M/s. Sanchit Consultants Pvt. Ltd., New Delhi V. DCIT, New Delhi

CO 185/DEL/2014

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 3437 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 5 month(s) 23 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 29-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 14-06-2017
• Assessment Year: 2004-2005
• Appeal Filed On: 06-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S RANA
• Keywords: Unexplained investment; Unexplained expenditure; Search and seizure; Document seized; Opportunity of being heard; Principle of natural justice; Assessment record; Documents seized
• Section: 69C; 40A(3); 153A; 234B; 27; 6; 132

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL, DELHI BENCH G, NEW DELHI BEFORE : SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER ITA NOS. 6410 TO 6415/DEL./2013 ASSESSMENT YEARS: 2003-04 TO 2008-09 DCIT, CENTRAL CIRCLE - 21 NEW DELHI. (APPELLANT) VS. M/S. SANCHIT CONSULTANTS PVT. LTD., (FORMERLY KNOWN AS D. BASE CONSULTANTS PVT. LTD.), WZ-13, GALI NO. 18, KRISHNA PARK, TILAK NAGAR, NEW DELHI. PAN AAOCS0318L (RESPONDENT) C.O. NOS. 184 TO 189/DEL./2014 (IN ITA NOS. 6410 TO 6415/DEL./2013) ASSESSMENT YEARS: 2003-04 TO 2008-09 M/S. SANCHIT CONSULTANTS PVT. LTD., (FORMERLY KNOWN AS D. BASE CONSULTANTS PVT. LTD.), WZ-13, GALI NO. 18, KRISHNA PARK, TILAK NAGAR, NEW DELHI. (APPELLANT) VS. DCIT, CENTRAL CIRCLE - 21 NEW DELHI. (RESPONDENT) REVENUE BY SHRI S.S. RANA, CIT/DR ASSESSEE BY SHRI KAPIL GOEL, ADVOCATE ORDER PER L.P. SAHU, A.M.: ALL THE ABOVE APPEALS BY THE REVENUE AND CROSS-OBJ ECTIONS BY THE ASSESSEE ARISE OUT OF SEPARATE ORDERS OF LD. CIT(A)-II, NEW DELHI OF THE EVEN DATE, I.E., 2 ND SEPTEMBER, 2013 FOR THE ASSESSMENT YEARS 2003-04 TO 2008-09 RESPECTIVELY. THE DATE OF HEARING 30.11.2017 DATE OF PRONOUNCEMENT 29 .01.2018 ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 2 REVENUE HAS CHALLENGED THE DELETION OF FOLLOWING AD DITIONS IN ALL ITS APPEALS BY WAY OF COMMON GROUNDS : ASTT. YEARS DELETION OF ADDITION ON A/C OF UNEXPLAINED PURCHASES U/S. 69C DELETION OF ADDITION ON A/C OF DISALLOWANCE OF EXPENDITURE 2003-04 32,91,900 4,11,229 2004-05 34,37,622 3,18,740 2005-06 39,79,550 3,23,877 2006-07 35,02,567 3,22,319 2007-08 36,65,485 3,50,375 2008-09 2,10,20,990 19,69,519 THE ASSESSEE HAS ALSO RAISED THE COMMON GROUNDS IN ALL ITS CROSS-OBJECTIONS, CHALLENGING THE ORDERS OF THE LD. CIT(A) BOTH ON LE GAL GROUNDS AS WELL AS ON MERITS OF THE ADDITIONS. 2. SINCE THE COMMON QUESTIONS OF LAW AND FACTS WERE INVOLVED ALL THESE APPEALS AND CROSS-OBJECTIONS, THE SAME WERE HEARD T OGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. WE TAKE UP THE FACTS INVOLVED IN APPEAL OF THE REVE NUE AND CROSS OBJECTION OF ASSESSEE FOR THE ASSESSMENT YEAR 2003-04 FIRST, THE DECISION ON WHICH SHALL EQUALLY APPLY TO THE APPEALS AND CROSS OBJECTIONS F OR THE REMAINING ASSESSMENT YEARS. ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 3 3. THE BRIEF FACTS OF THE CASE ARE THAT SEARCH AND SEIZURE OPERATIONS U/S. 132 OF THE IT ACT WERE CARRIED OUT IN THE CASES OF SH. B.K . DHINGRA, SMT. POON DHINGRA & M/S. MADHUSUDAN BUILDCON PVT. LTD. ON 20.10.2008 AN D DURING THE COURSE OF SEARCH AT THEIR RESIDENTIAL PREMISES AT F-6/5, VASA NT VIHAR, NEW DELHI, CERTAIN DOCUMENTS BELONGING TO THE ASSESSEE COMPANY WERE SE IZED. ACCORDINGLY, NOTICE U/S. 153C WAS ISSUED ON 08.09.2010, IN RESPONSE TO WHICH THE ASSESSEE FILED RETURN OF INCOME DECLARING INCOME AT NIL. SUBSEQUEN TLY, NOTICES U/S. 143(2)/142(1) WERE ISSUED. THE ASSESSING OFFICER OB SERVED THAT ASSESSEE COMPANY BELONGS TO THE THAPAR GROUP OF CASES AND ON E OF THE MAIN ALLEGATIONS AGAINST THE GROUP WAS THAT SEVERAL CONCERNS WERE BE ING FLOATED BY THE GROUP WITH DUMMY DIRECTORS AND SHAREHOLDERS FORMING THEIR CAPI TAL AND BUILDING UP HUGE RESERVES AND SURPLUS OVER THE YEARS AND THESE RESER VE & SURPLUSES ARE DECLARED INVESTED IN STOCKS OF TEXTILES. THE ASSESSING OFFIC ER FURTHER OBSERVED THAT AS AND WHEN CASH IS REQUIRED, THE STOCKS ARE SHOWN TO HAVE BEEN SOLD AND THE MONEYS ARE UTILIZED FOR OTHER PURPOSES AS PER REQUIREMENT. 4. ANALYSING THE FACTS OF THE PRESENT CASE ON THE A NVIL OF AFORESAID FACTS, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAD DE CLARED A CLOSING STOCK OF RS.17,22,87,423/- AS ON 31.03.2002 FORMING PART OF OPENING STOCK OF THE ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 4 ASSESSMENT YEAR UNDER CONSIDERATION, PURCHASE OF TE XTILE GOODS OF RS.32,91,900/- AND SALES THEREOF AT RS.35,92,084/-. ON BEING ASKED , THE ASSESSEE SUBMITTED THAT THE ENTIRE PURCHASES OF TEXTILE GOODS WERE MADE IN CASH AND WERE NOT EXIGIBLE TO SALES TAX AND THEREFORE, THERE WAS NO NEED TO FILE AND SALES TAX RECORD/RETURNS. 5. THE ASSESSING OFFICER FURTHER OBSERVED THAT DURI NG THE POST SEARCH ENQUIRIES CONDUCTED BY INVESTIGATION WING AT THE AD DRESS OF THE ASSESSEE COMPANY, I.E., B-340, HARI NAGAR, NEW DELHI, IT WAS FOUND THAT ABOUT 15 NOS. OF CONCERNS OF THAPAR GROUP WERE DECLARED AS OPERATING FROM THIS ADDRESS. THE NAMES OF SUCH CONCERNS ARE GIVEN AT PAGE 3 OF THE A SSESSMENT ORDER. IT WAS ALSO FOUND IN THE POST SEARCH ENQUIRIES THAT THE ABOVE P REMISES WAS A RESIDENTIAL HOUSE OF SHRI SUDESH SABHARWAL BUILT UP ON A PLOT O F LAND MEASURING 53 SQ. YARDS WITH NO SIGNBOARDS AND WAS FOUND CLOSED. THEREFORE, STATEMENTS OF TWO NEIGHBOURS DARSHAN KUMAR AND D. BHATTACHARYA WERE R ECORDED, THE EXTRACTS OF WHICH ARE GIVEN AT PAGES 3 & 4 OF THE ASSESSMENT OR DER. FROM THE ABOVE STATEMENTS, SOME CRUCIAL FACTS CAME TO THE NOTICE T HAT THE OWNER OF HOUSE WAS WORKING AS ACCOUNTANT SOMEWHERE AT RAJENDRA PLACE, NEW DELHI; THAT NO BUSINESS ACTIVITIES WERE BEING CARRIED OUT FROM THE SAID PRE MISES AND THAT MR. SUBARWAL, HAVING NO CHILD WAS LIVING A SIMPLE LIFE. THE ENQUI RIES FURTHER REVEALED THAT THE DIRECTOR/SHAREHOLDER OF THE COMPANY IS NOT A MAN OF MEANS AND THE IMPUGNED ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 5 BUSINESS PREMISES WAS NOT A COMMERCIAL PREMISES AND IT WAS ALSO REPORTED BY THE INVESTIGATION WING THAT NO EVIDENCE OF STOCK WAS FO UND FROM ANY OTHER PREMISES OF THAPAR HOMES GROUP. ON BEING ASKED, THE ASSESSE E IN THE ASSESSMENT PROCEEDINGS CLAIMED THAT IT HAD A GODOWN AT KHASRA NO. 34/7, VILLAGE DERA MANDI, TEHSIL MEHRAULI, NEW DELHI, WHICH WAS NOT GIVEN FAV OUR TO, BEING NOT VERIFIABLE DUE TO LAPSE OF SO MANY YEARS AND THAT NO SUCH DECL ARATION WAS MADE EITHER IN THE COURSE OF SEARCH OR POST SEARCH ENQUIRIES. ON THE B ASIS OF THESE STATEMENTS, THE ASSESSING OFFICER WAS OF THE VIEW THAT THE ASSESSEE COMPANY WAS A CAPITAL FORMATION COMPANY ONLY AND MADE THE ADDITIONS CONCL UDING AS UNDER : 8. IN THE CASE OF PRESENT ASSESSEE ALL THE PURCHASE S & SALES ARE IN CASH. THE ITEMS PURCHASED & SOLD ARE TEXTILE & FABRICS. THE NA ME AND STYLE OF THE TEXTILES & FABRICS ARE 'DENIM, FABRICS K-III SUPER FINE (N), FABRIC (PS), FABRIC (PS) EMBROIDERY, FABRIC (PS) EXCEL, FABRICS, KASHMIRI FA BRICS-I, KASHMIRI FABRICS- I(D)' ETC. FROM THESE ITEMS IT CAN BE SEEN THAT THE ASSESSEE IS NOT DEALING IN BRANDED ITEMS. THERE IS NO NAME OF ANY COMPANY IN TH ESE PRODUCTS. SHAWLS ARE PURCHASED AND SOLD IN PIECES AND REST OTHER ITE MS ARE SOLD IN METERS. IT IS FURTHER SEEN THAT THE PURCHASES & SALES ARE WITHIN M/S THAPAR HOMES GROUP OF CASES. IN INVENTORIES OF FABRIC & TEXTILE GOODS S HOWN IN THE BALANCE SHEET THE CLOSING STOCK OF LAST YEAR STANDS AT RS. 17,22,87,423/-. THIS YEAR THE FIGURE IS RS. 17,21,92,807/- WHICH US ALMOST THE SAME. THEREFORE, PURCHASES & SALES ARE ONLY OUT OF CURRENT YEAR 'TRANSACTIONS' WHICH ARE HELD UNVERIFIABLE AND BOGUS. IT IS HIGHLY IMPROBABLE THAT WITH A HUGE STOCK INVENTORY OF GOODS WHICH CHANGE IN FASHION AND TASTE THE ASSESSEE HAS TO MAKE SALES FROM FRESH PURCHASES ONLY. THE PREPONDERANCE OF PROBABILITY SUG GESTS THAT THE STOCKS ARE NOT GENUINE BUT SINCE THESE ARE DECLARED PRIOR TO 1 .4.02, NO ACTION IS BEING TAKEN FOR NOW. 9. KEEPING IN VIEW THE FACTS OF THE CASE AND REPLY OF THE ASSESSEE, IT IS CRYSTAL CLEAR THAT ALL CASH PURCHASES ARE UNVERIFIA BLE AND HENCE A SUM OF RS. 32,91,900/- IS DISALLOWED. (THE OPENING STOCK IS OF THE PERIOD B EFORE THE BLOCK ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 6 PERIOD OF SECTION 153C). PENALTY PROCEEDINGS U/S 27 1(C) ARE BEING INITIATED FOR FURNISHING INACCURATE PARTICULARS OF INCOME. SINCE, THE ENTIRE CASH PURCHASES OF RS. 32,91,900/- ARE BOGUS AND ARE BROUGHT TO TAX AS UNACCOUNTED EXPENDITURE U/S 69C OF THE IT ACT, NO FURTHER ADDITION IS MADE U/S 40A(3) OF THE IT ACT SINCE THE ENTIRE AMOU NT OF CASH PURCHASES IS BROUGHT TO TAX. 10. SIMILARLY, THE EXPENSES CLAIMED BY THE ASSESSEE COMPANY IN P & L A/C ARE ALSO UNVERIFIABLE AS SUCH 100% OF THE EXPENSES ARE DISALLOWED. PENALTY PROCEEDINGS U/S 271(C) ARE BEING INITIATED FOR FURN ISHING INACCURATE PARTICULARS OF INCOME. 6. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A), WHO AFTER CONSIDERING THE DETAILED SUBMISSIONS OF THE ASSESSEE, ORDER OF THE ASSESSING OFFICER, VARIOUS C ASE LAWS AND ATTENDING FACTS OF THE CASE, REJECTED THE CLAIM OF ASSESSEE ON VALIDIT Y OF PROCEEDINGS U/S. 153C AND ON MERITS, THE LD. CIT(A) DELETING THE ADDITION MAD E BY ASSESSING OFFICER DIRECTED TO WORK OUT THE PEAK FROM THE ENTRIES IN THE CASH B OOK OF THE ASSESSEE FOR THE RELEVANT YEAR AND MAKE A SINGULAR ADDITION OF THE S AID AMOUNT, AS UNEXPLAINED INVESTMENT/EXPENDITURE. AGGRIEVED, THE REVENUE BY M EANS OF THESE APPEALS HAS CHALLENGED THE FINDING OF THE LD. CIT(A) ON MERITS OF THE ADDITIONS WHEREAS THE ASSESSEE, BY MEANS OF CROSS OBJECTIONS, HAS CHALLEN GED THE IMPUGNED ORDER BOTH ON LEGAL GROUNDS ON VALIDITY OF PROCEEDINGS U/S. 15 3C AND THE MERITS OF ADDITION ON THE FOLLOWING COMMON GROUNDS : EFFECTIVE GROUNDS RAISED IN REVENUES APPEAL : ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 7 1. THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.32,91,900/- ON ACCOUNT OF UNEXPLAINED PURCHASE U/S. 69C OF THE ACT. 2. THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.4,11,229/- ON ACCOUNT O F DISALLOWANCE OF EXPENDITURE. GROUNDS RAISED IN ASSESSEES CROSS OBJECTIONS: 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE CIT(A) HAS FAILED TO APPRECIATE THAT NOTICE ISSUED U/S. 153C AND ASSESSMENT ORDER PASSED BY THE AO U/S. 153C/143(3) IS ILLEGAL, TIME BARRED, BAD IN LAW AND WITHOUT JURISDICTION. THE ADDITIONS M ADE ARE UNJUST, UNLAWFUL AND ARBITRARY AND ARE MADE AGAINST THE PRINCIPLES O F NATURAL JUSTICE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE CIT (A) HAS FAILED TO APPRECIATE THAT THE A O WAS NOT JUSTIFIED TO IGNORE THE SUBMISSION OF THE ASSESSEE COMPANY THAT THE ASS ESSMENT PROCEEDINGS FOR THE YEAR UNDER APPEAL WAS NOT PENDING ON THE DATE O F THE RECORDING OF SATISFACTION U/S. 153C AND SINCE THE SAME DIDN'T AB ATE, THE PROCEEDINGS U/S. 153C OF THE INCOME TAX ACT IN THIS CASE ARE BAD IN L AW AND DESERVES TO BE QUASHED. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE CIT (A) HAS FAILED TO APPRECIATE THAT THE ASSESSMENT FRAMED BY THE AO IS AGAINST THE STATUTORY PROVISIONS OF THE ACT AND WITHOUT COMPLYING THE PROCEDURES PRESCRIBED U/S. 153C OF THE INCOME TAX AC T AND AS SUCH THE ASSESSMENT BEING BAD IN LAW DESERVES TO BE QUASHED. 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE CIT (A) HAS FAILED TO APPRECIATE THAT THE A O WAS NOT JUSTIFIED TO IGNORE THE SUBMISSION THAT ASSESSMENT U/S. 153C OF THE INC OME TAX ACT BE RESTRICTED TO ASSESSMENT IN RESPECT OF SEIZED DOCUMENTS OF INC RIMINATING NATURE FOR THE YEAR UNDER CONSIDERATION AND IN ABSENCE OF ANY INCR IMINATING SEIZED DOCUMENT, ASSESSMENT FRAMED U/S. 153C OF THE INCOME TAX ACT FOR THE YEAR UNDER CONSIDERATION, IS BAD IN LAW AND DESERVE TO B E QUASHED. ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 8 5. THAT IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT (A) HAS ERRED IN HOLDING THE CONCLUSION THAT THE 'AUDITED B OOKS' NOTWITHSTANDING, THE BOOK RESULTS ARE REQUIRED TO BE REJECTED, SINCE THE NARRATIONS ARE ARTIFICIAL, SHAM AND NOT REFLECTIVE OF THE ACTUAL BUSINESS / CO MMERCIAL TRANSACTIONS. 6. THAT IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE, CIT (A) HAS ERRED IN DISREGARDING THE PURCHASES, THE SALES AND THE EX PENSES CLAIMED BY THE ASSESSEE COMPANY. 7. THAT IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, CIT (A) HAS ERRED IN WRONGLY DIRECTING THE A O TO WORK OUT THE PEAK FROM THE ENTRIES IN THE CASH BOOK OF THE ASSESSEE C OMPANY FOR THE RELEVANT YEAR AND MAKE A SINGULAR ADDITION OF THE SAID AMOUN T, AS UNEXPLAINED INVESTMENT/EXPENDITURE, IGNORING THE FACT THAT THE SAME HAVE BEEN DULY ENTERED/DISCLOSED IN THE BOOKS OF ACCOUNTS OF THE A SSESSEE COMPANY. 8. THAT THE CIT (A) HAS WRONGLY DIRECTED THE AO TO WORK OUT THE PEAK FROM THE ENTRIES IN THE CASH BOOK OF THE ASSESSEE COMPAN Y FOR THE RELEVANT YEAR, WITHOUT GRANTING THE CREDIT OF THE PEAK OF FINANCIA L TRANSACTIONS AS PER THE CASH BOOK FOR THE PRECEDING YEAR, THUS, IGNORING TH E CONCEPT OF 'REAL INCOME'. 9. THAT ON THE FACTS AND CIRCUMSTANCES OF THE C ASE, THE VARIOUS OBSERVATIONS AND FINDINGS OF THE CIT (A) AND THE AO IN THE IMPUGN ED APPELLATE ORDER AND ASSESSMENT ORDER, RESPECTIVELY IS IRRELEVANT AND VI TIATED IN THE LAW. 10. THAT THE CIT (A) HAS ERRED IN IGNORING THE FAC T THAT THE AO HAS ERRED BOTH ON FACTS AND IN LAW, IN USING STATEMENT OF VARIOUS PERSONS WITHOUT GIVING A COPY OF THE SAME AND OPPORTUNITY TO CROSS EXAMINE. 11. THAT THE CIT (A) HAS ERRED IN IGNORING THE E XPLANATION GIVEN, EVIDENCES AND MATERIAL PLACED AND AVAILABLE ON RECORD. THE SAM E HAS NOT BEEN PROPERLY CONSIDERED AND JUDICIALLY INTERPRETED AND THE SAME DO NOT JUSTIFY THE ADDITIONS/DISALLOWANCES MADE. THE ADDITIONS HAVE BEE N SUSTAINED WITH PRESET MIND OF THE CIT (A) AND HER ORDER IS BASED ON SURMIS ES, CONJECTURES AND SUSPICION. 12. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE INTEREST CHARGED U/S. 234A AND 234B HAS BEEN WRONGLY AND ILLEGALLY CHARGE D AND IN ANY CASE IS HIGHLY EXCESSIVE. ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 9 7. WE DEEM IT APPROPRIATE FIRST TO DEAL WITH THE LE GAL ISSUES RAISED BY THE ASSESSEE IN ITS CROSS OBJECTIONS ON INITIATION OF P ROCEEDINGS U/S. 153C OF THE IT ACT. 8. THE FIRST CHALLENGE TO THE VALIDITY OF PROCEEDIN GS MADE BY THE LD. AR IS BASED ON THE ARGUMENTS THAT IN THE INSTANT CASE NO SATISF ACTION HAS BEEN RECORDED BY THE ASSESSING OFFICER IN THE STATUS OF ASSESSING OFFICE R OF SEARCHED PERSON THAT THE IMPUGNED DOCUMENTS FOUND DURING THE SEARCH BELONGS TO THE ASSESSEE, BUT THE SATISFACTION, WHATSOEVER, RECORDED IN THE INSTANT C ASE WAS IN THE STATUS OF ASSESSING OFFICER OF THE ASSESSEE, THE PERSON OTHER THAN THE PERSON SEARCHED. IT IS ALSO SUBMITTED THAT VARIOUS APPLICATIONS SEEKING IN FORMATION ON THE SATISFACTION NOTE UNDER RTI ACT WERE GIVEN BY THE ASSESSEE, BUT NO REPLIES THEREOF WERE RECEIVED BY THE ASSESSEE. HE SUBMITTED THAT THE SAT ISFACTION NOTE BY THE A.O. OF SEARCHED PERSON IS A CONDITION PRECEDENT FOR INITIA TING PROCEEDINGS U/S 153C OF THE ACT AGAINST THE PERSON OTHER THAN THE SEARCHED PERSON. IN THE INSTANT CASE, SINCE THE STATUTORY SATISFACTION HAS NOT BEEN SO RE CORDED, THE ASSESSING OFFICER OF THE ASSESSEE IS NOT ENTITLED TO ACQUIRE JURISDICTIO N FOR INITIATING PROCEEDINGS U/S. 153C AS PER LAW. IT WAS ALSO SUBMITTED THAT IN THE FOLLOWING CASES OF ASSESSEE GROUP, THE SAME SATISFACTION NOTE, AS RECORDED IN T HE INSTANT CASE, HAS BEEN TREATED BY THE ITAT, DELHI BENCHES, TO HAVE BEEN RECORDED I N THE CASE OF ASSESSEE AND NOT IN THE CASE OF PERSON SEARCHED AND THE ASSESSING OF FICER HAS BEEN HELD TO HAVE NO JURISDICTION TO INITIATE PROCEEDINGS U/S 153C OF TH E ACT : ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 10 (I). DCIT VS. SATKAR MOTORS (ITA NOS. 6398 TO 6403/ DEL/2013) AND CO NOS.359 TO364/DEL./14) ORDER DATED 29.10.2015. (II) TANVIR COLLECTIONS, 168 TTJ 145 (ITAT H BENCH) (III). DCIT VS. IVAN INFOTECH PVT. LTD. (ITA NOS. 1 8 TO 23/DEL./2014) AND CO NOS. 272 TO 277/DEL./2014) ORDER DATED 31.08.2016 A ND MANY OTHER DECISIONS OF ITAT DELHI BENCHES IN OTHER GROUP CASE S. (IV). ACIT VS. SALDI CHITS PVT. LTD. (ITA NOS. 6697 TO 6699/DEL/13 AND CO 396 TO 398/DEL./14 ORDER DATED 11.08.17-ITAT DELHI BENCH) (IV). SINHGAD TECHNICAL EDUCATION SOCIETY (CIVIL AP PEAL NO.11080 OF 2017) (SUPREME COURT) (V). PR. CIT VS. INDEX SECURITIES PVT. LTD. (ITA NO . 571/2017)(DELHI HC) 9. ON THE OTHER HAND, THE LD. DR RELIED ON THE ORDE R OF THE LD. CIT(A) ON THIS ASPECT OF THE CASE. THE LD. DR ALSO RELIED ON SOME CASE LAWS WHICH ARE PLACED ON RECORD. 10. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HA VE GONE THROUGH THE ENTIRE MATERIAL AVAILABLE ON RECORD. BEFORE WE DECIDE THIS ISSUE, IT IS APPROPRIATE TO REPRODUCE THE SATISFACTION RECORDED BY THE ASSESSIN G OFFICER ON 08.09.2010 AS UNDER : IN THE CASE OF SHRI B.K. DHINGRA, SMT. POONAM DHING RA AND M/S. MATHUSUDAN BUILDCON PVT. LTD., SEARCH & SEIZURE TOOK PLACE U/S . 132 ON 20.10.2008.THE UNDERSIGNED IS THE JURISDICTIONAL A.O. OF THESE CAS ES. DURING THE COURSE OF SEARCH & SEIZURE DOCUMENTS/PAPERS AT PAGES 182 TO 1 88 OF ANNEXURE A-30, PAGES 119 TO 168 OF ANNEXURE A-25, PAGE 16 TO 19 AN D PAGES 30 TO 35 OF ANNEXURE A-3, PAGES 27 TO 30 OF ANNEXURE A-6, ANNEX URES 17, 36 AND 40, SEIZED BY PARTY R-2, AND PAGE 15 TO 55 OF ANNEXURE AA-1 AND PAGE 1 TO 75 OF ANNEXURE AA-2 ARE FOUND TO BELONG TO M/S. D. BASE C ONSULTANT PVT. LTD., B-340, HARI NAGAR, NEW DELHI. I HAVE EXAMINED THE ABOVE ME NTIONED DOCUMENTS/PAPERS AND PROVISION OF SECTION 153C IS I NVOKEABLE IN THIS CASE. AS THE UNDERSIGNED IS ALSO THE JURISDICTIONAL A.O. OF M/S. D. BASE CONSULTANT PVT. ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 11 LTD., B-340, HARI NAGAR, NEW DELHI, THIS SATISFACTI ON NOTE IS PLACED IN THE FILE BEFORE ISSUING NOTICE U/S. 153C. 11. IT IS SIGNIFICANT TO NOTE THAT THE ITAT DELHI B ENCHES IN DIFFERENT OTHER CASES OF THE GROUP, NO DOUBT, HAS TREATED THE SAME TEXT O F SATISFACTION NOTE TO HAVE BEEN RECORDED IN THE CASE OF OTHER THAN SEARCHED PERSONS AND NOT IN THE CASE OF PERSON SEARCHED. IT IS, HOWEVER, ALSO A FACT ON RECORD THA T THE HONBLE JURISDICTIONAL HIGH COURT IN OTHER CASE OF THE ASSESSEE GROUP, I.E., PR . CIT VS. INSTRONICS LTD., (2017) 82 TAXMANN.COM 357 (DELHI), RELIED BY THE LD. DR, HAS HELD THE VERY SAME SATISFACTION NOTE AS RECORDED IN THE CASE OF PERSON SEARCHED AND VALID FOR ACQUIRING JURISDICTION U/S. 153C OF THE ACT. THE OBSERVATIONS OF THE HONBLE JURISDICTIONAL HIGH COURT READ AS UNDER : 15. IN THE PRESENT CASE, THE ITAT OVERLOOKED THE FA CT THAT THE SATISFACTION NOTE WAS IN FACT RECORDED BY THE AO OF THE SEARCHED PERSON WHO ALSO HAPPENED TO BE THE AO FOR THE ASSESSEE (THE OTHER P ERSON) AS WELL. THIS IS CLEAR FROM THE SENTENCE IN THE SATISFACTION NOTE WHICH RE ADS: 'THE UNDERSIGNED IS THE JURISDICTIONAL AO OF THESE CASES.' THE AO OF THE SEARCHED PERSON HAS RECORDED THE SATISFACTION THAT THE SEIZED DOCUMENTS BELONGED TO THE ASSESSEE. IN SIMILAR CIRCUMSTANCES IN SATKAR FINCAP LTD. (SUP RA), THIS COURT HELD LIKEWISE. THE SATISFACTION NOTE IN THE PRESENT CASE, THEREFORE, SATISFIES THE REQUIREMENT OF THE LAW. CONSEQUENTLY, THE QUESTION FRAMED IS ANSWERED IN THE NEGATIVE I.E., IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE. IN VIEW OF ABOVE INTERPRETATION OF HONBLE JURISDIC TIONAL HIGH COURT ON THE IMPUGNED TEXT OF SATISFACTION NOTE, WE HAVE NO REAS ON TO ACCEPT THE CONTENTION OF THE ASSESSEE THAT THE SAID SATISFACTION NOTE WAS RE CORDED IN THE CASE OF ASSESSEE ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 12 AND NOT IN THE CASE OF PERSON SEARCHED AS REQUIRED BY LAW. BESIDES, NO SPECIFIC GROUND HAS BEEN HAS BEEN RAISED IN THE CROSS OBJECT ION ON THE SATISFACTION NOTE IN PARTICULAR. ACCORDINGLY, THIS ISSUE IS DECIDED AGAI NST THE ASSESSEE AND WE FIND NO JUSTIFICATION TO DISTURB THE FINDINGS REACHED BY TH E LD. CIT(A) ON THIS COUNT. 12. THE NEXT CONTENTION OF THE ASSESSEE HAS BEEN TH AT THE ASSESSMENT ORDERS FOR A.YRS. 2003-04 AND 2004-05 U/S. 153C ARE BARRED BY LIMITATION. REFERRING TO THE FIRST PROVISO TO SECTION 153C, IT WAS SUBMITTED THA T THIS PROVISO CONSTRUES THE DATE OF INITIATION OF SEARCH AS THE DATE OF RECEIVING TH E BOOKS OF ACCOUNT/DOCUMENT/SEIZED MATERIAL IN CASES OF 'SUCH OTHER PERSON'. IN THE PRESENT CASE, SINCE THE SATISFACTION FOR INITIATION OF THE PROCEEDINGS U/S 153C WAS RECORDED BY THE AO IN THE MONTH OF SEPTEMBER, 2010 ON 25.09.2010 (I.E. A.Y. 2011-12), WHICH MAY BE ASSUMED AS THE MONTH OF RECE IVING THE BOOKS/SEIZED MATERIAL, THEREFORE, ASSESSMENT U/S 153C COULD BE U NDERTAKEN UP TO 6 FINANCIAL YEARS PRIOR TO SEPTEMBER 2010, WHICH WOULD INCLUDE FINANCIAL YEARS RELEVANT TO ASSESSMENT YEARS 2005-06 TO 2010-11. IT WAS, THEREF ORE, SUBMITTED THAT A. YRS. 2003-04 AND 2004-05 WERE OUTSIDE THE PURVIEW OF SEC TION 153C. THE ASSESSEE HAS, INTER ALIA, RELIED ON THE DECISION IN ONE OF T HE GROUP CASES, I.E., CIT VS. RRJ SECURITIES LTD., 380 ITR 612(DELHI), RENDERED BY HO NBLE JURISDICTIONAL HIGH COURT. ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 13 13. ON THE OTHER HAND, THE LD. DR, REITERATED THE F INDINGS REACHED BY THE LD. CIT(A) ON THIS COUNT IN THE IMPUGNED ORDER AND RELI ED ON SOME DECISIONS, WHICH ARE PLACED ON RECORD. 14. HAVING CONSIDERED THE RIVAL SUBMISSIONS AND GON E THROUGH THE ENTIRE MATERIAL AVAILABLE ON RECORD, WE FIND THAT THIS ISS UE INVOLVED IN CROSS OBJECTIONS OF ASSESSEE FOR A.YRS. 2003-04 AND 2004-05 IS COVERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE BY THE DECISION OF HONBLE JURI SDICTIONAL HIGH COURT RENDERED IN ONE OF THE ASSESSEES GROUP CASES, RRJ SECURITIE S LTD. (SUPRA), WHEREIN AFTER CONSIDERING THE PROVISOS TO SECTIONS 153A AND 153C OF THE ACT, THE HONBLE JURISDICTIONAL HIGH COURT HAS OBSERVED AS UNDER : AS DISCUSSED HEREINBEFORE, IN TERMS OF PROVISO TO SECTION 153C OF THE ACT, A REFERENCE TO THE DATE OF THE SEARCH UNDER THE SECON D PROVISO TO SECTION 153A OF THE ACT HAS TO BE CONSTRUED AS THE DATE OF HANDING OVER OF ASSETS/DOCUMENTS BELONGING TO THE ASSESSEE (BEING THE PERSON OTHER T HAN THE ONE SEARCHED) TO THE AO HAVING JURISDICTION TO ASSESS THE SAID ASSES SEE. FURTHER PROCEEDINGS, BY VIRTUE OF SECTION 153C(1) OF THE ACT, WOULD HAVE TO BE IN ACCORDANCE WITH SECTION 153A OF THE ACT AND THE REFERENCE TO THE DA TE OF SEARCH WOULD HAVE TO BE CONSTRUED AS THE REFERENCE TO THE DATE OF RECORD ING OF SATISFACTION. IT WOULD FOLLOW THAT THE SIX ASSESSMENT YEARS FOR WHICH ASSE SSMENTS/REASSESSMENTS COULD BE MADE UNDER SECTION 153C OF THE ACT WOULD A LSO HAVE TO BE CONSTRUED WITH REFERENCE TO THE DATE OF HANDING OVER OF ASSET S/DOCUMENTS TO THE AO OF THE ASSESSEE. IN THIS CASE, IT WOULD BE THE DATE OF THE RECORDING OF SATISFACTION UNDER SECTION 153C OF THE ACT, I.E., 8TH SEPTEMBER, 2010. IN THIS VIEW, THE ASSESSMENTS MADE IN RESPECT OF ASSESSMENT YEAR 2003 -04 AND 2004-05 WOULD BE BEYOND THE PERIOD OF SIX ASSESSMENT YEARS AS REC KONED WITH REFERENCE TO THE DATE OF RECORDING OF SATISFACTION BY THE AO OF THE SEARCHED PERSON. IT IS CONTENDED BY THE REVENUE THAT THE RELEVANT SIX ASSE SSMENT YEARS WOULD BE THE ASSESSMENT YEARS PRIOR TO THE ASSESSMENT YEAR RELEV ANT TO THE PREVIOUS YEAR IN ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 14 WHICH THE SEARCH WAS CONDUCTED. IF THIS INTERPRETAT ION AS CANVASSED BY THE REVENUE IS ACCEPTED, IT WOULD MEAN THAT WHEREAS IN CASE OF A PERSON SEARCHED, ASSESSMENTS IN RELATION TO SIX PREVIOUS YEARS PRECE DING THE YEAR IN WHICH THE SEARCH TAKES PLACE CAN BE REOPENED BUT IN CASE OF A NY OTHER PERSON, WHO IS NOT SEARCHED BUT HIS ASSETS ARE SEIZED FROM THE SEARCHE D PERSON, THE PERIOD FOR WHICH THE ASSESSMENTS COULD BE REOPENED WOULD BE MU CH BEYOND THE PERIOD OF SIX YEARS. THIS IS SO BECAUSE THE DATE OF HANDING OV ER OF ASSETS/DOCUMENTS OF A PERSON, OTHER THAN THE SEARCHED PERSON, TO THE AO W OULD BE SUBSEQUENT TO THE DATE OF THE SEARCH. THIS, IN OUR VIEW, WOULD BE CONT RARY TO THE SCHEME OF SECTION 153C(1) OF THE ACT, WHICH CONSTRUES THE DAT E OF RECEIPT OF ASSETS AND DOCUMENTS BY THE AO OF THE ASSESSEE (OTHER THAN ONE SEARCHED) AS THE DATE OF THE SEARCH ON THE ASSESSEE. THE RATIONALE APPEARS TO BE THAT WHEREAS IN THE CASE OF A SEARCHED PERSON THE AO OF THE SEARCHED PE RSON ASSUMES POSSESSION OF SEIZED ASSETS/DOCUMENTS ON SEARCH OF THE ASSESSEE; THE SEIZED ASSETS/DOCUMENTS BELONGING TO A PERSON OTHER THAN A SEARCHED PERSON COME INTO POSSESSION OF THE AO OF THAT PERSON ONLY AFTER THE AO OF THE SEARCHED PERSON IS SATISFIED THAT THE ASSETS/DOCUMENTS DO NO T BELONG TO THE SEARCHED PERSON. THUS, THE DATE ON WHICH THE AO OF THE PERSON OTHER THAN THE ONE SEARCHED ASSUMES THE POSSESSION OF THE SEIZED ASSET S WOULD BE THE RELEVANT DATE FOR APPLYING THE PROVISIONS OF SECTION 153A OF THE ACT. WE, THEREFORE, ACCEPT THE CONTENTION THAT IN ANY VIEW OF THE MATTE R, ASSESSMENT FOR AY 2003- 04 AND AY 2004-05 WERE OUTSIDE THE SCOPE OF SECTION 153C OF THE ACT AND THE AO HAD NO JURISDICTION TO MAKE AN ASSESSMENT OF THE ASSESSEES INCOME FOR THAT YEAR. THEREFORE, RESPECTFULLY FOLLOWING THE PRINCIPLE OF LAW LAID DOWN BY HONBLE JURISDICTIONAL HIGH COURT IN THE ABOVE DECISION, WE HAVE NO HESITATION TO CONCLUDE THAT THE ASSESSMENTS MADE BY THE ASSESSING OFFICER U/S. 153C OF THE ACT FOR A.YRS. 2003-04 AND 2004-05 ARE BEYOND THE SCOPE OF SECTION 153C AND THE SAME BEING VOID AB INITIO DESERVE TO BE QUASHED. ACCORDINGLY, THE CROSS OBJECTIONS OF THE ASSESSEE FOR A.YRS. 2003-04 AND 2004-05 DESERVE TO BE ALLOWED ON THIS LEGAL ISSUE ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 15 ONLY AND SINCE THE ASSESSMENTS FOR THESE YEARS ARE HELD AS VOID, THE APPEALS OF THE REVENUE FOR THESE YEARS DESERVE TO FAIL. 15. ADVERTING TO THE MERITS OF ADDITIONS CHALLENGED BY THE REVENUE AND BY ASSESSEE IN REMAINING APPEALS AND CROSS OBJECTIONS, WE FIND THAT ON THE IDENTICAL CONTENTIONS OF THE PARTIES AND SIMILAR FACTS AND CI RCUMSTANCES OF THE CASE, THE ITAT, DELHI BENCHES ON THE BASIS OF SAME SEARCH DAT ED 20.10.2008, HAS DECIDED THE MERITS OF SAME ADDITIONS MADE ON THE BASIS OF S IMILAR DOCUMENTS FOUND, IN THE CASE OF ASSESSEES GROUP, DCIT VS. M/S. DEVI DAYAL PETROCHEMICALS PVT. LTD. (REVENUES APPEAL NOS. 5430 TO 5436/DEL./2013) AND ASSESSEES CROSS OBJECTIONS NOS. 83 TO 88/DEL./2014) FOR A.YRS. 2003-04 TO 2008 -09, HAVE RESTORED THE ISSUE BACK TO THE FILE OF ASSESSING OFFICER VIDE ORDER DA TED 10.09.2014 OBSERVING AS UNDER : LD. COUNSEL OF THE ASSESSEE FURTHER STATED THAT A SSESSMENT FRAMED IS AGAINST THE SCHEME OF THE ACT WHEREBY THE REASSESSMENT U/S. 153C IN SU CH CASES IS TO BE CONFINED TO THE ADDITIONS AND DISALLOWANCES CONSEQUENT TO THE MATER IAL FOUND DURING THE COURSE OF THE SEARCH. THE ADDITIONS WHICH ARE NOT BASED ON ANY IN CRIMINATING MATERIAL FOUND DURING SEARCH ARE LIABLE TO BE DELETED. HE ALSO SUBMITTED THAT THE REVENUE AUTHORITIES HAVE ERRED IN LAW AND ON FACTS IN HOLDING THAT THE AUDIT ED BOOKS AND TRANSACTIONS THROUGH BANK NOWITHSTANDING, THE BOOK RESULTS ARE REQUIRED TO BE REJECTED, SINCE THE ENTRIES ARE ARTIFICIAL, SHAM AND NOT REFLECTIVE OF ACTUAL BUSIN ESS / COMMERCIAL TRANSACTIONS. LD. COUNSEL OF THE ASSESSEE FILED A PAPER BOOK HAVING PAGES 1 T 27 CONTAINING THE ASSESSMENT RECORDS ETC. AND DRAW OUR ATTENTION TOWA RDS THE PAGE NO. 1 OF THE SAME PAPER BOOK VIZ. SATISFACTION NOTE DATED 5.7.2010 FOR ISSUING NOTICE U/S. 153C OF THE I.T. ACT, 1961 TO THE ASSESSEE FOR THE ASSESSMENT YEARS 2003-04 TO 2008-09 AND STATED THAT DOCUMENTS AT PAGES 1 TO 25 OF ANNEXURE A-25 SEIZED BY THE DEPARTMENT ARE THE CHEQUE BOOK WHICH ARE NOT RELATED TO THE ASSESSMENT YEAR 2003-04 TO 2008-09 AND ALSO SUBMITTED THAT THE SAME HAS ALREADY BEEN ACCOUNTED FOR IN THE BOOKS OF ACCOUNTS BY THE ASSESSEE. HE ALSO DRAW OUR ATTENTION TOWARDS THE DE CISION DATED 29.3.2012 OF THE HONBLE DELHI HIGH COURT DELIVERED IN THE CASE OF SSP AVIATION LTD. VS. DEPUTY ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 16 COMMISSIONER OF INCOME TAX [2012] 346 ITR 177 (DELH I) IN SUPPORT OF ITS CASE. LD. COUNSEL OF THE ASSESSEE ALSO SUBMITTED THAT THE V IEW TAKEN BY THE HONBLE HIGH COURT IS FORTIFIED BY THE LEGISLATIVE AMENDMENT MADE BY THE FINANCE ACT, 2014 IN SECTION 153C OF THE INCOME TAX ACT, 1961. ACCORDINGLY, LD. CO UNSEL OF THE ASSESSEE REQUESTED THAT THE ISSUES INVOLVE IN THE ASSESSEES CROSS OBJECTIONS AND IN THE REVENUES APPEALS MAY BE SET ASIDE TO THE ASSESSING OFFICER TO VERIFY WHETH ER THE SEIZED DOCUMENTS MENTIONED IN THE SATISFACTION NOTE DATED 5.7.2010 RELATING TO THE ASSESSEE ON WHICH NOTICE U/S. 153C HAS BEEN ISSUED TO THE ASSESSEE AND IF THESE D OCUMENTS NAMELY THE CHEQUES HAVE ALREADY BEEN ACCOUNTED FOR IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE AND ARE NOT RELATING TO THE PERIOD I.E. ASSTT. YEAR 2003-04 TO 2008-09, THEN THE PROCEEDINGS U/S. 153C MAY BE CANCELLED, OTHERWISE, THE ASSESSING OFFICER MAY TAK E ACTION, AS PER LAW. 8. ON THE OTHER HAND, LD. DEPARTMENT REPRESENTATIV E RELIED UPON THE ORDER OF THE ASSESSING OFFICER AND SHE OPPOSE THE REQUEST OF T HE ASSESSEES COUNSEL. 9. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE R ECORDS. WE HAVE ALSO GONE THROUGH THE ORDERS OF THE LOWER AUTHORITIES, PAPER BOOK FILED BY THE ASSESSEE AND THE CASE LAW RELIED UPON BY THE ASSESSEE. WE FIND THAT LD. COUNSEL OF THE ASSESSEE FILED A PAPER BOOK HAVING PAGES 1 TO 27 CONTAINING THE ASSESSMENT RECORDS ETC. AND HE DRAWN OUR ATTENTION TOWARDS THE PAGE NO. 1 OF THE SAME PA PER BOOK VIZ. SATISFACTION NOTE DATED 5.7.2010, THE SAME IS REPRODUCED HERE-BELOW:- SATISFACTION NOTE FOR ISSUING NOTICE U/S. 153C OF THE I.T. ACT, 1961 IN THE CASE OF M/S DEVI DAYAL PETRO CHEMICALS PVT. LTD., LANE W-17-A, HOUSE NO. 18, WESTERN AVENUE, SAINIK FARM SOUTH, NEW DELHI, AACCD454J FOR A.Y. 2003-04 TO 200 8-09. 05/7/2010 DOCUMENTS AT PAGES 1 TO 25 OF ANNEXURE A -25 SEIZED BY THE PARTY R-2 FROM THE PREMISES AT F-6/5, VASANT VIHAR, NEW DELHI DURING THE COURSE OF SEARCH CONDUCTED U/S. 132 OF THE I.T. ACT, 1961 ON 20.10.2 008 IN THE CASE OF SH. BK DHINGRA, SMT. POONAM DHINGRA, M/S MADHUSUDAN BUILDCON PVT. L TD. HAVE BEEN FOUND TO BELONG TO M/S DEVI DAYAL PETRO CHEMICALS PVT. LTD., LANE W-17-A, HOUSE NO. 18, WESTERN AVENUE, SAINIK FARM SOUTH, NEW DELHI WHICH HAS NOT BEEN COVERED U/S. 132 OF THE I.T. ACT, 1961. ACCORDINGLY, IN TERMS OF PRO VISIONS OF SECTION 143C OF THE ACT, NOTICES U/S. 153C ARE HEREBY ISSUED FOR THE A.Y. 20 03-04 TO 200809 IN THE CASE OF M/S DEVI DAYAL PETRO CHEMICALS PVT. LTD.. THE CASE WAS CENTRALIZED IN THE CENTRAL CIRCLE-17, NEW DELHI VIDE ORDERS DATED 14.12.2009 O F CIT-IV, NEW DELHI. SD/- DATED 5.7.10 DCIT, CENTRAL CIRCLE-17, NEW 9.1 IT WAS CONTENDED BY THE LEARNED COUNSEL THAT TH E DOCUMENTS MENTIONED BY THE ASSESSING OFFICER IN THE SATISFACTION NOTE I.E. DOC UMENTS AT PAGES 1 TO 25 OF ANNEXURE A-5 ARE ONLY THE COUNTERFOIL OF THE CHEQUE BOOK WHICH I S DULY ACCOUNTED FOR IN THE BOOKS OF ACCOUNT. HE HAD ALSO CONTENDED THAT THE COUNTERFOI L BELONGED TO THE YEAR 2008-09 AND, THEREFORE, THE PROCEEDINGS UNDER SECTION 153C COULD NOT HAVE BEEN INITIATED FOR THE YEARS TO WHICH THE DOCUMENTS DO NOT BELONG AND EVEN AFTER INITIATING PROCEEDINGS TO THE YEAR TO WHICH THE DOCUMENTS BELONGED, THE ASSESSING OFFICER OUGHT TO HAVE DROPPED THE ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 17 PROCEEDINGS BECAUSE ALL TRANSACTIONS REFLECTED BY T HE COUNTERFOILS BY THE CHEQUES IS DULY ACCOUNTED FOR. IN SUPPORT OF THIS CONTENTION, HE H AD RELIED UPON THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SSP AVIATI ON LTD. 346 ITR 177. AT PAGE 189 OF THE REPORT IN PARAGRAPH 17, THEIR LORDSHIPS HELD AS UNDER:- THE SECTION MERELY ENABLES THE REVENUE AUTHORITIES TO INVESTIGATE INTO THE CONTENTS OF THE DOCUMENT SEIZED, WHICH BELONGS TO A PERSON OTHER THAN THE PERSON SEARCHED SO THAT IT CAN BE ASCERTAINED W HETHER THE TRANSACTION OR THE INCOME EMBEDDED IN THE DOCUMENT HAS BEEN ACC OUNTED FOR IN THE CASE OF THE APPROPRIATE PERSON. IT IS AIMED AT ENS URING THAT INCOME DOES NOT ESCAPE ASSESSMENT IN THE HANDS OF ANY OTHER PER SON MERELY BECAUSE HE HAS NOT BEEN SEARCHED UNDER SECTION 132 OF THE ACT. IT IS ONLY A FIRST STEP TO THE ENQUIRY, WHICH IS TO FOLLOW. THE ASSESSING OFF ICER WHO HAS SEARCHED THE SATISFACTION THAT THE DOCUMENT RELATES TO A PER SON OTHER THAN THE SEARCHED PERSON CAN DO NOTHING EXCEPT TO FORWARD TH E DOCUMENT TO THE ASSESSING OFFICER HAVING JURISDICTION OVER THE OTHE R PERSON AND THEREAFTER IT IS FOR THE ASSESSING OFFICER HAVING JURISDICTION OVER THE OTHER PERSON TO FOLLOW THE PROCEDURE PRESCRIBED BY SECTION 153A IN AN ATTEMPT TO ENSURE THAT THE INCOME REFLECTED BY THE DOCUMENT HAS BEEN ACCOUNTED FOR BY SUCH OTHER PERSON. IF HE IS SO SATISFIED AFTER OBTAININ G THE RETURNS FROM SUCH OTHER PERSON FOR THE SIX ASSESSMENT YEARS, THE PROC EEDINGS WILL HAVE TO BE CLOSED. IF THE RETURNS FILED BY THE OTHER PERSON F OR THE PERIOD OF SIX YEARS DOES NOT SHOW THAT THE INCOME REFLECTED IN THE DOCU MENT HAS BEEN ACCOUNTED FOR, ADDITIONS WILL BE ACCORDINGLY MADE A FTER FOLLOWING THE PROCEDURE PRESCRIBED BY LAW AND AFTER GIVING ADEQUA TE OPPORTUNITY OF BEING HEARD TO SUCH OTHER PERSON. THAT, IN SUM AND SUBSTANCE, IS THE POSITION. 9.2 CONSIDERING THE FACTS OF THE CASE AND THE AR GUMENTS OF BOTH THE SIDES, WE SET ASIDE THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR RE-EXAMINATION OF THE ISSUE IN THE LIGHT OF THE ABOVE DECISION OF HON'BLE JURISDICTIONAL HIG H COURT I.E., THE ASSESSING OFFICER WILL FIRST VERIFY THE YEARS TO WHICH THE SEIZED DOCUMENT S BELONGED. THERE WOULD BE NO JUSTIFICATION FOR CONTINUATION OF THE PROCEEDINGS U NDER SECTION 153C TO WHICH THE SEIZED DOCUMENTS DO NOT BELONG. THEREFORE, THE ASSESSING OFFICER WILL DROP THE PROCEEDINGS INITIATED UNDER SECTION 153 OF THE YEARS TO WHICH T HE SEIZED DOCUMENTS DO NOT BELONG. FOR THE YEAR TO WHICH THE SEIZED DOCUMENTS BELONGED , HE WILL VERIFY WHETHER THE TRANSACTION REFLECTED BY THE SEIZED DOCUMENTS ARE D ULY ACCOUNTED FOR IN THE BOOKS OF ACCOUNT. IF THE TRANSACTIONS ARE DULY ACCOUNTED FO R IN THE BOOKS OF ACCOUNT, AS CONTENDED BY THE LEARNED COUNSEL, THE ASSESSING OFFICER WILL DROP THE PROCEEDINGS INITIATED UNDER SECTION 153C. HOWEVER, IF FOR THE YEAR TO WHICH TH E SEIZED DOCUMENTS BELONGED, THE TRANSACTION REFLECTED BY THE SEIZED DOCUMENTS IS NO T RECORDED IN THE BOOKS OF ACCOUNT, THE PROCEEDINGS UNDER SECTION 153C WILL CONTINUE AN D THE ASSESSING OFFICER WILL MAKE THE ASSESSMENT AFRESH IN ACCORDANCE WITH LAW. SINC E WE HAVE SET ASIDE ALL THE YEARS UNDER APPEAL, THE REVENUES APPEALS ON MERITS DO NO T REQUIRE ANY ADJUDICATION AND THEY ARE ALSO DEEMED TO BE ALLOWED FOR STATISTICAL PURPO SES. THE ASSESSING OFFICER WILL PROCEED TO MAKE THE ASSESSMENT AFRESH ONLY IN THE Y EAR WHERE PROCEEDINGS UNDER ITA NOS. 6410 TO 6415 & C.O. NO. 184 TO 189/DEL./20 14 18 SECTION 153C CAN VALIDLY CONTINUE IN THE LIGHT OF T HE ABOVE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT. SIMILAR ARGUMENTS HAVE BEEN ADVANCED BY BOTH THE PA RTIES IN THE INSTANT CASES ALSO AND IDENTICAL ADDITIONS HAVE BEEN MADE ON THE BASIS OF DOCUMENTS SEIZED ON THE SAME SEARCH. WE, THEREFORE, RESPECTFULLY FOLLOW ING THE DECISION OF CO-ORDINATE BENCH IN THE ABOVE DECISION, REMIT THE ISSUE OF ADD ITIONS ON MERITS BACK TO THE FILE OF THE ASSESSING OFFICER TO DECIDE THE SAME AFRESH IN THE LIGHT OF DIRECTIONS/OBSERVATIONS GIVEN BY ITAT, BENCH B IN THE CASE OF DCIT VS. M/S. DEVI DAYAL PETRO CHEMICALS PVT. LTD. (SUPRA) AT PARA NO. 9.2 OF THE ORDER DATED 10.09.2014 (RELIED BY THE LD. AR) AS REPRODUCED ABO VE. ACCORDINGLY, ALL THE APPEALS OF THE REVENUE AND CROSS OBJECTIONS OF THE ASSESSEE FOR A.YRS. 2005-06 TO 2008-09 DESERVE TO BE ALLOWED FOR STATISTICAL PURPO SES. 16. IN THE RESULT, THE APPEALS OF THE REVENUE FOR A .YRS. 2003-04 AND 2004-05 ARE DISMISSED WHEREAS THE CROSS OBJECTIONS OF THE ASSES SEE FOR THESE YEARS ARE ALLOWED. THE REMAINING APPEALS OF THE REVENUE AND CROSS OBJECTIONS OF THE ASSESSEE FOR A.YRS. 2005-06 TO 2008-09 ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH JANUARY, 2018. SD/- SD/- (H.S. SIDHU) (L.P. SAHU) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 29.01.2018 *AKS*