ACIT, New Delhi v. M/s Inlay Marketing Pvt. Ltd.,, New Delhi

ITA 4200/DEL/2012 | 2006-2007
Pronouncement Date: 14-11-2014 | Result: Dismissed

Appeal Details

RSA Number 420020114 RSA 2012
Assessee PAN AAACI0477N
Bench Delhi
Appeal Number ITA 4200/DEL/2012
Duration Of Justice 2 year(s) 3 month(s) 11 day(s)
Appellant ACIT, New Delhi
Respondent M/s Inlay Marketing Pvt. Ltd.,, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 14-11-2014
Appeal Filed By Department
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 14-11-2014
Date Of Final Hearing 03-06-2014
Next Hearing Date 03-06-2014
Assessment Year 2006-2007
Appeal Filed On 03-08-2012
Judgment Text
ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C NEW DELHI BEFORE SHRI S.V. MEHROTRA ACCOUNTANT MEMBER AND SHRI CHANDRA MOHAN GARG JUDICIAL MEMBER ITA NO. 4200/DEL/2012 TO 4202/DEL/2012 ASSESSMENT YEAR: 2006-07 2007- 08 2008-09 ITA NO. 4197/DEL/2012 TO 4199/DEL/2012 ASSESSMENT YEAR: 2003-04 2004- 05 2005-06 ASSTT.COMMISSIONER OF INCOME TAX VS INLAY M ARKETING PVT. LTD. CENTRAL CIRCLE 21 6111 BLOCK NO. 7 NEW DELHI. DEV NAGAR KAROL BAGH NEW DELHI. (PAN: AAACI0477N) C.O. NO. 380 381 382 383 384 385/DEL/2012 (IN ITA NO. 4197 4198 4199 4200 4201 4202 / DEL/2012) ASSTT.YEAR: 2003-04 TO 2008-09 INLAY MARKETING PVT. LTD. VS ACIT CE NTRAL CIRCLE 21 NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDE NT) APPELLANT BY: SHRI SUNIL BAJPAI SR. DR RESPONDENT BY: SHRI KAPIL GOYAL ADVOCATE O R D E R PER BENCH THESE APPEALS FILED BY THE REVENUE AND COS FILED BY THE ASSESSEE HAVE BEEN PREFERRED AGAINST THE ORDER OF THE CIT(A)-II NEW DELHI DATED 17.5.2012 IN APPEAL NO. 504 505 503 506 507 AND 508/10-11 FOR AYS 2003-04 TO 2008-09 RESPECTIVELY. SINCE ALL ABOVE C APTIONED APPEALS AND ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 2 COS HAVE ARISEN FROM ONE ORDER OF CIT(A)-II DELHI WE HAVE CLUBBED THEM TOGETHER AND ARE ADJUDICATING THEM BY THIS CONSOLID ATED ORDER. 2. BRIEFLY STATED THE FACTS GIVING RISE TO THESE AP PEALS AND COS ARE THAT A SEARCH AND SEIZURE OPERATION UNDER SECTION 132 OF T HE ACT WAS CARRIED OUT IN THE CASES OF SHRI B.K. DHINGRA SMT. POONAM DHINGRA AND M/S MADHUSUDAN BUILDCON (P) LTD. ON 20.10.2008 AND DURING THE COUR SE OF SEARCH AT THEIR RESIDENTIAL PREMISES AT F-6/5 VASANT VIHAR NEW DE LHI CERTAIN DOCUMENTS BELONGING TO THE ASSESSEE WERE SEIZED. ON THE BASI S OF DOCUMENTS SO FOUND BELONGING TO THE ASSESSEE COMPANY PROCEEDINGS WERE INITIATED IN THE CASES OF THE ASSESSEE COMPANY UNDER SECTION 153C R/W SECT ION 153A OF THE ACT. INITIALLY THE CASE OF THE ASSESSEE COMPANY WAS CENT RALIZED WITH ACIT CENTRAL CIRCLE 17 UNDER SECTION 127 OF THE ACT VIDE ORDER OF CIT(A)- DEHRADUN-IV NEW DELHI DATED 14.12.2009. 3. A NOTICE UNDER SECTION 153COF THE ACT WAS ISSUED TO THE ASSESSEE COMPANY TO FILE RETURN FOR AY 2003-04 TO 2008-09 WI THIN 15 DAYS OF THE SERVICE OF NOTICES. IN RESPONSE TO THE NOTICE UNDE R SECTION 153C OF THE ACT THE ASSESSEE FILED A RETURN FOR SIX ASSESSMENT YEAR S AS REQUIRED BY THE ASSESSING OFFICER ON 8.9.2010. 4. SUBSEQUENTLY THE CASES WERE TRANSFERRED TO CENT RAL CIRCLE-21 VIDE ORDER DATED 19.10.2010 PASSED UNDER SECTION 127 OF THE ACT. THE ASSESSING ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 3 OFFICER REJECTED THE LEGAL CONTENTIONS OF THE ASSES SEE AND MADE ADDITIONS PERTAINING TO UNEXPLAINED PURCHASES UNDER SECTION 6 9C OF THE ACT AND EXPENSES DISALLOWED AS PER DISCUSSION IN THE RESPEC TIVE ASSESSMENT ORDERS. 5. THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT( A) WHICH WAS PARTLY DISMISSED ON LEGAL CONTENTIONS OF THE ASSESSEE BUT AT THE SAME TIME THE CIT(A) PARTLY ALLOWED THE APPEAL ON MERITS DELETING THE ADDITIONS MADE BY THE ASSESSING OFFICER. NOW THE AGGRIEVED REVENUE IS BEFORE THIS TRIBUNAL AGAINST THE PART RELIEF GRANTED BY THE CIT(A) DELET ING THE ADDITIONS MADE UNDER THE ASSESSMENT ORDER PASSED UNDER SECTION 143 (3) R/W SECTION 153C OF THE ACT IN ALL SIX AYS. THE ASSESSEE HAS ALSO PREF ERRED COS CHALLENGING THE CONCLUSION OF THE CIT(A) IN NOT HOLDING THAT THE NO TICE ISSUED UNDER SECTION 153C OF THE ACT AND ASSESSMENT ORDER PASSED UNDER S ECTION 153C/143(3) OF THE ACT ARE ILLEGAL BAD IN LAW AND WITHOUT JURISDI CTION. COS OF THE ASSESSEE 6. AT THE OUTSET BOTH THE PARTIES REQUESTED THAT T HE COS OF THE ASSESSEE BEING LEGAL GROUNDS MAY BE ADJUDICATED FIRST HENCE WE ARE FIRST TAKING UP COS OF THE ASSESSEE FOR ADJUDICATION. 7. ALTHOUGH THE ASSESSEE HAS TAKEN AS MANY AS SEVEN COS SIMILARLY WORDED IN ALL SIX CASES BUT EXCEPT MAIN CO NO. 1 O THER COS ARE ARGUMENTATIVE AND SUPPORTIVE TO THE MAIN CO NO.1 WH ICH READS AS UNDER:- ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 4 1. THAT IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE CIT(A) HAS ERRED IN NOT HOLDING THAT THE NOTICE ISSUED U/ 153C AND THE ASSESSMENT ORDER PASSED U/S 153C/143(3) ARE ILLEGAL BAD IN LAW WITHOUT JURISDICTION AND BARRED BY TIME LIMITATION. 8. WE HAVE HEARD RIVAL ARGUMENTS OF BOTH THE PARTIE S AND CAREFULLY PERUSED THE RELEVANT MATERIAL PLACED BEFORE US ON R ECORD. 9. LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT THE D OCUMENTS FOUND DURING THE SEARCH PROCEEDINGS AS REFERRED TO IN THE SATISFACTION NOTE RECORDED BY THE AO OF THE ASSESSEE (THE PERSON OTHER THAN TH E PERSON SEARCHED) DO NOT BELONG TO ASSESSEE AS THE SAME WERE PART OF WORKING PAPERS OF THE CA SHRI B.K. DHINGRA IN WHOSE OFFICE THE SEARCH WAS CONDUCT ED ON 20.10.2008. LD. COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT ADM ITTEDLY AS RECORDED IN THE SATISFACTION NOTE NO SEIZED DOCUMENT RELATED TO TH E RELEVANT ASSESSMENT YEAR WAS FOUND AND THE SEIZED PAPERS REFERRED IN THE SAI D SATISFACTION NOTE WERE DULY REFLECTED IN THE REGULAR BOOKS OF ACCOUNTS OF THE ASSESSEE AND THEREFORE NO INCRIMINATING MATERIAL WAS FOUND. IT WAS ALSO S UBMITTED ON BEHALF OF THE ASSESSEE THAT THE ASSESSMENT HAS BEEN FRAMED IN NON -CONFIRMATION WITH STATUTORY PROVISIONS OF SECTION 143(3) R/W SECTION 153C OF THE ACT THEREFORE THE CIT(A) ERRED ON FACTS AND LAW IN UPHOLDING AND CONFIRMING THE ACTION OF THE ASSESSING OFFICER. ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 5 10. LD. COUNSEL OF THE ASSESSEE VEHEMENTLY CONTENDE D THAT THE CIT(A) HAS ERRED IN FACTS AND ON LAW IN UPHOLDING THE VALI DITY OF ASSESSMENT ORDER PARTICULARLY WHEN THE ASSESSMENT HAS BEEN MADE WITH OUT COMPLYING WITH LAW AND ADDITIONS MADE ARE ILLEGAL BAD IN LAW AND WITHOUT JURISDICTION. ON BEHALF OF THE ASSESSEE IT WAS ALSO SUBMITTED THAT THE CIT(A) WAS NOT JUSTIFIED AND ERRED IN NOT CONSIDERING THE FACT THA T THE ASSESSMENT PROCEEDINGS FOR ALL SIX AYS UNDER APPEAL WERE NOT P ENDING ON THE DATE OF RECORDING OF SATISFACTION UNDER SECTION 153C OF THE ACT (ON 5.7.2010) AND ACCORDINGLY THE SAME DID NOT ABATE FOR THE PURPOSE OF INITIATION OF PROCEEDINGS UNDER SECTION 153C OF THE ACT AND AS SU CH THE REASSESSMENT BEING BAD IN LAW ILLEGAL AND WITHOUT JURISDICTION DESERVES TO BE QUASHED. 11. FOR ABOVE SUBMISSIONS AND CONTENTIONS THE ASSE SSEE HAS RELIED ON FOLLOWING DECISIONS OF HONBLE HIGH COURTS AND THE TRIBUNAL:- I) MANISH MAHESHWARI VS ACIT (2007) 289 ITR 341(S C) II) PEPSICO INDIA HOLDINGS PVT. LTD. VS ACIT (2014) 367 ITR 673 (DELHI) III) CIT VS CALCUTTA KNITWEAR (2014) 362 ITR 673(SC) IV) CIT VS RAO SUBBA RAO (HUF) IN ITA NO. 254/2014 DATE D 15.04.2014 (HONBLE A.P. HIGH COURT) V) CIT VS GOPI APARTMENT IN ITA 60/2014 DATED 1.5.2014 (HONBLE HIGH COURT OF ALLAHABAD) VI) DSL PROPERTIES (P) LTD. VS DCIT IN ITA NO. 1344/D/2 012 DATED 22.3.2013 (ITAT DELHI B BENCH) 60 SOT 88 VII) V.K. FISCAL SERVICES LTD. VS DCIT IN ITA NO. 5460 T O 5465/DEL/2012 DATED 27.11.2013 (ITAT H BENCH DELHI) 12. REPLYING TO THE ABOVE LD. DR CONTENDED THAT TH ERE IS NO NEED TO RECORD SATISFACTION UNDER SECTION 153C OF THE ACT B Y THE ASSESSING OFFICER ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 6 OF THE PERSON SEARCHED AND THERE IS NO NEED TO RECO RD A SPECIFIC SATISFACTION NOTE AS SATISFACTION CAN BE INFERRED FROM OTHER REC ORDS AND ORDERS OF THE DEPARTMENT. LD. DR FURTHER POINTED OUT THAT IT IS NECESSARY FOR THE PERSON OBJECTING TO THE VALIDITY OF THE NOTICES TO DEMONST RATE PREJUDICE SUFFERED BY HIM OTHERWISE VALIDITY OF THE NOTICE UNDER SECTION 153C OF THE ACT CANNOT BE HELD ILLEGAL BAD IN LAW AND WITHOUT JURISDICTIO N. LD. DR ALSO CONTENDED THAT THE TECHNICALITIES AND IRREGULARITIES WHICH DO NOT OCCASION FAILURE OF JUSTICE ARE NOT ALLOWED TO DEFEAT THE ENDS OF JUSTI CE THEREFORE ON THE BASIS OF SMALL AND CURABLE TECHNICALITIES AND IRREGULARITIES ENTIRE PROCEEDINGS CONDUCTED BY THE REVENUE CANNOT BE HELD ILLEGAL OR WITHOUT JURISDICTION. TO SUPPORT ABOVE CONTENTIONS AND SUBMISSIONS THE LD. DR HAS PLACED RELIANCE ON FOLLOWING DECISIONS OF HONBLE SUPREME COURT HO NBLE HIGH COURTS AND THE TRIBUNAL:- (I) STATE BANK OF PATIALA & OTHERS VS S.K. SHARMA (1996 ) AIR 1669 (HON'BLE SUPREME COURT) (II) K.M. MEHBOOB VS DCIT (2012) TIOL-642-HC-KERALA-IT (HONBLE KERALA HIGH COURT) (III) CIT VS PANCHJANYAM MANAGEMENT 333 ITR 281 (KERALA) HONBLE KERALA HIGH COURT (IV) SHIRISH MADHUKAR DALVI VS ACIT (2006) 287 ITR 242 ( HONBLE BOMBAY HIGH COURT) ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 7 (V) SUBHAN JAVED VS ACIT (2010) 122 ITD 307 (BANGALORE) ITAT BANGALORE BENCH B 13. ON CAREFUL CONSIDERATION OF ABOVE RIVAL CONTENT IONS OF BOTH THE SIDES AND ON CAREFUL PERUSAL OF THE RELEVANT MATERIAL ON RECORD AND INTER ALIA RATIO OF THE ABOVE MENTIONED DECISIONS AS RELIED BY BOTH THE PARTIES AT THE OUTSET WE OBSERVE FOLLOWING ADMITTED AND UNDISPUTED FACTS AS NOTICED BY US:- A) ORIGINAL SEARCH AND SEIZURE OPERATION UNDER SECTION 132 OF THE ACT WAS CARRIED OUT IN THE CASES OF SHRI B.K. DHINGRA POONAM DHINGRA AND M/S MADHUSUDAN BUILDCON (P) LTD. ON 20.10.2008. B) DCIT CC-17 NEW DELHI RECORDED SATISFACTION NOTE F OR ISSUING NOTICE UNDER SECTION 153C OF THE ACT TO THE ASSESSE E ON 5.7.2010 AND NOTICE UNDER SECTION 153C OF THE ACT WAS ISSUED TO THE ASSESSEE ON 6.7.2010. C) IN RESPONSE TO THE NOTICE UNDER SECTION 153C OF THE ACT THE ASSESSEE FILED RETURNS ON 8.9.2010 FOR ALL SIX AYS. 14. AT THE TIME OF RECORDING SATISFACTION NOTE ON 5 .7.2010 AND ISSUING NOTICES UNDER SECTION 153C OF THE ACT ON 06.7.2010 THE ASSESSING OFFICER OF THE PERSON SEARCHED I.E. SHRI B.K. DHINGRA AND O THERS AND THE ASSESSING OFFICER OF THE PERSON OTHER THAN SEARCHED I.E. APPE LLANT/ASSESSEE COMPANY IN ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 8 THE PRESENT CASES WAS THE SAME AUTHORITY I.E. THE A SSESSING OFFICER OF THE PERSON SEARCHED AND PERSON OTHER THAN SEARCHED WERE THE SAME. 15. THE MAIN CONTENTION OF THE LD. COUNSEL OF THE A SSESSEE STRESS UPON THE FACTUM THAT AS PER RTI REPLY DATED 10.6.2013 BY THE ASSESSING OFFICER OF THE PERSON SEARCHED ADMITTED THAT NO SATISFACTION NOTE FOR OTHER ENTITIES INCLUDING ASSESSEE HAS BEEN RECORDED AS PER ASSESSMENT RECORD S OF THE SEARCHED ENTITIES AND IT IS APPARENT FROM THE ASSESSMENT RECORDS OF T HE SEARCHED ENTITIES THAT THE REQUIRED SATISFACTION NOTE UNDER SECTION 153C O F THE ACT WAS NOT RECORDED BY THE ASSESSING OFFICER OF THE SEARCHED P ERSONS/ENTITIES. THE RTI REPLIES DATED 10.6.2013 ARE BEING ENCLOSED AS ANNEX URE A B & C ALONG WITH THIS ORDER. 16. ON BEHALF OF THE REVENUE LD. DR REPLIED THAT W HEN THE ASSESSING OFFICER OF THE PERSONS SEARCHED AND THE ASSESSING O FFICER OF THE PERSON OTHER THAN THE PERSONS SEARCHED ARE THE SAME THEN THERE IS NO NEED OF RECORDING SATISFACTION IN THE RECORDS OF PERSONS SEARCHED FOR INITIATION OF PROCEEDINGS UNDER SECTION 153C OF THE ACT. ON CAREFUL PERUSAL OF DECISION OF HONBLE KERALA HIGH COURT IN THE CASE OF CIT VS PANCHAJAY ANAM MANAGEMENT (SUPRA) AND K.M. MEHBOOB VS DCIT (SUPRA) WE O BSERVE THAT IN THE CASE OF K.M. MEHBOOB (SUPRA) AS RELIED BY THE LD. DR THEIR LORDSHIPS CONSIDERED THE RATIO OF THE DECISION OF HONBLE SUPREME COURT IN THE ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 9 CASE OF MANISH MAHESHWARI VS ACIT 289 ITR 341 (HON' BLE SUPREME COURT) AND ITS OWN DECISION I.E. DECISION OF HONBLE KERAL A HIGH COURT IN THE CASE OF CIT VS PANCHAJAYANAM MANAGEMENT (SUPRA) AND HEL D AS UNDER:- 5. THE REMAINING QUESTION TO BE CONSIDERED IS APPELLANT'S CHALLENGE AGAINST THE ASSESSMENTS COMPL ETED FOR THE SIX ASSESSMENT YEARS FROM 2003-04 TO 2008-09 UN DER SECTION 153C READ WITH SECTION 153A(1) ON THE GROUN D THAT THE ASSESSING OFFICER WHO CONDUCTED SEARCH ON THE A SSESSEE AT MANGALORE UNDER SECTION 132 HAS NOT RECORDED THE SATISFACTION AS REQUIRED UNDER SECTION 153C BEFORE TRANSFERRING THE FILES TO THE ASSESSING OFFICER OF THE APPELLANT TO MAKE ASSESSMENTS ON THE APPELLANT UNDE R SECTION 153C READ WITH SECTION 153A OF THE ACT. WHI LE LEARNED COUNSEL FOR THE APPELLANT HAS RELIED ON THE DECISION OF THE SUPREME COURT IN MANISH MAHESHWARI V. ASST. COMMISSIONER OF INCOME TAX AND ANOTHER REPORTED IN 289 ITR 341 LEARNED STANDING COUNSEL FOR THE REVENUE H AS RELIED ON THE DIVISION BENCH DECISION OF THIS COURT IN COMMISSIONER OF INCOME TAX V. PANCHAJANYAM MANAGEMENT AGENCIES AND SERVICES REPORTED IN 333 ITR 281 (KER). WE DO NOT THINK THERE IS ANY NEED TO GO TO B OTH THESE DECISIONS BECAUSE EVEN THOUGH SECTION 153C IS ANALO GOUS TO THE PREVIOUS PROVISIONS OF SECTION 153BD THERE IS COMPLETE DEVIATION IN THE NEW PROVISION IN AS MUCH AS WHILE SECTION 158BD PROVIDED FOR TRANSFER OF FILE ONLY WHEN THE A SSESSING OFFICER WHO CONDUCTED THE SEARCH OR WHO CALLED FOR BOOKS OF ACCOUNTS WAS SATISFIED THAT THE UNDISCLOSED INCOME FOUND THEREFROM BELONGS TO ANY PERSON OTHER THAN THE SEAR CHED ASSESSEE WHO HAS TO BE ASSESSED UNDER SECTION 158BD READ WITH SECTION 158BC UNDER SECTION 153C OF THE ACT F OR TRANSFERRING THE MATERIAL OR EVIDENCE COLLECTED IN SEARCH TO THE ASSESSING OFFICER OF AN ASSESSEE OTHER THAN THE SEARCHED ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 10 ASSESSEE WHAT IS REQUIRED TO BE SATISFIED IS THAT THE MONEY BULLION JEWELLERY OR OTHER VALUABLE ARTICLE OR THI NG OR BOOKS OF ACCOUNT OR DOCUMENTS SEIZED IN THE COURSE OF SEA RCH OF AN ASSESSEE BELONG TO OR RELATE TO A PERSON OTHER THAN THE SEARCHED ASSESSEE. IN OTHER WORDS UNLIKE UNDER SEC TION 158BD FOR TRANSFERRING A FILE UNDER SECTION 153C T HERE IS NO NEED TO EXAMINE WHETHER THE BOOKS OF ACCOUNTS OR OTHER EVIDENCE OR MATERIALS SEIZED IN THE COURSE OF SEARC H OF AN ASSESSEE REPRESENTS OR PROVES UNDISCLOSED INCOME OF ANOTHER ASSESSEE. ON THE OTHER HAND FOR TRANSFERRING THE F ILE TO THE ASSESSING OFFICER OF SUCH OTHER ASSESSEE ALL WHAT IS REQUIRED TO BE CONSIDERED IS WHETHER THE MATERIALS OR BOOKS OF ACCOUNTS OR EVIDENCE RECOVERED RELATES TO ANOTHE R ASSESSEE WHICH MAY OR MAY NOT LEAD TO AN ASSESSMEN T IN THE CASE OF THE OTHER ASSESSEE AFTER TRANSFER OF THE FI LE TO HIS ASSESSING OFFICER. THIS IS ONLY AN INTERNAL ARRANGE MENT TO BE MADE BETWEEN TWO DEPARTMENTAL OFFICERS AND IN THIS REGARD THE ONLY FACT THAT NEEDS TO BE VERIFIED IS WHETHER THE ASSESSEE WHOSE BOOKS OF ACCOUNTS OR MATERIALS ARE RECOVERED IN THE COURSE OF SEARCH OF ANY OTHER ASSESSEE IS A REGULA R ASSESSEE BEFORE ANOTHER OFFICER AND IF SO TO TRANSFER THE FILE TO SUCH OTHER OFFICER FOR HIS CONSIDERATION AND FOR PASSING ORDERS WHETHER ASSESSMENT OR PENALTY OR SUCH OTHER ORDER PERMISSIBLE UNDER THE ACT BY THAT OFFICER. ADMITTED LY IN THIS CASE THE ASSESSING OFFICER WHO CONDUCTED THE SEAR CH AND WHO OBTAINED MATERIALS AND EVIDENCE ABOUT THE INCOM E OF THE APPELLANT RIGHTLY TRANSFERRED THE FILES TO THE ASSESSING OFFICER OF THE APPELLANT AT KOZHIKODE WHO HAS JURI SDICTION TO ASSESS HIM AND IT IS ONLY ON RECEIPT OF SUCH FI LES AND MATERIALS FROM THE ASSESSING OFFICER FROM MANGALORE THE APPELLANT'S ASSESSMENTS WERE TAKEN UP AND COMPLETED UNDER SECTION 153C READ WITH SECTION 153A OF THE ACT. WE THEREFORE DO NOT FIND ANY MERIT IN THE CONTENTION OF THE APPELLANT'S COUNSEL THAT SATISFACTION WAS NOT RECOR DED BY THE ASSESSING OFFICER AT MANGALORE BEFORE TRANSFERRING THE ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 11 MATERIALS AND SEIZED RECORDS TO THE APPELLANT'S ASS ESSING OFFICER. IN OUR VIEW IF APPELLANT'S ARGUMENT IS AC CEPTED HE COULD BE PLACED IN A WORSE POSITION BECAUSE IF HIS OBJECTIONS WERE CONSIDERED AND OVERRULED WHILE TRAN SFERRING THE FILE BY THE ASSESSING OFFICER AT MANGALORE HOLD ING THAT GOODS SEIZED OR MATERIALS RECOVERED REALLY BELONG T O HIM JUSTIFYING ASSESSMENT THE APPELLANT WILL FORFEIT H IS RIGHT TO RAISE SAME OBJECTION BEFORE HIS ASSESSING OFFICER W HO HAS TO CONSIDER THE RELEVANCE OF THE DOCUMENTS ACCOUNTS O R OTHER MATERIALS RECEIVED FROM THE ASSESSING OFFICER AT MA NGALORE. THE SCOPE OF SECTION 153C IS SUCH THAT ASSESSMENT H AS TO BE STRICTLY MADE ONLY BY THE ASSESSING OFFICER BEFORE WHOM THE ASSESSEE IS REGULARLY ASSESSED BECAUSE IT IS THAT O FFICER WHO IS FAMILIAR WITH THE TRANSACTIONS INCOME AND REGUL AR ASSESSMENT OF THE ASSESSEE FOR THE PRECEDING YEARS' AND BASED ON THE SAME TO CONSIDER THE RELEVANCE OF MATE RIALS OR DOCUMENTS RECEIVED FROM ANOTHER ASSESSING OFFICER A FTER HEARING THE ASSESSEE TO CONSIDER SUCH MATERIALS OR EVIDENCE FOR ASSESSMENT. SO MUCH SO WE DO NOT THINK ANY ENQ UIRY OR HEARING OR ADJUDICATION IS CONTEMPLATED BY THE ASSE SSING OFFICER WHO CONDUCTED THE SEARCH OF AN ASSESSEE IN WHICH EVIDENCE OR MATERIALS BELONGING TO ANOTHER ASSESSEE IS OBTAINED FOR TRANSFERRING THE FILE TO THE ASSESSING OFFICER BEFORE WHOM SUCH OTHER ASSESSEE IS TO BE ASSESSED. EVEN THOUGH TRANSFER AS CONTEMPLATED UNDER SECTION 153C HAS TO BE MADE BY THE OFFICER WHO CONDUCTED THE SEARCH AND WHO RECOVERED BOOKS OF ACCOUNTS MATERIALS OR ARTICLES IN THE COURSE OF SEARCH OF AN ASSESSEE OTHER THAN SEARCHED ASSESSEE STILL IT IS OPEN TO SUCH ASSESSEE TO ESTA BLISH BEFORE HIS ASSESSING OFFICER THAT THE OPINION OF THE ASSES SING OFFICER TRANSFERRING THE MATERIALS OR EVIDENCE OR B OOKS OF ACCOUNTS OR GOODS SEIZED IS WRONG AND THAT THOSE DO NOT BELONG TO HIM. IN OTHER WORDS THE TRANSFER OF RECO VERED BOOKS OF ACCOUNTS EVIDENCE OR MATERIALS IS ONLY A PROCEDURAL FORMALITY TO BE COMPLIED WITH BY THE ASS ESSING ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 12 OFFICER WHO SEARCHED AN ASSESSEE AND RECOVERED MATE RIALS PERTAINING TO ANOTHER ASSESSEE AND THE ASSESSING O FFICER WHO TAKES UP ASSESSMENT UNDER SECTION 153C AGAINST THE LATTER WILL HAVE FULL JURISDICTION TO APPRECIATE EV IDENTIARY VALUE OF THE BOOKS OF ACCOUNTS OR MATERIALS OR GOOD S RECEIVED FROM THE OTHER OFFICER AND PROCEED TO MAKE ASSESSMENT IN HIS OWN WAY. WE THEREFORE DO NOT FIND ANY MERIT IN THE CONTENTION OF THE APPELLANT'S COUNSEL THAT SATISFACTION IS REQUIRED TO BE RECORDED BY THE ASSE SSING OFFICER WHO CONDUCTED THE SEARCH BEFORE TRANSFERRI NG MATERIALS OR ARTICLES OF THINGS FOUND BELONGING TO ANOTHER ASSESSEE. 17. THE RATIO LAID DOWN BY HONBLE HIGH COURT IN TH E CASE OF CIT VS PANCHJANYAM MANAGEMENT (SUPRA) AGENCIES IS THAT NON -RECORDING OF REASONS AND NON-COMMUNICATION OF THE SAME BY THE ASSESSING OFFICER WHILE ISSUING NOTICE UNDER SECTION 158BC OF THE ACT WILL NOT INVA LIDATE ASSESSMENT COMPLETED UNDER SECTION 158BD R/W 158BC OF THE ACT. THEIR LORDSHIPS IN THIS CASE WENT ON TO HOLD THAT THE ISSUANCE OF NOT ICE UNDER SECTION 158BD R/W SECTION 158BC IS A SUFFICIENT FOR INITIATION OF ASSESSMENT WHICH IS IN THAT CASE ADMITTEDLY DONE AND THE ASSESSEE HAD FILED RET URN IN FORM 2B IN TERMS OF THE SAID NOTICE. SPEAKING FOR HONBLE KERALA HI GH COURT THEIR LORDSHIPS ALSO HELD THAT BY VIRTUE OF OPERATION OF SECTION 14 2 OF THE ACT EVERY ASSESSEE ASSESSED UNDER SECTION 158BC AND 158BD GETS AN OPPO RTUNITY TO FILE OBJECTIONS AND VALIDITY OF ASSESSMENT IS NOT AFFECT ED BY THE REASONS OF ASSESSING OFFICERS FAILURE TO RECORD SATISFACTION UNDER SECTION 158BD ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 13 WHICH IS ONLY FOR THE PURPOSE OF TRANSFERRING THE F ILE AND ONCE THE FILE IS TRANSFERRED THE TRANSFERRING OFFICER BECOMES FUNCT US OFFICIO AND THE JURISDICTION FOR ALL PURPOSES IS TRANSFERRED TO THE OFFICER TO WHOM FILE IS TRANSFERRED AND WHO HAS JURISDICTION TO ASSESS THE ASSESSEE ABOUT WHOM THE DETAILS WERE OBTAINED IN THE COURSE OF SEARCH OF AN OTHER ASSESSEE I.E. PERSON SEARCHED. WE ALSO NOTE THAT THE CASE OF PANCHJANYA M MANAGEMENT AGENCIES (SUPRA) IS NOT RELATED TO SECTION 153A AND 153C OF THE ACT. 18. IN THE CASE OF K.M. MEHBOOB VS DCIT (SUPRA) H ONBLE HIGH COURT OF KERALA HELD THAT THE SATISFACTION NOTE IS REQUIR ED TO BE RECORDED BY THE ASSESSING OFFICER WHO CONDUCTED THE SEARCH BEFORE T RANSFERRING THE MATERIAL OR ARTICLES OR THINGS FOUND DURING THE SEARCH BELON GING TO ANOTHER ASSESSEE. THE SAME VIEW WAS ALSO RECORDED BY ITAT BANGALORE B ENCH B IN THE CASE OF SUBHAN JAVED VS ACIT (SUPRA). 19. RETURNING TO THE FACTS OF THE PRESENT CASE WE OBSERVE THAT THE CIT(A) HAS DISMISSED THE LEGAL CONTENTION AND GROUNDS OF T HE ASSESSEE WITH FOLLOWING OBSERVATIONS AND CONCLUSION:- 8. I HAVE CONSIDERED THE ASSESSMENT ORDER WRITTEN SUBMISSIONS REMAND REPORT AND REJOINDER TO THE REMAND REPORT FILED BY THE AR AS WELL AS THE FACTS OF THE CASE AND THE POSITION OF LAW. IT IS NOTED THAT IN G ROUNDS OF APPEAL NO.1 2 3 & 5 THE APPELLANT HAS RAISED T HE ISSUE THAT PROCEEDINGS U/S 153C INITIATED IN ITS CA SE ON THE SATISFACTION NOTE NOT BASED ON ANY INCRIMINATIN G MATERIAL IS BAD IN LAW AS ALSO THE FACT THAT INITIA TION OF ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 14 PROCEEDINGS U/S 153C SHOULD BE IN RESPECT OF SUCH Y EARS- IN WHICH THERE IS SOME MATERIAL. THAT THEREFORE EVE N ON THESE GROUNDS THE ASSESSMENT ORDER IS BAD IN LAW. I N THIS CONNECTION THE APPELLANT HAS PLACED RELIANCE ON TH E DECISIONS IN CASES OF VJM VIMAWAL (2009) 124 TTJ 508 (UR) AHMEDABAD SARAYA INDUSTRIES LTD. 3061TR 189(2008) DELHI ETC. I HAVE GONE THROUGH THE SATISF ACTION NOTE OF THE .4.0 DATED 05.07.2010. IT IS SEEN THAT THE AO HAS NOTED AS UNDER: 'DOCUMENTS AT PAGES 77 TO 161 OF ANNEXURE A-24 SEI ZED BY PARTY R-2 FROM THE PREMISES AT F-615 VASANT VIH AR NEW DELHI DURING THE COURSE OF SEARCH CONDUCTED U/S 132 OF THE I. T. ACT 1961 ON' 20.10.2008 IN THE CASE O F SH. B. K. DHINGRA SMT. POONAM DHINGRA M/S MADHUSUDAN BUILDCON PVT. LTD. HAVE BEEN BELONG TO M/S INLAY MARKETING PVT. LTD. 8-340 HARI NAGAR NEW DELHI WHICH HAS NOT BEEN COVERED U/S 132 OF THE I. T. ACT 1961. ACCORDINGLY IN TERMS OF PROVISIONS OF SECTION 153C OF THE ACT NOTICES U/S 153C ARE HEREBY ISSUED FOR THE A. Y . 2003-04 TO 2008-09 IN THE CASE OF M/S INLAY MARKETI NG PVT. LTD. THE FORESAID CASE WAS CENTRALIZED IN CENT RAL CIRCLE -17 NEW DELHI VIDE ORDERS DATED 14/DEC/09 O F CIT-IV NEW DELHI.' 9. IT IS ALSO OBSERVED FROM THE PLAIN AND LITERAL INTERPRETATION OF THE PROVISION OF SECTION 153C THA T ONCE A DOCUMENT IS FOUND TO BE BELONGING TO A PERSON OTH ER THAN THE PERSON REFERRED TO IN SECTION 153A THE PRO VISIONS OF SECTION 153C ARE IPSO FACTO ATTRACTED AND IT IS AUTOMATIC THAT THE ASSESSMENTS COVERED UNDER ALL TH E YEARS FALLING WITHIN THE MANDATE OF PROVISO OF SECT ION 153C(1) AND READ WITH 153A(1) GET ATTRACTED. MOREOV ER THERE IS NO LEGAL REQUIREMENT THAT INITIATION OF PROCEEDINGS SHOULD ONLY BE WITH RESPECT TO SUCH YEA RS IN RESPECT OF WHICH THERE IS SOME MATERIAL. NOW COMING TO THE ISSUE THAT THE SATISFACTION NOTE SHOULD CONTAIN SOME SATISFACTION ON THE PART OF THE AO LEADING TO UNDIS CLOSED INCOME ON THE BASIS OF THE SEIZED MATERIAL. IN THIS REGARD ALSO I HAVE CONSIDERED THE FACTS OF THE CASE AND IN MY ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 15 CONSIDERED OPINION RECORDING OF SATISFACTION SO AS TO SHOW EXISTENCE OF UNDISCLOSED INCOME IS NOT A PREREQUISITE UNDER THE PROVISION OF SEE 153C WHICH ARE DISTINGUISHABLE FROM THE PROVISIONS OF SEE 15880 OF THE ACT WHICH IS ALSO RELATED TO BLOCK ASSESSMENTS. THE LITERAL MEANING OF SEC 153C THAT ONCE DOCUMENTS ARE HANDED OVER TO THE AO OF THE OTHER PERSON WHICH INCIDENTA LLY IS THE SAME AO THE PROVISION OF SEC 153A ARE MADE APPLICABLE AND THEREFORE EVEN IF SUCH DOCUMENTS ETC . ARE RECORDED OR DISCLOSED TO THE DEPARTMENT BY SUCH OTH ER PERSON THE ASSESSMENT MAY HAVE TO BE FRAMED FOR AL L RELEVANT ASSESSMENT YEARS. THE REQUIREMENT OF THE S EC. 153C WITH REFERENCE TO SATISFACTION SEEMS TO BE ONL Y THE PRIMA FACIE SATISFACTION AND NOT A CONCLUSIVE SATIS FACTION. THUS THE AO MUST BE PRIMA FACIE SATISFIED THAT THE DOCUMENTS ETC. BELONG TO THE OTHER PERSON THAN THE PERSON SEARCHED. IN THE PRESENT CASE SUCH SATISFACT ION HAS BEEN STATED TO HAVE BEEN RECORDED AND I HAVE NO THING TO DOUBT THE ACTION OF THE AO IN THIS RESPECT AS IS BEING MADE OUT BY THE APPELLANT. NOW COMING BACK TO THE I SSUE OF LIMITATION RAISED BY THE APPELLANT IN THE ABOVE SAID GROUNDS OF APPEAL NO. 1 2 3 & 5 IT HAS BEEN ARGUE D THAT WHILE SEARCH HAS TAKEN PLACE IN THE GROUP CASE IN OCTOBER 2008 BUT THE DOCUMENTS ARE DEEMED TO BE HANDED OVER TO THE AO OF THE APPELLANT ON 05TH JULY 2010 THE DATE ON WHICH THE NOTICE U/S 153C HAS BEE N ISSUED IN THE APPELLANT'S CASE. THAT SIX YEARS WHIC H CAN BE ASSESSED U/S 153C SHALL HAVE TO BE CONSTRUED FRO M THE DATE ON WHICH THE BOOKS OF ACCOUNT OR DOCUMENTS ARE HANDED OVER BY THE AO OF THE MAIN PARTY SUBJECTED T O THE SEARCH TO THE AO OF THE OTHER PERSON (THE APPLICANT IN THIS CASE). THAT ACCORDINGLY THE SIX YEARS WHICH CAN BE ASSESSED U/S 153C IN APPLICANT'S CASE ARE A.Y 2005- 06 TO 2010-11. THE ABOVE VIEW IS CLEAR ON READING THE PRO VISO TO SEC 153C(1) R. W. S. 153A(1) OF THE I T ACT. IN THIS CONNECTION RELIANCE IS ALSO PLACED IN THE RATIO OF DECISION IN THE CASE OF VJM VIMAWAL VS ACIT 124 TTJ 508(UR). ACCORDINGLY THE INITIATION OF THE PROCEEDINGS FOR A Y. 03- 04(AND THE OTHER RESPECTIVE A.Y'S AS THE CASE MAY BE) WHICH HAS BEEN MADE ON 05.07.2010 IS BARRED BY ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 16 LIMITATION AND THEREFORE THE ASSESSMENT ORDER PASS ED U/S 153C IS HELD AS A NULLITY. THIS PLEA HOWEVER IS FUNDAMENTALLY FLAWED IN VIEW OF THE BASIS OF THE FA CT THAT IN CASE OF THIS APPELLANT THE AO WHO WAS TO HAND OV ER THE SEIZED MATERIAL IS ALSO THE AO OF THE APPELLANT WH O WAS TO TAKE OVER THE SEIZED MATERIAL THEREFORE THE ISS UE OF HANDING OVER AND TAKING OVER THE SEIZED MATERIAL I S OBVIATED THE PLEA TAKEN REGARDING THE DATE OF SEAR CH AND SUBSEQUENT DATE OF HANDING OVER OF SEIZED MATER IAL IS ALSO OBVIATED AS BOTH THE SIDES ARE MANNED BY THE S AME AO. FURTHER THE AO HAS PROVIDED THE COPY OF THE SATISFACTION NOTE WHEN ASKED BY THE APPELLANT COM PANY. I DO NOT FIND ANY MERIT IN THE GROUNDS OF THE APPEA LS NOR ANY INFIRMITY IN THE NOTICE ISSUED OR THE ORDER PAS SED U/S 153A/153C IN THIS CASE ON ACCOUNT OF GROUNDS NO 1 2 3 & 5 TAKEN BY THE APPELLANT. THESE GROUNDS ARE THERE FORE DISMISSED. 20. WE FURTHER OBSERVE THAT IN THE CASES OF DSL PRO PERTIES (P) LTD. (SUPRA) THE ITAT DELHI HELD THAT EVEN IF THE ASSES SING OFFICER OF THE PERSONS SEARCHED AND THE ASSESSING OFFICER OF THE S UCH OTHER PERSON OTHER THAN SEARCHED IS THE SAME THEN THE ASSESSING OFFIC ER HAS TO FIRST RECORD THE SATISFACTION IN THE FILE OF THE PERSON SEARCHED TH EREAFTER SUCH NOTE ALONG WITH THE SEIZED DOCUMENT/BOOKS OF ACCOUNTS IS TO BE PLACED IN THE FILE OF SUCH OTHER PERSON AND IN ABSENCE OF SUCH EXERCISE INITIATION OF PROCEEDINGS UNDER SECTION 153C OF THE ACT ITSELF ARE INVALID. 21. IN VIEW OF FACTUAL MATRIX OF THE PRESENT CASE WE ARE OF THE CONSIDERED VIEW THAT THERE IS NO NEED TO GO WITH CONFLICTING D ECISIONS ON THE LEGAL ISSUE AS THOUGH SECTION 153C OF THE ACT IS ANALOGOUS TO T HE EARLIER PROVISIONS OF ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 17 SECTION 158BD OF THE ACT BUT THERE IS A COMPLETE DE VIATION IN THE NEWLY INSERTED PROVISION OF SECTION 153C OF THE ACT INASM UCH AS WHILE SECTION 158BD OF THE ACT STIPULATES THAT FOR TRANSFER OF FI LE ONLY WHEN THE ASSESSING OFFICER WHO CONDUCTED THE SEARCH OR WHO CALLED FOR BOOKS OF ACCOUNTS WAS SATISFIED THAT THE UNDISCLOSED INCOME FOUND THEREFR OM BELONGS TO ANY PERSON OTHER THAN THE PERSON SEARCHED WHO HAS TO BE ASSESS ED UNDER SECTION 158BD R/W SECTION 158BC OF THE ACT. WHILE UNDER SECTION 153C OF THE ACT FOR TRANSFERRING THE MATERIAL OR EVIDENCE COLLECTED DUR ING COURSE OF SEARCH TO THE ASSESSING OFFICER OF ASSESSEE OTHER THAN THE PERSON SEARCHED WHAT IS REQUIRED IS THAT THE MONEY BULLION JEWELLERY OR O THER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNTS OR DOCUMENTS SEIZED IN T HE COURSE OF SEARCH OF AN ASSESSEE BELONGED TO OR RELATED TO A PERSON OTHER T HAN THE PERSON SEARCHED. IN SIMPLER WORDS UNLIKE SECTION 158BD OF THE ACT FO R TRANSFERRING A FILE UNDER SECTION 153C OF THE ACT THERE IS NO NEED TO EXAMINE WHETHER THE MATERIAL DOCUMENTS BOOKS OF ACCOUNTS OR OTHER EVI DENCE SEIZED DURING THE COURSE OF SEARCH OF AN ASSESSEE REPRESENTS OR DISCL OSED UNDISCLOSED INCOME OF ANOTHER ASSESSEE. 22. IN THE DECISION OF THE HONBLE SUPREME COURT IN THE CASES OF CALCUTTA KNITWEARS (SUPRA) THE RATIO LAID DOWN IN THE CASE READS THUS:- 38. HAVING SAID THAT LET US REVERT TO DISCUSSION OF SECTION 158BD OF THE ACT. THE SAID PROVISION IS A M ACHINERY ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 18 PROVISION AND INSERTED IN THE STATUTE BOOK FOR THE PURPOSE OF CARRYING OUT ASSESSMENTS OF A PERSON OTHER THAN THE SEARCHED PERSON UNDER SECTIONS 132 OR 132A OF THE ACT. UNDER SECTION 158BD OF THE ACT IF AN OFFICER IS SATISFIED THAT T HERE EXISTS ANY UNDISCLOSED INCOME WHICH MAY BELONG TO A OTHER PERS ON OTHER THAN THE SEARCHED PERSON UNDER SECTIONS 132 OR 132A OF THE ACT AFTER RECORDING SUCH SATISFACTION MAY TRANSMI T THE RECORDS/DOCUMENTS/CHITS/PAPERS ETC TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON. AFTER R ECEIPT OF THE AFORESAID SATISFACTION AND UPON EXAMINATION OF THE SAID OTHER DOCUMENTS RELATING TO SUCH OTHER PERSON THE JURISD ICTIONAL ASSESSING OFFICER MAY PROCEED TO ISSUE A NOTICE FOR THE PURPOSE OF COMPLETION OF THE ASSESSMENTS UNDER SECTION 158B D OF THE ACT THE OTHER PROVISIONS OF XIV-B SHALL APPLY. 39. THE OPENING WORDS OF SECTION 158BD OF THE ACT A RE THAT THE ASSESSING OFFICER MUST BE SATISFIED THAT 'UNDIS CLOSED INCOME' BELONGS TO ANY OTHER PERSON OTHER THAN THE PERSON WITH RESPECT TO WHOM A SEARCH WAS MADE UNDER SECTIO N 132 OF THE ACT OR A REQUISITION OF BOOKS WERE MADE UNDER S ECTION 132A OF THE ACT AND THEREAFTER TRANSMIT THE RECORD S FOR ASSESSMENT OF SUCH OTHER PERSON. THEREFORE THE SHO RT QUESTION THAT FALLS FOR OUR CONSIDERATION AND DECISION IS AT WHAT STAGE OF THE PROCEEDINGS SHOULD THE SATISFACTION NOTE BE PRE PARED BY THE ASSESSING OFFICER: WHETHER AT THE TIME OF INITI ATING PROCEEDINGS UNDER SECTION 158BC FOR THE COMPLETION OF THE ASSESSMENTS OF THE SEARCHED PERSON UNDER SECTION 13 2 AND 132A OF THE ACT OR DURING THE COURSE OF THE ASSESSM ENT PROCEEDINGS UNDER SECTION 158BC OF THE ACT OR AFTER COMPLETION OF THE PROCEEDINGS UNDER SECTION 158BC O F THE ACT. 23. WE FURTHER NOTE THAT THE HONBLE JURISDICTIONAL HIGH COURT OF DELHI IN THE CASE OF PEPSICO INDIA HOLDINGS PVT. LTD. VS ACI T (SUPRA) AFTER CONSIDERING ITS OWN DECISION IN THE CASE OF PEPSI F OODS PVT. LTD. VS ACIT ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 19 WP(C) NO. 415/2014 DATED 07.08.2014 AND THE PROVISI ONS OF SECTION 153C 132(4A)(I) AND 292 C(1)(I) IT HAS BEEN HELD THUS:- BEFORE WE EXAMINE THESE WRIT PETITIONS IN DETAIL I T WOULD BE PERTINENT TO POINT OUT THAT RECENTLY IN T HE CASE OF PEPSI FOODS PVT. LTD. VS. ASSISTANT COMMISSIONER OF INCOME TAX WP (C) NO.415/2014 AND OTHER CONNECTED MATTERS THIS COURT HAD OCCASION TO EXAMINE THE VERY PROVISIONS W HICH ARE UNDER CONSIDERATION IN THE MATTERS BEFORE US. IN TH E JUDGEMENT DELIVERED ON 07.08.2014 IN THE CASE OF PE PSI FOODS PVT. LTD. (SUPRA) AFTER EXAMINING THE PROVIS IONS OF SECTIONS 153C 132(4A)(I) & 292C(1 )(I) OF THE SAID ACT THIS COURT HAD OBSERVED AS UNDER: '6. ON A PLAIN READING OF SECTION 153C IT IS EVIDE NT THAT THE ASSESSING OFFICER OF THE SEARCHED PERSON MUST BE 'S ATISFIED' THAT INTER ALIA ANY DOCUMENT SEIZED OR REQUISITIONE D 'BELONGS TO' A PERSON OTHER THAN THE SEARCHED PERSON. IT IS ONLY THEN THAT THE ASSESSING OFFICER OF THE SEARCHED PERSON C AN HANDOVER SUCH DOCUMENT TO THE ASSESSING OFFICER HAV ING JURISDICTION OVER SUCH OTHER PERSON (OTHER THAN THE SEARCHED PERSON). FURTHERMORE IT IS ONLY AFTER SUCH HANDING OVER THAT THE ASSESSING OFFICER OF SUCH OTHER PERSON CAN ISSU E A NOTICE TO THAT PERSON AND ASSESS OR RE-ASSESS HIS INCOME I N ACCORDANCE WITH THE PROVISIONS OF SECTION 153A. THE REFORE BEFORE A NOTICE UNDER SECTION 153C CAN BE ISSUED TW O STEPS HAVE TO BE TAKEN. THE FIRST STEP IS THAT THE ASSESS ING OFFICER OF THE PERSON WHO IS SEARCHED MUST ARRIVE AT A CLEAR S ATISFACTION THAT A DOCUMENT SEIZED FROM HIM DOES NOT BELONG TO HIM BUT TO SOME OTHER PERSON. THE SECOND STEP IS - AFTER SU CH- SATISFACTION IS ARRIVED AT - THAT THE DOCUMENT IS H ANDED OVER TO THE ASSESSING OFFICER OF THE PERSON TO WHOM THE SAID DOCUMENT 'BELONGS'. IN THE PRESENT CASES IT HAS BEE N URGED ON BEHALF OF THE PETITIONER THAT THE FIRST STEP ITS ELF HAS NOT BEEN FULFILLED. FOR THIS PURPOSE IT WOULD BE NECESS ARY TO EXAMINE THE PROVISIONS OF PRESUMPTIONS AS INDICATED ABOVE. SECTION 132(4A)(I) CLEARLY STIPULATES THAT WHEN INT ER ALIA ANY DOCUMENT IS FOUND IN THE POSSESSION OR CONTROL OF A NY PERSON IN THE COURSE OF A SEARCH IT MAY BE PRESUMED THAT S UCH ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 20 DOCUMENT BELONGS TO SUCH PERSON. IT IS SIMILARLY PR OVIDED IN SECTION 292C(1 )(I). IN OTHER WORDS WHENEVER A DO CUMENT IS FOUND FROM A PERSON WHO IS BEING SEARCHED THE NORMA L PRESUMPTION IS THAT THE SAID DOCUMENT BELONGS TO TH AT PERSON. IT IS FOR THE ASSESSING OFFICER TO REBUT THAT PRESU MPTION AND. COME TO A CONCLUSION OR 'SATISFACTION' THAT THE DOC UMENT IN FACT BELONGS TO SOMEBODY ELSE. THERE MUST BE SOME C OGENT MATERIAL AVAILABLE WITH THE ASSESSING OFFICER BEFOR E HE/SHE ARRIVES AT THE SATISFACTION THAT THE SEIZED DOCUMEN T DOES NOT BELONG TO THE SEARCHED PERSON BUT TO SOMEBODY ELSE. SURMISE AND CONJECTURE CANNOT TAKE THE PLACE OF 'SATISFACTI ON'. XXXX XXXX XXXX XXXX XXXX '11. IT IS EVIDENT FROM THE ABOVE SATISFACTION NOT E THAT APART FROM SAYING THAT THE DOCUMENTS BELONGED TO THE PETI TIONER AND THAT THE ASSESSING OFFICER IS SATISFIED THAT IT IS A FIT CASE FOR ISSUANCE OF A NOTICE UNDER SECTION 153C THERE IS NOTHING WHICH WOULD INDICATE AS TO HOW THE PRESUMPTIONS WHI CH ARE TO BE NORMALLY RAISED AS INDICATED ABOVE HAVE BEEN REBUTTED BY THE ASSESSING OFFICER. MERE USE OR MENTION OF TH E WORD 'SATISFACTION' OR THE WORDS 'I AM SATISFIED' IN THE ORDER OR THE NOTE WOULD NOT MEET THE REQUIREMENT OF THE CONC EPT OF SATISFACTION AS USED IN SECTION 153C OF THE SAID AC T. THE SATISFACTION NOTE ITSELF MUST DISPLAY THE REASONS O R BASIS FOR THE CONCLUSION THAT THE ASSESSING OFFICER OF THE SE ARCHED PERSON IS SATISFIED THAT THE SEIZED DOCUMENTS BELON G TO A PERSON OTHER THAN THE SEARCHED PERSON. WE ARE AFRAI D THAT GOING THROUGH THE CONTENTS OF THE SATISFACTION NOTE WE ARE UNABLE TO DISCERN ANY 'SATISFACTION' OF THE KIND RE QUIRED UNDER SECTION 153C OF THE SAID ACT.' 24. THE COORDINATE BENCH OF THE TRIBUNAL IN THE CA SE OF DSL PROPERTIES (P) LTD. VS DCIT IN OPERATIVE PARAS 15 18 AND 21 ( SUPRA) HAS HELD THUS:- HELD ACTION U/S 153C CAN BE TAKEN IN RESPECT OF ANY OTHE R PERSON THAN PERSON SEARCHED IF AO OF PERSON SEARCHED IS SA TISFIED THAT ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 21 ANY MONEY BULLION JEWELLERY OR OTHER VALUABLE ART ICLE OR THING OR BOOKS OF ACCOUNT OR DOCUMENTS BELONG TO PERSON O THER THAN PERSON SEARCHED. THEREFORE RECORDING OF SATISFACTI ON BY AO OF PERSON SEARCHED THAT ANY MONEY BULLION JEWELLERY OR OTHER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNT OR DO CUMENTS SEIZED BELONG TO PERSON OTHER THAN PERSON SEARCHED IS A SINE QUA NON FOR INITIATING ACTION U/S 153C. IN S. 158B D AO OF PERSON SEARCHED IS TO BE SATISFIED THAT ANY UNDISCL OSED INCOME BELONG TO ANY PERSON OTHER THAN PERSON SEARCHED WH ILE IN CASE OF S. 153C AO OF PERSON SEARCHED IS TO BE SAT ISFIED THAT ANY MONEY BULLION JEWELLERY OR OTHER VALUABLE ART ICLE OR THING OR BOOKS OF ACCOUNT OR DOCUMENTS BELONG TO PERSON O THER THAN PERSON SEARCHED. PERUSAL OF SATISFACTION NOTE SHOWS THAT PAPER DOES NOT INDICATE IN WHOSE CASE THIS SATISFACTION W AS RECORDED AND WHO IS OFFICER RECORDING SATISFACTION. NEITHER NAME OF ASSESSEE OF AO WAS MENTIONED AND NO SEAL OF AO WAS THERE. AO RECORDED SATISFACTION IN CASE OF SUCH OTHER PERS ON WHICH DOES NOT SATISFY CONDITION OF ASSUMING JURISDICTION U/S 153C. MOREOVER NO ORIGINAL SATISFACTION NOTE IS AVAILABL E ON RECORD. PHOTOCOPY OF SATISFACTION NOTE PRODUCED BEFORE US D OES NOT BEAR NAME OF ANY ASSESSEE NAME OF AO OR ANY SEAL O F AO. THEREFORE SATISFACTION NOTE CANNOT BE SAID TO BE V ALID SATISFACTION NOTE WITHIN MEANING OF S. 153C. LIKEWI SE AO ISSUED NOTICE U/S 153C FOR AY 2004-05 WHICH IS CLEA RLY BARRED BY LIMITATION. THEREFORE ISSUE OF NOTICE U/S 153C ISSUED BY REVENUE CANNOT BE SUSTAINED ON BOTH COUNTS I.E. I T IS LEGALLY NOT VALID AS CONDITIONS LAID DOWN U/S. 153C HAS NOT BEEN FULFILLED AND IT IS BARRED BY LIMITATION. THEREFORE NOTICE ISSUED U/S 15AND CONSEQUENTLY ASSESSMENT COMPLETED IN PUR SUANCE TO SUCH NOTICE IS ALSO QUASHED. APPEAL ALLOWED. 25. EVEN IF THE DECISIONS OF HONBLE SUPREME COURT IN THE CASES OF MANISH MAHEHSWARI (SUPRA) CALCUTTA KNITWEARS (SUPR A) DECISION OF HONBLE HIGH COURT OF DELHI IN THE CASE OF PEPSICO HOLDINGS PVT. LTD. (SUPRA) AND DECISION OF ITAT DELHI IN THE CASE OF D SL PROPERTIES (SUPRA) ARE ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 22 NOT THERE THEN ALSO IN CLOSE JUXTAPOSITION TO FACTS OF THE PRESENT CASE AS PER RTI REPLY BY THE DEPARTMENT DATED 10.6.2013(PAPER B OOK NO. 3OF THE ASSESSEE AT PAGES 13 14 & 15) IT HAS BEEN STATED AND ANSWERED TO THE PRESENT ASSESSEE I.E. PERSON OTHER THAN PERSON SEAR CHED THE AO OF THE PERSON SEARCHED HAS ADMITTED THAT NO SATISFACTION NOTE IS AVAILABLE IN THEIR RECORD/FILES CONCERNING PERSON OTHER THAN THE PRESE NT CASE. 26. THE SATISFACTION NOTE AVAILABLE ON PAPER BOOK N O. 2OF THE ASSESSEE AT PAGE 51 CLEARLY REVEALS EX FACIE THAT THE SAME HAS BEEN RECORDED BY THE AO IN THE CAPACITY OF AO OF THE PERSON OTHER THAN PERS ON SEARCHED. MEANING THEREBY ASSESSEE OF THE INSTANT APPEALS. IN THESE CIRCUMSTANCES IT CAN SAFELY BE HELD THAT NO VALID SATISFACTION WAS RECORDED BY THE AO OF PERSON SEARCHED SO AS TO FULFILL REQUIREMENT OF VALID ASSUMPTION OF JURISDICTION U/S 153C OF THE ACT WHICH IS SINE QUA NON FOR VALIDLY ASSUMED JURISDICTION U/S 153A OF THE ACT. 27. REPLYING TO THE SPECIFIC QUERY OF THE BENCH LD . DR FOUND HIMSELF UNABLE TO SUBMIT THE OUTCOME OF THE ASSESSMENT PRO CEEDINGS FOR AY 2009- 10 RELEVANT TO PREVIOUS 2008-09 PERTAINING TO WHIC H ALLEGED CHEQUE BOOK AS TERMED AS INCRIMINATING MATERIAL BY THE DEPARTMENT WAS RELATED. IN THIS SITUATION WE CAN SAFELY PRESUME THAT NO REGULAR AS SESSMENT ORDER HAS BEEN PASSED TILL DATE FOR THE AY 2009-10 TO WHICH ONLY S EIZED MATERIAL I.E. CHEQUE ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 23 BOOK PERTAINS TO. LD. DR HAS ALSO NOT DISPUTED THE FACT SUBMITTED BY THE ASSESSEE THAT THE DETAILS OF CHEQUE BOOK WERE DULY REFLECTED IN THE RETURN OF THE ASSESSEE FOR AY 2009-10. THEREFORE IF THE AO OF THE PERSON OTHER THAN PERSON SEARCHED MIGHT HAVE GONE THROUGH THE RETURN OF THE ASSESSEE FOR AY 2009-10 WHICH WAS ADMITTEDLY FILED ON 30.09.2009 THEN HE COULD HAVE DRAWN A PROPER CONCLUSION ABOUT FURTHER ACTION OF T HE PROCEEDINGS FOR AY 2009-10 BUT THIS EXERCISE WAS NOT CONDUCTED PRIOR T O ISSUANCE OF NOTICE U/S 153C OF THE ACT ON 6.7.2010 HENCE THE INITIATION OF PROCEEDINGS AND ASSUMPTION OF JURISDICTION U/S 153C OF THE ACT GETS VITIATED ON ACCOUNT OF NON-RECORDING OF REQUIRED SATISFACTION BY THE AO OF THE PERSON SEARCHED AND NON APPLICATION OF MIND BY THE AO OF THE PERSON OTH ER THAN THE PERSON SEARCHED. 28. RELYING ON THE DECISIONS OF ITAT DELHI IN THE CASE OF DSL PROPERTIES LTD. (SUPRA) AND V.K. FISCAL SERVICES PVT. LTD. (SU PRA) LD. COUNSEL OF THE ASSESSEE HAS ALSO ADVANCED ANOTHER LEGAL CONTENTION THAT THE ASSESSMENT FOR AY 2003-04 AND AY 2004-05 IS TIME BARRED AS PER PRO VISIONS OF SECTION 153(1) OF THE ACT WHICH STIPULATED THAT THE ASSESSI NG OFFICER CAN ISSUE THE NOTICE U/S 153A OF THE ACT FOR SIX ASSESSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR I N WHICH SEARCH IS CONDUCTED AND FOR THE PURPOSE OF SECTION 153C OF T HE ACT FOR THE SIX ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 24 ASSESSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSME NT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH THE DOCUMENT OR MATERIAL IS HANDED OVER. 29. REPLYING TO THE ABOVE LD. DR POINTED OUT THE OBSERVATIONS AND CONCLUSIONS OF THE CIT(A) AT PAGE 79-80 OF THE IMPU GNED ORDER AND SUBMITTED THAT IN THIS CASE THE ASSESSING OFFICER WHO DID NOT HAND OVER THE SEIZED MATERIAL IS ALSO THE ASSESSING OFFICER OF TH E APPELLANT I.E. PERSON OTHER THAN SEARCHED PERSON WHO WAS TO TAKE OVER SEIZED M ATERIAL THEREFORE THE ISSUE OF HANDING OVER AND TAKING OVER THE SEIZED MA TERIAL IS OBVIATED. THE DR FURTHER CONTENDED THAT WHEN THE DATE OF SEARCH A ND SUBSEQUENT DATE OF HANDING OVER OF SEIZED MATERIAL IS OBVIATED BECAUSE BOTH THE AOS OF PERSON SEARCHED AND PERSON OTHER THAN THE PERSON SEARCHED WAS CONDUCTED BY THE SAME ASSESSING OFFICER. THE DR FURTHER CONTENDED T HAT IN THIS SITUATION DATE OF SEARCH IS RELEVANT FOR CALCULATING LIMITATI ON PERIOD FOR THE CASES OF THE PERSON OTHER THAN THE PERSON SEARCHED. 30. ON CAREFUL CONSIDERATION OF ABOVE SUBMISSIONS WE OBSERVED THAT IN THE RECENT DECISION OF ITAT E BENCH MUMBAI IN THE CASE OF SKS ISPAT AND POWER LIMITED VS DCIT IN ITA NO. 8746/M/2010 AND OT HER APPEALS THE ORDER DATED 7.5.2014 WE OBSERVE THAT THE ISSUE OF LIMITATION PRESCRIBED UNDER SECTION 153(1) OF THE ACT HAS BEEN DECIDED BY FOLLOWING THE DECISION OF ITAT DELHI H BENCH IN THE CASE OF V.K. FISCAL SERVICES PVT. LTD. VS ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 25 DCIT (SUPRA) IN FAVOUR OF THE ASSESSEE WITH FOLLOWI NG OBSERVATIONS AND CONCLUSIONS:- 15. WE ALSO FIND THAT THE CIT(A) MADE A REFERENCE TO THE INCRIMINATING MATERIAL WHICH YIELDED DISCLOSUR E OF SOME UNDISCLOSED INCOME. BUT ON PERUSAL OF THE DOCUMENT S WE FIND THAT THE CIT(A) ENTERED INTO AN ERROR ZONE AND THE DISCLOSURE IS ONLY RS 5 CRORES IN THIS CASE AND THE SAME RELATES TO THE LANDS DEALS. IN PRINCIPLE THIS DISCL OSURE HAS NOTHING DO WITH THE IMPUGNED ADDITIONS U/S 68 OR 14 A OF THE ACT. IN THE INSTANT CASE SPECIFIC TO THE ASSESSEE NO INCRIMINATING MATERIAL WITH THE DETAILS WAS REFERRE D EITHER IN THE ASSESSMENT ORDER OR IN THE ORDER OF THE CIT (A) FOR MAKING THE IMPUGNED ADDITIONS. AS PER THE CITED JUD GMENT IN THE CASE OF JAI STEELS LTD SUPRA THE ASSESSMENT U /S 153A IS ONLY FOR REITERATION RATHER THAN MAKING ANY ADDITIO NS IN A ROUTINE MANNER WITHOUT THE STRENGTH OF THE INCRIMIN ATING MATERIALS. SIMILAR VIEW WAS TAKEN UP BY THE ITAT D ELHI H BENCH IN THE CASE OF V.K. FISCAL SERVICES P LTD V S. DCIT VIDE ITA NOS.5460 TO 5465/DEL/2012 (WWW.ITATONLINE.ORG). IN THIS REGARD PARA 13 FROM THE SAID ORDER OF THE ITAT DELHI BENCH (SUPRA) IS RELEVANT A ND THE SAME READS AS UNDER: '13. APPLYING THE ABOVE CASE LAWS TO THE FACTS OF T HE CASE WE HAVE TO NECESSARILY QUASH THE ASSESSMENT PROCEED INGS FOR AY 2004-2005 2005-06 2007-08 2008-09 ON THE FOLL OWING GROUNDS. (A) NO BOOKS OF ACCOUNTS BELONGING TO THE ASSESSEE WERE FOUND AND SEIZED IN THE PREMISES OF THE OTHER PERSON. WHAT WAS FOUND WAS IN THE HARD DISK WAS ON LY A CONFIRMATION OF ACCOUNT THAT AN ATTACHED AN NEXURES. SUCH DOCUMENTS CANNOT BE SAID TO BE BOOKS OF ACC OUNTS OR DOCUMENTS BELONGING TO THE ASSESSEE. (B) THE REVENUE HAS NOT PRODUCED THE RECORD OF THE SEARCHED PERSON TO DEMONSTRATE THAT SATISFACTION WA S ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 26 RECORDED DURING THE COURSE OF ASSESSMENT PROCEEDING S IN THE CASE OF M/S. GLOBAL REALITY VENTURES P. LTD. ON THE DATE OF RECORDING OF SATISFACTION FIRST NOTICE U/S 153(C) WAS ISSUED. THERE IS NO INDICATION WHATSOEVER THAT THE ASSESSM ENT PROCEEDINGS IN THE CASE OF GLOBAL REALITY VENTURES P. LTD WERE IN PROGRESS OR NOT AT THE POINT OF TIME AND T HAT THE AO DURING THE COURSE OF THAT PROCEEDINGS RECORDED THIS SATISFACTION. THE PROCEDURE CONTEMPLATED UNDER THE ACT WAS NOT FOLLOWED. (C) THE SATISFACTION IS RECORDED ON 23RD JULY 2010 . THE RELEVANT AY WOULD BE 2011-12. THE SIX PRECEDING AYS RELEVANT TO THIS AY WOULD BE 2005-06 / 2006-07 / 20 07-08 / 2008-09 / 2010-11. THUS THE NOTICE ISSUED U/S 153 C FOR THE AY 2004-05 IS CLEARLY BARRED BY LIMITATION. (D) EVEN OTHERWISE AS THERE IS NO INCRIMINATING MA TERIAL FOUND DURING THE COURSE OF SEARCH THE AO SHOULD HA VE DROPPED THE PROCEEDINGS INITIATED U/S 153 C OF THE ACT. (E) AS THERE IS NO DISPUTE THAT NO ASSESSMENT OR RE ASSESSMENT HAS ABATED IN THIS CASE FOR THE REASON THAT THE DA TE OF SEARCH THE DATE OF SEARCH WHICH IN THE CASE ON HAN D WOULD BE 25.3.2010 BY VIRTUE OF FIRST PROVISO TO SECTION 153 C I.E. THE DATE OF PASSING AN ORDER U/S 127 TRANSFER RING THE CASES OF THE ASSESSEE TO THE PRESENT ASSESSING OFFI CER NO ASSESSMENT OR REASSESSMENT WAS PENDING. WHEN NO ASSESSMENT HAS ABATED THE QUESTION OF MAKING ANY A DDITION OR MAKING DISALLOWANCE WHICH ARE NOT BASED ON ONLY MATERIAL FOUND DURING THE SEARCH IS BAD IN LAW.' 31. IN VIEW OF ABOVE DECISION AND AS PER LETTER AND SPIRIT OF SECTION 153(1) OF THE ACT WE ARE INCLINED TO HOLD THAT SINCE IN T HIS CASE SATISFACTION WAS RECORDED ON 5.7.2010 AND NOTICE UNDER SECTION 153C WAS ISSUED ON ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 27 6.7.2010 THE ONLY CONCLUSION THAT CAN BE DRAWN IS THAT THE ASSESSING OFFICER OF SUCH OTHER PERSON OTHER THAN SEARCHED HAS TAKEN OVER THE POSSESSION OF THE SEIZED DOCUMENT ON 5.7.2010. ACCORDINGLY AS PER S ECTION 153A(1) OF THE ACT THE ASSESSING OFFICER CAN ISSUE A NOTICE UNDER SECTION 153A OF THE ACT FOR THE PREVIOUS YEAR IN WHICH THE SEARCH IS CONDUC TED AND THE PURPOSE OF SECTION 153C OF THE ACT ON THE DATE ON WHICH THE DO CUMENT IS HANDED OVER TO THE ASSESSING OFFICER OF THE PERSON OTHER THAN THE SEARCHED PERSON FOR SIX AYS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEV ANT TO THE PREVIOUS YEAR IN WHICH SUCH SEARCH IS CONDUCTED OR REQUISITI ON OR HANDING OVER OF DOCUMENT OR MATERIAL IS MADE. IN THE CASE IN HAND THE RELEVANT DATE OF HANDING OVER MAY EASILY BE INFERRED FROM SATISFACTI ON NOTE I.E. 5.7.2010 AND THUS RELEVANT PREVIOUS YEAR IS 2010-11 AND OBVIOUS LY THE ASSESSMENT YEAR WOULD BE AY 2011-12. SIX PRECEDING PREVIOUS YEARS AND RELEVANT ASSESSMENT YEAR WOULD BE AS UNDER:- PREVIOUS YEAR ASSESSMENT YEAR 1.4.2009 TO 31.3.2010 2010-11 1.4.2008 TO 31.3.2009 2009-10 1.4.2007 TO 31.3.2008 2008-09 1.4.2006 TO 31.3.2007 2007-08 1.4.2005 TO 31.3.2006 2006-07 1.4.2004 TO 31.3.2005 2005-06 32. IN VIEW OF ABOVE WE ARE INCLINED TO HOLD THAT THE ASSESSING OFFICER HAS ISSUED NOTICE UNDER SECTION 153C OF THE ACT DAT ED 5.7.2010 FOR AY ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 28 2003-04 AND 2004-05 ON 6.7.2010 WHICH IS CLEARLY BA RRED BY LIMITATION. THEREFORE THE ISSUE OF NOTICE UNDER SECTION 153C O F THE ACT BY THE REVENUE CANNOT BE SUSTAINED BECAUSE IT IS LEGALLY NOT VALI D AS THE CONDITIONS LAID DOWN FOR VALID ASSUMPTION OF JURISDICTION U/S 153C OF THE ACT HAVE NOT BEEN FULFILLED AND THE SAME IS BARRED BY LIMITATION FOR AY 2003-04 AND 2004-05. IN VIEW OF ABOVE DISCUSSION WE QUASH THE NOTICE IS SUED UNDER SECTION 153C OF THE ACT AND CONSEQUENTLY THE ASSESSMENT COMPLET ED IN PURSUANCE TO SUCH NOTICE ARE ALSO QUASHED FOR AY 2003-04 AND 2004-05 AS THE SAME ARE BARRED BY LIMITATION AND ALSO NOT INITIATED PROPERLY WITHO UT HAVING VALID ASSUMPTION OF JURISDICTION AS REQUIRED U/S 153C OF THE ACT. 33. LD. COUNSEL OF THE ASSESSEE HAS ALSO POINTED OU T THAT AS PER REVENUE THE ONLY DOCUMENT WHICH WAS FOUND DURING THE SEARCH AND SEIZURE OPERATION ON SHRI B.K. DHINGRA AND OTHERS IS A CHEQUE BOOK WH ICH PERTAINS TO AY 2009-10 FOR WHICH NO ASSESSMENT WAS MADE UNDER SECT ION 143(3) OF THE ACT AS THE TRANSACTIONS REFLECTED FROM THE SAID CHEQUE BOOK WERE DULY RECORDED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE OF THE REL EVANT FINANCIAL YEAR/PREVIOUS YEAR THEREFORE NOTHING INCRIMINATING WAS FOUND DURING THE SEARCH WHICH COULD IMPEACH THE ASSESSEES BOOK RESU LTS. LD. COUNSEL OF THE ASSESSEE FURTHER CONTENDED THAT THE REVENUE HAS NOT PROVED THE BASIS OF THE FINDINGS OF THE CIT(A) AS NO MATERIAL WAS BROUGHT O N RECORD BY THE REVENUE ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 29 TO JUSTIFY THEIR CASE WHICH WAS BASED ONLY ON WILD ALLEGATIONS LEVELED ON THE BASIS OF CONJECTURES SURMISES AND HEARSAY WITHOUT ANY CONCLUSIVE AND CORROBORATIVE EVIDENCE WHICH CANNOT TAKE THE PLACE OF INCRIMINATING MATERIAL AGAINST THE ASSESSEE. 34. LD. DR REPLIED THAT CHEQUE BOOK SEIZED DURING T HE SEARCH AND SEIZURE OPERATION CONDUCTED ON SHRI B.K. DHINGRA AND OTHERS ON 20.10.2008 IS UNDISPUTEDLY AND ADMITTEDLY BELONGS TO THE APPELLAN T I.E. PERSON OTHER THAN PERSON SEARCHED AND IT IS NOT OBLIGATORY ON THE PAR T OF ASSESSING OFFICER OF THE PERSON SEARCHED TO VERIFY AND TO DRAW A CONCLUS IVE FINDING THAT DOCUMENT WHICH WAS CHEQUE BOOK IN THE PRESENT CASE IS AN INC RIMINATING MATERIAL OR NOT. THE DR FURTHER CONTENDED THAT THIS IS THE BUS INESS OF THE ASSESSING OFFICER OF THE PERSON OTHER THAN THE PERSON SEARCHE D WHO WILL HAVE FULL JURISDICTION TO APPRECIATE EVIDENTIARY VALUE OF THE BOOKS OF ACCOUNTS OR MATERIAL OR GOODS RECEIVED FROM THE OTHER ASSESSING OFFICER AND TO PROCEED TO MAKE ASSESSMENT IN HIS OWN WAY. 35. ON CAREFUL CONSIDERATION OF ABOVE CONTENTIONS WE ARE OF THE VIEW THAT ALTHOUGH THE ASSESSING OFFICER OF THE PERSON SEARCH ED IS NOT REQUIRED TO GO INTO DETAIL AND TO ADJUDICATE THE ISSUE AS TO WHETH ER THE MONEY BULLION JEWELLERY DOCUMENT ETC. SEIZED DURING THE COURSE O F SEARCH OPERATION WHICH WERE FOUND TO BELONG TO OTHER PERSON OTHER THAN THE PERSON SEARCHED ARE ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 30 INCRIMINATING MATERIAL OR NOT BUT AT THE SAME TIME THERE MUST BE PRIMA FACIE OBSERVATION BY THE AO OF THE PERSON SEARCHED IN THE FORM OF SATISFACTION NOTE THAT ON THE DATE WHEN THE HANDING OVER OF SUCH MATE RIAL OR EVIDENCE TO THE AO OF THE PERSON OTHER THAN THE PERSON SEARCHED WAS BEING CONDUCTED THE MATERIAL SHOULD BE RELATED TO THE PERIOD AS PER PRO VISIONS OF SECTION 153A(1)(B) OF THE ACT MEANING THEREBY THE MATERIAL BEING TRANSFERRED TO THE ASSESSING OFFICER HAVING JURISDICTION UNDER SECTION 153C OF THE ACT SHOULD PERTAIN TO THE PERIOD TO THE PREVIOUS YEAR IN WHICH THE DOCUMENT OR MATERIAL IS HANDED OVER SIX ASSESSMENT YEARS IMMEDIATELY PR ECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH THE DOC UMENT OR MATERIAL IS HANDED OVER. 36. HOWEVER ADMITTEDLY THE ONLY DOCUMENT WHICH WA S FOUND RELATED TO THE PRESENT APPELLANT ASSESSEE WAS CHEQUE BOOK RELA TED TO THE ASSESSMENT YEAR 2009-10 AND THE LD. DR HAS NOT DISPUTED THE FA CT THAT THE SAME WAS DULY RECORDED IN THE BOOKS OF ACCOUNTS OF THE ASSES SEE AND THEREFORE BY ANY STRETCH OF IMAGINATION THE SAID CHEQUE BOOK CANNOT BE SAID TO BE AN INCRIMINATING MATERIAL. BUT THE ASSESSING OFFICER OF THE PRESENT ASSESSEE I. E THE PERSON OTHER THAN THE PERSON SEARCHED HAS NOT EXAMINED AND RATHER IGNORED ABOVE IMPORTANT FACT BEFORE ISSUING NOTICE U/S 153C OF THE ACT. ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 31 37. WE ALSO FIND IT APPROPRIATE TO MENTION TH AT IT MUST NOT BE LOST SIGHT OF THAT SECTION 153C OF THE ACT AND 158BD OF THE ACT A RE DRACONIAN IN NATURE WHEN ACCOUNTS OF THE PERSON OR ENTITY OTHER THAN TH E PERSON SEARCHED ARE REOPENED AUTOMATICALLY AND REVENUE GETS AUTHORITY T O ASSESSEE OR REASSESS ASSESSMENT OF SIX ASSESSMENT YEARS PRECEDING PREVIO US YEAR IN WHICH SEIZED MATERIAL OR EVIDENCE BELONGED TO THE PERSON OTHER T HAN THE PERSON SEARCHED IS HANDED OVER TO THE ASSESSING OFFICER OF THAT OTHER PERSON. THEREFORE IT IS ALWAYS ADVISABLE TO THE REVENUE AUTHORITIES THAT TH E PROCEEDINGS UNDER SECTION 153C OF THE ACT SHOULD NOT BE INITIATED AND CONDUCTED IN A CASUAL MANNER AND THE MOTIVE OF STATUTORY PROVISION CLEARL Y STIPULATES THAT THE ASSESSING OFFICER SHOULD MAKE HIMSELF SATISFIED PRI OR TO INITIATION OF PROCEEDINGS UNDER SECTION 153C OF THE ACT. 38. HOWEVER THE ASSESSING OFFICER RECORDED SATISFA CTION AND ISSUED NOTICE UNDER SECTION 153C OF THE ACT FROM AY 2003-0 4 TO 2008-09 BUT ON THE DATE OF RECORDING OF SATISFACTION I.E. 5.7.2010 THE RELEVANT PREVIOUS YEAR IS 2010-11 AND THE CHEQUE BOOK WHICH BELONGED TO FY 2008-09 WAS CERTAINLY RELATED TO AY 2009-10 WHICH CANNOT BE SAI D OUT OF AMBIT OF THE BLOCK OF RELEVANT SIX ASSESSMENT YEARS. 39. THE LD. DR HAS ALSO PLACED RELIANCE ON THE DEC ISION OF HONBLE HIGH COURT OF DELHI IN THE CASE OF FILATEX INDIA LTD. VS CIT 2014-TIOL-1325- ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 32 HC-DEL. BUT ON VIGILANT AND CAREFUL READING OF THI S DECISION WE RESPECTFULLY REACH TO A CONCLUSION THAT BENEFIT OF THE RATIO OF THIS CASE IS NOT AVAILABLE FOR THE REVENUE IN THE EXTANT CASE AS FAC TS ARE CLEARLY DISTINGUISHABLE TO THE PRESENT CASE AS THE CASE OF FILATEX (SUPRA) IS RELATED TO THE PROCEEDINGS U/S 153A OF THE ACT AND NOT TO THE PROCEEDINGS U/S 153C OF THE ACT AND NOT TO THE PROCEEDINGS U/S 153C OF THE ACT AND IT IS A WELL ACCEPTED PROPOSITION THAT THE LATER PROVISION IS NA RROWER IN COMPARISON TO FORMER PROVISION AND FURTHERMORE THERE WAS SUFFICIE NT INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH IN THE CASE OF FI LATEX (SUPRA) WHEREAS IN THE INSTANT CASE THERE WAS NO INCRIMINATING MATERI AL FOUND OR UNEARTHED FOR ANY OF THE ASSESSMENT YEAR COVERED U/S 153C OF THE ACT. WE MAY ALSO ADD THAT IN THE PRESENT CASE ONLY A CHEQUE BOOK AS AL LEGED BY THE DEPARTMENT AS INCRIMINATING MATERIAL WAS FOUND AND THE LD. DR HA S NOT DISPUTED THE FACTUM THAT THE DETAILS OF SAID CHEQUE BOOK WAS DUL Y REFLECTED IN THE RETURN OF INCOME OF THE RELEVANT ASSESSMENT YEAR. ON THIS POINT ALSO AND IN TOTALITY OF THE FACTUAL MATRIX OF THE INSTANT CASE WE REACH TO A CONCLUSION THAT THE ASSESSMENT DISALLOWANCES AND ADDITIONS MADE BY THE AO ON REGULAR ISSUES ARE EX FACIE NOT SUSTAINABLE IN THE ABSENCE OF INCRIMINATING MA TERIAL. 40. THE LAST LEGAL CONTENTION RAISED BY THE LD. COU NSEL OF THE ASSESSEE IS THAT AS PER RTI REPLY DATED 10.6.2013 BY THE ASSESS ING OFFICER OF THE ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 33 SEARCHED PERSON NO SATISFACTION NOTE IN THE CASE O R PERSON OR ENTITY SEARCHED WAS RECORDED WHICH IS ALSO APPARENT FROM THE CURSOR Y LOOK ON THE AVAILABLE SATISFACTION NOTE BEING RECORDED BY THE ASSESSING O FFICER OF THE ASSESSEE. LD. DR REPLIED THAT AS THE ASSESSING OFFICER OF THE PERSON SEARCHED AND ASSESSING OFFICER OF THE PERSON OTHER THAN SEARCHED WAS THE SAME THEN THERE WAS NO OCCASION OF TAKING OVER OR HANDING OVER OF M ATERIAL OR EVIDENCE AND WHEN THE SATISFACTION CAN BE EASILY INFERRED FROM T HE RECORDS AND NOTE SHEET ENTRIES THEN THERE IS NO NEED TO RECORD SATISFACTI ON IN THE RECORD OF PERSON SEARCHED. THE DR POINTED OUT THAT IT IS NECESSARY FOR THE PERSON OBJECTING THE VALIDITY OF THE ASSESSING OFFICER TO DEMONSTRAT E PREJUDICE SUFFERED BY IT AND MERELY TECHNICALITIES AND IRREGULARITIES WHICH DO NOT OCCASION OR CAUSE FAILURE OF JUSTICE ARE NOT ALLOWED TO DEFEAT THE EN DS OF JUSTICE. TO SUPPORT ABOVE CONTENTION LD. DR HAS RELIED ON THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF SHIRISH DELVI VS ACIT (SU PRA) AND DECISION OF HONBLE SUPREME COURT IN THE CASE OF STATE BANK OF PATIALA VS S.K. SHARMA (SUPRA). 41. WE OBSERVE THAT LD. DR HAS PLACED PAPER BOOK ON 12.6.2014 WHEREIN WE FIND A LETTER OF ACIT (CC-21) NEW DELHI ADDRESSE D TO THE PRINCIPAL OFFICER OF THE APPELLANT ASSESSEE WHEREIN FOLLOWING FACTS HAVE BEEN MENTIONED:- ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 34 ON THE BASIS OF THE DOCUMENTS SEIZED FROM THE POSSESSION OF A PERSON COVERED U/S 132 OF THE I.T.A CT WHICH CLEARLY BELONGED TO YOU AND AFTER RECORDING SATISFA CTION FOR THE SAME NOTICE U/S 153C WERE ISSUED BY YOUR THEN AO THE ACIT CENTRAL CIRCLE-17 NEW DELHI. ASS THE AC IT CENTRAL CIRCLE-17 NEW DELHI WAS ASSESSING THE PERS ONS COVERED UNDER A WARRANT U/S 132 THERE WAS NO NEED TO TRANSFER THE BOOKS OF ACCOUNTS/DOCUMENTS TO ANY OTH ER OFFICER. THEREAFTER JURISDICTION OVER YOUR CASE HA S BEEN VESTED WITH THE UNDERSIGNED BY VIRTUE OF ORDER U/S 127 DATED 19.10.2010 PASSED BY THE CIT(CENTRAL)-II NEW DELHI. 2.2 IT IS INFORMED THAT YOU ARE INTERPRETING THE F IRST PROVISO OF SECTION 153C(1) WRONGLY WHILE CLAIMING T HAT THE SIX PREVIOUS ASSESSMENT YEARS ARE TO BE CALCULATED W.R.T. THE DATE OF MAKING A REFERENCE U/S 153C. FOR YOUR KIND INFORMATION SECTION 153C(1) DIRECTS THAT THE PROCEE DINGS U/S 153C SHALL TAKE PLACE IN ACCORDANCE WITH THE PROVISIONS OF SECTION 153A THE FIRST PROVISO TO SE CTION 153C(1) RELATES TO DETERMINING THE NUMBER OF PENDIN G ASSESSMENTS PROCEEDINGS WHICH SHALL ABATE AFTER ISS UING NOTICE U/S 153C. THE NUMBER OF ASSESSMENT YEARS CO VERED U/S 153C ARE THE SAME AS PER THE PROVISIONS OF SEC TION 153A ONLY. 3. ACCORDINGLY THE ASSESSMENT PROCEEDINGS HAVE B EEN INITIATED FOR AYS 2003-04 TO 2008-09 AS PER PROVISI ONS OF THE ACT. AS REGARDS TO YOUR CONTENTION THAT ASSESS MENT U/S 153C CANNOT BE EQUATED TO REGULAR AND NORMAL ASSESSMENTS AND NEED TO BE BASED ON INCRIMINATING A ND SEIZED DOCUMENTS YOUR ATTENTION IS INVITED TO THE DECISION OF ITAT IN THE CASE OF SHYAM LATA KAUSHIK VS ACIT ( 2008) 4 DTR (DEL:G) ITAT G BENCH & SHIVNATH RAI HARNARAIN INDIA (PVT.) LTD. VS DCIT (2009) 117 ITD 74 WHEREAS IT HAS BEEN HELD THAT THERE IS NO REQUIREMENT FOR AN ASSESSMENT MADE U/S 153A TO BE BASED ON ANY MATERIA L SEIZED IN THE COURSE OF SEARCH. THERE IS NOTHING C ONTAINED IN SECTION 153A WHICH DEPICTS THAT ADDITION U/S 153 A CAN BE MADE ONLY ON THE BASIS OF DOCUMENTS/MATERIAL FOU ND OR ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 35 SEIZED DURING THE COURSE OF SEARCH. AS SUCH YOUR OBJECTIONS TO THE PROCEEDINGS INITIATED U/S 153C HA VE BEEN CONSIDERED AND AS THERE ARE NO MERITS IN THE SAME THEY ARE REJECTED. 42. IN THIS LETTER THE ACIT HAS MENTIONED THAT AS THE ACIT CENTRAL CIRCLE 21/17 NEW DELHI WAS ASSESSING THE PERSON COVERED U /S 132 OF THE ACT AND THE NOTICE UNDER SECTION 153C OF THE ACT WAS ALSO I SSUED BY THE SAME ASSESSING OFFICER THEN THERE WAS NO NEED TO TRANSF ER THE BOOKS OF ACCOUNTS/DOCUMENTS TO ANY OTHER OFFICER. IN THIS L ETTER THE ACIT HAS ALSO MENTIONED THAT THEREAFTER JURISDICTION OVER THE CAS E OF THE PRESENT APPELLANT ASSESSEE HAS BEEN VESTED WITH THE ACIT CC-21 BY VI RTUE OF ORDER UNDER SECTION 127 DATED 19.10.2010 PASSED BY CIT CENTRAL -II NEW DELHI. AT THE COST OF REPETITION WE FIND IT APPROPRIATE TO ELABO RATE OUR FINDINGS THAT AS WE HAVE ALREADY OBSERVED THAT AS PER RECENT DECISIONS OF HONBLE JURISDICTIONAL HIGH COURT OF DELHI IN THE CASE OF PEPSICO HOLDINGS PVT. LTD. (SUPRA) AND PEPSI FOODS (SUPRA) AND DECISION OF ITAT DELHI IN T HE CASE OF DSL PROPERTIES (SUPRA) WE CLEARLY NOTE THAT RECORDING OF SATISFACTION BY THE AO OF THE PERSON SEARCHED IS SINE QUA NON . 43. IN THE PRESENT CASE WE HAVE ALREADY HELD THAT THE AO OF THE PERSON SEARCHED HAD NOT RECORDED ANY SATISFACTION NOTE. T HE AO OF THE PERSON OTHER THAN PERSON SEARCHED RECORDED SATISFACTION WHICH DO ES NOT SATISFY THE ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 36 CONDITIONS OF VALIDLY ASSUMING JURISDICTION U/S 153 C OF THE ACT. THEREFORE ASSUMPTION OF JURISDICTION WAS NOT VALID AND BAD IN LAW. LIKEWISE AO ISSUED NOTICE U/S 153C OF THE ACT FOR AY 2003-04 AN D 2004-05 WHICH IS CLEARLY BARRED BY LIMITATION AS PER DATE OF ISSUANC E OF NOTICE ON 6.7.2010. ACCORDINGLY SOLE LEGAL CROSS OBJECTION OF THE ASSE SSEE IS FOUND TO BE ACCEPTABLE AND THE SAME IS HEREBY ALLOWED. UNDER T HESE FACTS CIRCUMSTANCES AND IN VIEW OF ABOVE CONCLUSION DRAWN BY US WE QUA SH NOTICE U/S 153C OF ACT FOR ALL SIX ASSESSMENT YEARS UNDER CONSIDERATIO N IN THESE APPEALS AND CONSEQUENTLY THE ASSESSMENT COMPLETED IN PURSUANCE TO SUCH NOTICES IS ALSO QUASHED. ACCORDINGLY CROSS OBJECTION OF THE ASSES SEE IN ALL SIX CASES IS ALLOWED. APPEALS OF THE REVENUE 44. FROM CAREFUL PERUSAL OF THE GROUNDS TAKEN BY TH E REVENUE IN ALL SIX APPEALS WE OBSERVE THAT EXCEPT QUANTUM OF AMOUNT THE BASIS FACTS AND CONTENTIONS RAISED IN ALL SIX APPEALS ARE SIMILAR. FOR THE SAKE OF CLARITY AND TRANSPARENCY THE GROUNDS RAISED BY THE REVENUE IN THESE APPEALS READ AS UNDER:- 1. THAT THE CIT(A) ERRED IN LAW AND ON FACTS OF T HE CASE IN DELETING THE ADDITION MADE BY THE AO ON ACC OUNT OF UNEXPLAINED PURCHASE U/S 69C OF THE INCOME TAX ACT 1961. 2. THAT THE CIT(A) ERRED IN LAW AND ON FACTS OF TH E CASE IN NOT CONFIRMING THE AOS OBSERVATION THAT TH E ENTIRE ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 37 SALES OF THE ASSESSEE REPRESENTED ITS INCOME FROM UNDISCLOSED SOURCES. 3. THAT THE CIT(A) ERRED IN LAW AND ON FACTS OF THE CASE IN DELETING THE ADDITION MADE BY THE AO BY WAY OF DISALLOWANCE OF 100% OF EXPENDITURE AND DEPRECIATIO N CLAIMED BY THE ASSESSEE. 4. THAT THE CIT(A) ERRED IN LAW AND ON FACTS OF TH E CASE IN HOLDING THAT STATEMENTS OF VARIOUS PERSONS WITHOUT HAVING BEEN CONFRONTED TO THE ASSESSEE HAVE NO EVID ENTIARY VALUE. GROUND NO.1 45. APROPOS GROUND NO.1 WE OBSERVE THAT THE CIT(A) HAS GRANTED RELIEF FOR THE ASSESSEE WITH FOLLOWING OBSERVATIONS AND FI NDINGS:- 22. I HAVE CONSIDERED THE ASSESSMENT ORDER WRITTEN SUBMISSIONS REMAND REPORT AND REJOINDER TO THE REMAND REPORT FILED BY THE AR AS WELL AS THE FACTS OF THE CASE AND THE POSITION OF LAW. IN MY CONSIDERED OPIN ION I AGREE WITH THE APPELLANT THAT SECTION 69C WOULD APP LY ONLY WHEN THERE IS SOME EXPENDITURE FOR WHICH THE APPELL ANT IS NOT IN A POSITION TO EXPLAIN THE SOURCE OF THE SAME AND IN THE PRESENT CASE THE FACT THAT THE WHOLE OF THE PUR CHASES OF VARIOUS AMOUNTS RESPECTIVELY INVOLVED IN EACH OF TH E ASSESSMENT YEARS IN QUESTION HAVE BEEN DULY ACCOUNT ED FOR BY THE APPELLANT IN ITS BOOKS OF ACCOUNTS HAS NOT B EEN CHALLENGED OR QUESTIONED AND MORE PARTICULARLY WHEN THE BOOKS OF ACCOUNTS HAVE NOT BEEN REJECTED BY THE F7. 0 NO QUESTION OF DISALLOWANCE OF PURCHASES U/S 69C ARISE S. THE JUDGEMENT IN THE CASE OF CIT VS M/S RADHIKA CREATIO N ITA NO. 692/2009 BY HON'BLE DELHI HIGH COURT IS APPLICA BLE TO THE PRESENT FACTS OF THE CASE AS ALL THE PURCHASES ARE ACCOUNTED IN THE REGULAR BOOKS THE SOURCE IS OBVIO USLY EXPLAINED. THE PROVISIONS OF SEC .69C ARE NOT APPLI CABLE AS ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 38 THERE WAS NO UNACCOUNTED EXPENDITURE. IT IS ALSO AN ADMITTED FACT THAT COMPLETE BOOKS OF ACCOUNTS WERE ALSO PRODUCED BEFORE THE AO AND THE SAME WERE EXAMINED. NO DEFECT WAS POINTED OUT. THUS THE SAME STOOD ACCEPT ED BY THE AO. IT IS SETTLED LAW THAT BOOKS OF ACCOUNT MA INTAINED IN THE NORMAL COURSE OF BUSINESS ARE EVIDENCE UNDER THE 'EVIDENCE ACT' AND INCOME TAX ACT. IT IS ADMITTED F ACT THAT THE BOOKS OF ACCOUNT WERE PRODUCED BEFORE THE SALES TAX OFFICER WARD 101 NEW DELHI DURING THE ASSESSMENT PROCEEDING UNDER THE DELHI SALES TAX ACT. NO ADVERS E REMARK HAS BEEN MADE IN THE SALES TAX ASSESSMENT OR DER. WHEN OPENING STOCK STOOD ACCEPTED AND THE SALES ALS O STOOD ACCEPTED AS INCOME THERE IS NO RATIONALE OF NOT ACCEPTING THE PURCHASE AS EXPENDITURE. THE SAME IS AGAINST THE PRINCIPLES OF ACCOUNTANCY. IN VIEW OF T HE ABOVE THE ADDITIONS MADE AS PER DETAILS HEREUNDER MADE BY THE AO IN EACH OF THE SIX ASSESSMENT YEARS I.E. FOR THE A.Y. 2003-04 TO A.Y. 2008-09 INVOLVED IN THIS GROU ND ON ACCOUNT OF PURCHASES U/S 69C ARE DELETED. S.NO. A.Y AMOUNT (RS.) 1. 2003-04 25 95 575/- 2. 2004-05 32 45 450/- 3. 2005-06 36 60 320/- 4. 2006-05 37.15.230/- 5. 2007-08 37 12 568/- 6. 2008-09 1 29 508/- THE GROUNDS ARE THEREFORE ALLOWED IN FAVOUR OF THE APPELLANT COMPANY. 46. LD. DR SUBMITTED THAT THE CIT(A) ERRED IN DELET ING THE ADDITIONS MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED PURCHASES UNDER SECTION 69C OF THE ACT. LD. COUNSEL OF THE ASSESSEE REPLIE D THAT WHEN THE BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESSEE IN THE NORMAL C OURSE OF BUSINESS REFLECTS AMOUNT OF PURCHASES MADE BY THE ASSESSEE DURING THE RELEVANT FINANCIAL YEAR ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 39 AND DURING THE ASSESSMENT PROCEEDINGS NO DEFECT WA S POINTED OUT BY THE ASSESSING OFFICER THEN AN INFERENCE MAY BE DRAWN T HAT THE SAME STOOD ACCEPTED BY THE ASSESSING OFFICER. THE COUNSEL OF THE ASSESSEE ALSO SUBMITTED THAT WHEN THE PURCHASES STOOD ACCEPTED BY THE ASSESSING OFFICER AND NO ADVERSE REMARKS HAS BEEN MADE IN THE SALES T AX ASSESSMENT ORDER THEN ADDITIONS UNDER SECTION 69C OF THE ACT ARE NOT SUSTAINABLE. 47. ON CAREFUL CONSIDERATION OF ABOVE RIVAL SUBMISS IONS OF BOTH THE PARTIES AND CAREFUL PERUSAL OF THE OBSERVATIONS AND FINDINGS OF THE CIT(A) WE OBSERVE THAT ADMITTEDLY THE ASSESSEE PRODUCED CO MPLETE BOOKS OF ACCOUNTS BEFORE THE ASSESSING OFFICER AND THE SAME WERE EXAMINED DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND NO DEFECT INFIRMITY OR AMBIGUITY WAS FOUND OR POINTED OUT BY THE ASSESSING OFFICER. WE ALSO OBSERVE THAT THE REVENUE HAS NOT DISPUTED THE POINT THAT NO ADVERSE REMARK HAS BEEN MADE IN THE SALES TAX ASSESSMENT ORDER WITH REGARD TO THE P URCHASES MENTIONED BY THE ASSESSEE. WE FURTHER OBSERVE THAT WHEN OPENING STO CK OF THE ASSESSEE IN THE BEGINNING OF THE YEAR AND THE SALES ALSO STOOD ACCE PTED THEN THERE IS NO CAUSE FOR NOT ACCEPTING THE AMOUNT OF PURCHASES. A CCORDINGLY WE ARE INCLINED TO HOLD THAT THE ASSESSING OFFICER MADE AD DITION ON WRONG PREMISES WHICH WAS RIGHTLY CORRECTED BY THE CIT(A) DELETING THE IMPUGNED ADDITIONS. ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 40 WE ARE UNABLE TO SEE ANY VALID REASON TO INTERFERE WITH THE SAME HENCE GROUND NO. 1 OF THE REVENUE IS DISMISSED. GROUND NO. 2 48. APROPOS GROUND NO.2 OF THE REVENUE FROM THE IM PUGNED ORDER WE OBSERVE THAT THE CIT(A) DELETED THE ADDITION MADE B Y THE ASSESSING OFFICER PERTAINING TO THE AMOUNT OF SALES WITH FOLLOWING FI NDINGS AND CONCLUSIONS:- 26. I HAVE CONSIDERED THE ASSESSMENT ORDER WRITT EN SUBMISSIONS REMAND REPORT AND REJOINDER TO THE REM AND REPORT FILED BY THE AR AS WELL AS THE FACTS OF THE CASE AND THE POSITION OF LAW. I HAVE OBSERVED THAT AS ALL TH E SALES HAVE BEEN RECORDED IN THE BOOKS OF ACCOUNTS THE SAM E INCLUDING SALES AND PURCHASE VOUCHERS AND STOCK REG ISTERS MAINTAINED ON DAY TO DAY BASIS WERE PRODUCED BEFORE THE AO WHICH WAS DULY EXAMINED BY .HIM. NO NEGATIVE OBSERVATION WAS CONFRONTED TO THE APPELLANT. COMPLE TE NAMES AND ADDRESSES OF THE PARTIES TO WHOM GOODS WE RE SOLD WERE AVAILABLE WITH THE AO. MOST OF THE CUSTOM ERS WERE ASSESSED TO INCOME TAX. THE PART OF SALES WERE MADE AGAINST THE OPENING STOCK AND THE PURCHASES MADE D URING THE YEAR AND THE SALES ARE NOTHING BUT THE CONVERSI ON OF THE STOCK AND THE PROFIT FROM THE SAME HAS ALREADY BEEN TAXED NO EVIDENCE HAS BEEN BROUGHT ON RECORD BY THE AO WH ICH INDICATE THAT THE SALE PROCEEDS REPRESENT INCOME FR OM UNDISCLOSED SOURCES ON THE BASIS OF CONJECTURES & SURMISES. THE APPELLANT IS ASSESSED WITH SALES TAX DEPARTMENT UNDER THE DELHI SALES TAX ACT. SALES AND PURCHASES STOOD ACCEPTED BY THE SALES TAX DEPARTMEN T. THERE IS NO NEGATIVE OBSERVATION IN THE SALES TAX ASSESSMENT ORDER. MOREOVER THE AO HAS GOT CONFIRME D THE TRANSACTION OF SALES MADE TO N.K. TEXTILES BY ISSUI NG NOTICE U/S 133(6) OF THE I.T. ACT. ONUS WAS ON THE AD TO M AKE ENQUIRIES IF HE WAS NOT SATISFIED. IN THE CONNECTIO N I HAVE GONE THROUGH THE VIEWS OF HON'BLE MADRAS HIGH COURT IN ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 41 THE CASE OF CIT VS ANANDHA METAL CORPN. (2006) 152 TAXMAN 300 (MAD). HELD 'IF THAT BE SO UNLESS AND UNTIL THE COMPETENT AUTHO RITY UNDER THE SALE TAX ACT DIFFERS OR VARIES WITH THE C LOSING STOCK OF THE ASSESSEE THE RETURN ACCEPTED BY THE COMMERCIAL TAX DEPARTMENT UNDER THE TNGST ACT IS IN OUR OPINION BINDING ON THE INCOME TAX AUTHORITIES AND THE ASSESSING OFFICER THEREFORE HAS NO POWER TO SCRUT INIZE THE RETURN SUBMITTED BY THE RESPONDENT/ASSESSEE TO THE COMMERCIAL TAX DEPARTMENT UNDER THE PROVISIONS OF T HE TNGST ACT AND AS ACCEPTED BY THE SAID AUTHORITIES U NLESS OTHERWISE IT IS VARIED OR MODIFIED BY THE AUTHORITI ES UNDER THE TNGST ACT THEREFORE THE ASSESSING OFFICER DOE S NOT HAVE ANY JURISDICTION TO GO BEYOND TILE VALUE OF TH E CLOSING STOCK DECLARED BY THE RESPONDENT-ASSESSEE AND ACCEP TED BY THE COMMERCIAL TAX DEPARTMENT.' IN THE ABOVE AID CASE 'APOLLO TYRES LTD. VS CIT (20 02) 255 ITR 273 (SUPREME COURT) IS FOLLOWED. THE' ABOVE SAID JUDGMENT OF HON'BLE MADRAS HIGH COURT HAS BEEN FOLLOWED BY HON'BLE DELHI HIGH COURT IN THE CASE O F HARBIR SIGH IN APPEAL NO 608/2009 DT 19.01.2011. IN VIEW OF THE FACTS OF THE CASE AS SUMMARIZED ABOVE IN MY CONSIDERED OPINION AND BY PLACING RELIANCE ON THE JUDGMENT OF E LAND INTERNATIONAL PVT. LTD. VS. DCIT BY THE HON'BLE DELHI TRIBUNAL ITO VS. SURANA TRADERS (2005) 93 TT J MUMBAI 875 AND CIT VS ANANDHA METAL CORPN.. (2006) 152 TAXMAN 300 (MAD) AND CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE I HOLD THAT AD WAS NOT JUSTIFIED IN MAKING AN OBSERVATION THAT THE SALES REPRESENT INCOME FROM UNDISCLOSED SOURCES ON THE BASIS OF CONJECTURE & SURMISES. IN VIEW OF THIS POS ITION THE GROUND OF APPEAL NO 10 RAISED BY THE APPELLANT IS ALLOWED. ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 42 49. LD. DR SUPPORTING THE ASSESSMENT ORDER SUBMITT ED THAT THE ASSESSING OFFICER MADE ADDITION BY DISALLOWING ENTIRE SALES W HICH WAS INCOME OF THE ASSESSEE FORM UNDISCLOSED SOURCES. LD. DR FURTHER CONTENDED THAT THE CIT(A) DELETED THE ADDITION WITHOUT ANY BASIS BY TA KING A HYPER TECHNICAL APPROACH. LD. DR THEREFORE SUBMITTED THAT THE IM PUGNED ORDER MAY BE SET ASIDE BY RESTORING THAT OF THE ASSESSING OFFICER. 50. LD. AR CONTENDED THAT WHEN THE REVENUE HAS ACCE PTED THE AMOUNT OF OPENING STOCK AND THE PURCHASES MADE BY THE ASSESSE E DURING THE YEAR THEN THE SALES CANNOT BE DOUBTED. THE AR FURTHER CONTEN DED THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED IN OBSERVING THAT THE ENT IRE SALES OF THE ASSESSEE REPRESENTED ITS INCOME FROM UNDISCLOSED SOURCES. T HE AR SUPPORTED THE IMPUGNED ORDER AND SUBMITTED THAT THE ASSESSING OFF ICER MADE ADDITION WITHOUT ANY JUSTIFIED AND COGENT REASON WHICH WAS R IGHTLY DELETED BY THE CIT(A). 51. ON CAREFUL CONSIDERATION OF IMPUGNED ORDER IN T HE LIGHT OF CONTENTION AND SUBMISSIONS OF BOTH THE PARTIES WE OBSERVE THA T SINCE FROM THE EARLIER PART OF THIS ORDER WE HAVE UPHELD THE DELETION OF ADDITIONS MADE BY THE ASSESSING OFFICER ON ACCOUNT OF REJECTION OF PURCHA SES MADE BY THE ASSESSEE DURING THE YEAR THEREFORE WHEN A MAJOR PART OF TH E SALES WERE MADE AGAINST THE OPENING STOCK AND THE PURCHASES MADE DURING THE YEAR THEN THE SALES IS ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 43 NOTHING BUT THE CONVERSION OF STOCK INTO LIQUIDITY AND THAT TOO WHEN THE PROFIT EARNED FROM THIS PURCHASE AND SALES ACTIVITI ES HAS BEEN ALREADY OFFERED TO TAX THEN IT CANNOT BE INFERRED THAT THE SALE PR OCEEDS REPRESENT INCOME FROM UNDISCLOSED SALES OF THE ASSESSEE. IN THIS SI TUATION WE CAN EASILY INFER THAT THE ASSESSING OFFICER MADE ADDITIONS ON THE BA SIS OF CONJECTURES AND SURMISES WHICH WAS RIGHTLY DELETED BY THE CIT(A). WE HAVE NO REASON TO INTERFERE WITH THE FINDINGS OF THE CIT(A) IN THE IM PUGNED ORDER IN THIS REGARD. ACCORDINGLY GROUND NO. 2 OF THE REVENUE B EING DEVOID OF MERITS IS DISMISSED. GROUND NO. 3 52. FROM THE IMPUGNED ORDER WE OBSERVE THAT THE CI T(A) GRANTED RELIEF FOR THE ASSESSEE BY DELETING ADDITION MADE BY THE A SSESSING OFFICER BY WAY OF 100% DISALLOWANCE OF EXPENDITURE AND DEPRECIATIO N CLAIMED BY THE ASSESSEE WITH FOLLOWING OBSERVATIONS AND FINDINGS: 31. I HAVE CONSIDERED THE ASSESSMENT ORDER WRIT TEN SUBMISSIONS REMAND REPORT AND REJOINDER TO THE REM AND REPORT FILED BY THE AR AS WELL AS THE FACTS OF THE CASE AND THE POSITION OF LAW. IT IS OBSERVED THAT DURING THE SEARCH PROCEEDINGS NO MATERIAL HAS BEEN FOUND WHICH JUSTIF IES THE DISALLOWANCE OF THE EXPENSES. MOREOVER BOOKS OF AC COUNTS ARE DULY AUDITED UNDER THE COMPANIES ACT. THERE IS NO NEGATIVE OBSERVATION IN THE AUDITORS REPORT. BOOKS OF ACCOUNTS WERE PRODUCED BEFORE THE AO AND THE SAME W ERE EXAMINED BY HIM. NO DEFICIENCY HAS BEEN POINTED OUT IN THE BOOKS OF ACCOUNTS. IT IS FURTHER SUBMITTED THAT THE ASSESSMENT OF THE ASSESSEE COMPANY FOR THE A.Y. 200 2-03 ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 44 HAS ALREADY BEEN COMPLETED WHEREIN NO DISALLOWANC E OF EXPENSES WAS MADE. IN VIEW OF THE ABOVE IN MY CONS IDERED OPINION THERE IS NO SUBSTANCE IN LUMP SUM DISALLOWA NCE OF THE EXPENSES IN EACH OF THE RESPECTIVE ASSESSMENT Y EARS DETAILS AS UNDER :- S.NO. A.Y. AMOUNT 1. 2003-04 3 64 548/- 2. 2004-05 4 12 658/- 3. 2005-06 4 56 968/- 4. 2006-07 4 48 230/- 5. 2007-08 4 72 934/- 6. 2008-09 5 05 706/- ACCORDINGLY THE AO IS DIRECTED TO DELETE THE ADDITI ON FOR THE A.Y. 2003-04 TO 2008-09 DETAILS HEREINABOVE M ADE ON THIS ACCOUNT. REGARDING ALLOWANCE OF DEPRECIATION T HE AO IS DIRECTED TO ALLOW THE SAME AS PER INCOME TAX AC T /RULES. THIS GROUND IS THEREFORE ALLOWED IN FAVOUR OF THE APPELLANT COMPANY. 53. LD. DR SUBMITTED THAT WHEN THE EXPENSE CLAIMED BY THE ASSESSEE COMPANY IN THE P&L ACCOUNT WERE UNVERIFIABLE FROM T HE RECORDS AND BILLS AND VOUCHERS THEN THE ASSESSING OFFICER HAD NO OPT ION BUT TO DISALLOW ENTIRE AMOUNT OF CLAIMED EXPENSES AND DEPRECIATION.. LD. D R SUBMITTED THAT THE IMPUGNED ORDER MAY BE SET ASIDE BY RESTORING THAT O F THE ASSESSING OFFICER. 54. REPLYING TO THE ABOVE CONTENTION OF THE LD. DR LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT WHEN THE BOOKS OF ACCOUNTS OF THE ASSESSEE COMPANY ARE DULY AUDITED UNDER THE PROVISIONS OF THE COMPAN IES ACT AND THERE IS NO NEGATIVE OBSERVATION IN THE AUDITORS REPORT THEN THE CLAIM OF EXPENSES AND ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 45 DEPRECIATION CANNOT BE DOUBTED. LD. COUNSEL FOR TH E ASSESSEE ALSO POINTED OUT THAT THE ENTIRE BOOKS OF ACCOUNTS WERE PRODUCED BEFORE THE ASSESSING OFFICER AND THE SAME WERE EXAMINED BY HIM AND NO DE FICIENCY OR DEFECT HAS BEEN POINTED OUT BY THE ASSESSING OFFICER IN THE AU DITED BOOKS OF ACCOUNTS OF THE ASSESSEE THEN NO DISALLOWANCE OF EXPENSES C LAIMED COULD BE MADE. LD. AR SUPPORTING THE IMPUGNED ORDER SUBMITTED THAT THE CIT(A) WAS NOT JUSTIFIED IN GRANTING RELIEF FOR THE ASSESSEE. 55. FROM BARE READING OF THE IMPUGNED ORDER WE OBS ERVE THAT THE CIT(A) HAS GRANTED RELIEF FOR THE ASSESSEE BY RELYING ON T HE BOOKS OF ACCOUNTS WHICH WERE DULY AUDITED AND THERE WAS NO NEGATIVE COMMENT IN THE AUDIT REPORT. THE DR HAS NOT DISPUTED THE FACT THAT THE AUDITED B OOKS OF ACCOUNTS WERE EXAMINED BY THE ASSESSING OFFICER AND NO DEFECT OR DEFICIENCY WAS FOUND BY THE ASSESSING OFFICER. IN THIS SITUATION WE ARE I N AGREEMENT WITH THE FINDINGS OF THE CIT(A) THAT LUMP SUM DISALLOWANCE O F EXPENSES IS NOT SUSTAINABLE AND WE HOLD THAT THE CIT(A) RIGHTLY DEL ETED THE ADDITION AND THE CIT(A) WAS ALSO JUSTIFIED IN DIRECTING THE ASSESSIN G OFFICER TO ALLOW THE DEPRECIATION FOR THE ASSESSEE AS PER PROVISIONS OF THE ACT AND INCOME TAX RULES 1962. ACCORDINGLY WE UPHOLD THE CONCLUSION AND FINDINGS RECORDED BY THE CIT(A) AND CONSEQUENTLY GROUND NO. 3 OF THE REVENUE IS ALSO DISMISSED. ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 46 GROUND NO.4 56. APROPOS GROUND NO.4 OF THE REVENUE LD. DR SUBM ITTED THAT THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN HOLDING THA T THE STATEMENTS OF THE VARIOUS PERSONS WITHOUT HAVING BEEN CONFRONTED TO T HE ASSESSEE HAVE NO EVIDENTIARY VALUE. LD. COUNSEL FOR THE ASSESSEE SU BMITTED THAT IF THE AUTHORITIES BELOW ARE CONSIDERING AND ACCEPTING THE STATEMENTS OR EVIDENCE AGAINST THE ASSESSE FOR MAKING ANY DISALLOWANCE OR ADDITION ON THE BACK OF THE ASSESSEE THEN THE SAME IS NOT SUSTAINABLE AS S AME STATEMENT OR EVIDENCE CANNOT BE USED AGAINST THE ASSESSEE WITHOUT HAVING BEEN CONFRONTED TO THE ASSESSEE. 57. ON CONSIDERATION OF ABOVE CONTENTIONS AND SUBMI SSIONS AND PERUSAL OF THE IMPUGNED ORDER OF THE CIT(A) WE NOTE THAT THE CIT(A) HAS DECIDED THE ISSUE AS UNDER:- IT HAS ALSO BEEN OBSERVED THAT SH. DARSHAN SINGH A ND SH.D. BHATTACHARYA WHOSE STATEMENT IS BEING RELIED UPON DO NOT APPEAR TO HAVE ANY CONNECTION WITH THE APPELLAN T CO. WHICH HAS BEEN ESTABLISHED BY THE AO. KEEPING IN VI EW THE FACTS OF THE CASE AND KEEPING IN VIEW THE RULINGS O F THE JURISDICTIONAL HIGH COURT OF DELHI IN THE CASE OF S MC SHARE BROKER LTD. AND SH. ASHWANI GUPTA AND THAT OF SUPRE ME COURT IN CASE OF KISHAN CHAND CHELLA RAM 125 ITR 7 13 I HOLD THAT THE STATEMENTS OF VARIOUS PERSONS WITHOUT BEING CONFRONTED TO THE APPELLANT CO. HAVE NO EVIDENCIARY VALUE. FURTHER THEY DON'T HAVE ANY CONNECTION WITH THE AP PELLANT CO. THEREFORE THE AO IS PRECLUDED FROM RELYING ON THE SAME WHILE FRAMING ASSESSMENT IN THE CASE OF THE APPELLANT CO. THUS THE APPELLANT COMPANY SUCCEEDS ON THESE GROUNDS ALSO. ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 47 58. IN VIEW OF ABOVE AND UNDER PECULIAR FACTUM OF T HE INSTANT CASE WE NOTE THAT THE CIT(A) HAS RIGHTLY HELD THAT THE STAT EMENT OF VARIOUS PERSONS RECORDED ON THE BACK OF THE ASSESSEE CANNOT BE USED AGAINST THE ASSESSEE WITHOUT HAVING BEEN CONFRONTED TO THE ASSESSEE AND THE IMPUGNED STATEMENT RECORDED ON THE BACK OF THE ASSESSEE HAVE NO EVIDEN CIARY VALUE. HENCE GROUND NO. 4 OF THE REVENUE IS ALSO DISMISSED. 59. TO SUM UP SOLE LEGAL GROUND/CROSS OBJECTION OF THE ASSESSEE IN ALL SIX CROSS OBJECTION CASES OF THE ASSESSEE ARE HEREBY AL LOWED. GROUND NO.1 TO 4 OF THE REVENUE IN ALL ABOVE CAPTIONED SIX APPEALS A RE DISMISSED. IN THE RESULT CROSS OBJECTION OF THE ASSESSEE IN ALL SIX CASES AR E ALLOWED AND ALL SIX APPEALS OF THE REVENUE ON ALL FOUR SIMILAR GROUNDS ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 14.11.2014. SD/- SD/- (S.V. MEHROTRA) (CHANDRAMOHAN GARG) ACCOUNTANT MEMBER JUDICI AL MEMBER DT. 14TH NOVEMBER 2014 GS ITA 4200 TO 4202/DEL/2012 & 4197 TO 4199/D/2012 CO NOS.380 TO 385/DEL/2012 48 COPY FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR BY ORDER ASSTT. REGISTRAR