The DCIT, 1(1), Indore V. Smt. Padma Kalani, Indore

ITA 107/IND/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5633 (ITAT-INDORE)
• Duration Of Justice: 2 year(s) 9 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-11-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 17-10-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 07-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GIRISH AGARWAL
• Assessee Lawyers: LALCHAND
• Keywords: Gift; Search and seizure; Documents seized
• Section: 153A; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER SHRI ANIL AGARWAL (HUF) E-2,126, AREA COLONY, BHOPAL VS. ACIT 1(2) BHOPAL APPELLANT RESPONDENT PAN:AAUPA 0002 E APPELLANT BY SHRI GIRISH AGARWAL, CA RESPONDENT BY SHRI LAL CHAND, CIT(DR) DATE OF HEARING 16.11.2016 DATE OF PRONOUNCEMENT 16.11.2016 O R D E R PER O.P. MEENA, ACCOUTANT MEMEBR. 1. THE ABOVE APPEALS ARE FILED BY THE ASSESSEE AGAINST THE COMMON ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-I, DTD. 22.05.20 15 FOR THE ASSESSMENT YEAR 1999-2000, 2002-03 AND 2004-05. 2. THE ASSESSEE HAS TAKEN THE GROUND NO. 1 AND 2 WHIC H READ AS UNDER :- GROUND NO. 1 AND 2 STATES, THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE INITIATION OF PROCEEDINGS U/S. 153C & THE ASSESSMENT IN PURSUANCE TO SUCH NOTICE ARE BAD IN LAW AND , THEREFO RE, THE ASSESSMENT BE KINDLY QUASHED. I.T.A.(SS) NO.213, 214 &215/IND/2015 ASSESSMENT YEAR: 1999-2000, 2002-03 & 2004-05 ANIL AGARWAL (HUF)/ITA (SS) NO.213, 214 &215/IND/20 15/A.Y.99-00-02-03-04-05. PAGE 2 OF 10 GROUND NO. 2 STATES THAT ON THE FACTS AND IN THE CI RCUMSTANCES OF THE CASE AND IN LAW, THE FINDING OF LD. CIT (A) IN PARA4.5 O F HIS ORDER THAT THE APPELLANT HAS NOT REQUESTED FOR SATISFACTION NOTE AND THERE IS NO REQUIREMENT OF RECORDING OF SATISFACTION ARE UNLAWFUL & UNJUSTIFIE D AND, THEREFORE, SUCH FINDING BE QUASHED AND THE ASSESSMENT MADE BE CANCELLED . THESE GROUND ARE COMMON FOR THE ASSESSMENT YEAR 1999-2000, 2002-0 3 AND 2004-05. 3. BRIEFLY, STATED THE FACTS ARE THAT THE ASSESSEE IS HUF OF WHICH KARTA IS SHRI ANIL AGARWAL. THE ASSESSEE HUF IS EARNING INCOME FROM TRA DING IN SHARES AND INTEREST. A SEARCH AND SEIZURE OPERATION UNDER SECTI ON 132(1) OF THE ACT WAS CONDUCTED ON 02.11.2004 AT THE RESIDENCE OF SHRI AN IL AGARWAL[INDIVIDUAL] AND HIS WIFE SMT. TRIPTI AGARWAL. DURING THE COURSE OF SEARCH, CERTAIN DOCUMENTS, GIFT DEEDS, BELONGING TO THE ASSESSEE HU F, WERE FOUND AND SEIZED. THEREFORE, THE AO ISSUED NOTICE UNDER SECTI ON153C OF THE ACT DTD. 21.04.2005 TO THE ASSESSEE REQUIRING THE ASSESSEE TO FURNISH ITS RETURN OF INCOME UNDER SECTION 153A R.W.S. 153C OF THE ACT. IN RESPON SE TO WHICH THE ASSESSEE FURNISH RETURN OF INCOME FOR THE ASSESSMENT YEAR 199 9-00 ON 28.09.2006 AND FOR OTHER ASSESSMENT YEARS ON 07.05.2005. THE ASSESSMEN T WAS MADE U/S.153C R.W.S.143(3) OF THE ACT ASSESSING INCOME AT RS. 1,71 ,000/- FOR THE ASSESSMENT YEAR 1999-2000, RS. 1,78,720/- FOR THE ASSESSMENT YEA R 2002-03 AND RS. 2,70,770/- FOR THE ASSESSMENT YEAR 2004-05 RESPECTIVE LY. THE ASSESSEE CARRIED MATTER BEFORE THE LD. CIT (A), WHEREIN THE ASSESSEE R EQUESTED THE LD. CIT (A) TO PROVIDE COPY OF SATISFACTION NOTE RECORDED BY THE A O FOR ASSESSING THE ASSESSEE. LD. CIT (A) HAS CALLED A REMAND REPORT FROM THE AO ASKING TO PROVIDE SATISFACTION NOTE IF ANY. HOWEVER, THE AO SU BMITTED THAT CASE IS VERY ANIL AGARWAL (HUF)/ITA (SS) NO.213, 214 &215/IND/20 15/A.Y.99-00-02-03-04-05. PAGE 3 OF 10 OLD ONE, HOWEVER IT WAS SUBMITTED THAT WHEN THERE IS THE AO IS SAME ASSESSING OFFICER FOR SEARCHED PERSON THEN THERE IS NO NEED TO RECORD SATISFACTION NOTE. LD. CIT (A) HELD THAT DOCUMENTS BE ING GIFT DEED BELONGING TO THE ASSESSEE HUF WERE FOUND AND SEIZED DURING SE ARCH FROM THE RESIDENCE OF KARAT OF HUF, HENCE, PROVISIONS OF SECTION 153C O F THE ACT ARE ATTRACTED IN THIS CASE. LD. CIT (A) WAS ALSO OF VIEW THAT SAME AO HAS ALSO MADE ASSESSMENT IN THE CASE OF SHRI ANIL AGARWAL (SEARCHE D PERSON) AND IN THE CASE OF THE ASSESSEE HUF. HENCE, IT CANNOT BE SAID T HAT THE AO HAS NOT RECORDED SATISFACTION NOTE BEFORE ISSUING NOTICE UND ER SECTION153C OF THE ACT. THE AO HAVING JURISDICTION OVER THE SEARCHED PE RSON SHRI ANIL AGARWAL WAS ALSO HAVING JURISDICTION OVER THE APPELLANT HUF C OVERED U/S.153C OF THE ACT AND, THEREFORE, THERE WAS NO REQUIREMENT OF HAND ING OVER DOCUMENTS BY ONE ASSESSING OFFICER TO ANOTHER ASSESSING OFFICER AND, THUS, THERE WAS NO REQUIREMENT OF RECORDING OF SATISFACTION. LD. CIT (A) ALSO SUPPORTED HIS VIEW BY PLACING RELIANCE IN THE CASE OF CIT VS. PANCHAJANAYA M MANAGEMENT AGENCIES SERVICES [2011] 333 ITR 281(KERALA), CIT V S. T.M. KURIACHAN [2013] 32 TAXMANN.COM 165(KER.), TVS SECURITIES & FINANCE (P) LTD. [2014] 42 TAXMANN.COM 441(ALL), BHARAT GINNING AND PRESSING FAC TORY VS. ITO [2013] 32 TAXMANN.COM 322 (AHD- TRIB). ACCORDINGLY LD. CIT (A) UPHELD THE VALIDITY OF INITIATION OF PROCEEDINGS U/S.153C OF THE ACT. 4. BEING, AGGRIEVED THE ASSESSEE FILED THIS APPEAL BEFORE THE TRIBUNAL. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT SECTI ON 153C OF INCOME TAX ACT,1961 PRESCRIBED A MANDATORY REQUIREMENT OF RECORDING OF SATISFACTION BY THE AO OF SEARCHED PERSON ABOUT THE BELONGINGNESS OF S EIZED MATERIAL BY ANIL AGARWAL (HUF)/ITA (SS) NO.213, 214 &215/IND/20 15/A.Y.99-00-02-03-04-05. PAGE 4 OF 10 OTHER PERSON. THE AO OF THE SEARCHED PERSON IS ALSO REQUIRED TO HAND OVER SUCH SEARCHED MATERIAL TO THE AO OF THE OTHER PERSON WHO THEN PROCEED FOR MAKING THE ASSESSMENT OF OTHER PERSON. IN THE INSTANT CASE, THE AO OF THE SEARCHED PERSON HAS NOT RECORDED THE SATISFACTION I N THE ASSESSMENT OF SHRI ANIL AGARWAL(INDIVIDUAL). THE ASSESSEE HAS RAISED T HIS ISSUE BEFORE LD. CIT (A) BUT LD. CIT (A) HAS TAKEN ADVERSE VIEW BY HOLDING TH AT THE AO HAD JURISDICTION OVER SHRI ANIL AGARWAL (INDIVIDUAL ) AND THE APPELLAN T ANIL AGARWAL (HUF), THERE WAS NO NECESSITY TO TRANSFER THE SEIZED DOCUM ENTS FROM ONE OFFICER TO ANOTHER. HENCE, THE AO WAS FULLY EMPOWERED TO INITIAT E PROCEEDINGS U/S.153C OF THE ACT AGAINST HUF I.E. OTHER PERSON AN D NO SEPARATE SATISFACTION WAS REQUIRED TO BE RECORDED IN SUCH CASE. THE LEARNE D COUNSEL FOR THE ASSESSEE, REFERRED THE CBDT CIRCULAR NO. 24/2015 DA TED 31 ST DECEMBER 2015 REGARDING RECORDING OF SATISFACTION NOTE UNDER SECT ION 158BD/153C OF THE ACT WHEREIN IN PARA 4 IT WAS MENTIONED THE GUIDELINES OF THE HON`BLE SUPREME COURT AS REFERRED IN PARA 2 ABOVE, WITH REG ARD TO RECORDING OF SATISFACTION NOTE MAY BE BROUGHT TO THE NOTICE OF A LL FOR STRICT COMPLIANCE. IT IS FURTHER CLARIFIED THAT EVEN IF THE AO OF THE SEARCH ED PERSON AND THE OTHER PERSON IS ONE AND THE SAME, THEN ALSO HE IS REQUI RED TO RECORD HIS SATISFACTION AS HELD BY THE COURTS. THE LEARNED COUNSEL FOR THE ASSESSEE, SUBMITTED THAT THE ASSESSMENT PROCEEDINGS CARRIED UNDER SECTION153C OF THE INCOME-TAX ACT, 1961 WERE A WITHOUT RECORDING ANY SA TISFACTION BY THE AO. THE LEARNED COUNSEL CONTENDED THAT IN THE ASSESSEES CASE NO SATISFACTION WAS RECORDED BY THE AO OF THE PERSON SEARCHED. THE AS SESSEE IS ALSO AGITATING THAT EVEN IN ITS OWN CASE NO SATISFACTION WAS RECORDED AS REGARD TO ANIL AGARWAL (HUF)/ITA (SS) NO.213, 214 &215/IND/20 15/A.Y.99-00-02-03-04-05. PAGE 5 OF 10 ITS BELONGINGNESS TO CERTAIN INCRIMINATING DOCUMENTS S EIZED FROM THE PREMISES OF SHRI ANIL AGARWAL. THE LEARNED COUNSEL FOR THE A SSESSEE, FURTHER RELIED IN THE CASE OF CIT VS. MECHMEN [2015] 60 TAXMANN.COM 484 (MP ) WHEREIN THE HON`BLE HIGH COURT HELD AS IN THE PRESENT CASE, THE CONCURRENT FINDING OF FACT RECORDED BY THE APPELLATE FORUM IS THAT, NO S ATISFACTION HAS BEEN RECORDED BY THE ASSESSING OFFICER BEFORE ISSUING OF NOTICE UNDER SECTION153C. FURTHER, NONE OF THE PAPERS SEIZED BELONGS OR BELON G TO THE ASSESSEE( NOTICEE).THE APPELLATE FORUM HAVE FURTHER FOUND TH AT NO ADDITION OR EVEN OBSERVATION HAVE BEEN MADE BY THE ASSESSING OFFICER IN ANY OF THE ORDERS FOR THE RELEVANT ASSESSMENT YEARS IN CONNECTION WITH AN Y MATERIAL FOUND DURING THE COURSE OF SEARCH. EVEN FOR THAT REASON NO ACTIO N UNDER SECTION 153C, IS JUSTIFIED. THESE FINDINGS OF FACT NEED NO INTERFERE NCE AND HAVE NOT BEEN QUESTIONED BEFORE US. CONSIDERING THE ABOVE, THE AP PEAL MUST FAIL. THE ASSESSEES FURTHER AGITATED THAT EVEN THE SATISFACTI ON MUST HAVE BEEN FORMED AS REGARD TO THE UNDISCLOSED INCOME OF THE ASSESSEE WHICH HAS NOT BEEN SO FORMED. THE LEARNED COUNSEL FURTHER SUBMITTED THAT IN THE INSTANT CASE NEITHER SATISFACTION HAS BEEN RECORDED BY THE AO IN THE ASSES SMENT OF SEARCHED PERSON NOR HAS ANY COPY OF RECORDING OF SATISFACTION NOTE PROVIDED TO THE APPELLANT. THEREFORE, PROCEEDINGS INITIATED ON THE APPE LLANT U/S.153C ARE NULL AND VOID. 5. ON THE OTHER HAND, THE LD. CIT (D.R.) DEFENDED THE ORDERS OF THE LD. CIT(A) SUBMITTING THAT LD. CIT(A) HAS DISCUSSED THE ISSUE AT PARA 4.5 RELYING ON CERTAIN JUDICIAL PRONOUNCEMENTS AND REACHED TO THE CONCLUSION THAT THE ASSESSING ANIL AGARWAL (HUF)/ITA (SS) NO.213, 214 &215/IND/20 15/A.Y.99-00-02-03-04-05. PAGE 6 OF 10 OFFICER HAS VALIDLY MADE ASSESSMENT U/S 153C. THEREFOR E, ORDERS OF THE LD. CIT (A) ON THIS ISSUE MAY BE UPHELD. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PERUSED T HE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ASSESSING OFFI CER HAS ISSUED NOTICES U/S 153C OF THE ACT ON THE BASIS OF SEARCH U/S 132(1) W HICH WAS CARRIED OUT IN THE CASE OF SHRI ANIL AGARWAL KARTA OF HUF. THE ASSESSI NG OFFICER ISSUED NOTICES U/S 153C AND REOPENED ASSESSMENTS FOR THE YEARS UNDER CON SIDERATION. THE PROVISIONS OF SECTION 153C CAN BE INVOKED ONLY AFTER RECORDING A SATISFACTION IN THE CASE OF PERSONS SEARCHED QUA THE ASSETS OR BOOK S OR DOCUMENTS SEIZED DURING THE COURSE OF SEARCH BELONG TO SOME OTHER PERS ON. IN THE INSTANT CASE, THE ASSESSING OFFICER OF OTHER CONCERNED ASSESSEES HAS NOT RECORDED ANY SATISFACTION QUA THE BELONGINGNESS OF THE SEIZED DOCU MENTS WITH THE ASSESSEE AND THERE WAS NO SATISFACTION RECORDED, TH EREFORE, THE ASSESSMENTS ARE BAD IN LAW. THE SIMILAR ISSUE HAD COME UP BEFORE TH E HONBLE JURISDICTIONAL HIGH COURT OF MADHYA PRADESH IN THE CASE OF CIT VS. MECHMEN [2015] 60 TAXMANN.COM 484 (MP), WHEREIN THE HON'BLE HIGH COURT DISCUSSING THE VARIOUS JUDGMENTS HAS HELD THAT THE AO IS OBLIGED TO RECORD SATISFACTION (IN CASE OF THE SEARCHED PERSON) THAT THE ASSETS OR DOCUMENTS DO NOT BELONG TO THE SEARCHED PERSON AND THESE IN-FACT BELONG TO SO ME OTHER PERSON OTHER THAN THE SEARCHED PERSON. THIS IS SINE QUA NON DESPIT E THE FACT THAT THE AO OF SEARCHED AND NON-SEARCHED PERSON IS SAME. THEREAFTER , HE HAS TO HANDOVER THE MATERIAL TO THE AO OF NON SEARCHED PERSON HAVING JURISDICTION OVER HIM (MAY BE THE SAME AO). AFTER RECEIPT OF THE MATERIAL AN D DUE VERIFICATION, THE AO OF NON SEARCHED PERSON HAS TO ISSUE NOTICE U/S 15 3C OF THE ACT AND TO ANIL AGARWAL (HUF)/ITA (SS) NO.213, 214 &215/IND/20 15/A.Y.99-00-02-03-04-05. PAGE 7 OF 10 PROCEED IN THE MATTER. THE RELEVANT OBSERVATIONS OF HON'BLE M.P. HIGH COURT ARE AS UNDER : 14. THUS, AS ENVISAGED BY SECTION 158BD, 'SATISFACT ION' OF THE ASSESSING OFFICER BEFORE HE TRANSMITS THE MATERIAL/RECORDS TO OTHER ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON I S SINE QUA NON. SANS SUCH SATISFACTION, THE ASSESSING OFFICER CANNOT VAL IDLY TAKE RECOURSE TO THE MACHINERY PROVISION. 15. WE MAY NOW TURN TO SECTION 153C. NO DOUBT, THE FORM OF SECTION 153C IS DISSIMILAR TO THAT OF SECTION 158BD. IT IS ALSO TRUE THAT THE TWO PROVISIONS ARE EMBEDDED UNDER DIFFERENT CHAPTERS. FOR , SECTION 153C IS IN CHAPTER XIV PROVIDING FOR PROCEDURE FOR ASSESSME NT, WHEREAS SECTION 158BD IS FOUND IN CHAPTER XIV-B PROVIDING FOR SPECIA L PROCEDURE FOR ASSESSMENT OF SEARCH CASES. FURTHER, SECTION 153C O PENS WITH NON- OBSTANTE CLAUSE. HOWEVER, THE NON-OBSTANTE CLAUSE I N SECTION 153C IS NECESSITATED TO GIVE POWER TO THE ASSESSING OFFICER HAVING JURISDICTION TO PROCEED AGAINST THE PERSON OTHER THAN THE PERSON R EFERRED TO IN SECTION 153A, INSPITE OF THE ACTION UNDER SECTION 13 9, 147, 148, 149, 151 AND 153 OF THE I.T. ACT. HOWEVER, ON CLOSER SCRUTIN Y OF THE TWO PROVISIONS, IT IS INDISPUTABLE THAT, THESE PROVISIONS ARE MACHINERY PROVISIONS AND HAVE BEEN PROVIDED FOR IN THE STATUTE BOOK FOR THE PURPOSE OF CARRYING OUT ASSESSMENT OF A PERSON OTHER THAN THE SEARCHED PERSON UNDER SECTION 132 OR 132A OF THE I.T . ACT IN RELATION TO SECTION 158BD; AND SECTION 153A IN RELATION TO SECT ION 153C. NOTABLY, THE PURPOSE UNDERLYING BOTH THESE PROVISIONS IS SIMILA R, EVEN THOUGH SECTION 153C DOES NOT SPECIFICALLY REFER TO THE EXPR ESSION 'UNDISCLOSED' INCOME. HOWEVER, IN BOTH THE SITUATIONS, THE ASSESSI NG OFFICER ENGAGED IN CARRYING ON SEARCH OF THE ASSESSEE WITHIN HIS JU RISDICTION, IF SEIZES OR REQUISITIONS THE ITEMS (BOOKS OF ACCOUNT OR OTHER DOC UMENTS OR ANY ASSETS FOR SECTION 158BD; AND MONEY, BULLION, JEWELL ERY OR OTHER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNT OR DOCU MENTS FOR SECTION 153C), IS EXPECTED TO HANDOVER THOSE ITEMS TO THE AS SESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON AND THERE AFTER THE ASSESSING OFFICER HAVING JURISDICTION HAS TO PROCEED AGAINST SUCH OTHER PERSON WITHIN HIS JURISDICTION. EVEN FOR THE PURPOSE OF SEC TION 153C, THE ASSESSING OFFICER BEFORE HANDING OVER THE ITEMS TO T HE ASSESSING OFFICER HAVING JURISDICTION MUST BE 'SATISFIED' THAT THE ITEM S BELONGS OR BELONG TO THE PERSON OTHER THAN THE PERSON REFERRED TO IN SE CTION 153A. THAT SATISFACTION OF THE CONCERNED ASSESSING OFFICER IS A SINE QUA NON. THE CONSEQUENCES FLOWING FROM THE ACTION TO BE TAKEN ON T HE BASIS OF SUCH INFORMATION HANDED OVER TO THE ASSESSING OFFICER HA VING JURISDICTION, FOR THE ASSESSEE, WHO IS A PERSON OTHER THAN THE PERSON R EFERRED TO IN SECTION 153A, IS DRASTIC OF ASSESSMENT OR REASSESSM ENT OF HIS INCOME FALLING WITHIN SIX ASSESSMENT YEARS. ANIL AGARWAL (HUF)/ITA (SS) NO.213, 214 &215/IND/20 15/A.Y.99-00-02-03-04-05. PAGE 8 OF 10 16. SUFFICE IT TO OBSERVE THAT THE DISSIMILARITY OF THE FORM OF TWO PROVISIONS WOULD MAKE NO DIFFERENCE TO THE PURPOSE UN DERLYING. THE POWER BESTOWED ON THE ASSESSING OFFICER HAVING JURISD ICTION BE IT UNDER SECTION 153C OR SECTION 158BD IS IDENTICAL. 17. WE ARE NOT INCLINED TO ACCEPT THE ARGUMENT OF T HE DEPARTMENT THAT THE PURPOSE UNDERLYING THE TWO PROVISIONS IS DIF FERENT. WE ALSO FIND THAT EVEN THE PROCEDURE IS NOT DIFFERENT. THE SUBJE CT MATTER OF THE ACTION WOULD DIFFER IN THE CONTEXT OF THE MACHINERY PROVISION INVOKED, IN THE GIVEN CASE. THAT, HOWEVER, CANNOT BE THE BASIS TO EXTRICATE THE ASSESSING OFFICER, WHO RESORTS TO POWER UNDER SECTIO N 153C OF HANDING OVER THE ITEMS REFERRED TO IN SECTION 153C TO THE A SSESSING OFFICER HAVING JURISDICTION, OF HIS DUTY TO BE SATISFIED ABOU T THE JURISDICTIONAL FACT THAT THE ITEMS BELONGS OR BELONG TO A PERSON OTH ER THAN THE PERSON REFERRED TO IN SECTION 153A. 18. THE CONCOMITANT OF THIS CONCLUSION, IS THAT, TH E LEGAL POSITION AS APPLICABLE TO SECTION 158BD REGARDING SATISFACTION IN THE FIRST INSTANCE OF THE FIRST ASSESSING OFFICER FORWARDING THE ITEMS TO THE ASSESSING OFFICER HAVING JURISDICTION; AND IN THE SECOND INSTANCE OF THE ASSESSING OFFICER HAVING JURISDICTION WHILST SENDING NOTICE TO SUCH O THER PERSON (OTHER THAN THE PERSON REFERRED TO IN SECTION 153A), MUST A PPLY PROPRIOVIGORE. THE FACT THAT INCIDENTALLY THE ASSESSING OFFICER IS COMMON AT BOTH THE STAGES WOULD NOT EXTRICATE HIM FROM RECORDING SATIS FACTION AT THE RESPECTIVE STAGES. IN THAT, THE ASSESSING OFFICER IS SATISFIED THAT THE ITEMS REFERRED TO IN SECTION 153C BELONGS OR BELONG TO A PERSON (OTHER THAN THE PERSON REFERRED TO IN SECTION 153A), BEING SINE QUA NON. HE CANNOT ASSUME JURISDICTION TO TRANSMIT THOSE ITEMS TO ANOT HER FILE WHICH INCIDENTALLY IS PENDING BEFORE HIM CONCERNING OTHER PE RSON (PERSON OTHER THAN THE PERSON REFERRED TO IN SECTION 153A). THE QUESTION AS TO WHETHER THAT MAY INFLUENCE THE OPINION OF THE ASSESS ING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON, ALSO CANNOT BE T HE BASIS TO TAKE ANY OTHER VIEW. AS A MATTER OF FACT, THE OTHER ASSE SSING OFFICER TO WHOM THE ITEMS ARE HANDED OVER, BEFORE ISSUING NOTIC E MUST HIMSELF BE SATISFIED AFTER DUE VERIFICATION OF THE ITEMS RECEI VED AND THE DISCLOSURES MADE BY THE OTHER PERSON IN THE RETURNS FOR THE RELEV ANT PERIOD ALREADY FILED BY THE OTHER PERSON BEFORE HIM. FOR THE SAME RE ASON, WE MUST REJECT THE ARGUMENT OF THE DEPARTMENT THAT THE DISCR ETION OF THE ASSESSING OFFICER HAVING JURISDICTION WILL BE IMPAIR ED IN ANY MANNER, IF HE WERE TO HOLD A DIFFERENT VIEW. SIMILARLY, AS THE RE IS NO PROVISION EITHER EXPRESS OR IMPLIED (IN THE ACT) TO DISPENSE WITH THE REQUIREMENT OF SATISFACTION, IF THE ASSESSING OFFICER HAPPENS TO BE THE SAME, AS IN THIS CASE, THE ARGUMENT OF THE DEPARTMENT MUST BE NEGATIVE D. 19. AFTER RECEIPT OF THE MATERIALS, THE ASSESSING O FFICER HAVING JURISDICTION IS EXPECTED TO CONDUCT ENQUIRY AND DUE V ERIFICATION OF THE RELEVANT FACTS; BEFORE FORMING HIS PRIMA FACIE SATIS FACTION. THE ASSESSING ANIL AGARWAL (HUF)/ITA (SS) NO.213, 214 &215/IND/20 15/A.Y.99-00-02-03-04-05. PAGE 9 OF 10 OFFICER HAVING JURISDICTION WILL BE WELL WITHIN HIS RIGHTS TO FORM AN INDEPENDENT VIEW BEFORE ISSUING NOTICE TO THE OTHER PE RSON (PERSON OTHER THAN THE PERSON REFERRED TO IN SECTION 153A) U NDER HIS JURISDICTION ON THE BASIS OF HIS OWN ENQUIRY. IN OUR OPINION, THE V IEW FORMED BY THE ASSESSING OFFICER AFTER HIS OWN ENQUIRY DOES NOT EN TAIL IN SEATING IN APPEAL OVER THE SATISFACTION OF THE FIRST ASSESSING O FFICER, WHO HAD HANDED OVER THE ITEMS TO HIM. 7. IN THE ABOVE DECISION, IT HAS BEEN HELD THAT EVEN WHE N THE ASSESSING OFFICER OF THE PERSON SEARCHED AND THE OTHER PERSON IS COMMON, THE ASSESSING OFFICER OF THE PERSON SEARCHED HAS TO NECESSARILY FO RM A SATISFACTION THAT THE ITEM REFERRED TO IN SECTION 153C BELONGS OR BELONG TO A PERSON OTHER THAN THE PERSON SEARCHED. APPARENTLY, IN THE PRESENT APPEALS, NO SUCH SATISFACTION BY THE ASSESSING OFFICER HAS BEEN FOUND RECORDED. BEFOR E US, THE LD. DRS VEHEMENTLY ARGUED THAT THE APPRAISAL REPORT IS PREPARED BY ADIT WHO IS AN ASSESSING OFFICER AND IF IN THE APPRAISAL REPORT, A RE CORDING REGARDING A PARTICULAR DOCUMENT BELONGING TO A THIRD PERSON OTHER T HAN PERSON SEARCHED IS GIVEN THEN IT SHOULD TANTAMOUNT TO RECORDING OF T HE SATISFACTION BY THE PERSON SEARCHED. THE LD. DRS HAVE NOT CONTROVERTED T HE SUBMISSION OF THE LD. AR OF THE ASSESSEE THAT IN THE CASE OF THE PERSONS S EARCHED, NO SATISFACTION AS REGARD TO THE BELONGINGNESS OF ANY DOCUMENT TO TH E PRESENT ASSESSEES WAS RECORDED. IN OUR CONSIDERED VIEW, ANY RECORDING IN AN APPRAISAL REPORT CANNOT SUBSTITUTE THE LEGAL REQUIREMENT OF RECORDING OF SATISFACTION IN THE CASE OF PERSONS SEARCHED. SUCH A VIEW WAS ALSO HELD BY INDORE BENCH IN THE CASE OF ACIT VS. CHIRCHIND HYDRO LTD. (2011) 17 ITJ 197 (INDORE). WE HAVE ALSO TAKEN NOTE OF A CIRCULAR NO.24/2015 DATED 31.12.2015 , ISSUED BY THE CBDT, IN WHICH, THE BOARD, FOLLOWING THE DECISION OF HONBLE SUPREME COURT IN CASE OF M/S. CALCUTTA KNITWEARS (CIVIL APPEAL NO. 3958 OF 20 14 DATED 12.03.2014), ANIL AGARWAL (HUF)/ITA (SS) NO.213, 214 &215/IND/20 15/A.Y.99-00-02-03-04-05. PAGE 10 OF 10 HAS DIRECTED THAT WHERE THE SATISFACTION BY THE ASSE SSING OFFICER OF THE PERSON SEARCHED AND OTHER PERSON IS NOT FOUND RECORDED, THE DEPARTMENT SHOULD NOT PRESS THAT MATTER IN APPEAL. THUS, KEEPING IN VIEW RIVAL SUBMISSIONS IN LIGHT OF JUDICIAL PRONOUNCEMENTS AND PARTICULARLY THE DECIS ION OF HONBLE JURISDICTIONAL HIGH COURT OF M.P. CIT VS. MECHMEN [2 015] 60 TAXMANN.COM 484 (MP) AND CBDT CIRCULAR (SUPRA), ASSESSMENTS IN THESE CASES OF FOR THE ASSESSMENT YEAR 1999-2000, 2002-03 AND 2004-05 IN TH E CASE OF THE PRESENT ASSESSEES ARE HELD AS ILLEGAL AND VOID-AB-INITIO. A CCORDINGLY, THE GROUNDS RAISED BY THE ASSESSEES RELATING TO APPLICABILITY OF SE CTION 153C ARE ALLOWED. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR THE ASSESSMENT YEAR 1999-2000, 2002-03 AND 2004-05. SINCE AS WE HAVE AL LOWED GROUND OF VALIDITY OF NOTICE UNDER SECTION153C OF THE ACT, HENCE, OTHE R GROUNDS OF APPEAL DOES NOT REQUIRE ANY ADJUDICATION AND TO HAVE BEEN AL LOWED DEEMED. 9. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 16 .11.2016. SD/- (D.T.GARASIA) JUDICIAL MEMBER SD/- (O.P.MEENA) ACCOUNTANT MEMBER DATED :16 TH NOVEMBER, 2016.