The ACIT,Mehsana Circle,, Mehsana v. Shri Bharat J.Rao,, Kalol

ITSSA 96/AHD/2013 | 2002-2003
Pronouncement Date: 31-10-2013 | Result: Dismissed

Appeal Details

RSA Number 9620516 RSA 2013
Assessee PAN KETHE1922A
Bench Ahmedabad
Appeal Number ITSSA 96/AHD/2013
Duration Of Justice 8 month(s) 18 day(s)
Appellant The ACIT,Mehsana Circle,, Mehsana
Respondent Shri Bharat J.Rao,, Kalol
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 31-10-2013
Appeal Filed By Department
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 31-10-2013
Date Of Final Hearing 23-10-2013
Next Hearing Date 23-10-2013
Assessment Year 2002-2003
Appeal Filed On 11-02-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH AHMEDABAD BEFORE SHRI MUKUL KR. SHRAWAT JUDICIAL MEMBER AND SHRI N.S. SAINA ACCOUNTANT MEMBER IT(SS)A NO.92 93 94 95 96 & 97/AHD/2013 A.YS. 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 REVENUE BY : SHRI T.P. KRISHNAKUMAR CIT- D.R. ASSESSEE(S) BY : SHRI MS. URVASHI SODHAN A.R. / DATE OF HEARING : 23/10/2013 / DATE OF PRONOUNCEMENT: 31/10/2013 / O R D E R PER BENCH : THESE APPEALS HAVE BEEN FILED BY THE REVENUE ARISIN G FROM THE ORDER OF LEARNED CIT(A) GANDHINAGAR DATED 30 TH NOVEMBER 2012. REVENUE HAS RAISED IDENTICALLY WORDED GROUND FOR AL L THE YEARS AS FOLLOWS: THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS I N HOLDING THAT THE NOTICE ISSUED U/S. 153C R.W.S. 153A OF THE ACT WAS NOT VAL ID IGNORING THE FACT THAT THE SEIZED MATERIAL PERTAINS TO THE ASSESSEE AND THE SAME HAD BEEN RECORDED IN PARA 1 OF THE ASSESSMENT ORDER PASSED U/S. 153A(B) OF THE ACT. THE ACIT MEHSANA CIRCLE MEHSANA VS BHARAT J. RAO PROP. DESIGN POINT MANGALKUNJ VARDHAMANNAGAR NR. SARDAR BAUG KALOL PAN: AAWPR44454 (APPELLANT) (RESPONDENT) IT(SS)A NO.92 93 94 95 96 & 97/AHD/2013 ACIT MEHSANA VS. BHARAT J. RAO. FOR A.YS. 1998-99 TO 2003-04 - 2 - 2. FACTS IN BRIEF AS EMERGED FROM THE ASSESSMENT YEAR 1998-99 THE LEAD YEAR A PER AN ORDER PASSED U/S. 153A(B) OF IT ACT DATED 28.03.2006 WERE THAT THERE WAS A SEARCH ON BATA GROUP ON 04. 09.2003. THERE WAS ALSO A SEARCH AT THE RESIDENCE OF ONE SRI KIRIT B. MODI ON 04.09.2003. CERTAIN LOOSE PAPERS AND DOCUMENTS WERE FOUND AT TH E TIME OF SEARCH. THOSE DOCUMENTS PERTAINED TO CERTAIN HOUSING SOCIET IES VIZ. SURYAMANDI CO. OP. HOUSING SOCIETY MANAVMANDIR CO. OP. HOUSIN G SOCIETY AND VITHALNAGAR CO. OP. HOUSING SOCIETY. ON THE BASIS O F THOSE DOCUMENTS IT WAS ALLEGED THAT THE ASSESSEE WAS INVOLVED WITH THO SE SOCIETIES. THE ASSESSEE IS AN ARCHITECT BY PROFESSION. HIS STATEME NT WAS RECORDED. THERE- UPON IT WAS INFORMED THAT HE WAS ENGAGED IN THE PLA NNING OF THOSE SOCIETIES. ON THAT BASIS THE PROCEEDINGS U/S. 153C WAS INITIATED AGAINST THE ASSESSEE AND NOTICE U/S 153C R.W.S. 153A WAS IS SUED ON 11.02.2005. THE ASSESSEE WAS DIRECTED TO FILE THE DETAILS OF TH E INVESTMENT IN THOSE SOCIETIES. IN COMPLIANCE THE ASSESSEE HAS INFORMED THAT BEING AN ARCHITECT HE HAS EARNED ONLY PROFESSIONAL INCOME. THE ASSESSEE HAS FURNISHED RETURN OF INCOME ALONG WITH P & L A/C AND BALANCE-SHEET. BOOKS OF ACCOUNT WERE PRODUCED FOR VERIFICATION. FO R A.Y. 1998-99 IT WAS NOTED BY THE AO THAT THE ASSESSEE HAS RECEIVED UNSECURED LOANS OF RS.3 20 000/- WHICH WAS TAXED IN THE HANDS OF THE A SSESSEE U/S. 68 OF IT ACT. FOR A.Y. 1999-00 AN ADDITION OF RS.9 70 000/- WAS MADE U/S. 68 OF IT ACT. IN ADDITION IT WAS ALSO HELD BY THE AO THA T GENERALLY AN ARCHITECT EARNED 10 TO 15 PER CENT COMMISSION ON THE TOTAL PR OJECT SUPERVISED BY HIM. IT HAS ALSO BEEN OBSERVED BY THE AO THAT GENER ALLY A RATE OF PROFIT IS 3 PER CENT WHEN A PROJECT IS FINANCED AND WITHOUT F INANCING THE PROJECT- INCOME IS GENERALLY IN THE RANGE OF 10 TO 12 PER C ENT OF THE TOTAL PROJECT. IN THE LIGHT OF THOSE OBSERVATIONS AO HAS TAKEN A VIEW THAT THE TOTAL IT(SS)A NO.92 93 94 95 96 & 97/AHD/2013 ACIT MEHSANA VS. BHARAT J. RAO. FOR A.YS. 1998-99 TO 2003-04 - 3 - PROJECT COST OF THE THREE SOCIETIES AMOUNTED TO RS. 2 78 00 000/-. THE ASSESSEE WOULD HAVE EARNED INCOME @ 10 PER CENT WO RKED-OUT TO RS.27 80 000/-. THAT INCOME WAS EQUALLY BIFURCATED IN FIVE ASSESSMENT YEARS FROM 1999-00 TO 2003-04 EQUALLY AT RS.5 56 00 0/- AND TAXED ACCORDINGLY. LIKEWISE FOR A.Y. 2000-01 AN ADDITIO N U/S. 68 OF RS.5 18 000/- AND THE CONSULTATION FEES @10 PER CEN T OF RS.5 56 000/- WAS TAXED. FOR REST OF THE TWO YEARS IN AN IDENTIC AL MANNER THE ADDITIONS WERE MADE. 3. IN THE FIRST ROUND OF PROCEEDINGS THE MATTER WAS CARRIED UPTO THE TRIBUNAL AND THE RESPECTED ITAT B BENCH VIDE AN ORDER DATED 30 TH OF JUNE 2011 IN ITA NOS.2202 TO 2207/AHD/2008 TITLED AS BHARAT J. RAO V/S. ACIT CENTRAL CIRCLE-1(3) AHMEDABAD HAD ADMIT TED AN ADDITIONAL GROUND AND THEREUPON RESTORED THE MATTER BACK TO TH E STAGE OF LEARNED CIT(A) TO ADJUDICATE THE SAID ADDITIONAL GROUND IN THE FOLLOWING MANNER:- HAVING HEARD BOTH THE SIDES WE HAVE CAREFULLY GON E THROUGH THE ORDERS OF THE AUTHORITIES BELOW. KEEPING IN VIEW THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF NATIONAL THERMAL POWER (SUPRA) WE ADMIT THE ADDITIONAL GROUND OF APPEAL. THE HONBLE MADHYA PRADESH HIGH C OURT IN THE CASE OF CIT V/S. TOLLARAM HOSPITAL REPORTED IN 298 ITR 22 ( MP) HELD THAT THE TRIBUNAL PERMITTING ADDITIONAL GROUND TO BE RAISED FOR THE FIRST TIME TRIBUNAL SHOULD REMAND THE CASE TO THE COMMISSIONER (APPEALS ). WE THEREFORE FOLLOWING THE JUDGEMENT OF THE HONBLE MADHYA PRADE SH HIGH COURT SET ASIDE THE ORDER OF THE LD. CIT(A) AND DIRECT THE LD . CIT(A) TO DECIDE THE ADDITIONAL GROUND RAISED IN ALL THE SIX APPEALS. AF TER ADJUDICATING THE ADDITIONAL GROUND IF NECESSARY THE LD. CIT(A) WIL L DECIDE ALL THE GROUNDS RAISED ORIGINALLY AFRESH AFTER GIVING OPPORTUNITY OF BEING HEARD TO BOTH THE SIDES. 4. IN CONSEQUENCE THE LEARNED CIT(A) HAS DECIDED T HE ISSUE ON THE DIRECTIONS OF THE RESPECTED CO-ORDINATE BENCH IN TH E FOLLOWING MANNER: 7. IN ORDER TO DECIDE THE ADDITIONAL GROUND TAKEN AND ACCEPTED BY THE HON'BLE ITAT; THE FIRST LOGICAL STEP WAS TO CALL FO R THE SATISFACTION NOTE. A IT(SS)A NO.92 93 94 95 96 & 97/AHD/2013 ACIT MEHSANA VS. BHARAT J. RAO. FOR A.YS. 1998-99 TO 2003-04 - 4 - LETTER NO.CIT(A) GNR/BHARAT J. RAO/2012-13 DATED 6/ 9/2012 WAS WRITTEN TO THE AO OF THE APPELLANT I.E. AC1T MEHSANA CIRCLE MEHSANA DIRECTING HIM TO ATTEND WITH THE FOLLOWING: - I). COPY OF SATISFACTION RECORDED FOR INITIATING PROCE EDINGS U/S 153C AGAINST THE ASSESSEE. II). THE COPY OF APPRAISAL REPORT OF THE GROUP. III). THE COPIES OF DOCUMENTS AND SEIZED OR FOUND I N THE SEARCH PROCEEDINGS WHICH ARE CONTENDED TO BE BELONGING TO THE APPELLAN T. IV). COPY OF REPLY OF THE APPELLANT DATED 27.3.2006 FILED DURING THE COURSE OF ASSESSMENT PROCEEDINGS VIDE WHICH HE IS ALLEGED TO HAVE ACCEPTED THAT THE RECEIVED 1% OF PROJECT COST FROM THE 3 SOCIETIES AS CONSULTING FEES... 8. IN THE ABSENCE OF ANY SATISFACTION NOTE I GO ON TO EXAMINE WHETHER EVEN OTHERWISE WE CAN SAY THAT SOME DOCUMENT OR ASSET BE LONGING TO THE ASSESSEE WAS FOUND AND SEIZED. THE ASSESSMENT ORDERS DO NOT REFER TO ANY OF THE DOCUMENT OR ASSET AS BELONGING TO THE APPELLANT. TH E ALLEGATION IS AT THE MOST THAT DURING THE SEARCH ON 4.9.2003 IN CASE OF SHRI KIRIT B. MODI KALOL ACCOUNTANT OF THE BATA GROUP DOCUMENTS WERE SEIZED AS PER ANNEXURE A-2 WHICH INCLUDED PAPERS PERTAINING TO M/S. SURYAMANDI R CO-OP. HOUSING SOCIETY M/S. MANAVMANDIR CO-OP. HOUSING SOCIETY M /S. VITHALNAGAR CO-OP. HOUSING SOCIETY. IN THE ASSESSMENT ORDER; ALTHOUGH INITIALLY (REFER TO PARA 4 OF ASSESSMENT ORDER FOR A.Y. 2003-04 ETC.) IT HAS BEEN MENTIONED THAT THE ASSESSEE HAS PROMOTED THE ABOVE 3 SOCIETIES; THE FINAL ADDITION HAS BEEN MADE WITH THE FOLLOWING COMMENTS:- THEREFORE THE ASSESSEES INCOME FROM ABOVE TWO PRO JECTS IS CALCULATED @ 10% OF PROJECT COST AS CALCULATED BELO W WHICH THE ASSESSEE MUST HAVE RECEIVED IN CASH FROM ABOVE SOCI ETIES FOR RENDERING MANAGEMENT SERVICES AND SUPERVISION CHARG ES. ON A PLAIN READING OF THE AFORESAID PROVISIONS IT I S APPARENT THAT SEC. 153C WHICH IS SIMILARLY WORDED TO S. 158BD'OF THE ACT P ROVIDES THAT WHERE THE AO IS SATISFIED THAT ANY MONEY BULLION JEWELLERY OR OTHER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNT OR DOCUMENTS SEIZED OR RE QUISITIONED BELONGS OR BELONG TO A PERSON OTHER THAN THE PERSON REFERRED T O IN S. 153A HE SHALL PROCEED AGAINST EACH SUCH OTHER PERSON AND ISSUE SU CH OTHER PERSON NOTICE AND ASSESS OR REASSESS INCOME OF SUCH OTHER PERSON. HOWEVER THERE IS A DISTINCTION BETWEEN THE TWO PROVISIONS IN AS MUCH A S UNDER S. 153C NOTICE CAN BE ISSUED ONLY WHERE THE MONEY BULLION JEWELLERY OR OTHER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNT OR DOCUMENTS SEIZED OR RE QUISITIONED BELONG TO SUCH OTHER PERSON WHEREAS UNDER S. 158BD IF THE AO IS S ATISFIED THAT ANY UNDISCLOSED INCOME BELONGS TO ANY PERSON OTHER THA N THE PERSON WITH RESPECT TO WHOM SEARCH WAS MADE UNDER S. 132 OR WHOSE BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR ASSETS WERE REQUISITIONED UNDER S. 132 A HE SHALL PROCEED AGAINST SUCH OTHER PERSON UNDER S. 158BC. IT(SS)A NO.92 93 94 95 96 & 97/AHD/2013 ACIT MEHSANA VS. BHARAT J. RAO. FOR A.YS. 1998-99 TO 2003-04 - 5 - THUS A CONDITION PRECEDENT FOR ISSUING NOTICE UNDER S. 153C AND ASSESSING OR REASSESSING INCOME OF SUCH OTHER PERSON IS THAT TH E MONEY BULLION JEWELLERY VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNT OR DO CUMENTS SEIZED OR REQUISITIONED SHOULD BELONG TO SUCH PERSON. IF THE SAID REQUIREMENT IS NOT SATISFIED RESORT CANNOT BE HAD TO THE PROVISIONS O F S. 153C OF THE ACT. IN THE PRESENT CIRCUMSTANCES DISCUSSED IN DETAIL A S ABOVE; IT IS HELD THAT THE CONDITION PRECEDENT FOR ISSUANCE OF NOTICE IS NOT F ULFILLED AND THEREFORE ACTION TAKEN UNDER S. 153C OF THE ACT STANDS VITIATED. THE IMPUGNED NOTICES DT. 11/2/2005 ISSUED UNDER S. 153C OF THE ACT ARE HEREBY QUASHED AND SET ASIDE. THIS ORDER IS BEING P ASSED RESPECTFULLY FOLLOWING THE JUDGMENT OF JURISDICTIONAL HON'BIE GU JARAT HIGH COURT IN THE CASE OF SHRI VIJAYBHAI N. CHANDRANI (SUPRA) REPORTE D IN 231 CTR (GUJ.) 474. I THEREFORE DIRECT CANCELLING OF ALL THE ASSESSME NTS MADE FOR ALL THESE YEARS. 4.1 SINCE THE LEARNED CIT(A) HAS QUASHED THE IMPUG NED ASSESSMENT ORDER THEREFORE THE REVENUE IS IN APPEAL BEFORE U S. 5. FROM THE SIDE OF THE REVENUE DEPARTMENT LEARNED CIT-DR MR. T.P. KRISHNA KUMAR APPEARED. HE HAS RAISED A LEGAL OBJECTION THAT IF AT ALL THE ASSESSEE WAS INCLINED TO OBJECT THE JURISDI CTION OF THE AO THEN HE SHOULD HAVE RAISED THE OBJECTION WITHIN A PERIOD OF ONE MONTH FROM THE DATE ON WHICH HE WAS SERVED WITH THE IMPUGNED NOTIC E. ACCORDING TO HIM THE ADMITTED FACTUAL POSITION WAS THAT THE JUR ISDICTION WAS NOT CHALLENGED BEFORE THE AO. EVEN IT WAS NOT CHALLENGE D IN THE FIRST ROUND OF APPEAL BEFORE LEARNED CIT(A). RATHER IT WAS CHA LLENGED THROUGH ADDITIONAL GROUND BEFORE THE RESPECT TRIBUNAL. THE ASSESSEE WAS NOT ENTITLED TO RAISE SUCH A LEGAL OBJECTION AFTER SO M ANY YEARS MORE PARTICULARLY AT A LATER STAGE OF APPELLATE PROCEEDI NGS. IN SUPPORT OF THIS ARGUMENT LEARNED CIT-DR HAS REFERRED SECTION 124 OF IT ACT. AS PER SECTION 124(2) & (3) IT IS PRESCRIBED THAT WHERE A QUESTION ARISES AS TO WHETHER AN AO HAS JURISDICTION TO ASSESS ANY PER SON THEN NO PERSON SHALL BE ENTITLED TO CALL IN QUESTION THE JU RISDICTION OF THE AO IT(SS)A NO.92 93 94 95 96 & 97/AHD/2013 ACIT MEHSANA VS. BHARAT J. RAO. FOR A.YS. 1998-99 TO 2003-04 - 6 - AFTER EXPIRY OF ONE MONTH FROM THE DATE ON WHICH HE WAS SERVED WITH A NOTICE OR AFTER THE COMPLETION OF THE ASSESSMENT. FOR THIS LEGAL PROPOSITION RELIANCE WERE PLACED ON VAISHAL BUILDERS & COLONIZERS 25 TAXMANN.COM 464 (JODH.) & MANHARLAL V. SHAH 10 TAX MANN.COM 64 (AHD). IT HAS ALSO BEEN PLEADED BY LEARNED CIT-DR THAT TH E ASSESSEE HAS PARTICIPATED IN THE ASSESSMENT PROCEEDINGS THEREFO RE THE ASSESSEE IS NOT ENTITLED TO RAISE THE ISSUE OF JURISDICTION AT A LA TER STAGE OF PROCEEDINGS. RELIANCE WAS PLACED ON THISTLE PROPERTIES 16 TAXMANN. COM 155 (MUM). 6. FROM THE SIDE OF THE RESPONDENT-ASSESSEE LEARNE D AR MS. URVASHI SODHAN APPEARED. SHE HAS ARGUED THAT ONCE THE TRIBU NAL HAS ALREADY ADMITTED AN ADDITIONAL GROUND ON THIS LEGAL ISSUE T HEN THERE WAS NO SCOPE LEFT TO AGITATE THE ADJUDICATION OF THAT LEGAL GROU ND. ACCORDING TO HER LEARNED CIT(A) WAS DUTY BOUND TO ACT UPON THE DIREC TIONS OF THE TRIBUNAL. LEARNED CIT(A) HAS ASKED THE CONCERNED AO TO GIVE THE REPORT AND ONCE HE WAS SATISFIED THAT THE REQUIRED SATISFACTION NOTE WAS NOT AVAILABLE IN THE ASSESSMENT RECORD THEN HE HAS PROCEEDED TO D ECIDE THAT THE CONDITION PRECEDENT FOR INVOKING THE PROCEEDING S U/S.153C WAS NOT FULFILLED. SHE HAS FURTHER PLEADED THAT LEARNED CIT (A) HAS RIGHTLY PLACED RELIANCE ON THE CASE OF SRI VIJAYBHAI N. CHANDRANI 231 CTR 474 (GUJ.) . ON THIS ISSUE LEARNED AR HAS ALSO PLACED RELIANC E ON DSL PROPERTIES (P.) LTD & MEGHMANI ORGANICS (TAX APPEAL NO.2077 2078 & 2086 OF 2009) ORDER DATED 27.4.2011 OF HONBLE GUJA RAT HIGH COURT. SHE HAS ALSO OBJECTED THE ARGUMENT OF LEARNED CIT-DR RE VOLVING AROUND THE PROVISIONS OF SECTION 124 OF IT ACT. IN THIS CONNEC TION SHE HAS PLACED ON RECORD A PORTION OF THE COMMENTARY OF KANGA PALKHI VALA AND VYAS ( THE IT(SS)A NO.92 93 94 95 96 & 97/AHD/2013 ACIT MEHSANA VS. BHARAT J. RAO. FOR A.YS. 1998-99 TO 2003-04 - 7 - LAW & PRACTICE OF INCOME TAX) RELEVANT PAGE NO 1647 . SHE HAS PLEADED THAT IRREGULAR EXERCISE OF JURISDICTION IS A DIFFERENT T HING HOWEVER AN ASSUMPTION OF JURISDICTION SHOULD NECESSARILY BE AS PER LAW. IN RESPECT OF AN IRREGULAR EXERCISE OF JURISDICTION SECTION 12 4 PRESCRIBES THAT THE ASSESSEE HAS TO OBJECT THE SAME WITHIN THE TIME PRE SCRIBED RELEVANT PORTION IS EXTRACTED BELOW :- UNLIKE THE 1922 ACT WHICH REFERRED TO THE PLACE OF ASSESSMENT THIS SECTION REFERS TO THE JURISDICTION OF THE AO. IT IS IMPOR TANT TO NOTE THE SENSE IN WHICH THE WORD JURISDICTION IS USED IN THIS CONTEXT. TH E DISTINCTION BETWEEN WANT OF INHERENT JURISDICTION I.E. INHERENT INCOMPETENCY ON THE ONE HAND AND IRREGULAR EXERCISE OR ASSUMPTION OF JURISDICTION ON THE OTHER HAND IS WELL SETTLED. A PARTY MAY WAIVE OBJECTION TO IRREGULAR E XERCISE OR ASSUMPTION OF JURISDICTION; BUT THERE CAN BE NO QUESTION OF WAIVE R WHERE THERE IS A WANT OF INHERENT JURISDICTION BECAUSE IN SUCH A CASE THE OR DER MUST BE TREATED AS A NULLITY. UNDER THIS ACT IF AN ORDER IS MADE BY AN AO OTHER THAN THE ONE ENTITLED TO EXERCISE JURISDICTION IT MAY AMOUNT ME RELY TO IRREGULAR EXERCISE OR ASSUMPTION OF JURISDICTION; AND IF THE ASSESSEE HAS NOT OBJECTION WITHIN THE TIME PRESCRIBED BY SUB-S(3) HE WOULD BE DEEMED TO HAVE WAIVED HIS OBJECTION AND THE ORDER WOULD BE VALID AND EFFECTIVE. IF AN A DMINISTRATIVE ORDER TRANSFERRING A CASE FROM ONE AO TO ANOTHER IS SET A SIDE BY THE COURT THAT WOULD NOT NECESSARILY INVALIDATE ALL ACTION TAKEN BEFORE THE COURTS DECISION BY THE AO TO WHOM THE CASE WAS TRANSFERRED. THE QUESTION AS TO WHETHER AN AO HAS JURISDICTION WITHIN THIS SECTION TO ASSESS ANY PERSON CANNOT BE THE SUBJECT-MATTER OF APPEAL - THE APPELLATE AUTHORITIES ARE NOT COMPETENT TO DECIDE THE QUESTIO N AS TO THE AOS JURISDICTION. SUCH A QUESTION IS TO BE DECIDED BY T HE DIRECTOR GENERAL OR THE COMMISSIONER OR THE BOARD. SEE POST UNDER APPEAL A ND REFERENCE. 7. WE HAVE HEARD THE SUBMISSIONS OF BOTH THE SIDES AT SOME LENGTH. AS FAR AS THE QUESTION OF APPLICABILITY OF SECTION 124 OF IT ACT IS CONCERNED WE ARE ALSO OF THE VIEW THAT THERE IS A D ISTINCTION BETWEEN THE WANT OF INHERENT JURISDICTION ON ONE HAND AND TH E ASSUMPTION OF JURISDICTION ON THE OTHER HAND. SECTION 153C FALLS IN THE CATEGORY OF ASSUMPTION OF JURISDICTION. THIS SECTION IS IN RE SPECT OF AN ASSUMPTION OF INCOME OF AN OTHER PERSON. THIS SECTION SAYS T HAT WHEREOF AO IS SATISFIED THAT ANY MONEY BULLION OR DOCUMENTS ETC BELONG TO A PERSON IT(SS)A NO.92 93 94 95 96 & 97/AHD/2013 ACIT MEHSANA VS. BHARAT J. RAO. FOR A.YS. 1998-99 TO 2003-04 - 8 - OTHER THAN THE PERSON REFERRED TO IN SECTION 153A T HEN THE BOOKS OF ACCOUNT OR ANY OTHER ARTICLES SHALL BE HANDED OVER TO THE AO HAVING JURISDICTION OVER SUCH OTHER PERSONS. THEREAFTER THAT AO WHO HAS JURISDICTION OVER SUCH OTHER PERSON SHALL PROCEED A GAINST SUCH OTHER PERSON. THEREFORE THE PRE-CONDITION IS THAT THE AO MUST BE SATISFIED THAT IT BELONGED TO OTHER PERSON AND ON BEING RECORDING SATISFACTION THE CASE RECORD/SEIZED MATERIAL IS REQUIRED TO BE FORWARDED TO THE AO OF SUCH OTHER PERSON. THIS IS NOT THE QUESTION OF AN INCOMP ETENCY IN THE JURISDICTION BUT ACCORDING TO US IF A SATISFACTION IS NOT RECORDED THEN THIS IS AN IRREGULAR EXERCISE OF ASSUMPTION OF JURISDICT ION. THERE ARE SEVERAL CASES CITED BY THE ASSESSEE WHEREIN THE IMPORTANCE OF THE CONDITION PRECEDENT FOR ISSUANCE OF NOTICE U/S. 153C HAS BEEN APPRECIATED AND HELD THAT THE RECORDING OF SATISFACTION BY THE AO OF THE PERSON SEARCHED IS A SINE QUA NON BEFORE HANDING OVER OF THE SEIZED MATERIAL TO THE AO OF SUCH OTHER PERSON. 7.1 AFTER ANALYZING THIS LEGAL POSITI ON WE HAVE EXAMINED THE FACTUAL ASPECT THAT WHETHER THERE WAS A SATISFACTIO N RECORDED BEFORE THE INITIATION OF PROCEEDINGS U/S. 153C OF IT ACT ?. WE HAVE NOTED THAT THE LEARNED CIT(A) HAD GIVEN AMPLE OPPORTUNITY TO THE R EVENUE DEPARTMENT TO PLACE THE REQUIRED SATISFACTION IF AVAILABLE O N RECORD. HOWEVER THE REVENUE DEPARTMENT HAD FAILED TO PLACE ON RECORD AN Y SUCH SATISFACTION NOTE. IN THE ABSENCE OF THE SATISFACTION NOTE LEA RNED CIT(A) HAS QUASHED THE ASSESSMENT IN QUESTION. WE FIND NO IRREGULARITY IN THE FACTUAL AS WELL AS LEGAL FINDING OF LEARNED CIT(A). 7.2 THERE IS ONE MORE IMPORTANT POINT R AISED FOR OUR CONSIDERATION THAT THE QUANTUM ADDITIONS WHICH WERE MADE IN THE H ANDS OF THE ASSESSEE HAVE ALSO NOT BEEN CONNECTED WITH THE SEARCH MATERI AL. THERE WAS NO IT(SS)A NO.92 93 94 95 96 & 97/AHD/2013 ACIT MEHSANA VS. BHARAT J. RAO. FOR A.YS. 1998-99 TO 2003-04 - 9 - EVIDENCE UNEARTHED AT THE TIME OF SEARCH THROUGH WH ICH IT COULD HAVE BEEN DEMONSTRATED THAT THE ASSESSEE HAD EARNED THE IMPUGNED UNACCOUNTED INCOME SO ASSESSED. THE AO HAD TAXED ME RELY ON PRESUMPTION THAT THE ASSESSEE MIGHT HAVE EARNED SOM E PROFESSIONAL INCOME BEING AN ARCHITECT PERTAINING TO THE PROJECT SUPERVISED BY HIM. BUT THERE WAS NO EVIDENCE DETECTED CONSEQUENCE UPON THE SEARCH. LIKEWISE THE PROVISIONS OF SECTION 68 WERE NOT REL ATED TO THE SEIZED MATERIAL BUT BASED UPON THE BOOKS OF ACCOUNT OF THE ASSESSEE HENCE OUT OF THE PURVIEW OF THE SEARCH ASSESSMENT. UNDER THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN VIEW OF THE CA SE LAWS CITED HEREINABOVE WE FIND NO FORCE IN THE GROUNDS OF THE REVENUE. HENCE THE SAME ARE HEREBY DISMISSED. 8. TO SUM UP THESE APPEALS OF THE REVENUE ARE HERE BY DISMISSED. SD/- SD/- (N.S. SAINI) (MUKUL KR. SHRAWAT) ACCOUNTANT MEMBER JUD ICIAL MEMBER AHMEDABAD; DATED 31/10/2013 PRABHAT KR. KESARWANI SR. P.S. / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A)-III AHMEDABAD 5. / DR ITAT AHMEDABAD 6. / GUARD FILE. / BY ORDER / ( DY./ASSTT.REGISTRAR) / ITAT AHMEDABAD