Shri Mahendra G. Patel, V. The ACIT, Cent. Circle-1(4), Ahmedabad

CO 131/AHD/2013

• Counselvise Citation: [2013] 122 COUNSELVISE.COM (IT) 8823 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 month(s) 22 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 27-09-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 18-09-2013
• Assessment Year: 2010-2011
• Appeal Filed On: 05-06-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: RUPESH R SHAH
• Keywords: Search and seizure
• Section: 143(3); 153A; 132; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH BEFORE: SRI D.K TYAGI, JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI, ACCOUNTA NT MEMBER ACIT, CENTRAL CIRCLE 1(4), ROOM NO. 337, 3 RD FLOOR, AAYKAR BHAVAN, ASHARM ROAD, AHMEDABAD (APPELLANT) VS SHRI MAHENDRA G. PATEL, UMIYA SADAN, NEAR RAILWAY CROSSING, BHILAD, TAL: UMARGAM, GUJARAT PAN: ABTPP8024D (RESPONDENT) SHRI MAHENDRA G. PATEL, UMIYA SADAN, NEAR RAILWAY CROSSING, BHILAD, TAL: UMARGAM, GUJARAT PAN: ABTPP8024D (CROSS OBJECTOR) VS ACIT, CENTRAL CIRCLE 1(4), ROOM NO. 337, 3 RD FLOOR, AAYKAR BHAVAN, ASHARM ROAD, AHMEDABAD (RESPONDENT) REVENUE BY: SRI SUBHASH BAINS, CIT-D.R . ASSESSEE BY: SRI RUPESH R. SHAH, A.R . DATE OF HEARING : 18-09-2013 DATE OF PRONOUNCEMENT : 27-09-20 13 IT(SS)A NO.120/AHD/2013 ASSESSMENT YEAR 2010-11 CO NO. 131/AHD/2013 (IN IT(SS)A NO.120/AHD/2013) ASSESSMENT YEAR 2010-11 I.T.(SS)A NO.120/AHD/2013 & C.O. NO.131/AHD2013 A. Y.2010-11 PAGE NO ACIT VS. MAHENDRA G.PATEL 2 / ORDER PER : D.K. TYAGI, JUDICIAL MEMBER:- THIS IS THE REVENUES APPEAL AND CO OF ASSESSEE AG AINST THE ORDER OF LD. CIT(A)-I DATED 19-12-2012. 2. THE REVENUE HAS TAKEN FOLLOWING EFFECTIVE GROUND :- 1. THE LD. CIT(A) ERRED IN LAW AND ON FACTS IN HOL DING THAT THE NOTICE U/S. 153C R.W.S. 153A OF THE IT ACT IS INVAL ID AND DESERVES TO BE QUASHED. 3. BRIEF FACTS OF THE CASE ARE THAT A SEARCH AND SE IZURE OPERATION U/S. 132 OF THE INCOME TAX ACT WAS CARRIED OUT IN THE CASE O F B. NANJI GROUP AND OTHERS ON 04-03-2010. DURING THE COURSE OF SEARCH AND SEIZURE PROCEEDINGS, SOME DOCUMENTS RELATING TO LAND SITUATED AT VILLAGE DEHELI BELONGING TO THE ASSESSEE WERE FOUND. ACCORDINGLY, A NOTICE U/S. 15 3(C) OF THE INCOME TAX ACT WAS ISSUED ON 27-06-2011 AND 26-12-2011. ASSES SMENT WAS COMPLETED U/S. 143(3) READ WITH SECTION 153A OF THE ACT. THE ASSESSEE CHALLENGED THE ISSUANCE OF NOTICE U/S. 153C OF THE ACT, BEFORE LD. CIT(A) WHO PLACING RELIANCE ON THE DECISION OF GUJARAT HIGH COURT IN T HE CASE OF VIJAYBHAI AND N. CHANDRANI REPORTED IN 333 ITR 436 HELD THAT AO W AS NOT JUSTIFIED IN ISSUING NOTICE U/S.153(C) IN THIS CASE. 4. BEFORE US, LD.CIT-DR PLACING RELIANCE ON PAGES N OS. 62 & 63 OF SEIZED ANNEXURE A-1 SUBMITTED THAT ASSESSING OFFICE R HAS RIGHTLY INITIATED THE PROCEEDINGS U/S. 153C READ WITH SECTION 153A BECAUS E THESE DOCUMENTS I.T.(SS)A NO.120/AHD/2013 & C.O. NO.131/AHD2013 A. Y.2010-11 PAGE NO ACIT VS. MAHENDRA G.PATEL 3 BELONGED TO ASSESSEE AND AO BEFORE INITIATING SUCH PROCEEDINGS HAS RECORDED THE FOLLOWING SATISFACTION NOTE IN THIS RESPECT: SATISFACTION NOTE TO INITIATE PROCEEDINGS U/S. 153 C R.W.S. 153A OF THE I.T. ACT, 1961 IN THE CASE OF SHRI MAHENDRA G PATEL (PAN:ABTPP8024D) A SEARCH ACTION U/S 132 OF THE INCOME-TAX ACT, 1961 WAS CARRIED OUT IN THE B. NANJI GROUP AND OTHERS ON 04/03/2010 AND VAR IOUS DOCUMENTS/ BOOKS OF ACCOUNT/ OTHER VALUABLE ARTICLES/ OTHER TH INGS WERE FUND AND SEIZED FROM THE VARIOUS PREMISES COVERED U/S 132 OF THE IT ACT. ON VERIFICATION OF VARIOUS DOCUMENTS FOUND AND SEIZ ED ANNEXURE-A/I PAGE NO. 62 & 63 FROM THE RESIDENTIAL PREMISES OF S H. PRAKASH G PALEL CONTAINS A -SIGNED HANDWRITTEN AGREEMENT BE TWEEN SH. RAJENDRA GAJANAN PATEL AND B. NANJI ENTERPRISES LTD . THROUGH ITS DIRECTOR SH. SANDIP PADSHALA FOR THE PURCHASE OF L AND SITUATED AT VILLAGE. DEHELI AND PHOTOCOPY OF THE CHEQUE THAT AS SESSES HAD RECEIVED PAYMENT OF RS. 9 LAKHS BY SHRI BHIKHU NANJ I PADSALA THROUGH HDFC BANK ACCOUNT NO 156720200000781 A/C PAYEE CHEQ UE NO 017784 DATED 19/12/2009 WHICH CLEARLY INDICATE THAT THIS DOCUMENT IS BELONGING TO SHRI MAHENDRA GAJANAN PAT EL HAD RECEIVED THE PAYMENTS FOR THE ABOVE MENTIONED TRANSACTION. I T IS ALSO EVIDENT FROM PURCHASE DEED OF LAND HEARING OF SURVEY NUMBER S 43 AND 47 DEHALI, TALUKA UMARGAON SHRI MAHENDRA GAJANAN PATEL HAD SOLD THIS LAND AND RECEIVED THE PAYMENT. THUS, UNDERSI GNED IS SATISFIED THAT THE PAGE NO. 63 ANNEXURE-A1 SEIZED BELONGS TO SHRI MAHENDRA GAJANAN PATEL. IN VIEW OF THE ABOVE, I AM SATISFIED THAT PAGE NO 6 2 & 63 OF ANNEXURE AL SEIZED FROM THE RESIDENTIAL PREMISES OF PRAKASH C PATEL BELONGS TO SHRI MAHENDRA G PATEL (PAN: ABTPP8024D) AND HENCE T HE CASE IS FIT FOR INITIATING PROCEEDINGS U/S 153C R.W.S. 153A OF THE IT ACT, 1961. ACCORDINGLY, THE NOTICE V/S 153C R.W.S. 153A OF THE ACT ISSUED FOR A.Y. 04-05 TO A.Y. 09-10. THEREFORE LD. CIT(A) WAS NOT JUSTIFIED IN HOLDING THAT AO WAS NOT JUSTIFIED IN HOLDING THAT DOCUMENTS 62 & 63 OF ANNEXURE A-1 S EIZED FROM B. NANJIBHAI DURING THE COURSE OF SEARCH AND SEIZURE O PERATION BELONG TO THE I.T.(SS)A NO.120/AHD/2013 & C.O. NO.131/AHD2013 A. Y.2010-11 PAGE NO ACIT VS. MAHENDRA G.PATEL 4 ASSESSEE AND THEREFORE AO WAS NOT JUSTIFIED IN ISSU ING THE NOTICE U/S. 153C OF THE ACT. LEARNED COUNSEL OF THE ASSESSEE ON THE OTHER HAND PLACED RELIANCE ON THE ORDER PASSED BY LD. CIT(A). 5. AFTER HEARING BOTH PARTIES AND PERUSING THE RECO RD, WE FIND THAT THERE IS NO DISPUTE ABOUT THE FACT THAT A SEARCH AND SEIZ URE OPERATION WAS CARRIED OUT AT THE BUSINESS PREMISES OF B. NANJI GROUP ON 0 4-03-2010 AND DURING THIS OPERATION PAGES NOS. 62-63 OF ANNEXURE OF A-1 WERE SEIZED. ON THE BASIS OF THESE DOCUMENTS, AO HAS INITIATED PROCEEDI NGS U/S. 153C READ WITH SECTION 143(3) OF THE ACT BY RECORDING THE ABOVEMEN TIONED SATISFACTION NOTE. THE AGREEMENT MENTIONED THEREIN READS AS UNDER:- SELLER : RAJENDRA GAJANAN PATEL, AGE-MAJO R, OCCUPATION- AGRICULTURIST, RESIDING AT UMIYA SADAN, BHILAD, TALUKA UMARGAM . PURCHASER : N. NANJI ENTERPRISES LTD THROUGH I TS DIRECTOR SANDIP BHIKHUBHAI PADSALA OF 5, ASHOKNAGAR, SATELLITE, AHMEDABAD WHAT IS WRITTEN HEREIN-BELOW WILL BE TO BOTH THE PA RTIES. THE SELLER HAS AGREED TO SELL LAND BEARING SURVEY N O 47 AND 45 AT VIALLAGE: DEHELI IN TALUKA UMARGAON OWNED AND OCCUP IED BY SELLERS BROTHER @ RS. 33/- PER SQ FT. (RUPEES THREE HUNDRE D THIRTY THREE SQ FT. ONLY AND RECEIVED RS. 9,00,000/- (RUPEES NINE L ACS ONLY) BY CHEQUE DTD 19/12/2009 DRAWN ON HDFC BANK C G ROAD, BRANCH AS AGREEMENT AMOUNT. THE SALE DEED FOR THE SAID LAND IS TO BE MADE IN THE MONTH OF JANUARY. ALL EXPENSES RELATED TO EXECUTION OF SALE DEED SHAL L BE BORNE BY THE PURCHASER. THE ABOVE TERMS AND CONDITIONS ARE BINDING TO BOTH THE PARTIES. SELLER : SD/- WITNESS: SD/- (RAJENDRA GAJANAN PATEL) ( SANDIP SUDHAKAR AAREKAR) I.T.(SS)A NO.120/AHD/2013 & C.O. NO.131/AHD2013 A. Y.2010-11 PAGE NO ACIT VS. MAHENDRA G.PATEL 5 PURCHASER: SD/- WITNESS SD/- (SANDIP B PADSALA) (SIDDHARTH B VYAS) ENCLOSED WITH THIS AGREEMENT WAS THE A/C PAYEE CHEQ UE NO. 017784 DATED 19-12-2009 DRAWN IN HDFC BANK FOR RS. 19 LACS IN FAVOUR OF ASSESSEE. IT IS CLEAR FROM THE ABOVE THAT FROM THE RESIDENTIA L PREMISES OF SHRI PRAKASHJI PATEL A SIGNED HAND-WRITTEN AGREEMENT BETWEEN THE S RI RAJENDRA GAJANAN PATEL AND B NANJIBHAI ENTERPRISES LTD THROUGH ITS D IRECTOR SANDEEP PADSALA FOR THE PURCHASE OF LAND SITUATED AT VILLAGE DEHELI AND PHOTOCOPY OF THE CHEQUE THAT ASSESSEE HAD RECEIVED PAYMENT OF RS. 9 LACS FROM SHRI NANJI THROUGH ACCOUNT PAYEE CHEQUE NO. 017784 DATED 19-12 -2009 WAS FOUND. AGREEMENT BETWEEN THE RAJENDRA G. PATEL AND B NANJI BHAI ENTERPRISES IS AT PAGE 62 & 63 AND PHOTOCOPY OF CHEQUE NO. 017784 DAT ED 19-12-2009 FAVOURING SRI MAHENDERJEE PATEL (THE ASSESSEE) OF R S. 9 LACS IS ENCLOSED WITH THIS AGREEMENT IS NOT IN DISPUTE. LD. CIT(A) WHILE GIVING RELIEF TO THE ASSESSEE AND HOLDING THAT PAGES 62-63 DID NOT BELON G TO ASSESSEE HAS TOTALLY IGNORED THE EXISTENCE OF THIS CHEQUE IN FAVOUR OF A SSESSEE. THIS CHEQUE WAS EN-CASHED BY ASSESSEE IS ALSO NOT IN DISPUTE. AS A MATTER OF FACT, THIS WAS THE BASIS FOR ADDITION OF RS. 1,83,45,000/- MADE ON ACC OUNT OF UNACCOUNTED CASH RECEIPTS BY THE ASSESSEE, AND THEREFORE IT CANNOT B E SAID THAT NO DOCUMENT BELONGING TO ASSESSEE WAS NOT FOUND AT THE TIME OF SEARCH AND SEIZURE AT THE PREMISES OF B NANJIBHAI GROUP. FOR ISSUANCE OF NOT ICE U/S. 153C OF THE ACT TWO CONDITIONS ARE TO BE SATISFIED (I) IS THAT THER E HAS TO BE A SEARCH AND SEIZURE CONDUCTED U/S. 132 OR A REQUISITION MADE U/ S. 132A AT THE PREMISES OF SOME PERSON DURING THE COURSE OF WHICH ANY MONEY BU LLION JEWELLERY, OR OTHER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNT OR DOCUMENTS ARE SEIZED OR REQUISITIONED. THE SECOND CONDITION IS THAT TH E AO MUST BE SATISFIED THAT I.T.(SS)A NO.120/AHD/2013 & C.O. NO.131/AHD2013 A. Y.2010-11 PAGE NO ACIT VS. MAHENDRA G.PATEL 6 SUCH MONEY BULLION, JEWELLERY OR OTHER VALUABLE ART ICLE OR THING OR BOOKS OF ACCOUNT OR DOCUMENTS ARE SEIZED OR REQUISITIONED BE LONGED TO A PERSON OTHER THAN THE PERSON RESERVED U/S. 153A. SINCE IN THIS CASE BOTH THESE CONDITIONS ARE SATISFIED, THE RATIO AS LAID DOWN BY THE JURISD ICTIONAL HIGH COURT IN THE CASE OF VIJAYBHAI N. CHANDRANI VS. ACIT REPORTED IN 333 ITR 436 IS NOT APPLICABLE TO THE FACT OF THIS CASE AND LD. CIT(A) WAS NOT JUSTIFIED IN HOLDING THAT AO WAS NOT JUSTIFIED IN ISSUING NOTICE IN THI S CASE U/S. 153C OF THE ACT 6. IN VIEW OF THE ABOVE, THE ORDER PASSED BY LD. CI T(A) IS HEREBY SET ASIDE AND HE IS DIRECTED TO DECIDE THE APPEAL OF TH E ASSESSEE ON MERITS. 7. IN THE RESULT, APPEAL FIELD BY THE REVENUE IS AL LOWED. 8. IN VIEW OF OUR DECISION IN REVENUES APPEAL, CO FILED BY THE ASSESSEE WHICH IS IN SUPPORT OF CIT(A)S ORDER HAS BECOME IN FRUCTUOUS AND THE SAME IS DISMISSED AS INFRUCTUOUS. 9. IN THE COMBINED RESULT, REVENUES APPEAL IS ALLO WED AND CO OF ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE AT CAPTION PAGE SD/- SD/- (ANIL CHATURVEDI) ( D.K. TYAGI) ACCOUNTANT MEMBER J UDICIAL MEMBER AHMEDABAD : DATED 27/09/2013 AK I.T.(SS)A NO.120/AHD/2013 & C.O. NO.131/AHD2013 A. Y.2010-11 PAGE NO ACIT VS. MAHENDRA G.PATEL 7 / COPY OF ORDER FORWARDED TO:- 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,