TMI Blog2019 (4) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the statement of the appellant recorded on the same day revealed that the appellant had undisclosed income and such a prima facie satisfaction by the authority concerned was sufficient. True, what is required is only a prima facie satisfaction of the Assessing Officer of the undisclosed income of the person other than the person with respect to whom the search was conducted. But, the crucial aspect is recording of such satisfaction by the Assessing Officer. We hold that it is mandatory for the Assessing Officer under Section 158BD of the Act to record his satisfaction about the undisclosed income of the person other than the person with respect to whom the search was conducted. Preparation of satisfaction note by the Assessing Off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ditional Director of Income Tax. The statement revealed that the appellant had paid a total amount of ₹ 12,25,000/- for purchase of shop rooms. The Additional Director made recommendation to initiate necessary action against the appellant and forwarded a report to the Joint Director. The report ultimately reached the Assessing Officer of the appellant. The Assessing Officer issued notice to the appellant under Section 158BD read with 158BC of the Act. Assessment under Section 158BD of the Act was completed on 30.08.2006 on a total income of ₹ 11,58,800/- for the block period from 01.04.1996 to 18.04.2002. 3. Aggrieved by the assessment order, the appellant filed appeal before the Commissioner of Income Tax (Appeals). By order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficer having jurisdiction over such other person and that Assessing Officer shall proceed under Section 158 BC against such other person and the provisions of this Chapter shall apply accordingly. 7. In Manish Maheshwari v. Assistant Commissioner of Income Tax : AIR 2007 SC 1696 , the Apex Court has noticed the conditions precedent for invoking a block assessment under Section 158BD of the Act. The Apex Court has held as follows: Section 158BD, however, provides for taking recourse to a block assessment in terms of Section 158BC in respect of any other person, the conditions precedents wherefor are : (i) satisfaction must be recorded by the Assessing Officer that any undisclosed income belongs to any person, other than the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is necessary that the Assessing Officer shall not merely reach a satisfaction about the undisclosed income of the other person but he has to record his satisfaction in that regard. 10. In the instant case, admittedly, the Assessing Officer had not recorded his satisfaction about the undisclosed income of the appellant. The result is that the entire proceedings initiated against the appellant stand vitiated. 11. The Tribunal has found that only a prima facie satisfaction of the undisclosed income of the person, other than the person with respect to whom the search was made, is sufficient. The Tribunal has found that the entries in the documents seized during the search and the statement of the appellant recorded on the same day reveal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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