Dr.L.Srinivasan, CHENNAI V. ACIT, CHENNAI

CO 52/CHNY/2013

• Counselvise Citation: [2013] 122 COUNSELVISE.COM (IT) 8474 (ITAT-CHENNAI)
• Duration Of Justice: 17 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 18-04-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 01-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DR S MOHARANA
• Section: 143(3); 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH CHENN AI BEFORE SHRI ABRAHAM P GEORGE, ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD , JUDICIAL MEMBER .. ITA NOS.2007 TO 2011/MDS./2012 ASSESSMENT YEARS:2003-04 TO 2007-08 & C.O. NOS.14 TO 18/MDS./2012 ASSESSMENT YEARS:2003-04 TO 2007-08 ASST. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-IV(3)(I/C), 46,NUNGAMBAKKAM HIGH ROAD, CHENNAI. VS. DR.DEEPAK LAMECH, OLD NO.57,NEW NO.75, SPUR TANK ROAD, CHETPET, CHENNAI-31. PAN AAAPL 4470 F (APPELLANT) (RESPONDENT/ CROSS OBJECTOR ) APPELLANT BY : DR.S.MOHARANA, CIT D.R. RESPONDENT BY : SHRI SAROJ KUMAR PARIDA, ADVOCATE DR.L.SRINIVASAN DR.DEEPAK LEMECH 2 ITA NOS.2012 TO 2017/MDS./2012 ASSESSMENT YEARS:2003-04 TO 2008-09 & C.O. NOS.49 TO 54/MDS./2012 ASSESSMENT YEARS:2003-04 TO 2008-09 ASST. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-IV(3)(I/C), 46,NUNGAMBAKKAM HIGH ROAD, CHENNAI. VS. DR.L.SRINIVASAN, NO.52,MOOSA STREET, T.NAGAR CHENNAI-17. PAN AAHPS 9160 L (APPELLANT) (RESPONDENT/ CROSS OBJECTOR ) APPELLANT BY : DR.S.MOHARANA, CIT D.R. RESPONDENT BY : SHRI N. DEVANATHAN ADVOCATE DATE OF HEARING : 08.04.13 DATE OF PRONOUNCEMENT: 18.04.13 O R D E R PER BENCH : THESE ARE APPEALS AND CROSS OBJECTIONS FILED BY THE REVENUE AND THE ASSESSEES RESPECTIVELY FOR IMPUGNED DR.L.SRINIVASAN DR.DEEPAK LEMECH 3 ASSESSMENT YEARS AGAINST ORDERS DATED 24.08.2012 OF CIT(A)-1, CHENNAI. SINCE FACTS GIVING RISE TO THESE APPEALS A ND CROSS OBJECTIONS ARE SIMILAR FOR BOTH THE ASSESSEES, THES E APPEALS AND CROSS OBJECTIONS ARE DISPOSED OF THROUGH A CONSOLID ATED ORDER. 2. MR. SAROJ KUMAR PARIDA, THE LEARNED ADVOCATE APPEARING FOR THE ASSESSEE IN THE CASE OF DR.DEEPAK LEMECH, HAS FILED AN ADJOURNMENT PETITION, WHICH IS REJECTED SINCE NO PR OPER REASONS HAVE BEEN FILED FOR SEEKING ADJOURNMENT. MR.N.DEVA NATHAN, THE LEARNED ADVOCATE APPEARING FOR THE ASSESSEE IN THE CASE OF DR.L.SRINIVASAN, ORALLY PLEADED FOR AN ADJOURNMEN T. SINCE NO PROPER REASONS HAVE BEEN SHOWN FOR SEEKING THE ADJO URNMENT, THIS IS ALSO REJECTED. 3. CROSS OBJECTIONS OF THE ASSESSEE IN THE CASE O F DR.DEEPAK LEMECH ARE DELAYED BY 29 DAYS FOR WHICH CONDONATI ON PETITIONS HAVE BEEN FILED. DELAY IS CONDONED AND CROSS OBJECT IONS ARE ADMITTED. 4. SHORT FACTS APROPOS OF THE FACT ARE THAT SEARCH UNDER SECTION 132 OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) WAS CONDUCTED IN THE PREMISES OF ONE DR. P. RAVICHANDRA N ON DR.L.SRINIVASAN DR.DEEPAK LEMECH 4 12.10.2007. DR. P. RAVICHANDRAN IS A RENOWNED NEPH ROLOGIST. DURING THE YEARS 1996 TO 1998, HE WORKED AS A CONSU LTANT AT TAMIL NADU HOSPITAL, KANCHEEPURAM DIST. THEREAFTER , DURING 1999 TO 2003, HE ESTABLISHED A PROPRIETARY PROFESSI ONAL CONSULTATION UNIT CALLED KIDNEY INSTITUTE OF ORGAN TRANSPLANTATION (KIOT) AND THIS CONSULTING UNIT ENTERED INTO A MEMO RANDUM OF UNDERSTANDING (MOU) WITH M/S. MIOT HOSPITAL, MANAPAKKAM,CHENNAI. THIS ARRANGEMENT, IT SEEMS CON TINUED UPTO 2003. IN 2003-04, A SIMILAR TIE UP, WAS ENTERE D WITH ONE ST. THOMAS HOSPITAL. KIOT SPECIALIZED IN TREATMENT O F THE DISEASES CONNECTED TO KIDNEY AS ALSO RENAL TRANSPLANTS. DURI NG THE PERIOD, WHEN DR.P.RAVICHANDRAN WAS HAVING THE MOU WITH MIOT HOSPITAL, RENAL TRANSPLANTS ON PATIENTS WERE DONE I N MIOT HOSPITAL. THEREAFTER SUCH PROCEDURE WAS DONE IN ON E M/S.BHARATHIRAJA HOSPITAL & RESEARCH CENTRE,CHENNAI - 17(BHARATHI RAJA HOSPITAL, IN SHORT). IT SEEMS THE FACILITIES OF ST. THOMAS HOSPITAL WERE USED ONLY FOR PRE AND POST TRA NSPLANTATION TREATMENT AND CHECK UP OF KIDNEY PATIENTS AND KIDN EY DONORS. 5. DR.P.RAVICHANDRAN, BEING A NEPHROLOGIST AND N OT A SURGEON HAD USED THE SERVICES OF SOME OTHER DOCTORS FOR CONDUCTING THE RENAL TRANSPLANTATION SURGERIES. ASS ESSEES HERE DR.L.SRINIVASAN DR.DEEPAK LEMECH 5 WERE TWO OF SUCH DOCTORS. DR. DEEPAK LEEMACH, ONE OF THE ASSESSEES WAS DOING THE DONOR NEPHRECTOMY. DR.L.SR INIVASAN, OTHER ASSESSEE, WAS DOING THE TRANSPLANTS. IN OTHE R WORDS, DR.P.RAVICHANDRAN WAS ONLY A FACILITATOR AND HE UN DERTOOK THE POST OPERATIVE CARE OF THE DONORS AS WELL AS RECIPI ENTS OF THE KIDNEYS. 6. DURING THE COURSE OF THE SEARCH IN THE PREMISES OF DR.P.RAVICHANDRAN, IT SEEMS CERTAIN DOCUMENTS WERE FOUND IN THE FORM OF SIGNED PHOTOGRAPHS OF TWO PATIENTS IN BLANK PAPERS, WHICH AS PER REVENUE, CORROBORATED THE ALLEGATION THAT DR.P.RAVICHANDRAN WAS INVOLVED IN ILLEGAL RENAL TRA NSPLANTS. STATEMENTS WERE RECORDED FROM BOTH THE ASSESSEES, N AMELY DR.L.SRINIVASAN AND DR. DEEPAK LEEMACH, SINCE DR.P.RAVICHANDRAN HIMSELF HAD ADMITTED TO HAVE USED THEIR SERVICES FOR THE SURGERIES. CERTAIN MATERIALS /REC ORDS WERE IMPOUNDED FROM M/S.BHARATHIRAJA HOSPITAL ALSO. AS P ER THE REVENUE, SUCH RECORDS POINTED OUT THAT DR.P.RAVICHA NDRAN AND HIS TEAM HAD DONE 476 KIDNEY TRANSPLANTS BETWEEN SE PTEMBER, 2003 AND OCTOBER, 2007. SIMILARLY DURING THE PERIOD 01.04.01 TO 04.08.03, AS PER REVENUE, MIOT HOSPITAL HAD ALSO DO NE 284 KIDNEY TRANSPLANTS USING THE SERVICES OF THE ASSESS EES. RECORDS DR.L.SRINIVASAN DR.DEEPAK LEMECH 6 IMPOUNDED FROM ST. THOMAS HOSPITAL GAVE ESTIMATES OF KIDNEY TRANSPLANTS UNDER THREE PACKAGES. FIRST PACKAGE WA S FOR ` 3.75 LAKHS, WHICH WAS FOR TRANSPLANTATION AFTER IMMUNE MODIFICATION PROCEDURE. SECOND PACKAGE WAS FOR ` 5.75 LAKHS, FOR TRANSPLANTATION AFTER IMMUNE MODIFICATION PLUS DONO R STEM CELL STIMULATED SPECIFIC TRANSFUSION. THIRD PACKAGE WAS FOR FOREIGN PATIENTS, WHICH INCLUDED DIALYSIS AND BILATERAL NEP HRECTOMY SURGERY CHARGES AND THIS WAS US $ 26,000/- PER PROCEDURE. IT SEEMS THE PACKAGE CHARGES WERE RECEIVED DIRECTLY BY DR.P.RAVICHANDRAN AND HE HAD EFFECTED PAYMENTS IN C ASH TO THE CONCERNED HOSPITALS AND SURGEONS INVOLVED. 7. AS PER THE ASSESSING OFFICER, DR.P.RAVICHANDRAN IN HIS STATEMENT DATED 29.11.07 HAD ADMITTED PAYMENT OF ` 1 LAKH AS THE MAXIMUM SURGEON FEE PER OPERATION. PURSUANT T O THE SEARCH IN THE PREMISES OF DR.P.RAVICHANDRAN AND STATEMENT RECORDED FROM HIM ON 29.11.07, PROCEEDINGS UNDER SECTION 153 C WERE INITIATED AGAINST THE TWO ASSESSEES, HERE NAMELY DR . DEEPAK LEEMACH AND DR.L.SRINIVASAN. BOTH THE ASSESSEES RE SPONDED BY STATING THAT THE RETURNS ORIGINALLY FILED BY THEM COULD BE DEEMED AS FILED IN PURSUANCE OF SUCH NOTICES. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESSING OFFICER NOTED THA T THESE TWO DR.L.SRINIVASAN DR.DEEPAK LEMECH 7 ASSESSEES HAD MADE SUBSTANTIAL DEPOSITS IN THEIR RE SPECTIVE BANK ACCOUNTS. HE RECORDED STATEMENTS FROM THEM, INVOKIN G SEC.131 OF THE ACT. RELEVANT QUERIES POSED TO DR. DEEPAK L EEMACH AND HIS REPLIES ARE REPRODUCED HEREUNDER:- Q.NO.13 HAVE YOU RECEIVED ANY FEE FOR SURGERY DI RECTLY FROM THE PATIENTS. IF SO, FURNISH DETAILS. ANS. NO, NEVER I HAVE RECEIVED FEE DIRECTLY FROM THE PATIENTS. Q.NO.6 CAN YOU PLEASE TELL WHETHER DR.SRINIVASAN I S ENGAGING YOU FOR THE TRANSPLANTATION SURGERIES OR DR.P.RAVICHAND RAN? ANS. DR.P.RAVICHANDRAN ALONE COLLECTS ALL THE MONEY FROM THE PATIENTS. DR.L.SRINIVASAN AND I ARE PAID BY HIM ONL Y. Q.NO.7 CAN YOU PLEASE NARRATE HOW THE PATIENTS ARE REFERRED TO YOU AND YOUR ROLE IN PRE-SURGERY, SURGERY AND POST-SURG ERY. ANS. DR.P.RAVICHANDRAN PREPARES THE DONOR AND RECIPIENT FOR SURGERY AFTER HE ARRANGES THE THEATRE. ONCE THE FO RMALITIES ARE COMPLETED, I GO AND VERIFY THAT THE PATIENT IS FIT FOR SURGERY AND THAT HE HAS SIGNED THE CONSENT TO HAVE HIS KIDNEY REMOVE D. AT OPERATION THE KIDNEY IS REMOVED FROM THE DONOR AND GIVEN TO D R.L.SRINIVASAN WHO TAKES THE KIDNEY AND PUTS IT INTO THE RECIPIENT . POST OPERATIVELY, THE PATIENT IS MANAGED BY DR.P.RAVICHANDRAN AND HE IS DISCHARGED. SELECTION OF DONOR FOR THE KIDNEY TRANSPLANTATION I S DECIDED BY DR.P.RAVICHANDRAN AND I AM ASSIGNING THE DONORS FI TNESS FOR SURGERY. DR.L.SRINIVASAN DR.DEEPAK LEMECH 8 8. RELEVANT QUESTIONS POSED TO DR.L.SRINIVASAN AND HIS ANSWERS WERE AS UNDER:- QN.12. WHAT WAS THE MODE OF RECEIPT OF FEES? ANS. I WAS RECEIVING THE FEES FOR SURGERY F ROM DR.P.RAVICHANDRAN. I RECEIVED THE FEES BY WAY OF CA SH. GENERALLY I RECEIVE THE FEES WITHIN ONE MONTH OF THE SURGERY. Q.NO.13 HAVE YOU RECEIVED ANY FEE FOR SURGERY DIR ECTLY FROM THE PATIENTS. IF SO, FURNISH DETAILS. ANS. NO, I HAVE NEVER RECEIVED FEE DIRECTLY F ROM THE PATIENTS. Q.NO.15. DO YOU FIX THE AMOUNT OF FEES TO BE PAID BY THE PATIENTS. ANS. NO. Q.16. PLEASE TELL HOW YOUR FEES IS FIXED AND PAID. ANS. MY FEE WAS WHAT I RECEIVED FROM DR.P.RAVI CHANDRAN AND IS FIXED BY HIM. HE ONLY USED TO PAY ME THE FEES. Q.11. WHAT IS THE FEES FOR YOUR SURGERY? ANS. FROM 2002-03 ONWARDS, I WAS RECEIVING A F EE OF ` 15,000/- TO ` 18,000/- PER SURGERY. IN THE END OF THE YEAR 2006 , IT WAS RAISED TO ` 20,000 PER SURGERY. Q.19. HOW IS THE FEE DISTRIBUTED AMONG THE VARIOUS DOCTORS? ANS. OUT OF THE TOTAL SURGICAL TEAMS FEES APPR OX.25% WENT TO THE ANESTHETIST TEAM (NORMALLY TWO). 30% WENT TO T HE DONOR SURGICAL TEAM, 45% WENT TO THE RECIPIENT SURGICAL T EAM. IN THE YEAR 2000 TO 2003 THE TOTAL SURGICAL TEAMS FEE WAS BETW EEN ` 30,000 TO ` 35,000. FROM 2003 TO MIDDLE OF 2006, IT WAS ABOUT ` 40,000 AND AFTERWARDS, IT WAS ` 45,000/- DR.L.SRINIVASAN DR.DEEPAK LEMECH 9 9. ASSESSING OFFICER THEREAFTER VERIFIED THE IMPOU NDED MATERIAL FROM BHARATHIRAJA HOSPITAL, WHICH MENTIONE D 476 PROCEDURES TO HAVE BEEN DONE BETWEEN SEPTEMBER, 20 03 AND OCTOBER, 2007. NUMBER OF PROCEDURES CONDUCTED AT M IOT HOSPITAL CAME TO 284. ALTOGETHER, ACCORDING TO THE ASSESSING OFFICER, THE NUMBER OF RENAL TRANSPLANTS DONE CAME TO 760 CASES. YEAR-WISE BREAK UP WAS ALSO COMPILED BY THE ASSESSI NG OFFICER FROM THE IMPOUNDED RECORDS AND THIS READ AS UNDER:- ASST. YEAR NO. OF CASES 2002-03 7 03-04 214 04-05 130 05-06 85 06-07 110 07-08 92 08-09 122 TOTAL 760 10. THEREAFTER, CONSIDERING THE STATEMENT GIVEN BY DR.P.RAVICHANDRAN, AS ALSO STATEMENTS GIVEN BY THE ASSESSEES, ASSESSING OFFICER CAME TO A CONCLUSION THAT TOTAL S URGEON FEE PER DR.L.SRINIVASAN DR.DEEPAK LEMECH 10 OPERATION COULD BE ESTIMATED AT ` 75,000 FOR A.YS. 2006-07, 2007-08 & 2008-09 AND ` 70,000/- FOR A.YS. 2002-03, 2003- 04, 2004-05 & 2005-06. OUT OF THE TOTAL SURGICAL TEAMS FEES, AS PER THE A.O., 25% WENT TO THE ANESTHETIST TEAM, 30% WENT TO THE DONOR SURGICAL TEAM, VIZ. DR. DEEPAK LEEMACH, A ND 45% WENT TO THE RECIPIENT SURGICAL TEAM, VIZ. DR.L.SRINIVASA N. BASED ON THESE DATA, PROFESSIONAL RECEIPTS OF THE ASSESSEES WERE WORKED OUT AND ADDITIONS MADE FOR THE IMPUGNED ASSESSMENT YEARS. 11. BOTH THE ASSESSEES MOVED IN APPEAL BEFORE THE CIT(A), ASSAILING BOTH THE NUMBER OF OPERATIONS ESTIMATED F OR EACH YEAR AND ALSO THE INCOME ESTIMATED FROM EACH OPERATION. FURTHER, AS PER THE ASSESSEES, SUBSTANTIAL AMOUNTS WERE SPENT B Y THEM AS REMUNERATION TO THEIR ASSISTANTS WHO HELPED IN CAR RYING OUT THE PROCEDURES. THEREFORE, ACCORDING TO THEM, THE ESTIM ATION DONE WAS NOT RATIONAL. AGAIN, AS PER THE ASSESSEES, THE LIST BASED ON WHICH NUMBER OF OPERATIONS WERE WORKED OUT, INCLUDE D PROCEDURES WHICH WERE NOT TRANSPLANTS, AS ALSO PRO CEDURES, WHICH WERE DONE BY OTHER DOCTORS. AS PER THE ASSES SEES, IN TAKING PRESUMPTIONS WITH REGARD TO THE NUMBER OF OP ERATIONS, ASSESSING OFFICER HAD IGNORED THE BREAK-UP GIVEN BY DR.P.RAVICHANDRAN. FURTHER AS PER THE ASSESSEES, OU T OF 284 DR.L.SRINIVASAN DR.DEEPAK LEMECH 11 PATIENTS, MENTIONED IN LIST OF MIOT HOSPITAL, 40 WE RE NOT RELATING TO ANY RENAL TRANSPLANT PROCEDURES AND 122 WERE NOT PATIENTS OF DR.P.RAVICHANDRAN. IF THESE WERE EXCLUDED, THE NU MBER OF KIDNEY TRANSPLANTS DONE AT MIOT HOSPITAL CAME DOWN TO 122. WITH REGARD TO 476 SURGERIES PERFORMED AT BHARATHIR AJA HOSPITAL, ASSESSEES ARGUED THAT 13 CASES WERE DONE BY ONE DR. MUTHU JAYARAMAN, 33 CASES WERE NOT RELATED TO TRANSPLANT S AND 41 OPERATIONS WERE DONE BY DOCTORS OF BHARATHIRAJA HO SPITAL ITSELF. THUS, ACCORDING TO THEM, TOTAL NUMBER OF OPERATIONS IN WHICH THEY WERE INVOLVED CAME DOWN TO 389 VIS--VIS BHARATHIRA JA HOSPITAL & RESEARCH CENTRE AND 122 VIS--VIS MIOT HOSPITAL, AG GREGATING TO 511. OUT OF SUCH 511 CASES, ASSESSEES CLAIMED THAT 104 OPERATIONS WERE DONE FREE OF COST FOR M/S.KIDNEY CARE TRUST BELONGING TO DR.P.RAVICHANDRAN. THUS, EFFECTIVELY, AS PER THE ASSESSEES, THE TOTAL NUMBER OF OPERATIONS DONE BY T HEM CAME TO 407 ONLY. 12. A REMAND REPORT WAS CALLED FOR BY THE CIT(A) F ROM THE ASSESSING OFFICER, ON THE BREAK-UP FURNISHED BY TH E ASSESSEES. IN SUCH REMAND REPORT, ASSESSING OFFICER ACCEPTED T HAT TRANSPLANTS AT MIOT HOSPITAL WERE 120 ONLY. HOWEVE R, WITH REGARD TO THE PROCEDURES DONE IN BHARATHIRAJA HOSPI TAL, ASSESSING DR.L.SRINIVASAN DR.DEEPAK LEMECH 12 OFFICER REASSERTED THAT ALL THE 476 CASES WERE ATTE NDED BY BOTH THE ASSESSEES, WHO FORMED THE CORE TEAM OF KIOT. A SSESSING OFFICER ALSO DECLINED TO ACCEPT THE NET WEALTH METH OD SUGGESTED BY THE ASSESSEES FOR COMPUTING THEIR INCOME. 13. DR.L.SRINIVASAN, ONE OF THE ASSESSEE, DURING THE COURSE OF PROCEEDINGS BEFORE THE LD.CIT(A),HAD FILED A SUPPLE MENTARY WRITTEN SUBMISSION, WHICH INTER ALIA REQUESTED ADM ISSION OF ADDITIONAL GROUNDS ASSAILING THE INITIATION OF PRO CEEDINGS UNDER SECTION 153C OF THE ACT, FOR WANT OF RECORDING OF S ATISFACTION. 14. LD. CIT(A) AFTER CONSIDERING THE STATEMENTS OF ASSESSEE AND RECORDS AVAILABLE, CAME TO A CONCLUSION THAT TH E NUMBER OF OPERATIONS TOTALLY DONE BY THE TWO ASSESSEES HAD TO BE ACCEPTED AS 407 FOR THE PERIOD INVOLVED. ACCORDING TO HIM, THE DOCUMENT IMPOUNDED FROM THE BHARATHIRAJA HOSPITAL CLEARLY SH OWED THAT NAME OF SURGEON WAS MENTIONED AS ONE DR.MUTHU JAYA RAMAN IN 13 CASES. FOR 33 CASES, ACCORDING TO HIM, IT WAS CL EAR THAT ONLY ONE PATIENTS NAME WAS MENTIONED WHEREAS FOR RENAL BILATERAL NEPHRECTOMIES, TWO PATIENTS WERE A MUST FOR EACH PR OCEDURE. CIT(A) ALSO ACCEPTED THE CLAIM OF ASSESSEE THAT 41 NUMBER OF OPERATIONS WERE DONE BY DOCTORS NOT RELATED TO KIOT . WITH DR.L.SRINIVASAN DR.DEEPAK LEMECH 13 REGARD TO THE OPERATIONS DONE AT MIOT HOSPITAL, CIT (A) NOTED THAT ASSESSING OFFICER HIMSELF HAD ADMITTED THE NUM BER OF TRANSPLANTS AS 120. HE ALSO ACCEPTED THE CLAIM OF ASSESSEES THAT 104 OF SURGERIES WERE DONE FREE OF COST FOR KIDNE Y CARE TRUST BELONGING TO DR.P.RAVICHANDRAN. EFFECTIVELY, HE UP HELD NUMBER OF KIDNEY TRANSPLANTS AS 407. 15. VIS-A-VIS THE FEES RECEIVED, THE CIT(A) ACCEPT ED THE ESTIMATION DONE BY THE ASSESSING OFFICER. HOWEVER, ACCORDING TO HIM, ASSESSEES CLAIM THAT EXPENSES WERE INCURRED FO R JUNIOR DOCTORS, STAFF NURSES AND MEDICINES HAD TO BE ACCEP TED, SINCE ASSESSEES HAD IN THEIR STATEMENTS MENTIONED SUCH PA YMENTS. THOUGH THE ASSESSEE DR.L.SRINIVASAN ARGUED THAT HE HAD INCURRED MORE EXPENDITURE FOR EACH PROCEDURE WHEN C OMPARED TO DR. DEEPAK LEEMACH, THIS WAS NOT ACCEPTED BY THE CI T(A). ACCORDING TO LD.CIT(A), EXPENDITURE OF ` 9,000/- TO SUPPORT STAFF HAD TO BE ALLOWED FOR BOTH DR.L.SRINIVASAN AS WELL AS DR. DEEPAK LEEMACH. HE DIRECTED THE ASSESSING OFFICER TO ADOP T THE TOTAL NUMBER OF OPERATIONS DONE BY THE ASSESSEES AS 407 A ND DIRECTED REDUCTION OF ` 9,000/- PER PROCEDURE AS EXPENSES TOWARDS SUPPORTING STAFF, AND ACCORDINGLY TO RE-WORK THE IN COME OF THE ASSESSEES. DR.L.SRINIVASAN DR.DEEPAK LEMECH 14 16. NOW BEFORE US, D.R STRONGLY ASSAILING THE ORDE RS OF THE CIT(A) FOR THE IMPUGNED ASSESSMENT YEARS ARGUED THA T DR. P. RAVICHANDRAN WAS RECEIVING CONSIDERATION FOR ILLEGA L KIDNEY TRANSPLANTS AND THE TWO ASSESSEES HERE WERE HAND-IN - GLOVE WITH HIM. NONE OF THESE THE DOCTORS HAD MAINTAINED ANY BOOKS OF ACCOUNTS. CIT(A) HAD IN THE CASE OF DR. P. RAVICHA NDRAN, DIRECTED ADOPTION OF NET WEALTH METHOD FOR COMPUTIN G HIS INCOME CONSIDERING THE COMPLEXITIES INVOLVED, SINCE HE WAS HAVING A LARGE ARRAY OF INVESTMENTS INCLUDING DEPOSITS IN BA NK ACCOUNTS AND IN IMMOVABLE PROPERTIES. NEVERTHELESS, ACCORDI NG TO HIM, THIS METHOD COULD NOT BE ADOPTED IN THE CASE OF ASS ESSEE HERE, FOR A REASON THAT ASSESSEES WERE NOT SUBJECTED TO ANY SEARCH UNDER SECTION 132 OF THE ACT AND THEIR INVESTMENTS WERE NOT KNOWN. DR. P. RAVICHANDRAN ALONE WAS SEARCHED AND PROCEEDINGS AGAINST THE ASSESSEES HERE WERE UNDER SECTION 153C OF THE ACT. D.R FURTHER SUBMITTED THAT NUMBER OF CASES ESTIMATED BY THE CIT(A) WAS SIMPLY BASED ON THE SUB MISSIONS OF ASSESSEES WHICH WERE NOT SUPPORTED BY ANY CORROBORA TING RECORD. REFERRING TO PAGE NOS.21 TO 54 OF THE PAPER BOOK, W HICH IS A COPY OF THE RECORD IMPOUNDED FROM BHARATHIRAJA HOSPITAL, LD. D.R SUBMITTED THAT PROCEDURES MENTIONED AT SERIAL NOS. 12,14,55,60, DR.L.SRINIVASAN DR.DEEPAK LEMECH 15 & 62 CONSIDERED BY CIT(A) TO HAVE BEEN DONE BY DR.M UTHU JAYARAMAN, WAS NOT DONE BY THE SAID DOCTOR AT ALL. INITIAL OF DR. P. RAVICHANDRAN, ABBREVIATED AS DR.PRC WAS APPEARI NG AGAINST THESE CASES ALSO. NAMES OF THE DOCTORS MENTIONED AG AINST PROCEDURES AT SL. NO.66, 105 AND 112 WERE NOT CLEAR . NAME OF THE DOCTOR AGAINST SL. NO.14 WAS LEFT BLANK. FURTH ER, ACCORDING TO HIM, JUST BECAUSE TWO NAMES WERE NOT MENTIONED AGAI NST A PROCEDURE WOULD NOT MEAN THAT THE PROCEDURE WAS NOT ONE INVOLVING A TRANSPLANT. IN ANY CASE, ACCORDING TO HIM, FOR 41 NUMBERS CLAIMED BY THE ASSESSEE AS OPERATIONS IN W HICH THEY HAD NO PART TO PLAY, THERE WAS NO EVIDENCE. SIMILA RLY, ACCORDING TO THE LD.D.R, 104 OPERATIONS WERE SIMPLY PRESUMED BY THE CIT(A) TO HAVE BEEN DONE BY THE ASSESSEES FREE OF COST FOR M/S.KIDNEY CARE TRUST. 17. VIS--VIS THE CLAIM OF EXPENDITURE INCURRED BY THE ASSESSEES FOR THEIR SUPPORTING STAFF, D.R POINTED OUT THAT DR . P. RAVICHANDRAN HAD PAID A PART OF THE FEES TO CONCERN ED HOSPITALS BEING THE PART OF THE PACKAGE CHARGES, TO MEET THE HOSPITAL EXPENSES. THEREFORE, ACCORDING TO HIM, THE PRESUMP TION THAT ASSESSEES WOULD HAVE PAID DIRECTLY TO VARIOUS SUPPO RTING STAFF COULD NOT BE ACCEPTED. LD. CIT(A), AS PER D.R, AG AIN WENT BY DR.L.SRINIVASAN DR.DEEPAK LEMECH 16 THE SUBMISSIONS OF ASSESSEES WHICH WERE NOT CORROBO RATED BY ANY EVIDENCE. THEREFORE, ACCORDING TO HIM, CIT(A) F ELL IN ERROR IN DISTURBING THE FINDINGS OF THE ASSESSING OFFICER, E XCEPT FOR THE NUMBER OF TRANSPLANTS DONE AT MIOT HOSPITAL, WHICH WAS CONFIRMED AS 120 BY THE ASSESSING OFFICER, IN HIS R EMAND REPORT. LD.D.R FURTHER POINTED OUT THAT ASSESSEE HAD NOT P RODUCED ANY EVIDENCE WITH REGARD TO THE KIDNEY TRANSPLANTS DON E BY THEM IN BHARATHIRAJA HOSPITAL, EVEN DURING THE REMAND PROCE EDINGS. THEREFORE, ACCORDING TO HIM, THE ORIGINAL ADDITIONS HAD TO BE REINSTATED. 18. PER CONTRA, MR. SAROJ KUMAR PARIDA, THE LEARNE D ADVOCATE APPEARING FOR THE ASSESSEE IN THE CASE OF DR.DEEPA K LEMECH, SUBMITTED THAT NO EVIDENCE WAS BROUGHT ON RECORD BY THE REVENUE TO SHOW THAT NUMBER FREE OPERATIONS DONE B Y THE ASSESSEES FOR KIDNEY CARE TRUST WAS INCORRECT. FUR THER, ACCORDING TO LD. A.R. LIST OF CASES WHICH WERE DON E BY THE TEAM OF DR. P. RAVICHANDRAN AT BHARATHIRAJA HOSPITAL WA S SEPARATELY SUBMITTED BEFORE THE ASSESSING OFFICER. ACCORDING TO HIM, DR.MUTHU JAYARAMAN WAS ALSO A RENAL SURGEON AND TH ERE WAS NO REASON WHY ASSESSEES STATEMENT THAT 13 NUMBER OF TRANSPLANTS WERE DONE BY DR.MUTHU JAYARAMAN, COULD NOT BE BELIE VED. DR.L.SRINIVASAN DR.DEEPAK LEMECH 17 FURTHER ACCORDING TO HIM, THE LIST RELIED ON BY THE ASSESSING OFFICER HAD IN IT, MANY CASES WHICH DID NOT INVOLVE ANY NEPHRECTOMIES. ACCORDING TO HIM, HOSPITALS ONLY P ROVIDED THE OPERATION THEATER, BUT FEES FOR THE ASSISTANTS HAD TO BE PAID BY THE ASSESSEES. SUCH ASSISTANTS INCLUDED TWO JUNIOR DOCTORS, AND NURSES. EVEN COST OF MEDICINES HAD TO BE BORNE BY THE ASSESSEES. CERTIFICATES WERE PRODUCED FROM THE HOSP ITAL, WHICH SHOWED THAT THE ASSISTANTS WERE BEING PAID DIRECTLY BY THE ASSESSEES. MANY OF THE PAYMENTS TO THE ASSISTANT DO CTORS NAMELY, DR.ANANTHASWAMY DR. PREM KUMAR, AND DR.SURE SH KUMAR WERE MADE BY CHEQUES AND DETAILS OF ALL THE C HEQUES WERE PRODUCED BY THE ASSESSEE. IT WAS BASED ON SUCH EVI DENCE, CIT(A) ALLOWED THE RELIEF. 19. IN SUPPORT OF CROSS OBJECTIONS FILED BY DR.D EEPAK LEMECHS, LD.A.R. SUBMITTED THAT, CIT(A) FELL IN E RROR IN HOLDING THAT ASSESSEE HAD RECEIVED A NET AMOUNT OF ` 12,000/- PER OPERATION FOR ASSESSMENT YEARS 2003-04 TO 2005-06 A ND ` 13,500/- PER OPERATION FOR ASSESSMENT YEARS 2006-07 TO 2007-08. AFTER PAYING THE SUPPORTING STAFF, AMOUNT RECEIVED BY THE ASSESSEE WAS ` 9,000/- ONLY FOR ASSESSMENT YEARS 2003-04 TO 2005-06 AND ` 11,000/- FOR ASSESSMENT YEARS 2006-07 TO 2007- DR.L.SRINIVASAN DR.DEEPAK LEMECH 18 08. CIT(A) HAD ACCEPTED THE ESTIMATION OF CONSULTA TION CHARGES DONE BY THE ASSESSING OFFICER, WITHOUT APPRECIATING THE NATURE OF WORK DONE BY THE ASSESSEE. 20. SR.COUNSEL, N.DEVANATHAN, APPEARING FOR THE AS SESSEE DR.L.SRINIVASAN, SUBMITTED THAT ASSESSMENTS WERE MA DE PURELY ON SURMISES AND PRESUMPTIONS. ACCORDING TO HIM, HI S ASSESSEE HAD RAISED A SPECIFIC GROUND BEFORE THE CIT(A) QUES TIONING THE VALIDITY OF PROCEEDINGS INITIATED UNDER SECTION 153 C OF THE ACT. THOUGH THIS WAS NOT PART OF THE ORIGINAL GROUNDS OF APPEAL, IT WAS SUBMITTED DURING THE COURSE OF HEARING AS AN ADDITI ONAL GROUND. ACCORDING TO HIM, RECORDING OF SATISFACTION BY THE ASSESSING OFFICER WAS A PRE REQUISITE FOR INITIATING PROCEEDI NGS UNDER SECTION 153C OF THE ACT AND THIS WAS NOT DONE HERE. ASS ESSING OFFICER OF THE ASSESSEE AND ASSESSING OFFICER OF DR. P. RAV ICHANDRAN, WHO WAS SEARCHED, WERE DIFFERENT. RELIANCE WAS PLA CED ON THE DECISION OF APEX COURT IN THE CASE OF MANISH MAHESH WARI VS. ACIT IN 289 ITR 341. ACCORDING TO LD. A.R., CIT(A) FELL IN ERROR IN NOT ADJUDICATING THE ASPECT OF JURISDICTION. IN AN Y CASE, ACCORDING TO HIM, TRIBUNAL WAS DUTY BOUND TO EXAMINE THE QUES TION OF LAW EVEN IF IT WAS TAKEN AS AN ADDITIONAL GROUND OF APP EAL AS HELD BY HONBLE APEX COURT IN THE CASE OF NATIONAL THERMAL CORPN. VS. DR.L.SRINIVASAN DR.DEEPAK LEMECH 19 CIT 229 ITR 383. FURTHER, AS PER SR. ADVOCATE N. DEVANATHAN, HIS ASSESSEE COULD NOT BE TREATED ON A DIFFERENT FO OTING VIS--VIS DR. P. RAVICHANDRAN. ACCORDING TO HIM, LD. CIT(A) HAD ON THE APPEALS FILED BY DR. P. RAVICHANDRAN, DIRECTED THE ASSESSING OFFICER TO COMPLETE THE ASSESSMENT ON NET WEALTH B ASIS FOR THE VERY SAME IMPUGNED ASSESSMENT YEARS. LOWER AUTHORI TIES FELL IN ERROR IN NOT FOLLOWING SUCH METHOD HERE ALSO. 21. IN REPLY, LD. D.R SUBMITTED THE GROUND REGARDI NG THE JURISDICTION WAS NEVER RAISED BY THE ASSESSEE, DR.L .SRINIVASAN, BEFORE THE CIT(A) AND THE TRIBUNAL CANNOT CONSIDER NOW. 22. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSE D THE ORDERS OF THE LOWER AUTHORITIES. ASSESSMENTS OF BOTH THE ASSESSEES HERE, HAVE AS ITS BASE, THE SEARCH DONE IN THE RES IDENTIAL PREMISES OF DR. P. RAVICHANDRAN, WHO WAS ADMITTEDLY HEADING A NEPHROLOGY UNIT, WHICH WAS INTER ALIA DOING RENAL TRANSPLANTS. IT IS NOT DENIED BY EITHER OF THE ASSESSEES THAT THEY HAD ASSISTED DR. P. RAVICHANDRAN. DR.DEEPAK LEMECH WAS DOING TH E DONOR NEPHRECTOMIES WHEREAS DR.L.SRINIVASAN WAS DOING TH E RECIPIENT NEPHRECTOMIES. VIS--VIS THE NUMBER OF SUCH PROCED URES DONE IN DR.L.SRINIVASAN DR.DEEPAK LEMECH 20 MIOT HOSPITAL, THERE IS NO DISPUTE BETWEEN THE PART IES. THE BONE OF CONTENTION IS ONLY WITH REGARD TO THE NUMBER OF PROCEDURES DONE IN BHARATHIRAJA HOSPITAL AND NET FEES ASSESSAB LE IN THE RESPECTIVE HANDS. ASSESSING OFFICER RELIED ON A R ECORD FROM BHARATHIRAJA HOSPITAL, FOR COMPUTING THE NUMBER OF TRANSPLANTS AND THIS APPEARS AT PAPER BOOK AT PAGE NOS. 21 TO 5 4. EXCEPT FOR A FEW CASES THE NAME DR.PRC IS MENTIONED AGAINST EA CH PATIENT. NONE OF THE PARTIES HAVE DISPUTED THAT INITIAL PRC IS THE ABBREVIATION OF DR. P. RAVICHANDRAN. CASE OF THE ASSESSEES IS THAT 13 OF THE TOTAL 476 CASES MENTIONED IN THE LIS T WERE OPERATIONS DONE BY ONE DR.MUTHU JAYARAMAN. AN EX AMINATION OF THIS LIST SHOW THAT AGAINST SERIAL NOS.2,12,13,14,38,40,45,55,60,62,66,105 & 112, CONS IDERED BY CIT(A) AS TRANSPLANTS DONE BY DR.MUTHU JAYARAMAN EX CEPT SL. NOS. 2,38,40,13 WHICH SHOW THE INITIAL NJ OVERWR ITTEN OVER THE INITIAL PRC, ALL OTHERS ARE DOUBTFUL. SIMILAR COL UMN AGAINST SL.NO.14 SEEMS TO BE BLANK. SL. NO.12,45, 55, 60 & 62 HAVE NO MENTION OF NJ, BUT ONLY THE INITIAL DR.PRC APPE ARS. NAME OF DOCTORS AGAIN IN SL. NO.66 IS NOT CLEAR WHEREAS SL. NO.101 & 112 ARE MISSING. THEREFORE, OUT OF 13 CASES MENTIONED TO HAVE BEEN DONE BY DR.MUTHU JAYARAMAN, WHAT CAN AT THE BEST, B E ACCEPTED, IS ONLY EIGHT, GIVING THE FULL BENEFIT OF DOUBT THE ASSESSEE. DR.L.SRINIVASAN DR.DEEPAK LEMECH 21 CONTENTION OF THE ASSESSEE THAT UNLESS TWO NAMES WE RE GIVEN AGAINST SERIAL NUMBER, IT CANNOT BE CONSIDERED AS A BILATERAL NEPHRECTOMY SEEMS TO BE, PROBABLE SINCE A RENAL TRA NSPLANT REQUIRE A DONOR AS WELL. WE ARE UNABLE TO ACCEPT THE ARGUMENT OF THE LD. D.R. THAT NON-MENTIONING OF DONORS NAME COULD HAVE BEEN AN OMISSION, SINCE SURGERY ON DONOR IS ALSO A MASSIVE PROCEDURE. VIS--VIS THE CLAIM OF THE ASSESSEES THA T CERTAIN OPERATIONS IN THE LIST WAS EXCLUSIVELY DONE BY THE DOCTORS OF BHARATHIRAJA HOSPITAL, SERIAL NO. MENTIONED BY THE ASSESSEES ARE THE FOLLOWING: 76,79,88,103,102,107,112,118,120,138,13 9,157, 158,161,167,175,176,182,228,244,26 4,273 A VERIFICATION OF THE CORRESPONDING PAGES IN THE RE CORD OF M/S. BHARATHIRAJA HOSPITAL SHOW THAT THE INITIALS MENTI ONED AGAINST EACH IS PRC ONLY. HOWEVER, THERE IS NO CONCLUSIVE EVIDENCE TO SHOW THAT ASSESSEES WERE ALWAYS THE SURGEONS, WHEN INITIAL PRC WAS MENTIONED. NEITHER HAS ANY EVIDENCE BEEN PRODUCED BY THE ASSESSEES TO SHOW THAT THESE WERE DONE BY A TEAM IN WHICH ASSESSEES WERE NOT PART. SIMILARLY ASSESSEES HAVE ALSO NOT PRODUCED ANY RECORD TO PROVE THAT 104 NUMBERS OF TRANSPLANTS WERE DONE BY THEM FREE OF COST FOR M/S. KIDNEY CARE DR.L.SRINIVASAN DR.DEEPAK LEMECH 22 TRUST. CONSIDERING THE VARIOUS DIFFICULTIES IN EXA CTLY ASCERTAINING THE NUMBER OF OPERATIONS DONE BY THE ASSESSEES AT B HARATHIRAJA HOSPITAL, WE ARE OF THE OPINION THAT AN ESTIMATE OF 450 WILL RENDER JUSTICE. THUS, TOTAL NUMBER OF OPERATIONS DONE BY T HE ASSESSEES CONSIDERING BOTH MIOT HOSPITAL AS WELL AS BHARATH IRAJA HOSPITAL CAN BE TAKEN AS 570. THUS,VIS--VIS THE NUMBER OF OPERATIONS DONE BY THE ASSESSEES, WE SET ASIDE THE ORDERS OF T HE LOWER AUTHORITIES BELOW AND DIRECT THE ASSESSING OFFICER TO ADOPT SUCH NUMBER AT 570 AND APPORTION IT IN THE SAME RATIO AS DONE AT TABLE AT PARA 9 ABOVE. 21. COMING TO THE ASPECT OF THE FEES RECEIVED BY THE ASSESSEES FROM DR. P. RAVICHANDRAN, IT IS NOT DISPU TED THAT BOTH ASSESSEES HAD NOT MAINTAINED ANY RECORDS FOR THE RE CEIPTS FROM DR. P. RAVICHANDRAN. ASSESSEES HAD MENTIONED THAT AMOUNT RECEIVED PER OPERATION WAS ONLY ` 45,000/- AT THE MAXIMUM AGAINST WHICH ASSESSING OFFICER CONSIDERED IT AT ` 75,000/- FOR ASSESSMENT YEARS 2006-07 TO 2008-09 AND ` 70,000/- FOR ASSESSMENT YEARS 2002-03 TO 2005-06 PER OPERATION. IT IS NOT DISPUTED THAT BOTH THE ASSESSEES HAD SOME UNEXPLAIN ED DEPOSITS IN THEIR RESPECTIVE BANK ACCOUNTS. THEREFORE, IN OU R OPINION, DR.L.SRINIVASAN DR.DEEPAK LEMECH 23 CIT(A) WAS JUSTIFIED IN CONFIRMING THE QUANTUM OF FEES ESTIMATED MADE BY THE ASSESSING OFFICER IN THIS REGARD. 24. HOWEVER, VIS--VIS THE RELIEF GIVEN FOR THE EXP ENDITURE INCURRED ON SUPPORTING STAFF, THE STATEMENT GIVEN B Y THE HOSPITAL AUTHORITIES ARE VERY RELEVANT. THESE STATEMENTS FI ND A MENTION IN THE ASSESSMENT ORDER OF DR.P.RAVICHANDRAN. ONE SMT . ARUL JOTHI WHO WAS THE HOSPITAL-IN-CHARGE OF BHARATHIRAJA HOS PITAL HAD IN HER STATEMENT MENTIONED, THAT A SUM OF ` 70,000/- TO ` 75,000/- PER PATIENT WAS TO BE COLLECTED FROM DR. P. RAVICH ANDRAN FOR THE PROCEDURES DONE IN THE SAID HOSPITAL. THIS IS SPECI FICALLY MENTIONED IN THE ASSESSMENT ORDER OF DR. P. RAVICHA NDRAN FOR ASSESSMENT YEAR 2007-08 DATED 24.12.09, COPY OF WHI CH HAS BEEN PRODUCED BEFORE US. . SHE HAS ALSO GIVEN A BR EAK-UP OF THE EXPENDITURE IN FOUR HEADS NAMELY, HOSPITAL EXPENSE S, MEDICINES, DIET EXPENSES AND BLOOD CHARGES. SIMILARLY, DR.NAT ESAN, OF BHARATHIRAJA HOSPITAL IN A STATEMENT RECORDED ON 04 .02.08 HAD ALSO MENTIONED THAT DR. P. RAVICHANDRAN USED TO DEP OSIT ` 75,000/- IN CASH DIRECTLY AT THE CASH COUNTER AND T HIS SUM WAS AGAINST THEATRE CHARGES, POST OPERATIVE CHARGES, VE NTILATOR CHARGES, CARDIAC MONITOR CHARGES, ANESTHESIA CHARG ES, PHARMACY, BLOOD BANK AND CANTEEN CHARGES OF THE PAT IENTS. THIS DR.L.SRINIVASAN DR.DEEPAK LEMECH 24 ALSO APPEARS IN THE ASSESSMENT ORDER OF DR. P. RAVI CHANDRAN SUPRA. THUS, WHAT CAN CLEARLY BE DISCERNED IS THAT NONE OF THESE PERSONS HAD MENTIONED ANYTHING REGARDING THE PAYMEN TS TO THE SUPPORT STAFF IN THE SURGICAL TEAM OF THE ASSESSEES . DR.L.SRINIVASAN, IN HIS STATEMENT HAD MENTIONED THA T 30% WENT TO THE DONOR SURGICAL TEAM, AND 45% WENT TO THE RE CIPIENT SURGICAL TEAM. THE PAYMENTS EFFECTED WERE FOR THE TEAMS AS SUCH. THEREFORE, IN OUR OPINION CONTENTION OF ASSE SSEES THAT ASSISTANTS HAD TO BE PAID , WHICH INCLUDED JUNIOR DOCTORS AND STAFF NURSES, HAS CONSIDERABLE STRENGTH. LD. CIT(A) ESTIM ATED SUCH EXPENSES AT ` 9,000/- PER CASE. AMOUNT OF RS. 2,000/- ESTIMATED BY THE LD. CIT(A) AS PAYMENT TO TWO STAFF NURSES PE R OPERATION IS ON THE LOWER SIDE. IN THE FACTS AND CIRCUMSTANCES, WE ARE OF THE OPINION THAT EXPENSE OF RS.12,000/- PER CASE CAN BE CONSIDERED REASONABLE. ORDERS OF THE AUTHORITIES BELOW ARE SET ASIDE ON THIS ASPECT AND THE ASSESSING OFFICER IS DIRECTED TO REC OMPUTE THE INCOME OF RESPECTIVE ASSESSEES CONSIDERING THE EXPE NSE FOR EACH TRANSPLANT AT RS.12,000/-. CROSS OBJECTION OF THE ASSESSEES ON THIS ISSUE IS PARTLY ALLOWED. 25. COMING TO ONE OF THE GROUNDS IN THE CROSS OBJE CTIONS TAKEN BY DR.L.SRINIVASAN WHICH ASSAILS THE VALIDITY OF THE DR.L.SRINIVASAN DR.DEEPAK LEMECH 25 PROCEEDINGS INITIATED UNDER SECTION 153C OF THE ACT , WE DO FIND THAT THE ASSESSEE HAD FILED A SUPPLEMENTARY WRITTEN SUBMISSION BEFORE THE CIT(A) IN WHICH THE FOLLOWING APPEARS: WE WISH TO RAISE AN ADDITIONAL GROUND IN THE APPEA L FILED AGAINST THE ASSESSMENT COMPLETED UNDER SECTION 143( 3) R.W.S.153A/153C THAT THE A.O. HAS NOT RECORDED HIS SATISFACTION IN THE APPELLANTS CASE BEFORE INITIAT ING PROCEEDINGS UNDER SECTION 143(3) R.W.S.153A/153C F OR THE ASSESSMENT YEAR 2003-04. THE RECORDING OF SATISFAC TION BY THE ASSESSING OFFICER IS A SINE QUA NON FOR INITIAT ING PROCEEDINGS UNDER SECTION 153C OF THE ACT. LD. CIT(A) HAS NOT DEALT WITH THIS ISSUE AT ALL. IN OUR OPINION, CIT(A) WAS DUTY BOUND TO DISPOSE OF SUCH ADDITIONAL GROUND RAISED BY THE ASSESSEE SINCE IT RAISED A QUESTION O F LAW, WHICH WENT TO THE ROOT OF THE MATTER. WE THEREFORE REMIT THIS ISSUE BACK TO THE FILE OF THE CIT(A) FOR CONSIDERATION AND DIS POSAL IN ACCORDANCE WITH LAW. CROSS OBJECTION FILED BY ASSE SSEE DR.L.SRINIVASAN, IS THUS ALLOWED FOR STATISTICAL PU RPOSES. 26. VIS--VIS THE CLAIM OF THE LD. SENIOR COUNSEL THAT NET WEALTH METHOD SHOULD BE ADOPTED FOR ASCERTAINING THE INCOM E, WE ARE UNABLE TO ACCEPT SINCE BOTH THE ASSESSEES BEFORE U S WERE NOT DR.L.SRINIVASAN DR.DEEPAK LEMECH 26 SUBJECT TO SEARCH, AND THERE WERE VALID REASON FOR CIT(A) TO DIRECT SUCH METHOD IN THE CASE OF DR.P.RAVICHANDRAN, WHO A LONE WAS SUBJECTED TO SEARCH, AND IN WHOSE CASE INVESTMENTS MADE WERE ALL AVAILABLE ON RECORD. 27. TO SUMMARISE RESULT, APPEALS OF THE REVENUE ARE PARTLY ALLOWED, CROSS OBJECTIONS OF ASSESSEE, DR.DEEPAK LE MECH IS PARTLY ALLOWED WHEREAS CROSS OBJECTIONS OF ASSESSEE DR.L.SRINIVASAN IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED ON THURSDAY, THE 18 TH APRIL, 2013 AT CHENNAI. SD/- SD/- (CHALLA NAGENDRA PRASAD) (ABRAHAM P GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI DATED 18 TH APRIL, 2013 . K S SUNDARAM COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE DR.L.SRINIVASAN DR.DEEPAK LEMECH 27