TMI Blog2024 (5) TMI 161X X X X Extracts X X X X X X X X Extracts X X X X ..... the Assessee : Shri Ved Jain, Adv., Ms. Uma Upadhyay, CA And Ms. Kirti Gupta, CA For the Revenue : Ms. Sapna Bhatia, CIT(DR) ORDER PER SHAMIM YAHYA (A.M): This appeal by the Revenue is directed against order of ld. CIT(A) dated 02.08.2023 and pertains to A.Y. 2017-18. 2. Grounds of appeals read as under:- Whether on the facts and circumstances of the case Ld. CIT(A) has erred in differentiating the information concluded on the basis of seized material(as required u/s 148 of the Act) as per section 153C of the Act. Whether on the facts and circumstances of the case Ld. CIT(A) has erred in considering the fact that satisfaction note by AO of the searched person is a necessary requirement for proceedings u/s 153C of the Act. Whether in facts and circumstances of the case, Ld. CIT(A) has erred in overlooking the fact that no satisfaction note was sent to the AO of the assessee. 2. Brief facts of the case are that in this case assessment was done pursuant to the reopening of the case an assessment was framed u/s. 147/143(3) of the I.T Act, 1961. In the assessment, AO held that it is clear that the assessee has received accommodation entry in the form of bogus LTCG/STCG of Rs. 4,03,21,00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per has some extra details other than what is available in contract note. These details are as under: Commission @ 5.5% (second last column) Our share: Calculation given in third last column and distribution of commission is given at the bottom. As per the distribution, the share of Alankit Group is 70%. Bhallaji Share: Calculation given in second last column and distribution of commission is given at the bottom. As per the distribution, the share of Mr. Sunil Bhalla is 30%. Remark: In this column, it has clearly been mentioned that Commission received . This commission was over and above the brokerage and received in cash as stated by Mr. S K Gupta in his statement. 5.5.3 Further, the name of Mr. S K Bhalla is also appearing in the statement of Mr. S K Gupta wherein he has clearly mentioned that he and Mr. S K Bhalla are involved in providing the entries of capital gains/losses to their clients. Mr. S K Gupta in his statement has also explained in detail the modus operendi of providing the entries of capital gains/losses to their clients. 5.5.4 In view of the above analysis, it can be concluded that this seized paper, based on its contents and the statement of Mr. S K Gupta, acqui ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On having gone through the decisions cited above especially the decision of Amritsar Bench in the case of ITO vs. Arun Kumar Kapoor (supra), we find that in that case as in the present case before us, reassessment was initiated on the basis of incriminating material found in search of third party and the validity of the same was challenged by the assessee before the Learned CIT(Appeals) and the Learned CIT (Appeals) vitiated the proceedings. The same was questioned by the Revenue before the ITAT and the ITAT after discussing the cases of the parties and the relevant provisions in details has come to the conclusion that in the above situation, provisions of sec. 153C were applicable which excludes the application of sections 147 and 148 of the Act. The ITAT held the notice issued under sec. 148 and proceedings under sec. 147 as illegal and void ab initio. It was held that Assessing Officer having not followed procedure under sec. 153C, reassessment order was rightly quashed by the Learned CIT(Appeals). In the present case before us, it is an admitted fact, as also evident from the reasons recorded and the assessment order that the initiation of reopening proceedings was made by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xation. On perusal of list given with the above information, it is revealed that Sh. Girish Chand Sharma, 38, Chhoti Holi, Near Ganga Mandir, Khurja, Bulandshahr, has given donation/capitation fee for the admission of his son Sh. Shiv Kumar Gaur for the course of MS ENT on 27.04.2010 amounting to Rs. 40,01,000/- In view of the above facts, I have reason to believe that income of Rs. 40,01,000/- has escaped assessment due to failure on the part of the assessee to disclose true and correct particulars of income. In order to assess the same, notice u/s 148 of the I.T. Act needs to be issued. 9. It can been from the above that search operation was carried on in the premises of Santosh Group of Institutions. This means that any document found during the course of the search makes the assessee other person therefore the correct section for initiation of any proceeding against the assessee is section 153C of the Act. On identical set of facts the co-ordinate bench in the case of Sushil Gaur (supra) had the occasion to consider identical set of facts. In that case also the search in the premises of Santosh Medical College was under consideration. The relevant findings of the coordinate ben ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reto under sec. 147 read with section 143(3) of the Act are void ab initio. Hence, the reassessment in question is accordingly quashed. Since I have already quashed the reassessment, there is no need to adjudicate other grounds. 9. In the result, both the appeals filed by the different Assessees stand allowed in the aforesaid manner. 10. A similar view was taken by Lucknow Bench of the Tribunal in ITA No.205/LKW/2016 wherein also the search in the premises of Santosh Medical College was under consideration and coordinate bench was pleased to delete the impugned addition. 11. Respectfully following the findings of the coordinate bench (supra). I am inclined to hold that the notice issued u/s 148 of the Act and assessment framed u/s 147 of the Act is void ab initio. 13. On finding parity of facts I do not find any reason to differ from the findings of the coordinate bench (supra) and following the findings of the co-ordinate bench I am inclined to hold that the notice issued u/s. 148 and the assessment framed u/s. 147 of the Act is void-ab-initio. 14. Since the assessment has been quashed, I do not find it necessary to dwell into the merits of the case. Accordingly, the appeal filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itsar Bench in the case of ITO vs. Arun Kumar Kapoor (supra), I find that in that case as in the present case before me, reassessment was initiated on the basis of incriminating material found in search of third party and the validity of the same was challenged by the assessee before the Learned CIT(Appeals) and the Learned CIT(Appeals) vitiated the proceedings. The same was questioned by the Revenue before the ITAT and the ITAT after discussing the cases of the parties and the relevant provisions in details has come to the conclusion that in the above situation, provisions of sec. 153C were applicable which excludes the application of sections 147 and 148 of the Act. The ITAT held the notice issued under sec. 148 and proceedings under sec. 147 as illegal and void ab initio. It was held that Assessing Officer having not followed procedure under sec. 153C, reassessment order was rightly quashed by the Learned CIT(Appeals). I also draw my support from the ITAT, New Delhi decision in the case of Rajat Shubra Chatterji vs. ACIT, New Delhi ITA No. 2430/Del/2015 dated 20.5.2016, wherein the reassessment was quashed on the similar facts and circumstances by following the ITAT, Amritsar de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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