TMI Blog2019 (5) TMI 297X X X X Extracts X X X X X X X X Extracts X X X X ..... e is no recording about the contents of these documents allegedly pertaining to the assessee and AO nowhere has explained the steps taken by him to determine that the seized material belonged to the assessee. There is no specific satisfaction recorded by the Assessing Officer as to how the seized material belonged to the assessee. There is a failure on the part of the AO to provide clear and cogent reasons, which can explain why the seized material belonged to the assessee apart from saying that the documents belonged to the assessee and he was satisfied that it was a fit case for issuing of notice u/s 153C - If all these facts of the case are considered in the light of the decision of the Hon ble Delhi High Court in the case of N.S. Softwares [ 2018 (4) TMI 1005 - DELHI HIGH COURT] and Pepsi Foods Pvt. Limited [ 2014 (8) TMI 425 - DELHI HIGH COURT] , we find that the satisfaction recorded by the Assessing Officer is neither adequate nor proper and since it does not meet the requirement of the concept of satisfaction as used in section 153C, we hold that the initiation of proceedings u/s 153C itself was bad-in-law and the assessments completed in pursuance of such initiatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Assessing Officer in the assessment orders, the assessee-company, however, submitted incomplete and inaccurate particulars, on the basis of which necessary enquiry to ascertain the genuineness of the transactions could not be done. He also found that cash was deposited in their Bank accounts by the share subscriber companies just before making the payment to the assessee-company on account of share capital/share premium/share application money. He further found from the documents found during the course of search that various amounts were paid by the promoters of the assessee-company to the accommodation entry operators, which were routed back by cheques towards share capital/share premium/share application money. As noted by the Assessing Officer, the accommodation entry providers had also accepted in their statements recorded during the course of search of having given accommodation entries to the assessee-company in the form of share application money. Keeping in view all these findings, the Assessing Officer treated the share capital/share premium/share application money of ₹ 4,04,00,000/- and ₹ 2,30,00,000/- received by the assessee in the previous years re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arch, no assessment for this year was pending. Therefore, keeping in view the ratio decided by the Jurisdictional bench of Kolkata Tribunal in cases referred above and the ratio decided by the Hon'ble Calcutta High Court in the case of Veer Prabhu Marketing Ltd (supra) in the light of CB DT's decision of not filing SLP in this case in the Supreme Court and keeping in view the Apex Court's decision to dismiss SLP on similar issue in the case of Pr CIT vs Kurele Paper Mills Pvt Ltd : SLP (C) No.34554 of 2015 dt.07-122015, I am of this view that in order to maintain judicial continuity on this issue and respectfully following the ratio decided by the Hon 'ble Calcutta High Court in the case of Veer Prabhu Marketing Ltd (supra), assessee's appeal on grounds no 1 and 2 are allowed . Keeping in view the relief given by him to the assessee on the above ground, the ld. CIT(Appeals) did not adjudicate upon the other grounds raised by the assessee in the appeals on merit. Aggrieved by the orders of the ld. CIT(Appeals), the Revenue has preferred these appeals before the Tribunal, while the assesee-company has also filed its Cross Objections. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 18.04.2018), he has contended that in the absence of proper and sufficient satisfaction recorded by the Assessing Officer, the initiation of proceedings under section 153C itself was invalid and the assessments completed in pursuance thereof are liable to be cancelled being bad-in law. The ld. D.R. on the other hand has relied on the satisfaction recorded by the Assessing Officer to contend that it satisfies the requirement of section 153C. 5. We have carefully gone through the judgment of the Hon ble Delhi High Court in the case of M/s. N.S. Software (supra) cited by the ld. Counsel for the assessee. In the said case, the satisfaction note recorded by the Assessing Officer while initiating the proceedings under section 153C was as under:- 23.07.2010 A search operation was conducted on Rajdurbar group of cases on 31.07.2008. During the course of search operation at the premises of Party A-20, Residence-cum-Office of Narender Kumar Agarwal, 1st 2nd Floor, 7, Western Avenue, Maharani Bagh, New Delhi, various papers were found and seized belonging to M/s. N.S. Softwares Pvt. Ltd. The same are marked as Annexure A/26, Hard Disk containing books of ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of Pepsi Foods Pvt. Limited [52 taxmann.com 220 (Delhi), wherein it was clarified that section 132(4A) creates a general presumption that the documents found in the control and possession of a person belong to him or her and to rebut this presumption, the Assessing Officer should provide clear and cogent reasons which explain why the seized material belongs to somebody else. In the satisfaction note recorded in the said case, apart from saying that the documents belonged to the petitioner and the Assessing Officer was satisfied that it was a fit case for issuance of notice under section 153C, there was nothing which would indicate as to how the presumptions which were to be normally raised as indicated above, had been rebutted by the Assessing Officer and keeping in view the same, it was held by the Hon ble Delhi High Court that the note would not meet the requirement of the concept of satisfaction as used in section 153C of the Act. It was observed by the Hon ble Delhi High Court that the satisfaction note itself must display the reasons or basis for the conclusion that the Assessing Officer of the searched person is satisfied that the seized documents belong to a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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