Sh. Arun Kumar Girdhar, Dehradun V. DCIT, Dehradun

CO 110/DEL/2014

• Counselvise Citation: [2017] 123 COUNSELVISE.COM (IT) 2693 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 8 month(s) 15 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 06-01-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 04-01-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 21-04-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAVI JAIN
• Keywords: Search and seizure; Reason to believe
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH A AA A : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI BEFORE SHRI BEFORE SHRI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT AND AND AND AND SHRI KULDIP SINGH SHRI KULDIP SINGH SHRI KULDIP SINGH SHRI KULDIP SINGH, JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER ITA NO ITA NO ITA NO ITA NO . .. . 5353/DEL/2013 5353/DEL/2013 5353/DEL/2013 5353/DEL/2013 ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : 2009 2009 2009 2009 - -- - 10 1010 10 DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CENTRAL CIRCLE, CENTRAL CIRCLE, CENTRAL CIRCLE, CENTRAL CIRCLE, DEHRA DEHRA DEHRA DEHRADUN. DUN. DUN. DUN. VS. VS. VS. VS. SHRI ARUN KUMAR GIRDHAR, SHRI ARUN KUMAR GIRDHAR, SHRI ARUN KUMAR GIRDHAR, SHRI ARUN KUMAR GIRDHAR, 14, VASANT VIHAR, 14, VASANT VIHAR, 14, VASANT VIHAR, 14, VASANT VIHAR, PHASE PHASE PHASE PHASE- -- -2, 2,2, 2, DEHRADUN DEHRADUN DEHRADUN DEHRADUN 248 001. 248 001. 248 001. 248 001. PAN : AAVPG3251C. PAN : AAVPG3251C. PAN : AAVPG3251C. PAN : AAVPG3251C. (APPELLANT) (RESPONDENT) CROSS OBJECTION CROSS OBJECTION CROSS OBJECTION CROSS OBJECTION NO NONO NO .110/DEL/2014 .110/DEL/2014 .110/DEL/2014 .110/DEL/2014 ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : 2009 2009 2009 2009 - -- - 10 1010 10 SHRI ARUN KUMAR GIRDHAR, SHRI ARUN KUMAR GIRDHAR, SHRI ARUN KUMAR GIRDHAR, SHRI ARUN KUMAR GIRDHAR, 14, VASANT VIHAR, 14, VASANT VIHAR, 14, VASANT VIHAR, 14, VASANT VIHAR, PHASE PHASE PHASE PHASE- -- -2, 2,2, 2, DEHRADUN DEHRADUN DEHRADUN DEHRADUN 248 001. 248 001. 248 001. 248 001. PAN : AAVPG3251C. PAN : AAVPG3251C. PAN : AAVPG3251C. PAN : AAVPG3251C. VS. VS. VS. VS. DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF DEPUTY COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CENTRAL CIRCLE, CENTRAL CIRCLE, CENTRAL CIRCLE, CENTRAL CIRCLE, DEHRADUN. DEHRADUN. DEHRADUN. DEHRADUN. (APPELLANT) (RESPONDENT) REVENUE BY : SHRI RAVI JAIN, CIT - DR. ASSESSEE BY : SHRI SALIL KAPOOR AND MS. ANANYA KAPOOR, ADVOCATES. DATE OF HEARING : 04.01.2017 04.01.2017 04.01.2017 04.01.2017 DATE OF PRONOUNCEMENT : 06.01.2017 06.01.2017 06.01.2017 06.01.2017 ORDER ORDER ORDER ORDER PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP : :: :- -- - ITA NO.5353/DEL/2013 ITA NO.5353/DEL/2013 ITA NO.5353/DEL/2013 ITA NO.5353/DEL/2013 REVENUES APPEAL : REVENUES APPEAL : REVENUES APPEAL : REVENUES APPEAL :- -- - THIS APPEAL BY THE REVENUE FOR THE ASSESSMENT YEAR 2009-10 IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A)-1, DEH RADUN DATED 28 TH MARCH, 2013. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL :- ITA-5353/D/2013 & C.O.NO.110/D/2014 2 1. THAT LD. CIT(A) HAS ERRED IN LAW AND ON FACTS I N ANNULLING THE ASSESSMENT U/S 153C BY HOLDING THAT T HE DOCUMENT DOES NOT BELONG TO THE ASSESSEE BUT TO M/S T.R. BUILDERS AND THEREFORE ISSUE OF NOTICE U/S 153C IS INVALID, WITHOUT APPRECIATING THE FACT THAT THE DOCUMENT IS IN AGREEMENT SIGNED BY THE ASSESSEE AND THEREFORE BELO NGED TO THE ASSESSEE AS INDICATED IN THE STATEMENT OF FA CT ENCLOSED HEREWITH. 2. THAT LD.CIT(A) IS NOT JUSTIFIED IN LAW IN ANNULL ING THE ASSESSMENT U/S 153C HOLDING THAT THE DOCUMENT DOES NOT BELONG TO THE ASSESSEE BUT TO M/S T.R. BUILDERS AND THEREFORE ISSUE OF NOTICE U/S 153C IS INVALID WHERE AS THE DOCUMENT BELONGED TO THE ASSESSEE AS WELL, AS IT WA S SIGNED BY HIM AND REPRESENTED A TRANSACTION ENTERED INTO BY HIM. 3. THAT LD.CIT(A) IS NOT JUSTIFIED IN LAW IN ANNULL ING THE ASSESSMENT U/S 153C AND NOT DECIDING THE CASES ON M ERITS. 4. THAT LD.CIT(A) HAS ERRED IN LAW AND IGNORING THE FACT THAT NEITHER BEFORE INVESTIGATION WING NOR BEFORE T HE AO, EITHER THE ASSESSEE OR M/S T.R. BUILDERS DENIED THE GENUINENESS/AUTHENTICITIES OF THE DOCUMENT. 5. THAT THE ORDER OF THE LD.CIT(A) BEING ERRONEOUS IN LAW AND ON FACTS WHICH NEEDS TO BE VACATED AND THE ORDE R OF THE A.O. BE RESTORED. 3. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D HAVE PERUSED THE MATERIAL PLACED BEFORE US. LEARNED CIT (A) HAS RECORDED THE FINDING THAT SEARCH AND SEIZURE HAS TAKEN PLACE AT THE RESIDENTIAL PREMISES OF SHRI MOHIT BATOLA FROM WHOM CERTAIN PAP ERS BELONG TO M/S T.R. BUILDERS WERE FOUND. ACTION U/S 153C HAS ALRE ADY BEEN TAKEN IN THE CASE OF M/S T.R. BUILDERS. SHRI MOHIT BATOLA I S THE PARTNER IN M/S T.R. BUILDERS. HOWEVER, IN THE PAPERS BELONGING TO M/S T.R. BUILDERS, THE NAME OF THE ASSESSEE WAS ALSO FOUND RECORDED AN D, THEREFORE, ACTION U/S 153C HAS BEEN INITIATED IN THE CASE OF T HE ASSESSEE. LEARNED CIT(A) QUASHED THE ACTION IN THE CASE OF TH E ASSESSEE WITH THE FOLLOWING FINDING :- ITA-5353/D/2013 & C.O.NO.110/D/2014 3 1.7 THE SATISFACTION ENVISAGED IN SECTION 153C HAS TO BE GENUINE AND HAS TO BE REACHED OBJECTIVELY ON THE BA SIS OF THE FACTS AND CIRCUMSTANCES OF THE CASE. IN THIS C ASE, THERE WAS A PRIMA FACIE REASON TO BELIEVE THAT THE IMPUGN ED DOCUMENTS BELONGED TO M/S T.R. BUILDERS IN SO FAR A S IT WAS THE SELLER IN THE LAND TRANSACTION CONCERNED AND TH E DOCUMENTS WERE FOUND IN THE POSSESSION/CONTROL OF M R. MOHIT BATOLA (A PARTNER OF M/S T.R. BUILDERS). THE RE WAS NO DISCLAIMER FROM THE SAID FIRM (THAT THESE DOCUMENTS DID NOT BELONG TO IT) NOR WAS THERE A CLAIM FROM THE AS SESSEE (THAT THEY BELONGED TO HIM). THUS, ANY OBJECTIVE G ROUND FOR REACHING THE SATISFACTION THAT THE DOCUMENTS BE LONGED TO A PERSON OTHER THAN M/S T.R. BUILDERS DID NOT EX IST. THAT BEING SO, IT IS CLEAR THAT THE REQUIREMENT OF THE P ROVISION OF SECTION 153C OF THE I.T. ACT WAS NOT MET IN SUBSTAN CE. THE APPROPRIATE COURSE IN SUCH SITUATION WAS TO INITIAT E PROCEEDINGS U/S 147 OF THE I.T. ACT AND MAKE ASSESS MENT ACCORDINGLY. 4. AT THE TIME OF HEARING BEFORE US, IT WAS POINTED OUT BY THE LEARNED COUNSEL THAT IN THE LIGHT OF THE ABOVE DIRE CTION OF LEARNED CIT(A), THE ASSESSING OFFICER HAS ALREADY INITIATED PROCEEDINGS U/S 147 IN THE CASE OF THE ASSESSEE AND HAS MADE THE ADDITI ON OF `1,33,30,000/- I.E., THE IMPUGNED ADDITION WHICH WA S MADE IN THE CASE UNDER APPEAL IN THE LIGHT OF THE PAPER FOUND FROM S HRI MOHIT BATOLA. HE, THEREFORE, STATED THAT ONCE ACTION U/S 147 HAS ALREADY BEEN TAKEN AND THE SIMILAR ADDITION IS MADE, THE REVENUES APP EAL HAS BECOME INFRUCTUOUS. A COPY OF THE ASSESSMENT ORDER PASSED U/S 143(3) READ WITH SECTION 147 DATED 25 TH FEBRUARY, 2015 IS PLACED ON RECORD. HE ALSO STATED THAT EVEN OTHERWISE, THE PROCEEDINGS U/ S 153C ARE NOT VALID BECAUSE (I) NO PAPER BELONGING TO THE ASSESSEE WA S FOUND FROM THE PERSON SEARCHED AND (II) NO SATISFACTION WAS RECORD ED IN THE CASE OF THE PERSON SEARCHED THAT THE SEIZED DOCUMENT BELONGED T O THE ASSESSEE. 5. LEARNED CIT-DR, ON THE OTHER HAND, RELIED UPON T HE ORDER OF THE ASSESSING OFFICER. ITA-5353/D/2013 & C.O.NO.110/D/2014 4 6. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF BOTH THE SIDES AND PERUSED THE MATERIAL PLACED BEFORE US. THE FAC TS MENTIONED IN PARAGRAPH 1.7 OF LEARNED CIT(A)S ORDER HAVE NOT BE EN DISPUTED BY THE REVENUE. ON THE OTHER HAND, THE REVENUE HAS ALREAD Y ACTED UPON ON THE BASIS OF OBSERVATION IN ABOVE PARAGRAPH OF LEAR NED CIT(A)S ORDER AND HAS INITIATED PROCEEDINGS U/S 147. THE ASSESSM ENT ORDER HAS ALREADY BEEN COMPLETED IN PURSUANCE TO THE NOTICE I SSUED U/S 147 AND THE RELEVANT ADDITION HAS ALREADY BEEN MADE. IN TH E ABOVE CIRCUMSTANCES, NOW THE REVENUE CANNOT DISPUTE/CHALL ENGE THE FINDING RECORDED BY THE LEARNED CIT(A) IN PARAGRAPH 1.7. I T HAS NOT BEEN POINTED OUT BEFORE US THAT A VALID SATISFACTION AS REQUIRED UNDER THE PROVISIONS OF SECTION 153C FOR TAKING ACTION WAS RE CORDED. THEREFORE, WE DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE ORDER OF LEARNED CIT(A). THE SAME IS SUSTAINED. ASSESSEES CROSS ASSESSEES CROSS ASSESSEES CROSS ASSESSEES CROSS- -- -OBJECTION NO.110/DEL/2014 : OBJECTION NO.110/DEL/2014 : OBJECTION NO.110/DEL/2014 : OBJECTION NO.110/DEL/2014 :- -- - 7. IN THE CROSS-OBJECTION, THE ASSESSEE HAS RAISED THE GROUNDS AGAINST THE MERIT OF THE ADDITION. ONCE THE PROCEE DINGS U/S 153C HAVE BEEN QUASHED BY THE LEARNED CIT(A) AND WHICH HAS BE EN UPHELD BY US, THE IMPUGNED ASSESSMENT ORDER DOES NOT SURVIVE AND THEREFORE, ASSESSEES GROUNDS OF APPEAL WITH REGARD TO THE MER IT OF THE ADDITION NEED NO ADJUDICATION. 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED AND THE CROSS-OBJECTION OF THE ASSESSEE IS TREATED AS INFRU CTUOUS. DECISION PRONOUNCED IN THE OPEN COURT ON 06.01.2017 . SD/- SD/- (KULDIP SINGH (KULDIP SINGH (KULDIP SINGH (KULDIP SINGH ) )) ) ( (( ( G.D. A G.D. A G.D. A G.D. A GRAWAL GRAWAL GRAWAL GRAWAL ) )) ) JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VK. ITA-5353/D/2013 & C.O.NO.110/D/2014 5 COPY FORWARDED TO: - 1. REVENUE : DEPUTY COMMISSIONER OF INCOME TAX , DEPUTY COMMISSIONER OF INCOME TAX, DEPUTY COMMISSIONER OF INCOME TAX, DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, DEHRADUN. CENTRAL CIRCLE, DEHRADUN. CENTRAL CIRCLE, DEHRADUN. CENTRAL CIRCLE, DEHRADUN. 2. ASSESSEE : SHRI ARUN KUMAR GIRDHAR, SHRI ARUN KUMAR GIRDHAR, SHRI ARUN KUMAR GIRDHAR, SHRI ARUN KUMAR GIRDHAR, 14, VASANT VIHAR, PHASE 14, VASANT VIHAR, PHASE 14, VASANT VIHAR, PHASE 14, VASANT VIHAR, PHASE- -- -2, DEHRADU 2, DEHRADU 2, DEHRADU 2, DEHRADUN. N.N. N. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR