some times wrong. An amount of latitude is expected in such cases for, to err is human and lay men, as litigants are, may legitimately lean on expert counsel in legal as in other departments, without probing the professional competence of the advice. The court must of course, see whether in such cases there is any taint of mala fides or element of recklessness or ruse. If neither is present, legal advice honestly sought and actually given, must be treated as sufficient cause when an application under Section 5 of the Limitation Act is being considered. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bstantial justice deserves to be preferred. In the present case, it is a case of the assessee that no satisfaction note was recorded by the AO at the time of issue of notice u/s.153C. Now, it is settled principle of law that recording of satisfaction by the AO at the time of issuance of notice u/s.153C is a sine qua non for getting jurisdiction over the seized documents. In case, a satisfaction note was not recorded, the Assessing Officer would not get jurisdiction for the seized materials received by him. This position of law was explained by the Hon ble Apex Court in the context of provision of Sec.158BD of the Act in the case of CIT v. Calcutta Knitwears reported in 362 ITR 673 (SC). The CBDT vide its Circular No.24/2015 dated 31.12.2015 accepted that the same position holds good even in the context of provisions of Sec.153C of Act. In the present case, the appellant had filed the copies of ordersheet entries of the Assessing Officer indicating that no satisfaction note was recorded by the Assessing Officer. Even the Ld.CIT(DR) also filed copies of the ordersheet entries, wherein, no satisfaction note was recorded. Therefore, this material conclusively established that the Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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