Smt G Lakshmi Aruna, Bellary V. Deputy Commissioner of Income tax, Bangalore

ITA 1451/BANG/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9333 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 10 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-10-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 27-06-2016
• Assessment Year: 2005-2006
• Appeal Filed On: 19-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRAVEEN S DCIT CENTRAL CI
• Assessee Lawyers: MAYANK JAIN; MADHUR JAIN S
• Keywords: Search and seizure; Document seized; Opportunity of being heard; Validity of assessment; Block assessment; Documents seized
• Section: 143(3); 153A; 148; 132; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH B, BANGALORE BEFORE SHRI S.K.YADAV, JUDICIAL MEMBER AND SHRI A. K. GARODIA, ACCOUNTANT MEMBER ITA NO.1451 TO 1457(BANG) 2014 (ASSESSMENT YEARS : 2005 06 TO 2011 12) SMT. G. LAKSHMI ARUNA, NO.8, HAVAMBAVI, SIRUGUPPA ROAD, ASHOK NAGAR, BELLARY 583103 PAN: AFJPA5974P APPELLANT VS THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 1(3), BANGALORE RESPONDENT ASSESSEE BY : SHRI MAYANK JAIN & SHRI MADHUR JAIN A DVOCATES REVENUE BY : MS. NEERA MALHOTRA, CIT & SHRI PRAVEEN S., DCIT CENTRAL CIRCLE 1 (3) DATE OF HEARING : 26-08-2016 DATE OF PRONOUNCEMENT : 18-10-2016 O R D E R PER BENCH: ALL THESE SEVEN APPEALS ARE FILED BY THE ASSESSEE DIRECTED AGAINST THE COMBINED ORDER OF LEARNED CIT (A) VI, BANGALORE DATED 25.08.2014 FOR A. YS. 2005 06 TO 2011 12. 2. ALL THESE APPEALS WERE HEARD TOGETHER AND ARE B EING DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CO NVENIENCE. ITA NO.1451 TO 1457(BANG)/2014 PAGE 2 OF 26 3. IN ALL THESE APPEALS, THE ASSESSEE HAS OBJECTED TO THE VALIDITY OF THE ASSESSMENT ORDER PASSED U/S 153C READ WITH S ECTION 144 OF THE I. T. ACT. IN COURSE OF HEARING OF THESE APPEAL S, ON 27.06.2016, IT IS NOTED BY THE BENCH AS NOTED IN THE ORDER SHEET O F THAT DAY THAT THE LEARNED COUNSEL FOR THE ASSESSEE HAS RAISED A S ERIOUS OBJECTION WITH RESPECT TO INITIATION OF PROCEEDINGS U/S 153C OF THE I. T. ACT BY CONTENDING THAT NO SATISFACTION WAS RECORDED BY THE A.O. IN THE CASE OF SEARCHED PERSON THAT THE INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH BELONGS TO THE ASSESSEE AND THEREF ORE, THE ASSESSMENT COMPLETED U/S 153C OF THE ACT IS ILLEGAL . THE BENCH DIRECTED THE LEARNED DR OF THE REVENUE TO PLACE THE COPY OF SATISFACTION RECORDED IN THE CASE OF THE SEARCHED P ERSON THAT THE INCRIMINATING MATERIAL SEIZED DURING THE COURSE OF SEARCH PERTAINS TO THE ASSESSEE AND THE HEARING WAS ADJOURNED TO 03 .08.2016. THE HEARING WAS AGAIN ADJOURNED TON 10.08.2016 AND THEN TO 23.08.2016 AND AGAIN TO 26.08.2016 TO ENABLE THE DR TO FILE THE REQUIRED SATISFACTION. ON 26.08.2016, HEARING WAS C ONCLUDED WITH THE LIBERTY TO THE DR TO FILE WRITTEN SUBMISSIONS O N OR BEFORE 02.09.2016. ON 07.09.2016, LEARNED DR OF THE REVENU E FILED WRITTEN SUBMISSIONS AND SUBMITTED THAT IN VIEW OF ALL INDI A BANDH ON 02.09.2016, THE SAID WRITTEN SUBMISSIONS BE ACCEPTE D ON 07.09.2016. WE ACCEPT THE SAME AND CONSIDER IT FOR DECIDING THIS ITA NO.1451 TO 1457(BANG)/2014 PAGE 3 OF 26 TECHNICAL ASPECT FIRST I.E. VALIDITY OF ASSESSMENTS U/S 153C READ WITH SECTION 144. 4. IN COURSE OF HEARING ON 26.08.2016, BOTH SIDES A GREED THAT THE FACTS ON THIS TECHNICAL ASPECT IN THE PRESENT C ASE AND IN THE CASE OF THE HUSBAND OF THE PRESENT ASSESSEE SHRI GA LI JANARDAN REDDY IN ITA NO. 1444 TO 1450/BANG/2014 ALSO HEARD ON 26.08.2016 ARE SAME AND THE ARGUMENTS ARE ALSO SAME AND THESE APPEALS CAN BE DECIDED ON SIMILAR LINE. IN THE WRIT TEN SUBMISSIONS FILED BY THE LEARNED DR OF THE REVENUE ALSO, SIMILA R SUBMISSIONS ARE REITERATED. THESE WRITTEN SUBMISSIONS OF THE LEARNE D DR OF THE REVENUE SUBMITTED ON 07.09.2016 ARE REPRODUCED AS U NDER:- DURING THE COURSE OF HEARING HELD ON 26/08/2016 A REQUEST WAS MADE TO ALLOW THE DEPARTMENT TO FILE WRITTEN SUBMIS SIONS ON CERTAIN POINTS RAISED DURING THE COURSE OF HEARING. THE HON'BLE BENCH ACCEDED TO THE REQUEST AND GRANTED TIME UP TO 02/09/2016 TO FILE THE REPLY. AS 02/09/2016 WAS AN 'ALL INDIA BANDH', THE A.O COULD NOT PREPARE THE REPORT. ACCORDINGLY, THE REPLY IS BEING SUBMITTED TODAY. THE DELAY CAUSED MAY KINDLY BE CON DONED DUE TO UNFORESEEN CIRCUMSTANCES ARISING DUE TO BANDH. II. REPORT OF D.C.I. T CENTRAL CIRCLE (1)(3) WRITTEN SUBMISSIONS IN THE FORM OF THE REPORT OF D EPUTY COMMISSIONER OF INCOME TAX , CENTRAL CIRCLE (1) (3) , BANGALORE ALONG WITH THE PAPER BOOK CONTAINING THE COPIES OF THE SEIZED MATERIAL AND STATEMENTS OF THE TRANSPORTERS TO WHOM PAYMENTS MADE WERE REFLECTED IN THE BOOKS OF ACCOUNTS, WHICH WERE DENIED BY THESE TRANSPORTERS IN THE STATEMENTS RECORDED. T HE A.O IN HIS REPORT HAS DEALT WITH THE FOLLOWING POINTS DISCUSSE D DURING THE COURSE OF HEARING ON 26/08/2016 : ITA NO.1451 TO 1457(BANG)/2014 PAGE 4 OF 26 A) NOTE ON 1ST PROVISO TO SECTION 153C (REFER PG. 2 & 3 OF REPORT OF DCIT) IN THE SECTION 153A REFERENCE TO DATE/YEAR OF SEARC H OCCURS '3' TIMES VIZ. 153A(L)(B) WHICH MANDATES THE 6 YEARS WHICH HAVE TO BE COMPULSORILY ASSESSED. 2 ND PROVISO TO SECTION 153A(L), WHICH GOVERNS THE ABAT EMENT OF PENDING PROCEEDINGS. 3 RD PROVISO TO SECTION 153A(1), WHICH PROVIDES EXEMPTI ON FOR COMPULSORY ASSESSMENT IN CERTAIN NOTIFIED CLASS OF CASES. THE 1ST PROVISO TO SECTION 153C MAKES A DIRECT RE FERENCE ONLY TO 2 ND PROVISO TO SECTION 153A. 2 ND PROVISO TO SECTION 153A DEALS ONLY WITH THE ISSUE OF ABATEMENT OF PEND ING ASSESSMENT PROCEEDINGS. AS HAS BEEN RIGHTLY POINTED OUT BY DCIT IN HIS RE PORT THE INTERPRETATION RESORTED TO BY THE ASSESSEE WILL LEA D TO ABSURD SITUATIONS. FOR EXAMPLE, IF THE THE TRANSFER OF REC ORDS OCCURS IN A FINANCIAL YEAR 2 YEARS AFTER THE SEARCH DATE, THE A .O OF 153C CASES LOSSES JURISDICTION OVER THE EARLIEST 2 A.Y S . ON WHICH HE MAY POSSESS SEIZED RECORDS. ON THE OTHER HAND, HE A SSUMES JURISDICTION OVER 2 NEW A.YS. ON WHICH THERE ARE NO SEIZED RECORDS. THERE CAN BE NO ASSESSMENTS FOR THE LATEST 2 YEARS BASED ON SEIZED DOCUMENTS TRANSFERRED. THEREFORE, THE ARG UMENT OF THE ASSESSEE THAT THE 1ST 2 YEARS ASSESSMENTS ARE VOID ARE NOT LOGICAL VIS-A-VIS THE PROVISIONS OF THE ACT. B) NOTE ON OPPORTUNITY OF BEING HEARD (REFER PG. 4 OF REPORT OF DCIT) THE REPORT OF DCIT ELABORATES THAT THE ASSESSEE H AD NOT FILED RETURN OF IN RESPONSE TO NOTICE U/S 153C EVEN UNDER PROTEST AND THAT ALL ORDERS FOR THE BATCH OF 6 ASSESSMENT Y EARS WERE BEST JUDGEMENT ASSESSMENTS U/S 144 R.W.S. 153C BASED ON MATERIAL AVAILABLE ON RECORD DUE TO TOTAL NON-COOPERATION OF ASSESSEE DURING ASSESSMENT PROCEEDINGS. ITA NO.1451 TO 1457(BANG)/2014 PAGE 5 OF 26 C) NOTE ON TRANSPORTATION EXPENSES ( REFER PG. 4 T O 6 OF REPORT OF DCIT) THE REPORT OF DCIT ELABORATES THAT AO HAD SENT TW O SHOW- CAUSE NOTICES DATED 01/03/2013. THE ASSESSEE REPLIE D ON THE SAME ISSUE VIDE LETTER DATED 16/03/2013 RECEIVED ON 21ST MARCH, 2013 (PAGE 32 TO 34 OF PAPER BOOK) AND RAISED THE QUESTI ON OF CROSS EXAMINATION ON 21ST MARCH, 2013 WHEN THE PROCEEDING S WERE GETTING BARRED BY LIMITATION ON 31ST MARCH, 2013. T HE CROSS EXAMINATION SOUGHT BY THE ASSESSEE IS ON THE STATEM ENT OF THE SUPPOSED TRANSPORTATION CONTRACTOR ENGAGED BY THE A SSESSEE HERSELF. IT IS NOT A STATEMENT OF TOTALLY UNRELATED PARTY. THE NON- COMPLIANT APPROACH OF THE ASSESSEE IS ALSO RECORDED BY THE ASSESSING OFFICER AFTER THE LAST QUESTION OF HIS SH OW CAUSE LETTER DATED 0L.03.2013. ILL. WRITTEN SUBMISSION ON 'RECORDING OF SATISFACTION'- [ SIMILAR SUBMISSION WAS ALREADY FILED IN THE CASE OF SHRI G. JANARDHAN REDDY (ITA NOS. 1444 TO 1450/B/2014)DURING THE COURSE OF HEARING ON.26/08/2016.1 DURING THE COURSE OF HEARING HELD ON 23.08.2016 THE HON'BLE BENCH HAD DIRECTED FOR PRODUCTION OF SEIZED MATERIA L AND STATEMENTS OF SHRI RAGHAVACHARYALU AND SMT. G.RENUK A, WHOSE PREMISES WERE SEARCHED U/S 132 OF THE I.T ACT, AND DOCUMENTS PERTAINING TO SMT.G.LAXMI ARUNA, WHICH WERE SEIZED FROM THESE PREMISES, WHICH FORMED THE BASIS OF RECORDING OF SA TISFACTION BY THE A.O FOR ISSUING NOTICE U/S 153C IN THE CASE OF THE APPELLANT. IN THIS REGARD THE FOLLOWING 2 FACTS ARE OF GREAT S IGNIFICANCE WHICH ESTABLISHES THE CLOSE ASSOCIATION OF THESE 2 INDIVI DUALS WITH THE APPELLANT AND THE CLOSE CONNECTION WAS ADMITTED BY THESE 2 INDIVIDUALS AND , THEREFORE, IMPORTANT DOCUMENTS PE RTAINING TO APPELLANT WERE FOUND FROM THE PREMISES OF THESE 2 I NDIVIDUALS: 1. SMT. G. RENUKA IS A CHARTERED ACCOUNTANT BY PROFESS ION. HER 4IRM/S G.RENUKA& CO. IS THE CHARTERED ACCOUNTANT FO R THE ENTIRE JANARDHAN REDDY GROUP. 2. SHRI K.RAGHAVACHARYULU IS AN ADVOCATE BY PROFESSION AND HE IS HANDLING ALL THE LEGAL MATTERS FOR THE APPELLANT . ITA NO.1451 TO 1457(BANG)/2014 PAGE 6 OF 26 THIS IS EVIDENT FROM THE POWER OF ATTORNEY FILED BY THE ASSESSEE IN FAVOUR OF SMT G RENUKA & CO FOR REPRESE NTING HER DURING THE EARLIER ASSESSMENT PROCEEDINGS (PAGE 12 OF PAPER BOOK). THE AGREEMENT DATED 26.12.2005 BETWEEN ARUNA AND PAWAN CANNOT BE SAID TO BE NOT BELONGING TO THE ASSESSEE, BEING PARTY TO TRANSACTION. THEREFORE, AG REEMENT DATED 26.12.2005 ALONE IS A SUFFICIENT SATISFACTION FOR INITIATION FOR 153C PROCEEDINGS. IV. CASE LAWS (A) FOR THE ASSESSMENTS COMPLETED U/S 153C THERE IS NO REQUIREMENT U/S 153 C(1) THAT THE ASSESSING OFFICER SHOULD ALSO BE SATISFIED THAT THE INCRIMINATING DOCUMENTS SHOULD CONCLUSIVELY ESTABLISH THAT THE DOCUMENTS SEIZED SH OULD CONCLUSIVELY REFLECT OR DISCLOSE ANY UNDISCLOSED IN COME . IN THIS REGARD THE FOLLOWING CASE LAWS ARE RELIED UPON : 1. SSP AVIATION LTD. VS DCIT [2012] 20 TAXMANN.COM 214 (DELHI) (HC) 2. ALL CARGO GLOBAL LOGISTICS LTD. [20 12] 23 TAXMANN.COM 103 (MUM) (SB) 3. CIT VS CHETAN DAS LACHMAN DA S [2012] 25 TAXMANN.COM 227 (DELHI) (HC) ( B ) IN THE F O LL O WING CASE LAWS C OU RTS HAVE HELD THAT THAT S ATI S FACTION I S TO B E MADE WITH RESPECT TO TH E OWNERSHIP OF THE DOCUMENT S AND NOT REGARDING THE UNDISCLOSED INCOME : 1. ACIT VS PANCHURAM D ES HMUKH & OR S (ITAT BILASPUR) 33 TTD 53 V . N ON - COMPLIANC E BY THE ASS E S S E E T O THE NOTIC E I SSU ED U/S 153C F OR F ILI N G R E T U R N O F I NC OM E AN D T O TH E NOTIC ES IS SUE D D U RI N G TH E S CR U TI NY PROCE E DING S U/ S 153 C A VERY CRUCIAL ASPECT IN THIS CASE IS THE COMPLET E NON- COOPERATION AND NON-COMPLIANCE BY THE ASSESSE TO TH E STATUTORY NOTICES ISSUED. ITA NO.1451 TO 1457(BANG)/2014 PAGE 7 OF 26 (1) THE ASSESSEE DID NOT FILE ANY RETURN OF INCOME IN RESPONSE TO THE NOTICES ISSUED U/S 153C. (2) THE ASSESSEE DID NOT FILE ANY SUBMISSIONS DURING THE COURSE OF PROCEEDINGS U/S 153C BEFORE THE A.O. (3) THE ASSESSEE DID NOT FILE ANY EVIDENCE BEFORE THE CIT(A) IN SUPPORT OF THE CONTENTIONS RAISED. VI. DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC) & CIRCULAR OF C.B.D.T [SIMILAR SUBMISSION WAS ALREADY FILED IN THE CASE OF SHRI G.JANARDHAN REDDY (ITA NOS. 1444 TO 14501B12014) DURING THE COURSE OF HEARING ON 10/08/2016] 1. FIRSTLY, THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC) , WHICH IS RENDERED IN CONNECTION WITH SEARCH ASSESSMENTS U NDER CHAPTER XIV-B (SECTIONS 158B TO 158BI), WHICH ARE DIFFERENT PROVISIONS COMPARED TO ASSESSMENTS OF THE ASSESSEE WHICH RELATE TO THE NEW SEARCH ASSESSMENT PROCEDUR E AS CONTAINED UNDER SECTIONS 153A TO 153A WHICH ARE BROUGHT INTO STATUTE W.E.F 1-6-2003. 2. SECONDLY , THE FACTS IN THE CASE OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC) ARE DIFFERENT FROM THAT OF THE ASSESSEE AS THE OFFICER OF THE PERSON COVERED UNDER PROVISIONS OF SECTION 158BC WAS DIFFERENT FROM THE OFFICER OF THE PERSON COVERED UNDER PROVISIONS OF SECTION 158BD AND THERE FORE THE ISSUE OF 'TRANSMISSION OF RECORDS' (REFER PARA 39) CAME UP BEFORE THE HON'BLE COURT AND CONSEQUENTLY THE ISSUE OF THE 'WHO SHOULD RECORDING OF SATISFACTION' AND 'AT WHAT POINT OF TIME THE SATISFACTION SHOULD BE RECORDED WAS ALS O CONSIDERED ' . IN THIS CONTEXT THE HON'BLE COURT STATED THAT THE SATISFACTION CAN BE RECORDED AT ANY OF THE 3 STAGES - (1) AT THE TIME OF INITIATION OF PROCEEDINGS U/S 158BC, (2) AL ONG WITH THE PROCEEDINGS U/S 158BC AND (3) IMMEDIATELY AFTER CONCLUDING THE PROCEEDINGS U/S 158BC. ITA NO.1451 TO 1457(BANG)/2014 PAGE 8 OF 26 3. THE AFORESAID DECISION OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC) IS NOT APPLICABLE TO THE CASE OF THE ASSESSE FOR THE FOLLOWING REASONS: (I) AS THE ASSESSMENTS OF THE ASSSESSEE ARE COMPLET ED UNDER DIFFERENT PROVISIONS OF THE STATUTE AS THEY RELATE TO THE NEW SEARCH ASSESSMENT PROCEDURE AS CONTAINED UNDER SECT IONS 153A TO 153C WHICH ARE BROUGHT INTO STATUTE W.E.F 1 -6-2003. (II) THE ASSESSING OFFICER OF THE PERSON COVERED U NDER PROVISIONS OF SECTION 153 A IS THE SAME AS THE OFFICER OF THE PERSON COVERED UNDER PROVISIONS OF SECTION 153C AND, THERE FORE, THERE IS NO ISSUE OF 'TRANSMISSION OF RECORDS'. COPIES OF ASSESSMENT ORDERS IN THE CASES OF SHRI K. RAGHAVACHARYALU AND SMT. G.RENUKA ARE ENCLOSED TO ESTABLISH THAT THE ASSESSMENTS ARE COMPLETED BY THE SAME ASSESSING OFFICER I.E SHRI SHIVANAND H. KALAKERI, W HO HAD DONE THE ASSESSMENTS IN THE CASE OF THE ASSESSE E . (III) THE ASSESSING OFFICER HAS RECORDED SATISFACT ION IN THE CASE OF THE ASSESSEE. (IV) THE EVENTUALITY OF AN ASSESSING OFFICER OF TH E PERSON COVERED UNDER PROVISIONS OF SECTION 153BC BEING THE SAME AS THE OFFICER OF THE PERSON COVERED UNDER PROVISIO NS OF SECTION 153 BD IS NOT EXAMINED BY THE HON'BLE SUPRE ME COURT IN THE CASE OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC) . (V) IT IS HUMBLY SUBMITTED THAT JUDGMENTS MUST BE READ AS A WHOLE AND OBSERVATIONS IN JUDGMENTS SHOULD BE CONSI DERED IN THE CONTEXT IN WHICH THEY ARE MADE AND IN THE LI GHT OF QUESTIONS THAT WERE BEFORE THE COURT. IN CIT V. SUN ENGINEERING WORKS PVT. LTD.(198 ITR 297) THE SUPREME COURT OBSERVED: IT IS NEITHER DESIRABLE NOR PERMISS IBLE TO PICK OUT A WORD OR A SENTENCE FROM THE JUDGMENT OF THE SUPREME COURT DIVORCED FROM THE CONTEXT OF THE QUES TION UNDER CONSIDERATION AND TREAT IT TO BE THE COMPLETE LAW DECLARED BY THE COURT. THE JUDGMENT MUST BE READ AS A WHOLE AND THE OBSERVATIONS FROM THE JUDGMENT HAVE T O BE CONSIDERED IN THE LIGHT OF THE QUESTIONS WHICH WERE BEFORE THE COURT. A DECISION OF THE SUPREME COURT TAKES IT S COLOUR FROM THE QUESTIONS INVOLVED IN THE CASE IN WHICH IT IS ITA NO.1451 TO 1457(BANG)/2014 PAGE 9 OF 26 RENDERED AND, WHILE APPLYING THE DECISION TO A LATE R CASE, COURTS MUST CAREFULLY TRY TO ASCERTAIN THE TRUE PRI NCIPLE LAID DOWN BY THE DECISION. THIS HAS BEEN REITERATED BY T HE HON'BLE SUPREME COURT IN ITS DECISION OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC). 4. THEREFORE, IN VIEW OF THE FACT THAT ASSESSING OFF ICER OF THE PERSON COVERED UNDER PROVISIONS OF SECTION 153A BEI NG THE SAME AS THE OFFICER OF THE PERSON COVERED UNDER PROVISIO NS OF SECTION 153C AND THE ASSESSING OFFICER HAVING RECORDED THE SATISFACTION BEFORE ISSUING NOTICE U/S 153C, SUFFICIENT COMPLIAN CE HAS BEEN MADE BY THE A.O AS REQUIRED UNDER THE PROVISIONS OF THE STATUTE. SUBMITTED FOR KIND CONSIDERATION. 5. IN THE CASE OF THE HUSBAND OF THE PRESENT ASSESS EE SHRI GALI JANARDAN REDDY IN ITA NO. 1444 TO 1450/BANG/2014 AL SO HEARD ON 26.08.2016 AND ORDER PASSED ON 17.10.2016, SIMILAR ISSUE WAS RAISED BY WAY OF ADDITIONAL GROUND AND THE SAME WAS DECIDED IN FAVOUR OF THE ASSESSEE. THE RELEVANT PORTION OF THI S TRIBUNAL ORDER IS REPRODUCED AS UNDER:- WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. FIRST O F ALL, WE REPRODUCE THE WRITTEN SUBMISSIONS OF LD. DR OF REVE NUE DATED 10.08.2016. THE SAME IS AS UNDER:- DURING THE COURSE OF HEARING HELD ON 03.08.2016 T HE HON'BLE BENCH HAD DIRECTED FOR PRODUCTION OF SEARCH RECORDS OF THE ASSESSES IN WHOSE CASE SEARCH U/S 132 WAS CONDU CTED AND SEIZED MATERIAL PERTAINING TO SHRI GALI JANARDHAN R EDDY WAS FOUND ON THE BASIS OF WHICH SATISFACTION WAS RE CORDED FOR INITIATING PROCEEDINGS U/S 153C IN THE CASE OF THE ASSESSEE. ON PERUSAL OF THE ORDER SHEET RECORDING SATISFACTION N OTE BEFORE ISSUANCE OF NOTICE U/S 153C OF THE I.T ACT FOR A.YS 205-06 TO 2011-12, IT IS NOTED THAT THE FOLLOW ING PREMISES WERE COVERED U/S 132 OF THE LT ACT: ITA NO.1451 TO 1457(BANG)/2014 PAGE 10 OF 26 (A) SHRI K. RAGHAVACHARYALU, AT FLAT NO.402, KAKAT EEYA RESIDENCY, KAPPAGAL ROAD, BELLARY. (B) SMT. G.RENUKA, AT 'RISHIKES', NO.36, GOLDSMITH STREET, BELLARY. DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC) 1. FIRSTLY, THE DECISION OF HON'BLE SUPREME COURT IN T HE CASE OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC ) , WHICH IS RENDERED IN CONNECTION WITH SEARCH ASSESSM ENTS UNDER CHAPTER XIV-B (SECTIONS 158B TO 158BI), WHICH ARE DIFFERENT PROVISIONS COMPARED TO ASSESSMENTS OF THE ASSESSEE WHICH RELATE TO THE NEW SEARCH ASSESSMENT PROCEDURE AS CONTAINED UNDER SECTIONS 153A TO 153A WHICH ARE BROUGHT INTO STATUTE W.E.F 1-6-2003. 2. SECONDLY, THE FACTS IN THE CASE OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC) ARE DIFFERENT FROM THAT OF THE ASSESSEE AS THE OFFICER OF THE PERSON COVERED UNDER PROVISIONS OF SECTION 158BC WAS DIFFERENT FROM THE OFFICER OF THE PERSON COVERED UNDER PROVISIONS OF SECTION 1 58BD AND THEREFORE THE ISSUE OF 'TRANSMISSION OF RECORDS ' (REFER PARA 39) CAME UP BEFORE THE HON'BLE COURT AND CONSEQUENTLY THE ISSUE OF THE 'WHO SHOULD RECORDING OF SATISFACTION' AND 'AT WHAT POINT OF TIME THE SATISFACTION SHOULD BE RECORDED WAS ALS O CONSIDERED '. IN THIS CONTEXT THE HON'BLE COURT STATED THAT THE SATISFACTION CAN BE RECORDED AT ANY OF THE 3 ST AGES - (1) AT THE TIME OF INITIATION OF PROCEEDINGS U/S 158BC, (2) AL ONG WITH THE PROCEEDINGS U/S 158BC AND (3) IMMEDIATELY AFTER CONCLUDING THE PROCEEDINGS U/S 158BC. 3. THE AFORESAID DECISION OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC) IS NOT APPLICABLE TO THE CASE OF THE ASSESSE FOR THE FOLLOWING REASONS: (I) AS THE ASSESSMENTS OF THE ASSESSEE ARE COMPLETED UNDER DIFFERENT PROVISIONS OF THE STATUTE AS THEY ITA NO.1451 TO 1457(BANG)/2014 PAGE 11 OF 26 WHICH RELATE TO THE NEW SEARCH ASSESSMENT PROCEDURE AS CONTAINED UNDER SECTIONS 153A TO 153A WHICH ARE BROUGHT INTO STATUTE W.E.F 1-6-2003. (II) THE ASSESSING OFFICER OF THE PERSON COVERED UNDER PROVISIONS OF SECTION 153 A IS THE SAME AS THE OFFI CER OF THE PERSON COVERED UNDER PROVISIONS OF SECTION 153C AND ,THEREFORE, THERE IS NO ISSUE OF 'TRANSMISSION OF RECORDS'. COPIES OF ASSESSMENT ORDERS IN THE CASES OF SHRI K. RAGHAVACHARYALU AND SMT. G.RENUKA ARE ENCLOSED TO ESTABLISH THAT THE ASSESSMENTS ARE COMPLETED BY THE SAME ASSESSING OFFICER I.E SHRI, SHIVANAND H. KALAKERI, DCIT CENTRAL CIRCLE 1(3) WHO HAD DONE THE ASSESSMENTS I N THE CASE OF THE ASSESSEE. (III) THE ASSESSING OFFICER HAS RECORDED SATISFACTION IN THE CASE OF THE ASSESSEE. (IV) THE EVENTUALITY OF AN ASSESSING OFFICER OF THE PERS ON COVERED UNDER PROVISIONS OF SECTION 153BC BEING THE SAME AS THE OFFICER OF THE PERSON COVERED UNDER PROVISIONS OF SECTION 153 BD IS NOT EXAMINED BY THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC). (V) IT IS HUMBLY SUBMITTED THAT JUDGMENTS MUST BE REA D AS A WHOLE AND OBSERVATIONS IN JUDGMENTS SHOULD BE CONSIDERED IN THE CONTEXT IN WHICH THEY ARE MADE AN D IN THE LIGHT OF QUESTIONS THAT WERE BEFORE THE COUR T. IN CIT V. SUN ENGINEERING WORKS PVT. LTD.(198 ITR 297) THE SUPREME COURT OBSERVED: IT IS NEITHER DESIRABLE NOR PERMISSIBLE TO PICK OUT A WORD OR A SENTENCE FROM THE JUDGMENT OF THE SUPREME COURT DIVORCED FROM THE CONTEXT OF THE QUESTION UNDER CONSIDERATION AND TREAT IT TO BE THE COMPLETE LAW DECLARED BY THE COURT. THE JUDGMENT MUST BE READ AS A WHOLE AND THE OBSERVATIONS FROM THE JUDGMENT HAVE TO BE CONSIDERED IN THE LIGHT OF THE QUESTIONS WHIC H WERE BEFORE THE COURT. A DECISION OF THE SUPREME COURT TAKES ITS COLOUR FROM THE QUESTIONS INVOLVED IN THE CASE IN WHICH IT IS RENDERED AND, WHILE APPLYIN G THE DECISION TO A LATER CASE, COURTS MUST CAREFULLY TRY ITA NO.1451 TO 1457(BANG)/2014 PAGE 12 OF 26 TO ASCERTAIN THE TRUE PRINCIPLE LAID DOWN BY THE DECISION. THIS HAS BEEN REITERATED BY THE HON'BLE SUPREME COURT IN ITS DECISION OF CIT VS CALCUTTA KNITWEARS 43 TAXMANN.COM 446 (SC). 4. THEREFORE, IN VIEW OF THE FACT THAT ASSESSING OFFIC ER OF THE PERSON COVERED UNDER PROVISIONS OF SECTION 153 A BE ING THE SAME AS THE OFFICER OF THE PERSON COVERED UNDER PRO VISIONS OF SECTION 153 C AND THE ASSESSING OFFICER HAVING R ECORDED THE SATISFACTION BEFORE ISSUING NOTICE U/S 153C, SU FFICIENT COMPLIANCE HAS BEEN MADE BY THE A.O AS REQUIRED UND ER THE PROVISIONS OF THE STATUTE. SUBMITTED FOR KIND CONSIDERATION. 2. WE ALSO REPRODUCE THE SATISFACTION NOTE DATED 14.12 .2012 WHICH HAS BEEN SUBMITTED BY THE LD. DR OF REVENUE ALONG W ITH HER WRITTEN SUBMISSIONS. THE SAME IS AS UNDER:- RECORDING OF SATISFACTION NOTE BEFORE ISSUANCE OF NOTICE UNDER SECTION 153C: NAME OF THE ASSESSEE: SRI GALI JANARDHANA REDDY (AY: 2005-06 TO 2010-11) A SEARCH U/S. 132 WAS CONDUCTED ON 25/10/2010 IN TH E CASE OF MR K. RAGHVACHARYULU AT FLAT NO.402, KAKATEEYA RESI DENCY, KAPPAGAL ROAD, BELLARY. DURING THE COURSE OF THE SE ARCH, FOLLOWING DOCUMENTS/BOOKS OF ACCOUNT BELONGING TO S RI GALI JANARDHANA REDDY WERE SEIZED AND THE CONTENTS ARE E XPLAINED IN BRIEF AS BELOW- RB/1 PAGE NO.2 THIS PAGE CONTAINS APPLICATION FILED BY MR G JANARD HANA REDDY BEFORE THE RETURNING OFFICER WHILE CONTESTING FOR THE ELECTION TO THE MEMBER OF LEGISLATIVE COUNCIL IN TH E STATE OF KARNATAKA. ITA NO.1451 TO 1457(BANG)/2014 PAGE 13 OF 26 RB/1 PAGES 27-32 THESE PAGES CONTAIN DETAILS OF ASSETS (MOVABLE, IMM OVABLE, ASSETS ETC) BELONGING TO MR JANARDHANA REDDY, HIS S POUSE AND DEPENDENTS. RB/1PAGES 116-121 THIS CONTAIN INSTRUMENTS OF PARTNERSHIP DEED ENTERE D ON 8.1.2006 BETWEEN SRI B SRININIVAS REDDY, SRI PARAME SHWARA REDDY, SRI B SREERAMULU, SRI G KARUNAKAR REDDY, SRI SOMASHEKHAR REDDY, SMT G LAKSHMI ARUNA IN THE NAME AND STYLE OF HOTEL NAGARJUN. A SEARCH U/S. 132 WAS ALSO CONDUCTED ON 25/10/2010 IN THE CASE OF SMT G RENUKA AT 'RISHIKESH' #36, GOLDSMITH STREE T, BELLARY ON 25-10-2010. DURING THE COURSE OF THE SEARCH, FOL LOWING DOCUMENTS/BOOKS OF ACCOUNT BELONGING TO SRI GALI JA NARDHANA REDDY WERE SEIZED AND THE CONTENTS ARE EXPLAINED IN BRIEF AS BELOW- RN/1 PAGES 179-181. THESE PAGES CONTAIN TRIAL BALANCE OF GALI JANARDHAN A REDDY FOR F.Y.2009-10. RN/1 PAGES 184-185. THESE PAGES CONTAIN TRIAL BALANCE OF GALI JANARDHAN A REDDY FOR F.Y.2009-10 RN/1 PAGES 129 TO 139. THESE PAGES CONTAIN SALE DEED DATED 22-10-2005 BETW EEN SRI SUNIL KUMAR GUPTA (SELLER) AND SRI G JANARDHANA RED DY (PURCHASER) IN RESPECT OF PROPERTY AT PLOT NO.1121 AT JUBILEE HILLS, HYDERABAD. IN VIEW OF THE ABOVE, I AM SATISFIED THAT THE DOCU MENTS AND BOOKS OF ACCOUNT BELONGING TO SRI GALI JANARDHA NA REDDY HAVE BEEN FOUND AND SEIZED FROM THE SEARCHED PREMIS ES OF SRI RAGHAVACHARYULU AND SMT G RENU KA. ISSUE NOTICE U/S. 153C OF THE INCOME TAX ACT, 1961. ITA NO.1451 TO 1457(BANG)/2014 PAGE 14 OF 26 SD/- (SHIVANAND H KALAKERI) DEPUTY COMMISSIONER OF INCOME- TAX, DATE: 14.12.2012 CENTRAL CIRCLE 1(3), BANGALOR E.' 3. WE FIND THAT AS PER SATISFACTION NOTE DATED 14.12.2 012, SATISFACTION NOTE HAS BEEN RECORDED BY SHRI SHIVANA ND H. KALAKERI, DCIT, CENTRAL CIRCLE 1(3), BANGALORE AND AS PER THE COPY OF THE TWO ASSESSMENT ORDERS FOR AY 2005-06 U/S. 153A DATED 27 .3.2013 AND 30.3.2013 IN THE CASE OF SHRI K. RAGHAVACHARYALU AN D SMT. G. RENUKA RESPECTIVELY, THE AO IS THE SAME PERSON WITH THE SA ME DESIGNATION AND HENCE, THIS IS THE ADMITTED POSITION THAT THE A O OF ASSESSEE AND OF THE SEARCHED PERSONS IS ONE AND THE SAME PERSON AND SATISFACTION NOTE HAS BEEN RECORDED BY HIM ON 14.12.2012 BEFORE ISSUE OF NOTICE U/S. 153C OF THE I.T. ACT. IN THE SAME SATISFACTIO N NOTE, HE HAS NOTED IN THE LAST THAT ISSUE NOTICE U/S. 153C OF THE INC OME TAX ACT, 1961. THIS LAST LINE OF THE SATISFACTION NOTE PROVES BEYO ND DOUBT THAT SUCH SATISFACTION NOTE HAS BEEN RECORDED BY THE SAME OFF ICER WHO IS THE AO OF ASSESSEE AS WELL AS OF THE SEARCHED PERSONS I N HIS CAPACITY AS AO OF ASSESSEE AND NOT IN HIS CAPACITY AS AO OF SEA RCHED PERSONS, BECAUSE IF SATISFACTION NOTE IS RECORDED BY THE AO OF THE SEARCHED PERSON, IT CANNOT BE SAID IN THE SAID SATISFACTION NOTE THAT ISSUE NOTICE U/S. 153C OF THE INCOME-TAX ACT, BECAUSE SU CH NOTICE U/S. 153C OF THE ACT IS NOT REQUIRED TO BE ISSUED IN THE CASE OF SEARCHED ITA NO.1451 TO 1457(BANG)/2014 PAGE 15 OF 26 PERSON, BUT IN THE CASE OF THE OTHER PERSON I.E., T HE PRESENT ASSESSEE. IN OUR CONSIDERED OPINION, EVEN IF THE AO OF ASSESS EE AND THE SEARCHED PERSON IS ONE AND THE SAME, THEN ALSO, THE SATISFACTION NOTE HAS TO BE RECORDED BY THE AO IN HIS CAPACITY AS AO OF THE SEARCHED PERSON AND NOT IN HIS CAPACITY AS AO OF THE OTHER P ERSON IN WHOSE CASE NOTICE U/S. 153C IS REQUIRED TO BE ISSUED. 4. IN THE LIGHT OF THE ABOVE FACTS, NOW WE EXAMINE THE APPLICABILITY OF THE TRIBUNALS ORDER CITED BY THE LD. AR OF ASSE SSEE HAVING BEEN RENDERED IN THE CASE OF SHRI VINOD KUMAR CHAURASIA V. ACIT (SUPRA). IN THAT CASE, THE JUDGMENT OF HONBLE ALLAHABAD HIG H COURT HAS BEEN CITED BEFORE THE TRIBUNAL RENDERED IN THE CASE OF C IT V. M/S. GOPI APARTMENT IN ITA NO.60 OF 2014. THE RELEVANT PORTI ON OF THE JUDGMENT OF THE HONBLE ALLAHABAD HIGH COURT RENDERED IN THE CASE OF CIT V. M/S. GOPI APARTMENT HAS BEEN REPRODUCED BY THE TRIB UNAL IN THAT CASE ON PAGES 5 & 6 OF THAT ORDER AND THE SAME IS REPROD UCED HEREINBELOW FOR THE SAKE OF READY REFERENCE:- 5. HAVING GIVEN A THOUGHTFUL CONSIDERATION TO THE RIVAL SUBMISSIONS AND FROM A CAREFUL PERUSAL OF THE ORDER S OF THE AUTHORITIES BELOW, WE FIND THAT THE LD. CIT(A) HAS NOT GIVEN ANY SPECIFIC FINDING WITH REGARD TO RECORDING OF SATISF ACTION BY THE ASSESSING OFFICER OF THE SEARCHED PERSON BEFORE INI TIATING PROCEEDINGS UNDER SECTION 153C OF THE ACT. THE LD. CIT(A) HAS RATHER REJECTED THE CONTENTIONS OF THE ASSESSEE IN THIS REGARD BY HOLDING THAT THE ASSESSING OFFICER OF THE SEARCHED PERSON WAS NOT REQUIRED TO RECORD SATISFACTION AS REQUIRED UNDER S ECTION 158BD OF THE ACT BEFORE INITIATING PROCEEDINGS UNDER SECTION 153C OF THE ACT. DURING THE COURSE OF HEARING, VARIOUS OPPORTUNITIES WERE AFFORDED TO THE REVENUE TO PLACE SOME EVIDENCE IN ORDER TO D EMONSTRATE THAT ITA NO.1451 TO 1457(BANG)/2014 PAGE 16 OF 26 BEFORE INITIATING PROCEEDINGS UNDER SECTION 153C OF THE ACT AGAINST THE ASSESSEE, SATISFACTION WAS RECORDED BY THE ASSE SSING OFFICER OF THE SEARCHED PERSON THAT INCRIMINATING MATERIAL FOU ND DURING THE COURSE OF SEARCH IN FACT RELATE TO THE ASSESSEE. BU T NOTHING HAS BEEN PLACED ON RECORD BY THE REVENUE. MOREOVER, FROM THE ORDERS OF THE LOWER AUTHORITIES, IT IS APPARENT THAT SATISFACTION WAS NOT RECORDED BY THE ASSESSING OFFICER OF THE SEARCHED PERSON BEF ORE INITIATING PROCEEDINGS UNDER SECTION 153C OF THE ACT. NOW THE QUESTION ARISES WHETHER IN THE ABSENCE OF SATISFACTION RECORDED BY THE ASSESSING OFFICER OF THE SEARCHED PERSON, THE ASSESSMENT FRAM ED UNDER SECTION 153C OF THE ACT, IS SUSTAINABLE IN THE EYES OF LAW? THIS QUESTION WAS ANSWERED BY THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT (CENTRAL) VS. M/S GOPI APARTMENT (S UPRA) BY HOLDING THAT A CLEAR AND PLAIN READING OF SECTION 1 53C LEAVES NO DOUBT THAT RECORDING OF SATISFACTION BY THE ASSESSI NG OFFICER OF THE PERSON SEARCHED IS MANDATORY AND IT HAS TO PRECEDE THE INITIATION OF PROCEEDINGS AGAINST THE OTHER PERSON (NOT SEARCHED) . THE RELEVANT OBSERVATIONS OF THE JURISDICTIONAL HIGH COURT ARE E XTRACTED HEREUNDER:- 'WE HAVE HEARD SRI BHARAT JI AGRAWAL, LEARNED SENIO R COUNSEL ASSISTED BY SRI ASHOK KUMAR, LEARNED COUNSEL FOR AP PELLANT AND SRI ASHISH BANSAL, LEARNED COUNSEL FOR RESPONDENT A SSESSEE AND HAVE PERUSED THE RECORDS. THE CONTENTION OF SRI AGRAWAL IS TWO FOLD. FIRSTLY, HE CONTENDS THAT IN THE INSTANT CASE, THE ASSESSING OFFICER OF THE 'SEARCHED PERSON' AND THE 'OTHER PERSON' BEING THE SAME, THER E WAS NO REQUIREMENT OF HANDING OVER OF THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED, AS IS MENTIONED IN SECTION 153C NOR THERE WAS ANY NECESSITY OF RECORDI NG A PRIOR SATISFACTION BEFORE PROCEEDING TO ASSESS THE 'OTHER PERSON'. THE SATISFACTION SUBSEQUENTLY RECORDED IN THE ASSESSMEN T ORDER IN RESPECT OF THE 'OTHER PERSON' WAS SUFFICIENT COMPLI ANCE OF PROVISIONS OF SECTION 153C, WHICH, IN ANY CASE, WAS PROCEDURAL IN NATURE. THE A.O. OF BOTH THE PROCEEDINGS, BEING THE SAME, HE WAS NEITHER REQUIRED TO HANDOVER THE DOCUMENTS TO A NOTHER ASSESSING OFFICER NOR HE HAD TO RECORD ANY SATISFAC TION FOR THE PURPOSE OF ANY OTHER ASSESSING OFFICER SINCE SAME A SSESSING OFFICER OF THE SAME DESIGNATION IS HAVING JURISDICT ION OVER BOTH THE PERSONS, I.E. 'SEARCHED PERSON' AND THE 'OTHER PERSON' (NOT SEARCHED). SRI AGRAWAL RELIED UPON A DIVISION BENCH JUDGMENT ITA NO.1451 TO 1457(BANG)/2014 PAGE 17 OF 26 OF THIS COURT RENDERED IN THE CASE OF COMMISSIONER OF INCOME TAX VS. CLASSIC ENTERPRISES, (2013) 358 ITR 465. IT WAS CONTENDED THAT THE TRIBUNAL WAS NOT JUSTIFI ED IN QUASHING THE NOTICE UNDER SECTION 153C, INSTEAD OF DECIDING THE QUESTION ON MERITS AS TO WHETHER ADDITIONS ARE TO BE MADE AND/ OR TO WHAT EXTENT THE INCOME IS TO BE ASSESSED IN THE HANDS OF GOPI A PARTMENTS. SRI AGRAWAL ALSO CONTENDED THAT BY THE FINANCE ACT, 2003, AMENDMENT IN SECTION 153A W.E.F. 01.06.2003 WAS MAD E AND SECTIONS 153A AND 153C WERE ADDED IN PLACE OF SECTI ONS 153BC AND 153BD. SECTION 158BC IS EQUIVALENT TO SECTION 1 53A AND SECTION 158BD IS EQUIVALENT TO SECTION 153C. HE ALSO CONTENDED THAT THE RELIANCE PLACED BY THE I .T.A.T. UPON THE JUDGMENT OF THE SUPREME COURT IN MANISH MAHESHWARI (SUPRA) WAS MISPLACED AND THE CASE, AT HAND, WAS SQUARELY COVER ED BY THE DIVISION BENCH OF THIS COURT IN THE CASE OF CLASSIC ENTERPRISES (SUPRA). IN THIS REGARD, SRI AGRAWAL REFERRED TO TH E OBSERVATION IN MANISH MAHESHWARI'S CASE TO THE EFFECT THAT 'NO PRO CEEDING UNDER SECTION 158BC HAD BEEN INITIATED. THERE IS, THUS, A PATENT NON- APPLICATION OF MIND. SRI ASHISH BANSAL, LEARNED COUNSEL FOR RESPONDENT ASSESSEE, ON THE OTHER HAND, CONTENDED T HAT THE INITIATION OF THE PROCEEDINGS UNDER SECTION 153C AG AINST THE RESPONDENT ASSESSEE ITSELF WAS ILLEGAL, AS NO SATIS FACTION WAS RECORDED BY THE ASSESSING OFFICER OF THE 'SEARCHED PERSON' PRIOR TO INITIATION OF SUCH PROCEEDINGS AGAINST RESPONDENT A SSESSEE AS WAS MANDATORY. HE INVITED THE ATTENTION OF THE COURT TO THE SPECIFIC FINDING RECORDED BY THE LEARNED C.I.T. (APPEALS), A S UPHELD BY THE I.T.A.T., BASED ON THE ADMISSION BY THE A.O. BEFORE IT, WHICH HAS ALREADY BEEN TAKEN NOTE OF BY US IN THE EARLIER PAR T OF THE JUDGMENT. SRI BANSAL RELIED UPON A RECENT JUDGMENT OF THE APE X COURT IN THE CASE OF COMMISSIONER OF INCOME TAX-III VS. M/S CALC UTTA KNITWEARS, LUDHIANA PASSED IN CIVIL APPEAL NO.3958 OF 2014 DECIDED ON 12.03.2014 IN SUPPORT OF HIS CONTENTION. APART FROM THE ARGUMENTS, AS NOTED ABOVE, NO OTHER ARGUMENT WAS RAISED BY THE LEARNED COUNSEL FOR EITHER OF THE PAR TIES NOR ANY OTHER JUDGMENT WAS CITED BEFORE US IN SUPPORT OF THEIR RE SPECTIVE CONTENTIONS. THE RELEVANT PROVISION IN THE INSTANT CASE, I.E. SE CTION 153C IS AS UNDER: ITA NO.1451 TO 1457(BANG)/2014 PAGE 18 OF 26 '153C. ASSESSMENT OF INCOME OF ANY OTHER PERSON. (1 ) NOTWITHSTANDING ANYTHING CONTAINED IN SECTION 139, SECTION 147, SECTION 148, SECTION 149, SECTION 151 AND SECT ION 153, WHERE THE ASSESSING OFFICER IS SATISFIED THAT ANY M ONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING OR BOO KS OF ACCOUNT OR DOCUMENTS SEIZED OR REQUISITIONED BELONGS OR BEL ONG TO A PERSON OTHER THAN THE PERSON REFERRED TO IN SECTION 153A, THEN THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED SHALL BE HANDED OVER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON AND THAT ASSESSING OFFICER SHALL PROCEED AGAINST EACH SUCH OTHER PERSO N AND ISSUE SUCH OTHER PERSON NOTICE AND ASSESS OR REASSESS INC OME OF SUCH OTHER PERSON IN ACCORDANCE WITH THE PROVISIONS OF S ECTION 153A.' THE AFORESAID PROVISION IS CONTAINED IN CHAPTER- XI V OF THE INCOME TAX ACT, WHICH CONTAINS THE PROCEDURE FOR ASSESSMEN T. A SOMEWHAT SIMILAR PROVISION EXISTS IN SECTION 158B D UNDER CHAPTER XIV-B, WHICH CONTAINS THE PROCEDURE FOR ASS ESSMENT OF SEARCHED CASES, WHICH READS AS UNDER: '158BD. WHERE THE ASSESSING OFFICER IS SATISFIED TH AT ANY UNDISCLOSED INCOME BELONGS TO ANY PERSON, OTHER THA N THE PERSON WITH RESPECT TO WHOM SEARCH WAS MADE UNDER S ECTION 132 OR WHOSE BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR ANY ASSETS WERE REQUISITIONED UNDER SECTION 132A, THEN, THE BOOKS OF ACCOUNT, OTHER DOCUMENTS OR ASSETS SEIZED OR REQUIS ITIONED SHALL BE HANDED OVER TO THE ASSESSING OFFICER HAVING JURI SDICTION OVER SUCH OTHER PERSON AND THAT ASSESSING OFFICER SHALL PROCEED [UNDER SECTION 158BC] AGAINST SUCH OTHER PERSON AND THE PROVISIONS OF THIS CHAPTER SHALL APPLY ACCORDINGLY. ' THE MEANING AND SCOPE OF THE AFORESAID PROVISION CO NTAINED IN SECTION 158BD CAME UP FOR CONSIDERATION BEFORE THE SUPREME COURT IN THE CASE OF COMMISSIONER OF INCOME TAX-III VS. M/S CALCUTTA KNITWEARS, LUDHIANA (SUPRA). THE ISSUE THAT FELL FOR CONSIDERATION BEFORE THE SU PREME COURT, AS MENTIONED IN PARAGRAPH-3 OF THE JUDGMENT IS BEING Q UOTED HEREINBELOW: '3. THE ISSUE THAT FALLS FOR OUR CONSIDERATION AND DECISION IN ALL THESE APPEALS IS: AT WHAT STAGE OF THE PROCEEDINGS UNDER ITA NO.1451 TO 1457(BANG)/2014 PAGE 19 OF 26 CHAPTER XIV-B DOES THE ASSESSING AUTHORITY REQUIRE TO RECORD HIS SATISFACTION FOR ISSUING A NOTICE UNDER SECTION 158BD OF THE INCOME TAX ACT, 1961 ('THE ACT' FOR SHORT).' AFTER CONSIDERING THE RIVAL CONTENTIONS, RELEVANT P ROVISIONS OF THE INCOME TAX ACT AND THE AUTHORITIES ON THE SUBJECT, THEIR LORDSHIPS HELD AS UNDER: '41. WE WOULD CERTAINLY SAY THAT BEFORE INITIATING PROCEEDINGS UNDER SECTION 158BD OF THE ACT, THE ASSESSING OFFIC ER WHO HAS INITIATED PROCEEDINGS FOR COMPLETION OF THE ASSESSM ENTS UNDER SECTION 158BC OF THE ACT SHOULD BE SATISFIED THAT T HERE IS AN UNDISCLOSED INCOME WHICH HAS BEEN TRACED OUT WHEN A PERSON WAS SEARCHED UNDER SECTION 132 OR THE BOOKS OF ACCO UNTS WERE REQUISITIONED UNDER SECTION 132A OF THE ACT. THIS I S IN CONTRAST TO THE PROVISIONS OF SECTION 148 OF THE ACT WHERE R ECORDING OF REASONS IN WRITING ARE A SINE QUA NON. UNDER SECTIO N 158BD THE EXISTENCE OF COGENT AND DEMONSTRATIVE MATERIAL IS GERMANE TO THE ASSESSING OFFICERS' SATISFACTION IN CONCLUDI NG THAT THE SEIZED DOCUMENTS BELONG TO A PERSON OTHER THAN THE SEARCHED PERSON IS NECESSARY FOR INITIATION OF ACTION UNDER SECTION 158BD. THE BARE READING OF THE PROVISION INDICATES THAT THE SATISFACTION NOTE COULD BE PREPARED BY THE ASSESSIN G OFFICER EITHER AT THE TIME OF INITIATING PROCEEDINGS FOR CO MPLETION OF ASSESSMENT OF A SEARCHED PERSON UNDER SECTION 158BC OF THE ACT OR DURING THE STAGE OF THE ASSESSMENT PROCEEDIN GS. IT DOES NOT MEAN THAT AFTER COMPLETION OF THE ASSESSMENT, T HE ASSESSING OFFICER CANNOT PREPARE THE SATISFACTION NOTE TO THE EFFECT THAT THERE EXISTS INCOME TAX BELONGING TO ANY PERSON OTH ER THAN THE SEARCHED PERSON IN RESPECT OF WHOM A SEARCH WAS MAD E UNDER SECTION 132 OR REQUISITION OF BOOKS OF ACCOUNTS WER E MADE UNDER SECTION 132A OF THE ACT. THE LANGUAGE OF THE PROVISION IS CLEAR AND UNAMBIGUOUS. THE LEGISLATURE HAS NOT IMPO SED ANY EMBARGO ON THE ASSESSING OFFICER IN RESPECT OF THE STAGE OF PROCEEDINGS DURING WHICH THE SATISFACTION IS TO BE REACHED AND RECORDED IN RESPECT OF THE PERSON OTHER THAN THE SE ARCHED PERSON. 44. IN THE RESULT, WE HOLD THAT FOR THE PURPOSE OF SECTION 158BD OF THE ACT A SATISFACTION NOTE IS SINE QUA NON AND MUST BE PREPARED BY THE ASSESSING OFFICER BEFORE HE TRANSMI TS THE RECORDS TO THE OTHER ASSESSING OFFICER WHO HAS JURI SDICTION OVER SUCH OTHER PERSON. THE SATISFACTION NOTE COULD BE P REPARED AT ITA NO.1451 TO 1457(BANG)/2014 PAGE 20 OF 26 EITHER OF THE FOLLOWING STAGES: (A) AT THE TIME OF OR ALONG WITH THE INITIATION OF PROCEEDINGS AGAINST THE SEARCHED PERSON UNDER SECTION 158BC OF THE ACT; (B) ALONG WITH THE ASSESS MENT PROCEEDINGS UNDER SECTION 158BC OF THE ACT; AND (C) IMMEDIATELY AFTER THE ASSESSMENT PROCEEDINGS ARE CO MPLETED UNDER SECTION 158BC OF THE ACT OF THE SEARCHED PERS ON. 45. WE ARE INFORMED BY SHRI SANTOSH KRISHAN, WHO IS APPEAR ING IN SEVEN OF THE APPEALS THAT THE ASSESSING OFFICER HAD NOT RECORDED THE SATISFACTION NOTE AS REQUIRED UNDER SECTION 158 BD OF THE ACT, THEREFORE, THE TRIBUNAL AND THE HIGH COURT WER E JUSTIFIED IN SETTING ASIDE THE ORDERS OF ASSESSMENT AND THE O RDERS PASSED BY THE FIRST APPELLATE AUTHORITY. WE DO NOT INTEND TO EXAMINE THE AFORESAID CONTENTION CANVASSED BY THE LEARNED COUNS EL SINCE WE ARE REMANDING THE MATTERS TO THE HIGH COURT FOR CON SIDERATION OF THE INDIVIDUAL CASES HEREIN IN LIGHT OF THE OBSE RVATIONS MADE BY US ON THE SCOPE AND POSSIBLE INTERPRETATION OF S ECTION 158BD OF THE ACT. 46. WITH THESE OBSERVATIONS, THE APPEAL S ARE DISPOSED OF.' THE PROVISIONS OF SECTION 158BD BEING PARI MATERIA WITH THE PROVISIONS OF SECTION 153C, THE RATIO OF THE AFORES AID JUDGMENT CLEARLY APPLIES TO THE PRESENT CASE ALSO. THE REFERENCE TO THE ASSESSMENT PROCEEDINGS UNDER S ECTION 158BC BY THE SUPREME COURT IN THE EXTRACTS QUOTED ABOVE I S WITH REGARD TO THE 'ASSESSMENT PROCEEDINGS' IN RELATION TO THE 'SE ARCHED PERSON' AND NOT THE 'OTHER PERSON' AS REFERRED TO IN SECTIO N 158BD. A BARE PERUSAL OF THE PROVISION CONTAINED IN SECTIO N 153C OF THE I.T. ACT LEAVES NO DOUBT THAT, AS IS PROVIDED UNDER SECTION 158BD, WHERE THE ASSESSING OFFICER, WHILE PROCEEDING UNDER SECTION 153A AGAINST A PERSON WHO HAS BEEN SUBJECTED TO SEARCH A ND SEIZURE UNDER SECTION 132(1) OR HAS BEEN PROCEEDED UNDER SE CTION 132A, IS SATISFIED THAT ANY MONEY, BULLION, JEWELLERY OR OTH ER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNT OR DOCUMENTS SEIZED OR REQUISITIONED BELONGS OR BELONG TO A PERSON OTHER THAN THE PERSON REFERRED TO IN SECTION 153A, THEN THE BOOKS OF ACCOUNT OR DOCUMENT S OR ASSETS SEIZED OR REQUISITIONED SHALL BE HANDED OVER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON AND THAT ASSESSING OFFICER SHALL PROCEED AGAINST EACH SUCH OTHER PERSO N AND ISSUE SUCH OTHER PERSON NOTICE AND ASSESS OR REASSESS INCOME O F SUCH OTHER PERSON IN ACCORDANCE WITH THE PROVISIONS OF SECTION 153A. ITA NO.1451 TO 1457(BANG)/2014 PAGE 21 OF 26 THUS, THERE ARE TWO STAGES: (1) THE FIRST STAGE COMPRISES OF A SEARCH AND SEIZU RE OPERATION UNDER SECTION 132 OR PROCEEDING UNDER SECTION 132A AGAINST A PERSON, WHO MAY BE REFERRED AS 'THE SEARCHED PERSON '. BASED ON SUCH SEARCH AND SEIZURE, ASSESSMENT PROCEEDINGS ARE INITIATED AGAINST THE 'SEARCHED PERSON' UNDER SECTION 153A. A T THE TIME OF INITIATION OF SUCH PROCEEDINGS AGAINST THE 'SEARCHE D PERSON' OR DURING THE ASSESSMENT PROCEEDINGS AGAINST HIM OR EV EN AFTER THE COMPLETION OF THE ASSESSMENT PROCEEDINGS AGAINST HI M, THE ASSESSING OFFICER OF SUCH A 'SEARCHED PERSON', MAY, IF HE IS SATISFIED, THAT ANY MONEY, DOCUMENT ETC. BELONGS TO A PERSON OTHER THAN THE SEARCHED PERSON, THEN SUCH MONEY, DOCUMENT S ETC. ARE TO BE HANDED OVER TO THE ASSESSING OFFICER HAVING JURI SDICTION OVER 'SUCH OTHER PERSON'. (2) THE SECOND STAGE COMMENCES FROM THE RECORDING O F SUCH SATISFACTION BY THE ASSESSING OFFICER OF THE 'SEARC HED PERSON' FOLLOWED BY HANDING OVER OF ALL THE REQUISITE DOCUM ENTS ETC. TO THE ASSESSING OFFICER OF SUCH 'OTHER PERSON', THEREAFTE R FOLLOWED BY ISSUANCE OF THE NOTICE OF THE PROCEEDINGS UNDER SEC TION 153C READ WITH SECTION 153A AGAINST SUCH 'OTHER PERSON'. THE INITIATION OF PROCEEDINGS AGAINST 'SUCH OTHER P ERSON' ARE DEPENDANT UPON A SATISFACTION BEING RECORDED. SUCH SATISFACTION MAY BE DURING THE SEARCH OR AT THE TIME OF INITIATI ON OF ASSESSMENT PROCEEDINGS AGAINST THE 'SEARCHED PERSON', OR EVEN DURING THE ASSESSMENT PROCEEDINGS AGAINST HIM OR EVEN AFTER CO MPLETION OF THE SAME, BUT BEFORE ISSUANCE OF NOTICE TO THE 'SUCH OT HER PERSON' UNDER SECTION 153C. EVEN IN A CASE, WHERE THE ASSESSING OFFICER OF BOTH THE PERSONS IS THE SAME AND ASSUMING THAT NO HANDING OVER OF DOCUM ENTS IS REQUIRED, THE RECORDING OF 'SATISFACTION' IS A MUST , AS, THAT IS THE FOUNDATION, UPON WHICH THE SUBSEQUENT PROCEEDINGS A GAINST THE 'OTHER PERSON' ARE INITIATED. THE HANDING OVER OF D OCUMENTS ETC. IN SUCH A CASE MAY OR MAY NOT BE OF MUCH RELEVANCE BUT THE RECORDING OF SATISFACTION IS STILL REQUIRED AND IN FACT IT IS MANDATORY. IN THIS REGARD, THE RATIO OF THE JUDGMENT OF THE SU PREME COURT IN THE CASE OF COMMISSIONER OF INCOME TAX-III VS. M/S CALCUTTA KNITWEARS, LUDHIANA (SUPRA), AS NOTED ABOVE, CLEARL Y APPLIES TO THE PROCEEDINGS UNDER SECTION 153C ALSO. ITA NO.1451 TO 1457(BANG)/2014 PAGE 22 OF 26 THE 'SATISFACTION' HAS TO BE IN WRITING AND CAN BE GATHERED FROM THE ASSESSMENT ORDER PASSED IN RESPECT OF THE 'SEARCHED PERSON', IF IT IS SO MENTIONED/ RECORDED OR FROM ANY OTHER ORDER, NOT E OR RECORD MAINTAINED BY THE ASSESSING OFFICER OF THE 'SEARCHE D PERSON'. THE WORD 'SATISFACTION' REFERS TO THE STATE OF MIND OF THE ASSESSING OFFICER OF THE PERSON SEARCHED, WHICH GETS REFLECTE D IN A TANGIBLE SHAPE/ FORM, WHEN IT IS REDUCED INTO WRITING. IT IS THE CONCLUSION DRAWN OR THE FINDING RECORDED ON THE FOUNDATION OF THE MATERIAL AVAILABLE. IN THIS REGARD, REFERENCE MAY BE MADE TO THE PRONOUNCEMENTS IN THE CASE OF C.I.T. VS. RADHEY SHY AM BANSAL, (2011) 337 ITR 217 (DELHI) AND THE DIVISION BENCH J UDGMENT OF THIS COURT IN THE CASE OF C.I.T. VS. CLASSIC ENTERP RISES REPORTED IN (2013) 358 ITR 465 (ALLAHABAD). IN THE CASE OF MANISH MAHESHWARI VS. ASSISTANT COMM ISSIONER OF INCOME TAX AND ANOTHER, (2007) 289 ITR 341 (SC) , T HEIR LORDSHIPS HAD THE OCCASION TO CONSIDER THE PROVISIONS OF SECT IONS 158BC AND 158BD AND HELD THAT THE CONDITIONS PRECEDENT FOR TA KING RECOURSE TO A BLOCK ASSESSMENT IN TERMS OF SECTION 158BC AND 15 8BD (I) WERE AS UNDER: '(I) SATISFACTION MUST BE RECORDED BY THE ASSESSING OFFICER THAT ANY UNDISCLOSED INCOME BELONGS TO ANY PERSON, OTHER THAN THE PERSON WITH RESPECT TO WHOM SEARCH WAS MADE UNDER S ECTION 132 OF THE ACT; (II) THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR ASS ETS SEIZED OR REQUISITIONED HAD BEEN HANDED OVER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON; AND (III) THE ASSESSING OFFICER HAS PROCEEDED UNDER SEC TION 158BC AGAINST SUCH OTHER PERSON. 11. THE CONDITIONS PRECEDENT FOR INVOKING THE P ROVISIONS OF SECTION 158BD, THUS, ARE REQUIRED TO BE SATISFIED B EFORE THE PROVISIONS OF THE SAID CHAPTER ARE APPLIED IN RELAT ION TO ANY PERSON OTHER THAN THE PERSON WHOSE PREMISES HAD BEE N SEARCHED OR WHOSE DOCUMENTS AND OTHER ASSETS HAD BEEN REQUIS ITIONED UNDER SECTION 132A OF THE ACT.' THE RATIO OF THE JUDGMENT IN MANISH MAHESHWARI'S CA SE ALSO APPLIES TO THE PROVISIONS OF SECTION 153C AND TO TH E FACTS OF THIS CASE. ITA NO.1451 TO 1457(BANG)/2014 PAGE 23 OF 26 IN THE INSTANT CASE, A CATEGORICAL FINDING HAS BEEN RECORDED BY THE C.I.T. (APPEALS) AND THE I.T.A.T. THAT THERE IS NO MATERIAL SHOWING THE RECORDING OF SATISFACTION BY THE ASSESSING OFFI CER OF THE 'SEARCHED PERSON' PRIOR TO ISSUANCE OF NOTICE UNDER SECTION 153C TO THE RESPONDENT ASSESSEE, I.E. 'THE OTHER PERSON'. I T WAS THE ADMITTED CASE OF THE REVENUE BEFORE THE C.I.T. (APPEALS) AND THE I.T.A.T. THAT THOUGH THE ASSESSING OFFICER (OF THE OTHER PER SON) IN THE ASSESSMENT ORDER HAD STATED THAT SATISFACTION FOR I SSUING NOTICE UNDER SECTION 153C WAS RECORDED, HOWEVER, ON EXAMIN ATION, RECORDING OF SUCH SATISFACTION ALLEGED TO BE RECORD ED BY THE ASSESSING OFFICER WAS NOT AVAILABLE. IN VIEW OF THE LEGAL POSITION, AS ALREADY DISCUSSED ABOVE AND THE ADMITTED FACTUAL POSITION AS AFORESAID, WE ARE UNAB LE TO ACCEPT THE CONTENTIONS OF SRI AGRAWAL. WE ARE ALSO OF THE VIEW THAT PLEA, WHICH IS BEING R AISED IN THIS APPEAL, WAS NOT RAISED IN THE GROUNDS OF APPEAL BEF ORE THE I.T.A.T., HOWEVER, EVEN OTHERWISE SUCH PLEA DOES NOT HAVE ANY MERIT. THE CONTENTION OF SRI AGRAWAL THAT SECTION 153C IS ONLY PROCEDURAL IN NATURE, THEREFORE, THE NON-RECORDING OF PRIOR SA TISFACTION DOES NOT VITIATE THE ASSESSMENT ORDER, AS, SUCH SATISFACTION , HAS BEEN RECORDED IN THE ASSESSMENT ORDER PASSED SUBSEQUENTL Y WITH REGARD TO THE OTHER PERSON, IS ALSO NOT ACCEPTABLE FOR THE RE ASON THAT THE SUPREME COURT IN THE CASE OF M/S CALCUTTA KNITWEARS (SUPRA) HAS ALREADY CONSIDERED THIS ASPECT OF THE MATTER IN THE CONTEXT OF SECTION 158BD, AND AFTER TAKING NOTE OF THE FACT THAT THE S AID PROVISION IS A MACHINERY PROVISION HAS INTERPRETED THE SAME. IN TH E LIGHT OF THE INTERPRETATION GIVEN BY IT AND IN VIEW OF THE RATIO LAID DOWN THEREIN, THE CONTENTION OF SRI AGRAWAL DOES NOT HOLD GROUND. A CLEAR AND PLAIN READING OF SECTION 153C LEAVES NO DOUBT THAT RECORDING OF SATISFACTION BY THE ASSESSING OFFICER OF THE PERSON SEARCHED IS MANDATORY AND IT HAS TO PRECEDE THE INITIATION OF P ROCEEDINGS AGAINST THE OTHER PERSON (NOT SEARCHED). A SPECIFIC QUERY WAS PUT TO SRI AGRAWAL AS TO WHETH ER, ON THE BASIS OF THE MATERIAL COLLECTED DURING THE SEARCH AND SEI ZURE OPERATION OR DURING THE ASSESSMENT, PROCEEDINGS AGAINST THE 'SEA RCHED PERSON' OR THEREAFTER, ANY PROCEEDING COULD BE INITIATED AGAIN ST THE 'OTHER PERSON' UNDER ANY OTHER PROVISION OF THE INCOME TAX ACT, HE CATEGORICALLY REPLIED THAT EXCEPT SECTION 153C, THE RE WAS NO OTHER PROVISION UNDER WHICH ACTION COULD BE INITIATED AGA INST HIM. ITA NO.1451 TO 1457(BANG)/2014 PAGE 24 OF 26 THE RELIANCE PLACED BY SRI AGRAWAL UPON THE DIVISIO N BENCH JUDGMENT OF THIS COURT IN THE CASE OF C.I.T. VS. CL ASSIC ENTERPRISES (SUPRA) FAR FROM HELPING HIS CAUSE GOES AGAINST HIM . WE HAVE ALREADY RELIED UPON THE SAID JUDGMENT TO EXPLAIN TH E CONCEPT OF 'SATISFACTION' UNDER SECTION 153C, WHICH IS REQUIRE D TO BE RECORDED IN WRITING. HOWEVER, ON THE OTHER ISSUES, THE SAID JUDGMENT IS DISTINGUISHABLE FOR THE REASON THAT IN THE SAID CAS E, THE ASSESSING OFFICER HAD RECORDED HIS 'SATISFACTION' AND AFTER R ECORDING THE SATISFACTION ON THE SUBJECT MATTER ON 02.08.2006 HA NDED OVER THE BOOKS OF ACCOUNT AND SEIZED MATERIAL, THUS, THE ISS UE, WHICH FALLS FOR CONSIDERATION IN THIS APPEAL, IN FACT, DID NOT ARIS E FOR CONSIDERATION IN THE SAID APPEAL. IN ANY CASE, THE CASE AT HAND B EING SQUARELY COVERED BY THE PRONOUNCEMENTS OF THE SUPREME COURT, AS ALREADY REFERRED, THE RELIANCE PLACED BY SRI AGRAWAL ON THE AFORESAID JUDGMENT DOES NOT CUT MUCH ICE.' 6. NOW IT IS CLEAR FROM THE RECORD THAT SATISFACTI ON BY THE ASSESSING OFFICER OF THE SEARCHED PERSON WAS NOT RECORDED BEF ORE INITIATING PROCEEDINGS UNDER SECTION 153C OF THE ACT AGAINST T HE ASSESSEE AND THE IMPUGNED ISSUE IS SQUARELY COVERED BY THE AFORE SAID JUDGMENT OF THE JURISDICTIONAL HIGH COURT. WE, THEREFORE, HAVE NO HESITATION IN HOLDING THAT SINCE THE ASSESSMENT WAS FRAMED CONSEQ UENT TO THE PROCEEDINGS INITIATED UNDER SECTION 153C OF THE ACT , WITHOUT RECORDING SATISFACTION BY THE ASSESSING OFFICER OF THE SEARCHED PERSON, THE ASSESSMENT IS BAD IN LAW AND DESERVES T O BE QUASHED. WE ACCORDINGLY SET ASIDE THE ORDER OF THE LD. CIT(A) A ND QUASH THE ASSESSMENT FRAMED UNDER SECTION 153C READ WITH 143( 3) OF THE ACT. 5. FROM THE ABOVE TRIBUNALS ORDER, IT IS SEEN THAT TH E TRIBUNAL HAS NOT ONLY FOLLOWED THE JUDGMENT OF HONBLE ALLAHABAD HIGH COURT RENDERED IN THE CASE OF M/S. GOPI APARTMENT (SUPRA) , BUT THE TRIBUNAL HAS ALSO CONSIDERED AND FOLLOWED THE JUDGMENT OF HO NBLE APEX COURT REPORTED IN THE CASE OF CALCUTTA KNITWEARS (SUPRA) AND THE JUDGMENT OF THE HONBLE APEX COURT IN THE CASE OF MANISH MAH ESHWARI AS REPORTED IN 289 ITR 341. THE FACTS OF THE PRESENT CASE AS DISCUSSED ITA NO.1451 TO 1457(BANG)/2014 PAGE 25 OF 26 ABOVE SHOWS THAT IN THE PRESENT CASE ALSO, NO SATIS FACTION WAS RECORDED BY THE AO IN HIS CAPACITY AS AO OF THE SEA RCHED PERSON BECAUSE IT IS SEEN THAT THE SO-CALLED SATISFACTION NOTE PREPARED BY THE AO IS IN HIS CAPACITY AS AO OF ASSESSEE, ALTHOUGH H E HAPPENS TO BE THE AO OF THE SEARCHED PERSONS ALSO, IT COULD NOT B E SHOWN BY THE REVENUE THAT ANY SATISFACTION NOTE WAS PREPARED BY HIM AS AO OF SEARCHED PERSONS AND THEREFORE, UNDER THESE FACTS, THIS IS TO BE ACCEPTED THAT NO SATISFACTION WAS RECORDED BY THE A O OF SEARCHED PERSON AND THEREFORE, THIS TRIBUNAL ORDER AND THOSE JUDGMENTS OF THE HONBLE ALLAHABAD HIGH COURT RENDERED IN THE CASE O F M/S. GOPI APARTMENT (SUPRA) AND OF THE HONBLE APEX COURT REN DERED IN THE CASE OF CALCUTTA KNITWEARS (SUPRA) AND MANISH MAHESHWARI (SUPRA) ARE APPLICABLE AND THEREFORE, RESPECTFULLY FOLLOWING TH ESE JUDGMENTS, WE HOLD THAT IN THE PRESENT CASE, NOTICE ISSUED BY THE AO U/S. 153C OF THE I.T. ACT DESERVES TO BE QUASHED AND ACCORDINGLY, WE QUASH THESE ASSESSMENT ORDERS FRAMED BY THE AO U/S. 153C R.W.S. 143(3) OF THE I.T. ACT. ACCORDINGLY, ADDITIONAL GROUND IS ALLOWED IN ALL THE SEVEN YEARS. 6. IN LINE OF THE SAID TRIBUNAL ORDER RENDERED IN T HE CASE OF THE HUSBAND OF THE PRESENT ASSESSEE SHRI GALI JANARDAN REDDY IN ITA NO. 1444 TO 1450/BANG/2014(SUPRA), THIS ISSUE IS DE CIDED IN FAVOUR OF THE ASSESSEE AND IT IS HELD THAT ALL THES E SEVEN ASSESSMENT ORDERS PASSED BY THE A.O. U/S 153C READ WITH SECTIO N 144 ARE QUASHED. ITA NO.1451 TO 1457(BANG)/2014 PAGE 26 OF 26 7. IN VIEW OF OUR ABOVE DECISION, OTHER GROUNDS RAI SED BY THE ASSESSEE DO NOT REQUIRE ANY ADJUDICATION. 8. IN THE RESULT, ALL THESE SEVEN APPEALS OF THE AS SESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MEN TIONED ON THE CAPTION PAGE. (SUNIL KUMAR YADAV) (A.K. GARODIA) JUDICAL MEMBER ACCOUNTANT MEMBER PLACE: BANGALORE: D A T E D : 18.10.2016 AM COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT(A)-II BANGALORE 4 CIT 5 DR, ITAT, BANGALORE. 6 GUARD FILE BY ORDER, AR, ITAT, BANGALORE