Macro Proprieties Private Limited, M 28 Income Tax Colony Tonk Road Jaipur V. DCIT CENTRAL CIRCLE 2, LIC BUILDING JAIPUR

ITA 174/JPR/2023

AI Insights

The case involves M/s. Macro Properties Pvt. Ltd., which filed appeals against the orders of the CIT(A)-4, Jaipur, for the assessment years 2013-14 to 2016-17. The appeals were primarily concerned with the legality of the assessments made under Section 153C of the Income Tax Act, which were challenged on grounds of lack of proper jurisdiction and absence of incriminating material. The Tribunal examined the satisfaction note recorded by the Assessing Officer and found it insufficient to justify the invocation of Section 153C. The Tribunal also considered various judicial precedents that supported the view that without incriminating material, the assessments could not be sustained.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 132442 (ITAT-JAIPUR)
• Duration Of Justice: 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-07-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 06-06-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 27-03-2023
• Other Referred Cases: DCIT vs. M/s. U.K. Paints (Overseas) Ltd., PCIT vs. Himanshu Chandulal Patel, CIT vs. Raj Pal Bhatia, CIT vs. Smt. Chitra Devi Soni, PCIT vs. Star PVG Exports, DCIT vs. Qualitron Commodities (P.) Ltd, PCIT vs. Singhad Technical Education Society, Pr CIT vs. S. R. Trust Madurai, PCIT vs. M/s. Delhi International Airport Pvt. Ltd.
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DISALLOWING AMOUNT OF RS. RS.
• Keywords: Unexplained cash credit; Unexplained investment; Sale consideration of property below Jantri Value; Income from undisclosed sources; Search and seizure; Loose papers; Document seized; Share purchase agreement; Principle of natural justice; Non compliance; Assessment record; Block assessment; Documents seized; Revenue expenditure; Capital expenditure; Set aside; Capital Gains; CHAPTER XIVB
• Section: 131; 68; 69; 132; 271(1)(c); 143(3); 142(1); 133A; 153A; 14A; 250; 143(2); 69A; 191; 139(1); 113; 43; 153; 153C

Judgement Text

vk;djvihyh; vf/kdj.k] t;iqjU;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”A” JAIPUR Mk0 ,l- lhrky{eh]U;kf;dlnL; ,oaJhjkBksMdeys'kt;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;djvihy la-@ITA No.174 TO 177/JP/2023 fu/kZkj.ko"kZ@AssessmentYear : 2013-14 TO 2016-17 M/s. Macro Properties Pvt. Ltd.M-28, Income Tax Colony, Tonk Road Jaipur cuke Vs. The DCIT Central Circle-2 LIC Building, Jaipur LFkk;hys[kk la-@thvkbZvkj la-@PAN/GIR No.: AAFCM 3633 D vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksjls@Assesseeby : Shri C.M. Agarwal, CA jktLo dh vksjls@Revenue by: Shri JameshKurian, CIT lquokbZ dh rkjh[k@Date of Hearing : 07/06/2023 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 17 /07/2023 vkns'k@ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM The assessee has filed these four appeals against four different orders of the ld. CIT(A)-4,Jaipur dated 13-02-2023 for the assessment years 2013-14 TO 2016-17 respectively raising therein following grounds of appeal: Assessment Year 2013-14 2 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 1. That the orders passed by the Ld CIT(A) and the Assessing Officer are opposed to law, natural justice, equity, weight of evidences, probabilities , facts and circumstances of the case. 2. The Ld CIT(A) has erred in law as well as on the facts and circumstances of the case in dismissing the appeal of the appellant without providing adequate opportunity and also in confirming in full the absolutely illegal , arbitrary and void ab initio order of the Ld Assessing Officer without even considering the self speaking facts of the impugned assessment order, which need no further examination of records or any other documents. 3. Ld CIT(A) has erred in law as well as on facts and circumstances of the case in not quashing the illegal Assessment order passed by the Assessing Officer without assumption of proper jurisdiction as no proper satisfaction as mandated u/s 153C of the I.T.Act was recorded by the Assessing Officer. 3.1 Ld CIT(A) has erred in law as well as on facts and circumstances of the case in completely ignoring the fact that the Assessing Officer has not recorded satisfaction about any seized paper belonging to the Assessee for the impugned Assessment Year. 4. Ld CIT(A) erred in law as well as on facts and circumstances of the case in sustaining the addition of Rs 1,40,75,700/ made by the AO u/s 69 of the Act on account of alleged cash investment in property without considering the fact that assessee was not the owner of the said property and the said property was purchased by ShPooranmal Kanwat and also that no such alleged sale consideration was ever paid even by him. 4.1 Ld CIT(A) further erred in law as well as on facts and circumstances of the case in not considering the submissions that no material has been brought on record by the AO which might suggest that any investment in the property was made by the assessee. 4.2 Ld CIT(A) erred in law as well as on facts and circumstances of the case in not considering the fact that no opportunity to cross examine ShPooranmalKanwat was provided to the Appellant and therefore, his statement could not have been relied upon in taking an adverse view against the appellant. 5. Ld CIT(A) erred in law as well as on facts and circumstances of the case in sustaining the addition of Rs 1,34,84,685/ made by the AO on account of alleged short term capital gains without considering the fact that assessee was not the owner of the said property. 5.1 Ld CIT(A) further erred in law as well as on facts and circumstances of the case in not considering the submissions that no material has been brought on record by the AO which might suggest that the sale consideration was received by the appellant. 3 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 5.2 without prejudice, Ld CIT(A) erred in law as well as on facts and circumstances of the case in not giving any finding on the ground that the Assessing Officer arbitrarily applied the provisions of Section 50C(1) of the Income Tax Act. 6. Ld CIT(A) erred in law as well as on facts and circumstances of the case in sustaining the addition of Rs 3,68,874/ made by the AO u/s 69 of the Act on account of alleged investment without considering the fact that assessee was not the owner of the said property and the said property was purchased by Sh Vishnu Kumar Nakwal. 6.1 Ld CIT(A) further erred in law as well as on facts and circumstances of the case in not considering the submissions that no material has been brought on record by the AO which might suggest that any investment in the property was made by the assessee and also in not considering that the investment in the said property was made by the purchaser through source verifiable banking channels only. 6.2 Ld CIT(A) erred in law as well as on facts and circumstances of the case in not considering the fact that no opportunity to cross examine Sh Vishnu Kumar Nakwal was provided to the Appellant and therefore, his statement could not have been relied upon in taking an adverse view against the appellant. 7. Ld CIT(A) erred in law as well as on facts and circumstances of the case in sustaining the addition of Rs 29,95,596/ made by the AO on account of alleged cash investment in property without considering the fact that assessee was not the owner of the said property. 7.1 Ld CIT(A) further erred in law as well as on facts and circumstances of the case in not considering the submissions that no material has been brought on record by the AO which might suggest that any investment in the property was made by the assessee and also in not considering that the investment in the said property was made by the purchaser through source verifiable banking channels only. 7.2 Ld CIT(A) further erred in law as well as on facts and circumstances of the case in not even considering the submissions that the said transaction made by Smt Vijay Laxmi pertain to A.Y.2014-15 and not to A.Y.2013-14 and therefore cannot be considered for making any addition for the impugned assessment year. 7.3 Ld CIT(A) erred in law as well as on facts and circumstances of the case in not considering the fact that no opportunity to cross examine Smt Vijay Laxmi was provided to the Appellant by the AO and therefore, her statement could not have been relied upon in taking an adverse view against the appellant. 4 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 8. Ld CIT(A) further erred in law as well as on facts and circumstances of the case in confirming the illegal disallowance of expenses amounting to Rs 3,55,714/ made by the AO arbitrarily. 9. Ld CIT(A) erred in law as well as on facts and circumstances of the case in rejecting the contention of the appellant that the AO has grossly erred in invoking the provisions of section 115 BBE of the Income Tax Act.’’ Assessment Year 2014-15 ‘’1. That the orders passed by the Ld CIT(A) and the Assessing Officer are opposed to law, natural justice, equity, weight of evidences, probabilities , facts and circumstances of the case. 2. The Ld CIT(A) has erred in law as well as on the facts and circumstances of the case in dismissing the appeal of the appellant without providing adequate opportunity and also in confirming in full the absolutely illegal , arbitrary and void ab initio order of the Ld Assessing Officer without even considering the self speaking facts of the impugned assessment order, which need no further examination of records or any other documents. 3. Ld CIT(A) has erred in law as well as on facts and circumstances of the case in not quashing the illegal Assessment order passed by the Assessing Officer without assumption of proper jurisdiction as no proper satisfaction as mandated u/s 153C of the I.T.Act was recorded by the Assessing Officer. 3.1 Ld CIT(A) has erred in law as well as on facts and circumstances of the case in completely ignoring the fact that the Assessing Officer has not recorded satisfaction about any seized paper belonging to the Assessee for the impugned Assessment Year. 4. The ld. CIT(A) erred in law as well as on facts and circumstances of the case in not directing the Assessing Officer to allow to the assessee duly made claim of carry forward of brought forward losses ofA.Y. 2012-13 and 2013-14 amounting to Rs.5,98,326/- rejected by the AO arbitrarily 5. Ld CIT(A) erred in law as well as on facts and circumstances of the case in sustaining the addition of Rs 46,62,876/-/ made by the AO on account of alleged short term capital gains without considering the fact that assessee was not the owner of the said property. 5.1 Ld CIT(A) further erred in law as well as on facts and circumstances of the case in not considering the submissions that no material has been brought on record by the AO which might suggest that the sale consideration was received by the appellant. 5.2 without prejudice, Ld CIT(A) erred in law as well as on facts and circumstances of the case in not giving any finding on the ground that the 5 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR Assessing Officer arbitrarily applied the provisions of Section 50C(1) of the Income Tax Act. 6. Ld CIT(A) erred in law as well as on facts and circumstances of the case in sustaining the addition of Rs. 14,00,000/- made by the AO u/s 69 of the Act on account of alleged investment without considering the fact that assessee was not the owner of the said property and the said property was purchased by Sh Vishnu Kumar Nakwal. 6.1 Ld CIT(A) further erred in law as well as on facts and circumstances of the case in not considering the submissions that no material has been brought on record by the AO which might suggest that any investment in the property was made by the assessee and also in not considering that the investment in the said property was made by the purchaser through source verifiable banking channels only. 6.2 Ld CIT(A) erred in law as well as on facts and circumstances of the case in not considering the fact that no opportunity to cross examine Sh Vishnu Kumar Nakwal was provided to the Appellant and therefore, his statement could not have been relied upon in taking an adverse view against the appellant. 7. Ld CIT(A) erred in law as well as on facts and circumstances of the case in sustaining theabsolutely illegal and arbitrary addition of Rs.60,00,000/-made by the AO u/s 68 of the Income Tax Act treating the genuine loan transaction from M/s.Inner Mercantile Pvt. Ltd. as accommodation entry 7.2 Ld CIT(A) erred in law as well as on facts and circumstances of the case in not considering the contention of the Appellant that the office of the lender company existed at its registered office and also the notices sent were duly served upon the lender company and therefore, observation of the AO that lender company was a mere paper company was totally misplaced. 7.3 Ld CIT(A) erred in law as well as on facts and circumstances of the case in summarily rejecting the contention of the appellant that it had duly discharged the burden cast upon it of proving the identity, genuineness of the transaction and creditworthiness of the lender by filing confirmations, copy of ITR and bank account statements of the lender. 8. Ld CIT(A) erred in law as well as on facts and circumstances of the case in rejecting the contention of the appellant that the Ld Assessing Officer grossly erred in making addition of Rs 15000/ on account of hypothetical commission paid for obtaining accommodation entry. 8.1 That the Ld CIT(A) erred in law as well as on facts and circumstances of the case in not considering the contention of the appellant that the AO has not brought on record any evidence of payment of commission/arrangement of accommodation entry either during the assessment proceedings or found as a result of search. 6 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 9. Ld CIT(A) erred in law as well as on facts and circumstances of the case in rejecting the contention of the appellant that the AO has grossly erred in invoking the provisions of section 115 BBE of the Income Tax Act. 10. Ld CIT(A) further erred in law as well as on facts and circumstances of the case in confirming the disallowance u/s 14A of the Income Tax Act made by the AO without recording proper satisfaction and without considering the submissions that no expenditure was incurred by the appellant.’’ Assessment Year 2015-16 ‘’1. That the orders passed by the Ld CIT(A) and the Assessing Officer are opposed to law, natural justice, equity, weight of evidences, probabilities, facts and circumstances of the case. 2. The Ld CIT(A) has erred in law as well as on the facts and circumstances of the case in dismissing the appeal of the appellant without providing adequate opportunity and also in confirming in full the absolutely illegal, arbitrary and void ab initio order of the Ld Assessing Officer without even considering the self speaking facts of the impugned assessment order, which need no further examination of records or any other documents. 3. Ld CIT(A) has erred in law as well as on facts and circumstances of the case in not quashing the illegal Assessment order passed by the Assessing Officer without assumption of proper jurisdiction as no proper satisfaction as mandated u/s 153C of the IT.Act was recorded by the Assessing Officer. 3.1 Ld CIT(A) has erred in law as well as on facts and circumstances of the case in completely ignoring the fact that the Assessing Officer has not recorded satisfaction about any seized paper belonging to the Assessee for the impugned Assessment Year. 4. Ld CIT(A) erred in law as well as on facts and circumstances of the case in sustaining the addition of Rs 7,00,000/ made by the AO u/s 69 of the Act on account of alleged investment without considering the fact that assessee was not the owner of the said property and the said property was purchased by Sh Vishnu Kumar Nakwal. 4.1 Ld CIT(A) further erred in law as well as on facts and circumstances of the case in not considering the submissions that no material has been brought on record by the AO which might suggest that any investment in the property was made by the assessee and also in not considering that the investment in the said property was made by the purchaser through source verifiable banking channels only. 4.2 Ld CIT(A) erred in law as well as on facts and circumstances of the case in not considering the fact that no opportunity to cross examine Sh Vishnu Kumar 7 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR Nakwal was provided to the Appellant and therefore, his statement could not have been relied upon in taking an adverse view against the appellant. 3. Ld CIT(A) erred in law as well as on facts and circumstances of the case in sustaining the addition of Rs 1,06,19,558/ made by the AO u/s 68 of the Income Tax Act. 5.1 Ld CIT(A) erred in law as well as on facts and circumstances of the case in not giving any finding on the contentions of the Appellant that no incriminating material as to the credit entry in the name of Sitaram Meena duly recorded in the Books of accounts of the assessee, was found during the course of search and thus the entire addition was bad in law. 5.2 Ld CIT(A) erred in law as well as on facts and circumstances of the case in not considering the contention of the Appellant that the said credit entry was not an unsecured loan taken from Sitaram Meena but repayment by Sitaram Meena of sums already advanced to Sh Sitaram Meena. 5.3 Ld CIT(A) erred in law as well as on facts and circumstances of the case in summarily rejecting the contention of the appellant that it had duly discharged the burden cast over it of proving the identity, genuineness of the transaction and creditworthiness of the lender by filing confirmations and bank account statements of the lender. 5.4. Ld CIT(A) erred in law as well as on facts and circumstances of the case in summarily dismissing the contentions of the appellant that the source of the monies in the Bank account of Sh Sitaram Meena was duly explained before the Assessing Officer and the addition was made only on misplaced observations. 5.5 Ld CIT(A) erred in law as well as on facts and circumstances of the case in not giving any decision on the contention of the appellant that no opportunity of cross examination of the lender was given to it before placing reliance on his statement and therefore, order passed by the AO is bad in law. 6. Ld CIT(A) erred in law as well as on facts and circumstances of the case in rejecting the contention of the appellant that the AO has grossly erred in invoking the provisions of section 115 BBE of the Income Tax Act. 7. Ld CIT(A) further erred in law as well as on facts and circumstances of the case in confirming the disallowance u/s 14A of the Income Tax Act made by the AO without recording proper satisfaction and without considering the submissions that no expenditure was incurred by the appellant.’’ Assessment Year 2016-17 ‘’1. That the orders passed by the Ld CIT(A) and the Assessing Officer are opposed to law, natural justice, equity, weight of evidences, probabilities, facts and circumstances of the case. 8 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 2. The Ld CIT(A) has erred in law as well as on the facts and circumstances of the case in dismissing the appeal of the appellant without providing adequate opportunity and also in confirming in full the absolutely illegal, arbitrary and void ab initio order of the Ld Assessing Officer without even considering the self speaking facts of the impugned assessment order, which need no further examination of records or any other documents. 3. Ld CIT(A) has erred in law as well as on facts and circumstances of the case in not quashing the illegal Assessment order passed by the Assessing Officer without assumption of proper jurisdiction as no proper satisfaction as mandated u/s 153C of the I.T.Act was recorded by the Assessing Officer. 3.1. Ld CIT(A) has erred in law as well as on facts and circumstances of the case in completely ignoring the fact that the Assessing Officer has not recorded satisfaction about any seized paper belonging to the Assessee for the impugned Assessment Year. 4. Ld CIT(A) erred in law as well as on facts and circumstances of the case in sustaining the addition of Rs 15,89,250/ made by the AO on account of alleged undisclosed profit on sale of property without considering the fact that assessee was not the owner of the said property. 4.1 Ld CIT(A) further erred in law as well as on facts and circumstances of the case in not considering the submissions that no material has been brought on record by the AO which might suggest that the sale consideration was received by the appellant. 4.2 Ld CIT(A) erred in law as well as on facts and circumstances of the case in not considering the fact that no opportunity to cross examine Smt Vijay Laxmi was provided to the Appellant by the AO and therefore, her statement could not have been relied upon in taking an adverse view against the appellant. 4.3 Ld CIT(A) further erred in law as well as on facts and circumstances of the case in not giving any findings on the ground of the appellant that the Assessing Officer arbitrarily applied the provisions of Section 50C(1) of the Income Tax Act. 4.4 Ld CIT(A) further erred in law as well as on facts and circumstances of the case in recording findings of fact contrary to the assessment order in holding that Assessing officer has rightly arrived at the unexplained investment of Rs 15,89,250/- made in the name of BenamidarSmt Vijay Laxmi Verma when the AO has made addition of the identical amount on account of undisclosed profit from sale of the property. 5. Ld CIT(A) further erred in law as well as on facts and circumstances of the case in confirming the disallowance u/s 14A of the Income Tax Act made by the AO without recording proper satisfaction and without considering the submissions that no expenditure was incurred by the appellant.’’ 9 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 2. First, we take up the appeal of the assessee for the assessment year 2013-14 for adjudication. Apropos Grounds of appeal of the assessee for the assessment year 2013-14, the facts as emerges from the order of the ld. CIT(A) are as under wherein the ld. CIT(A) has dismissed the appeal of the assessee. ‘’2. Here in this appeal, appellant has raised nine (9) grounds of appeal. Ground of Appeal No. 8 relating to initiation of penalty proceeding u/s 271(1)(c) is premature, therefore the same is dismissed. Ground of Appeal No. 9 is general in nature and not needing any specific adjudication. The main Ground of Appeal No. 1 to 7 (Ground of Appeal No. 2 to 2.4, Ground of Appeal No. 3 to 3.2, Ground of Appeal No. 4 to 4.4 and Ground of Appeal No. 5 to 5.4 are inter related hence they are clubbed for adjudication)is reproduced herein as under: ‘’Ground No. 1: On the facts and in the circumstances of the case, the Ld. AO has ered in passing the impugned order u/s 153C of the IT Act, 1961 without recording the proper satisfaction and therefore the order so passed is bad in law and deserves to be quashed. Ground No. 2: Without Prejudice to ground no. 1 above and in the alternate 2: On facts and in circumstances of the matter, the Ld. AO has grossly erred in making addition of Rs. 1,40,75,700/- u/s 69 on account of alleged cash investment in purchase of property, arbitrarily. Thus the addition so made deserves to be deleted in full. 2.1: That the Ld, AO has further erred in making addition of Rs. 1,40,75,700/- solely based on alegedIkrar-nama (sale agreement), when in fact no such sale consideration was ever paid to the sellers on behalf of the actual purchaser Sh. PooranmalKanwat nor such agreement was ever acted upon by the parties. Thus the addition made for purchase consideration alleged as paid in cash merely on conjecture and surmises is bad in law and deserves to be deleted. 2.2: That the Ld. AO has further erred in ignoring the vital fact that the subject properties has been purchased by Sh. PooranmalKanwat through three separate registered sale deeds and there it is clearly established that the alleged sale agreement to sale was never executed and therefore no addition can be made in the hands of the assessee. 10 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 2.3: That the Ld. AO has further erred in ignoring the fact that the even as per sales agreements dated 25.05.2012 the purchase consideration was required to be paid in two installments and lastly by 20.01.2013. however since the deal could not get materialized in the purported manner and the subject property was ultimately got transferred in the shape of agriculture land only vide sales deeds executed on 11.07.2012 which were also found during the course of search, thus it is clearly established from the seized record itself that alleged sales agreements were never acted upon and therefore any additions made based on these agreements without having any material in hand is contrary to the facts of the case and the no addition can be made in the hands of the asessee. 2.4: That The Ld. AO has further erred in not giving opportunity to cross- examination Sh. PooranmalKanwat before placing reliance on his statements for making addition which is in gross violation of principle of natural justice and accordingly the addition made deserves to be deleted. Ground No. 3: On facts and in circumstances of the case, the Ld. AO has grossly erred in making addition of Rs. 1,34,84,685/- on account of alleged short term capital gain on sale of property arbitrarily. Thus the additions so made deserves to be deleted in full. 3.1: That the Ld. AO has further erred in making additions in the hands of the assessee while in fact the owner of the property is third person and Ld. AO has not brought on record any evidence which suggest that the sale consideration has been received by the assessee and therefore in absence of any such document no addition could have been made in the hands of the assessee. 3.2: Without prejudice to above, and in the alternate the Ld. AO has further erred adopting the full value of sale consideration of piece property sold to Smt. Sunita Mathur at Rs. 10,07,63,400/- by applying provision of section 50C(1) of the LT. Act. 1961, arbitrarily, thus the value so adopted deserves to be hold bad in law. Ground No. 4: On facts and in circumstances of the matter, the Ld. AO erred in making addition of Rs. 3,68,874/- u/s 69 on account of alleged investment in property, arbitrarily. Thus the addition so made deserve to be deleted in full. 4.1: That the Ld. AO has further erred in making addition of Rs. 3,68.874/- solely based on some sale deeds which were in the name of Sh. Vishnu Kumar Nakwal and as per which the owner of the properties is Sh. Vishnu Kumar Nakwat only and therefore the addition made for purchase consideration alleged as paid in cash merely on conjecture and surmises is bad in law and deserves to be deleted. 4.2: That the Ld. AO has further erred in ignoring the vital fact that the subject property has been purchased by Sh. Vishnu Kumar Nakwal through registered sale deed and in any case assessee was not the purchaser even as per these sale deeds and therefore no addition can be made in the hands of the assessee. 11 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR .3: That the Ld. AO has further erred in making these addition by ignoring the fact that no evidence what so ever was found as a result of search suggesting any cash payment made by assessee. Moreover the transaction with Sh. Vishnu Kumar Nakwal has been made by banking channels and were duly recorded in assessee's books of accounts. Thus the addition so made for purchase consideration alleged as paid in cash is bad in law and deserves to be deleted in full. 4.4: That the Ld. AO has further erred in not giving opportunity to cross- examine Sh.Vishnu Kumar Nakwal before placing reliance on his statements for making addition which is in gross violation of principle of natural justice and accordingly the addition made deserves to be deleted. Ground No. 5: On facts and circumstances of the matter, the Ld. AO erred in making addition of Rs. 29.95.596/- u/s 69 an account of alleged investment in property, arbitrarily. Thus the addition so made deserve to be deleted in full. 5.1: That the Ld. AO has further erred in making addition of Rs. 29.55.596/- solely based on some sale deeds which were in the name of Smt. Vijay Laxmi Verma and as per which the owner of the properties is Smt. Vijay Laxmi Verma only and therefore the addition made for purchase consideration alleged as paid in cash merely on conjecture and surmises is bad in law and deserves to be deleted. 5.2: That the Ld. AO has further emed in ignoring the vital fact that the subject property has been purchased by Smt. Vijay Laxmi Verma through registered sale deed and in any case assessee was not the purchase even as per these sale deeds and therefore no addition can be made in the hands of the assessee. 5.3: That the Ld. AO has further erred in making these addition by ignoring the fact that no evidence what so ever was found as a result of search suggesting any cash payment made by assessee. Moreover the transaction with Smt. Vijay Laxmi Verma has been made by banking channels and that too in AY 2014-15 only and were duly recorded in assessee's books of accounts. Thus the addition so made for purchase consideration alleged as paid in cash is bad in law and deserve to be deleted in full. 5.4: That the Ld. AO has further erred in not giving opportunity to cross-examine Smt.Vijay Laxmi Verma before placing reliance on his statements for making addition which is in gross violation of principle of natural justice and accordingly the addition made deserves to be deleted. Ground No.6: On fact and in circumstances of the case the Ld. AO has grossly erred In disallowing the expenses claimed at Rs 3,55,714/-in the profit and loss account by assuming that assessee company has not commenced any business activity and these expenses are in the nature of capital expenses, which is contrary to the facts of the case and without any material in possession of the Ld. AO and therefore the disallowance so made should be allowed to the assessee company. 12 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR Ground No. 7: On facts and in circumstances of the matter the Ld. AD has grossly erred in invoking the provision of section 1158BE of the IT. Act, 1961.’’ 3. During the course of appellate proceedings, appellant has not complied with the notices issued on various dates, the details of which are reproduced herein as under: Date of Notice Date of hearing Remarks 18-01-2021 28-01-2021 Adjournment letter submitted on ITBA Portal vide dated 28.01.2021 with frivolous reasons that "due to last date of audit we are preparing the reply so we are requested to please adjourned the case and oblige" 09-07-2021 18-07-2021 Adjournment letter submitted by Director of the company stated reasons that "It is submitted that due to Covid-19 pandemic has greatly affected the manner of working and has also affected the various deadlines that have been shifted to two or three. months thereby increasing the work load that to within limited working hours so we are preparing the reply" vide dt. 19.07.2021 and the case was adjourned to 12.08.2021. 12-08-2021 No compliance 11-11-2021 18-11-2021 No compliance 14-12-2021 27-12-2021 No compliance 03-01-2022 11-01-2022 No compliance. However, a letter is filled on ITBA portal on 24-01-2022, submitting adjournment letter submitted by Director of the Company stated reasons that ‘’due to Omicron - pandemic affecting our business very badly. Father of Sh. Charan, Singh Khandgarot director of the company is expired on 22.01.2022, who was admitted in ICU from many days. We hereby request you to give adjournment of 15 days for submission of documents against the above Mentioned appeals. You are requested to please grant adjournment for 15 days in case and oblige. ‘’ vide dt. 24-01-2022 05-12-2022 12-12-2022 No compliance 14-12-2022 21-12-2022 No compliance 03-01-2023 12-01-2023 No compliance 13 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 20-01-2023 02-02-2023 No compliance 3.1 Vide the notice issued on 20.01.2023, the appellant was specifically informed that this is the last opportunity. The relevant portion of the notice is reproduced herein as under: .....This is to inform you that 3 notices u/s 250 of the income-tax Act, 1961 have already been issued in your case vide DIN & Notice No. ITBA/APLIFIAPL 1/2022- 23/104780601811) dated 05.12.2022. DIN & Notice No. ITBA/APL/FIAPL 1/2022- 23/1047987826[1] dated 14.12.2022 and DIN & Notice No. ITBA/APL/F/APL 1/2022- 23/1048406407(1) dated 03.01.2023 respectively but till date there has not been any compliance on your part and no documentary evidences (s)/information/submissions/clarification have been furnished by you. Hence, you are being provided a final opportunity to present your case/file your submissions, if no submission/information is furnished/received within the stipulated time period, it will be presumed that you have nothing to submit/say in the matter and you appeal would be decided on the basis of material already available on record....." 3.2 However, the appellant did not comply with this notice also and nor filed any submissions to support his grounds of appeal. 4. It is crystal clear from the above chart that the appellant has been given a number of opportunities to present his case. However, no compliance and no written submissions are made till date. The appeal has been filed by the appellant but looking at the conduct of not complying with the notices, not filing any information's/submissions in support of the grounds of appeal, the only inference that can be drawn is that the appellant is not interested in perusing the appeal and therefore I am left with no alternative but to decide the appeal on the basis of material available on record. 4.1 The brief facts of the case are that appellant company in engaged in the business of dealing in property. The Appellant company filed its original return of income u/s 139(1) of the Act, on 18.09.2013 for the AY 2013-14 declaring a total loss at Rs. 3,55,714/-. Pursuant to this, AO issued a notice u/s 153C of the Act to the appellant on 23.08.2019, in compliance of which, the appellant filed its return of income declaring the same income as declared in the original return filed u/s 139 of the Act. However, in the return of income filed in response to notice u/s 153C of the Act no undisclosed income pertaining to the relevant year has been declared by the appellant. 5. The first Ground of Appeal that the appellant has raised is purely a legal ground viz-a-viz the assessment completed u/s 153C. Based on whatever material is available on file, I do not find any infirmity in the assessment made as per the Section 153C of the Act. This Ground of Appeal is rejected. 6. The Ground of Appeal No. 2 to 2.4 are inter related hence they are clubbed together for adjudication and is with respect to the addition on a/c of unexplained 14 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR investment in immovable property u/s 69 of the Act situated at Ajayrajpura and Mathurawala, Teh. Sanganer, Jaipur amounting to Rs. 1,40,75,700/-. The AO has observed that sale deed dated 25-05-2012 and subsequent 3 registered sale deeds were executed in the name of Sh. Pooran Mal Kanwat S/o Sh. Mehtab Singh Kanwat. However, payment has been made through the bank account of M/s Macro Properties Pvt. Ltd. and M/s Macro Township Pvt. Ltd. held in Malviya Urban Co-operative Bank which established that Sh. Pooran Mal Kanwat is only a name lender whereas actual beneficiary owner of the aforesaid land are M/s Macro Properties Pvt. Ltd. and M/s. Macro Township Pvt. Ltd. 6.1 Sh. Pooran Mal Kanwat is a retired government employee and he is showing his income from pension & interest. He has not filed any return of income for AYrs 2011- 12 to 2012-13. Sh. Pooran Mal Kanwat is a person of no means as per his ROI filed for the AY 2013-14 shows that his net income is at Rs. 3,65,130/- whereas he has purchased agricultural land amounting to crores of rupees. It is also evident from the discussion above that he has not paid even a single penny from his pocket and the sale consideration was paid by M/s Macro Township Private Limited and M/s Macro Properties Private Limited. 6.2 Further, the statement of Sh. Pooran Mal Kanwat was recorded u/s 131 of the Act on dated 24-10-2017 wherein he stated that the land under reference was belonging to Schedule Tribes and Schedule Tribe land cannot be purchased by the persons of other community, therefore, Sh. Charan Singh Khangarot has purchased these properties in his name whereas actual owner of the land under reference is M/s Macro Properties Private Limited & M/s Macro Township Private Limited, the companies related to Shri Charan Singh Khangarot. He has further admitted that he did not pay a single penny for purchase of above land and his name was only used by Sh. Charan Singh Khangarot and companies belonging to him. The scanned copy of statement of Sh. Pooran Mal Kanwat is mentioned in AO's assessment order at page no. 16 to 19. The AO has made a detailed analysis of the facts and evidence found at the time of search in the group of cases, while establishing that actual beneficial owner of the land is not Sh. Pooran Mal Kanwat. The relevant fact is mentioned in AO's assessment order at page no. 19 to 21. The same is not repeated for sake of brevity. 6.3 In view of the above facts and evidence brought on record it is evident that the land under consideration was purchased in the name of Sh. Pooran Mal Kanwat as he belongs to ST community and the land under consideration is also ST land which can be purchased by the person of ST community. The whole sale consideration was paid through cheque issued from bank account of M/s Macro Properties Pvt. Ltd. and M/s Macro Township Pvt. Ltd. and Sh. Pooran Mal Kanwat does not have any worth to invest huge amount in the immovable property which he admitted in the statement also. Therefore, it is beyond doubt that Sh. Pooran Mal Kanwat is only a name lender and actual beneficial owner of the land are M/s Macro Township Pvt. Ltd. and M/s Macro Properties Pvt. Ltd. 15 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 6.4 During the appellate proceedings, the appellant has not furnished any information/source of investment in property in spite of providing various opportunities. Based on whatever material is available on file and in absence of any new submission/ finding and any other material for which the appellant was provided so many opportunities, I do not find any infirmity in the addition made by the AO. This Ground of Appeal is rejected and the addition of Rs. 1,40,75,700/- is confirmed. 7. The Ground of Appeal No. 3 to 3.2 are inter related hence they are clubbed together for adjudication and with respect to the addition on a/c of undisclosed short term capital gain earned on sale of land which is situated at Ajayrajpura&Mathurawala, Teh. Sanganer, Jaipur amounting to Rs. 1,34,84,685/ The AO has observed that land measuring 387 hectares situated at Village Ajayrajpura&Mathurawala, Tehsil Sanganer, Jaipur purchased in the name of Sh. Pooran Mal kanwat by M/s Macro Properties Private Limited & M/s Macro Township Private Limited from various Khatedars for total sale consideration of Rs. 4,30,58,000/- was later on converted from agricultural to mixed uses by JDA on the application filed for conversion of the land by Sh. Kapil Bhakar, Power of Attorney holder of Sh. Pooran Mal Kanwat. 7.1 The AO has given a detailed analysis of the seized material i.e. as per details available in hard disc containing computer imaging data of various computers installed at office premises of M/s FS Housing Private Limited various data & tally software of various concerns related to F S Group were impounded during the course of survey action On perusal of one of the hard disc, tally data of Sh. Pooran Mal Kanwat for the AY 2013-14 & 2014-15 were found vide path Account PC- Ganesh Agarwal- Tally Data- Account PC-2 Ganesh Agarwal-G drive Tally backup 12.06.2017 -Nawal-Misc -File No. 10999. 7.2 In this hard disc, details of other expenses, registry amount, land development charges etc are also available which has been discussed elaborately at pages 29 to 38 of the AO's order, to arrive at the conclusion that the appellant has earned short term capital gain of Rs. 1,34,84,685/-. The same are not repeated here for the sake of brevity. 7.3 During the appellate proceedings, the appellant has not furnished any information/source of short term capital gain earned on sale of aforementioned land. Based on whatever material is available on file and in absence of any new submission/ finding and any other material for which the appellant was provided so many opportunities, I do not find any infirmity in the addition made by the AO. This Ground of Appeal is rejected and the addition of Rs. 1,34,84,685/- is confirmed. 8. The Ground of Appeal No. 4 to 4.4 are inter related hence they are clubbed together for adjudication and with respect to the addition on a/c of unexplained investment in the immovable property in the name of banamidaar Sh. Vishnu Kumar Nakwal. The AO observed that certain loose papers/documents/sale agreements/sale deeds were found & impounded which were inventorized as annexure "A "exhibit-1 to 60 which includes Exhibit 44 it is gathered that some of 16 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR the sale deeds are related to Sh. Vishnu Kumar Nakwal S/o Sh. Ram Pal Nakwal, 97/2, Valmiki Colony, Malviya Nagar, Jaipur. The sale deeds related to Sh. Vishnu Kumar Nakwalis is tabulated as mentioned at page no. 39 to 41 of AO's assessment order. 8.1 During the course of post search proceedings, the statement of Sh. Vishnu Kumar Nakwal was recorded on oath u/s 131 of the Act on 11/10/2017 wherein in reply to the question no 7 he has stated that the payments for purchase of land & stamp duty payments and registration expenses were paid by M/s Macro Properties Private Limited. He further stated that Sh. Charan Singh Khangarot& M/s Macro Properties Private Limited have made the payments Sh. Vishnu Kumar Nakwal in his statement repeatedly admitted that sale consideration was paid by M/s Macro properties Private Limited and he has not paid even a single penny from his own pockets in purchase of these lands. A scanned copy of statement of Sh. Vishnu Kumar Nakwal as recorded u/s 131 of the Act is available in AO's order at page 42. He has admitted that the amount invested in purchase of immovable property was borne by M/s Macro properties private Limited, therefore, he is not aware about exact amount of investment made in purchase of properties at Newai Town He has further admitted that details of quantum of investment & source must be available with M/s Macro properties Private Limited or Shri Charan Singh Khangarot as the amounts were paid by them .He further admitted that all the original documents of these properties are in possession of Sh. Charan Singh Khangarot or M/s Macro Properties Private Limited and aforesaid scanned copy of statement is mentioned in page no. 43 of AO's order. 8.2 In reply to question no .18 of his statement recorded u/s 131 of the Act on 11/10/2017, Sh. Vishu Kumar Nakwal has categorically stated that the land purchased in his name which is situated at Newai Town belonged to persons of SC community,therefore, Sh. Charan Singh Khangarut could not purchase the land being a person of other community then SC community He has further admitted that Sh. Charan Singh Khangaret got the land purchased in his name by paying the sale consideration to the land owners through his company M/s Macro Properties Private Limited He has further admitted that the sale consideration reported to be paid through cheques was paid by M/s Macro Properties Private Limited through its own bank account and all other expenses incurred in cash were also paid by them and aforesaid scanned copy of statement is mentioned in page no. 43 of AO's order. 8.3 The statement of Sh. Vishnu KumartNakwal is supported by documentary evidences in the form of copy of sale deeds The cheque numbers mentioned in the registered sale deeds belong to M's Macro Properties Private Limited's bank account no. 00311000001019 held in Malviya Urban Co-Operative Bank Limited, Jaipur from where the same have been debited. The amount of investment in the purchase of the property for this assessment year is Rs. 3,68,874/- which has been held to be unexplained investment u/s 69 of the Act 17 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 8.4 During the appellate proceedings, the appellant has not furnished any information/source of unexplained investment in the immovable property in the nume of benamidaar of Sh. Vishnu Kumar Nakwal. Based on whatever material is available en file and in absence of any new submission/ finding and any other material for which the appellant was provided so many opportunities, I do not find any infirmity in the addition made by the AO. This Ground of Appeal is rejected and the addition of Rs. 3,68,874/-is confirmed. 9. The Ground of Appeal of Appeal No. 5 to 5.4 are inter related hence they are clubbed together for adjudication and with respect to the addition on a/c of unexplained investment in immovable property in the name of benamidaar Smt. Vijay Laxmi Verma. The AO has observed that certain loose papers/documents/sale agreements/sale deeds were found & impounded which were inventorized as annexure "A" exhibit-1 to 60. which includes some of the sale deeds related to Newai Town, Tonk are related to Smt. Vijay laxmi Verma D/o Sh. Chunni Lal Verma, 40-Bhagwati Nagar-11. Kartarpura, Jaipur. The sale deeds related to Smt. Vijay Laxmi Verma is tabulated in mentioned at page no. 49 & 50 of AO's order. 9.1 These properties situated at various Khasra nos. were purchased by Smt Vijay Laxmi Verma during the FY 2012-13. All the properties were purchased by her in cash. 9.2 As huge investment was made in cash therefore during post search investigation the purchaser Smt Vijay Laxmi Verma was examined and her statement was recorded u/s 131 of the Act on 11.10.2017. During the enquiry, she has furnished the copy of return of income for AY 2011-12 to 2016-17 alongwith computation of income and copy of her bank account statement of account no.0020311000002937 held in Malviya Urban Co-operative Bank Limited On perusal of her bank account statement, it was gathered that from 01.04.2011 to 27.08.2012, she has withdrawn a sum of Rs. 1,36,000/- in cash only and during the same period she has deposited cash amounting to Rs. 1,54,800/-, thus availability of cash in hand amounting to Rs. 29,95,596/- for purchase of immovable property remained unexplained 9.3 Further, her bank account statement of account no 0020311000002937 held in Malviya Urban Co-operative bank Limited has also been examined thoroughly from 03.06.2015 to 30.06.2017 and it was gathered that even a single penny has not been deposited in cash by her in her bank account despite the fact that she had sold two immovable properties situated at Newai town for sale consideration of Rs. 35,29,500/- in cash. This fact also strengthen the fact that the sale consideration must have been received by the real beneficial owner of the properties i.e.M/s Macro Properties Private Limited which is discussed in detail in the body of the assessment order. 9.4 The AO has discussed the seized documents and entries in the bank account in detail in the body of the assessment order to arrive at the investment of Rs. 29,95,596/- in the name of benamidaar Smt. Vijay Laxmi Verma. During the 18 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR appellate proceedings, the appellant has not furnished any information/source of unexplained investment in the immovable property in the name of benamidaar of Smt. Vijay Laxmi Verma. Based on whatever material is available on file and in absence of any new submission/finding and any other material for which the appellant was provided so many opportunities, I do not find any infirmity in the addition made by the AO. This Ground of Appeal is rejected and the addition of Rs. 29,95,596/- is confirmed. 10. The sixth Ground of Appeal is with respect to the disallowance of loss on account of revenue expenditure amounting to Rs. 3,55,714/- On perusal of the Profit & Loss Account of the appellant company it is gathered that no revenue has been received from operation which clearly established that business was not commenced during the period. The AO treated the said expenditure as capital expenditure and disallowed the same. During the appellate proceedings, the appellant has not brought anything on record to show how this is un allowable expenditure. Based on whatever material is available on file, I do not find any infirmity in the addition made by the AO. This Ground of Appeal is rejected and the addition of Rs. 3,55,714/- is confirmed. 11. The seventh Ground of Appeal is with respect to invoking the provisions of section 115BBE(1) of the Act. All the additions made by the AO are based on the seized material, invoking the provisions of Section 69A and therefore the Provisions of Section 115BBE(1) are clearly applicable. Based on whatever material is available on file, I do not find any infirmity in the application of Section 115BBE(1) for charging of tax on additions made by the AO. This Ground of Appeal is rejected. 12. In the result, the appeal of the appellant is dismissed.’’ 3. Apropos to the legal ground so taken by the assessee during the course of hearing, the ld. AR of the assessee opposed to the finding of the ld. CIT(A) who has recorded the cryptic finding and has not touched upon the important facts of the case. Therefore, ld. AR of the assessee read the discussion made in the order of the assessee and the same is reproduced here in below : 19 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR ‘’1. A search and seizure action u/s 132 of the Income Tax Act, 1961 (‘’the Act’’) and / or survey action u?s 133A of the Act was carried out by the Income Tax Department on the members of Kiran Fine Jewellers Group on 02-08-2017 on which the assessee is one of the members. 2. The jurisdiction over the case was assigned to Central Circele-2, Jaipur by the Pr. Commisioner of Income Tax-II, Jaipur by means of an order u/s 127 of the Act circulated vide Pr. CIT-2/JPR/127/2019-20/1283 dated 14-08-2019. 3. Thus being satisfied that the books of account or documents found and seized during the search belonged to a person other than the person in the case of whom the search u/s 132 of the Act was carried out, notice (s) under section (s) 153C of the Act dated 23-08-2019 was issued and served upon the assessee, requiring him to file a true ad correct return of income as prescribed under Rule 12 of the Income Tax Rules, 1962 within 15 days of the service of the said notice. 4. In response to the said notice (s), a return declaring loss of Rs.355714/- was filed by the assessee on 10-09-2019. In the return of income originally filed by the assessee u/s 139(1) of the Act on 18-09-2013 at loss of Rs. 355714/- was declared. However, in the return of income filed in response to notice u/s 153C of the Act no undisclosed income pertaining to the relevant year has been declared by the assessee.’’ As there is no reference of the seized material and the ld. AR submitted that the documents/ material discussed in the order of the assessment relates to the recorded transaction in the books of account of the assessee company and the other part of the document relied upon were seized during the course of survey. Based on that fact and considering the 20 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR provision of the law ld. AO does not hold jurisdiction to reopen the case u/s. 153C of the Act as there is no incriminating material found in the search for that he has relied upon the recent supreme court decision settling the controversy in the case of U. K. Paints. The ld. AR of the assessee also submitted that the ld.CIT(A) has erred in dismissing the appeal of the assessee summarily without dealing with the facts and merits of the case that the ld. AO had erred in passing the assessment order u/s 153C of the Act,1961 without recording the proper satisfaction so as to invoke the provision of section 153C of the Act and the ld. CIT(A) without elaborately discussing the main issue of applicability of section153C of Act and rejected this ground wherein the ld. AR of the assessee narrated the ground No. 1 raised by the assessee and subsequently disposed off by this ground by the ld. CIT(A) rejecting ground of the assessee. The relevant observation of the ld. CIT(A) on the issue is reiterated here in below :- ‘’5. The first ground of appeal that the appellant has raised is purely a legal ground viz-a-viz the assessment completed u/s 153C. Based on whatever material is available on file, I do not find any infirmity in the assessment made as per the Section 153C of the Act. This ground of appeal is rejected.’’ 4. Denoting to the above finding of the ld. CIT(A), and the ground of the appeal of the assessee raising the legal ground the bench noted that the assessee has challenged the validity of the assessment and has contended 21 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR that the ld. AO has passed the order without recording the satisfaction as required u/s. 153C of the Act as it did not transpire from the order of the assessment as there is no discussion to recording of the satisfaction for taking up the case of the assessee u/s. 153C of the Act. 5. The bench noted that there is no discussion to the satisfaction note or finding of any incriminating material in the order of the assessment, therefore, in the course hearing the bench directed the ld. AO through DR to demonstrate as to the content of the satisfaction note if any before issue of notice u/s. 153C of the Act. The satisfaction note so recorded by the ld. AO as submitted by the ld. DR is reproduced here in below: Record Satisfaction (Stage 1) [Satisfaction remarks for recommending the case u/s 153C to jurisdictional AO] A search &seizure action u/s 132(1) of the 11 A 19-1 was carried out at the residential premises of Shri Charan Singh Khangaros s/o Shri Mukut Singh Khangarot, started at M-28, Income Tax Colony, Durgapura, Tonk Road, Jaipur on dated 02-08-2017 wherein certain documents were found and seized and inventorized as Annexure AS, Exhibit 1 to 06. Exhibit AS-3 contains 102 pages. Page No. 21 to 28 is a duly notorized sale agreement dated 25-05-2012 executed between Shri Tofan, Kalyan S/o Shri Mahadev, Shri Foollchand, Shri Mangilal, Shri Babula, Shri Chhotu S/o Shri Jagannath Meena, R/o Vill. NagaliyaManpur, Dhani Bainada, Tehsil- Sanganer, Jaipur (Sellers) and Shri Pooran Mal Kanwat S/o Shri Mahtab Singh Kanwat (Purchaser) for sale of immovable property of 26 Khasra No. having total area 3.87 hectare in village Ajayrajpuria&Mathurawala, Tehsil-Sanganer, Jaipur at the sale consideration of Rs.17,10,70,000/- for the land situated at aforementioned. These lands were purchased by Shri Pooran Mal Kanwat through three sale deeds duly registered with SR-Sanganer-1, Jaipur on 11-07-2012 22 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR During the course of search proceedings at residence of Shri Ashok Singh situated at M-21. Income Tax Colony, Durgapura, laipur 3 sale deeds of these aforesaid land as mentioned in sale agreement were found and seized as as page no, no. 17-24, 25-33 & page no. 14-41 of Exhibit-4 of Annexure-AS, which reveals that sale consideration reported in these sale deeds is shown at much below the actual consideration reported in sale agreement. Details of these sale deeds are as under:- (a) 1st Registered Deed: Property admeasuring .80 hectare hectares of land purchased from Shiri Tofan, Shri Kalyan s/o Shri Mahadev, Shiri Foolchand, Shri Mangi tal, Shri Babulal, Shri Chnotu s/o Shri Jagannath, Smt Naini Devi w/oShriJagananth, Viit. NangaliyaManpur, Dhani Bainada, Sanganer, Jaipur by Shri Pooran Mal Kanwat on 11/07/2012 for total sale consideration of Rs. 1,18,40,000/- out of land located at Village Mathurawala, Tehsil Sanganer. District Jaipur However, the actual sale consideration of the land as per the duly notarized sale agreement dated 25.05.2012 is at Rs 3,53,63,307/-whereas in the registered sale deed sale consideration reported to have been paid to the sellers at Rs 1,18,40,000/- thus there is difference in sale consideration amounting to Rs. 2,35,23,307/- between sale agreement and registered sale deed which has been paid to the sellers in cash by the purchaser out of his unaccounted income. However, the cheques numbers mentioned in the sale deed belong to the Malviya Urban Co-operative Bank account number 0020301000001468, which is found to be in the name of M/s Macro Township Private Limited. Hence it is also evident that the cash consideration of Rs. 2.35 crore was also paid by M/s M/s Macro Township Private Limited to the seller (b) 2nd registered deed: A property admeasuring 2.56 hectare hectares of land was purchased by Shri Pooran Mal Kanwat on 11-07-2012 from Shri Tofan, Shri Kalyan s/o Shri Mahadev, Shri Foolchand Shri Mang Lal Shri Babulal, Shri Chhotu s/o Shri Jagannath, Smt Naini Devi w/c5hri Jagananth, Vill NangaliyaManpur, Dhani Bainada, Sanganer, Jaipur out of land located at Village Mathurawala, Tehsil Sanganer, District Jaipur. For the consideration of Rs. 2,76,48,000/- However, the actual sale consideration of the land as per aforesaid duly notarized sale agreement is at Rs. 11,31,62,583/- thus there is a difference in sale consideration amounting to Rs. 8,55,14,583/ between sale agreement and registered sale deed which has been paid to the sellers in cash by the purchaser out of his unaccounted income. However, the cheques numbers mentioned the sale deed belong to the Malviya Urban Cooperative Bank account number 0020201000001019, which are respectively found to be in the name of M/s. Macro Township Private Limited & M/s. Macro Developers Private Limited. 2. Record Satisfaction (Stage 2)[Satisfaction remarks for marking the care for notice generation u/s 153C] 23 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR I am therefore, satisfied that the document seized belong to M/s. Macro Properties Private Limited (PAN AAFCM3633D) other than the search person and have bearing on the determination of his total income. Hence notice u/s 153C of the IT Act, for the AYs 2012-13 to 2017-18 and notice u/s 142(1)/143(2) for AY 2018-19 are to be issued for the purpose of assessment and reassessment of income of Shri Pooran Mal Kanwat in accordance with provision of Section 153A’’ 6. The ld. AR of the assessee referring to the satisfaction so recorded vehemently argued that the document which the ld. AO mentionedin his satisfaction note is not incriminating material. The transaction recorded is the bank transfer recorded as loan and the property referred was in fact sold subsequently to the third party by the real owner of the property where there is no connection to the assessee company. Not only that the money so advanced by the company is still receivable in the books of the assessee company. Thus, so far as the advances given by the company there is no incriminating material unearthed in the search which suggest to invoke the provision of section 153C of the Act in the case of the company. The rest of the documents are found during survey and therefore, the addition u/s. 153C can only be invoked if the incriminating material found in the search. Thus, the ld. AR relying on the apex court decision in the case of DCIT Vs. M/s. U. K. Paints (Overseas) Ltd. submitted that the addition de hors the incriminating material cannot be made in the year under consideration. In addition to the above oral arguments, the ld. AR of the 24 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR assessee on all the ground so taken and attacked in this appeal has also relied upon the written submission as reiterated here in below :- ‘’Assessee is a company incorporated under the Indian Companies Act and is engaged in the business activity of dealing in property. The Assessee company is duly complying with all the statutory requirements like getting its account audited from an auditor and filing annual return of income as required under the Indian Income Tax Act. On 23.08.2019, DCIT Central Circle-2, Jaipur issued Notice u/s 153C of the Income Tax Act to the assessee company requiring it to file its return of income for the A.Ys. 2012-13 to A.Ys A.Y. 2017-18. Reasons for issuing Notices u/s 153C were never supplied: Though the Notices u/s 153C were issued on 23.08.2019, however, no reasons for issuing the said notice were ever supplied to the Appellant by the Assessing Officer. The reasons for issuing Notice u/s 153C are also not uploaded on the web portal. Therefore, the appellant is not sure whether any reasons were recorded by the Assessing Officer prior to the issuance of Notice u/s 153C of the Income Tax Act or not. Reasons discernible form assessment orders; Though no reasons for issuing Notices u/s 153C of the Act were ever supplied to the appellant, however, from the copies of assessment orders served upon the appellant, it is seen that the Assessing Officer has made the following common observations in respect of all the assessment years in appeal: “ A search and seizure action u/s 132 of the Income Tax Act 1961( “the Act”) and/or survey action u/s 133A of the Act was carried out by the Income Tax Department on the members of Kiran Fine Jewellers Group on 02.08.2017 of which the assessee is one of the members. The Jurisdiction over the case was assigned to Central Circle-2 Jaipur by the Pr Commissioner of Income Tax Jaipur-1, Jaipur by means of an order u/s 127 of the Act circulated vide Pr CIT-2/)/JPR/ 127/2019-20/1283 dated 14.08.2019. Thus being satisfied that the Books of accounts or documents found and seized during the search belonged to a person other than the person in the case of whom the search u/s 132 of the Act was carried out, Notice (s) under Section(s) 153C of the Act dated 23.08.2019 was issued and served upon the assessee, requiring him to file a true and correct return of income as prescribed under rule 12 of the Income Tax Rule 1962 within 15 days of the service of the said notice.” 25 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR Though the Assessing Officer has mentioned that on being satisfied that the Books of accounts or documents found and seized during the course of search belonged to a person other than the person in the case of whom search u/s 132 of the Act was carried out, however, no such satisfaction is manifest in the assessment order. The Assessing Officer has neither referred to the specific person searched nor referred to any specific books of account or document. Thus from the plain reading of the facts noted by the Assessing Officer, it is crystal clear that the assumption of jurisdiction by the Assessing Officer in issuing Notice u/s 153C of the Income Tax Act was totally illegal and bad in law and thereby renders the assessments made pursuant thereto as illegal and void ab inito. The Assessing Officer in a completely arbitrary and illegal manner violated the statutory provisions of section 153C of the Income Tax Act and proceeded to complete the assessments without any authority legal or otherwise. Continuing with the absolutely illegal assumption of jurisdiction without complying with the statutory mandate of Section 153C of the Act, the Assessing Officer made huge additions to the total income of the Appellant without making any reference to any seized material belonging or related to the appellant for any of the assessment years. Aggrieved by the absolutely, illegal, arbitrary and void ab inito orders of the Assessing officer, the appellant filed appeals before theLd CIT(A)-4 Jaipur. However, the Ld CIT(A) dismissed the appeals filed by the appellant in a completely arbitrary manner and in utter disregard to the statutory provisions of the Income Tax Act and settled legal position. Hence the present appeals have been preferred by the appellant. The appellant hereby submits that in respect of the subject matter of the present appeals the appellant has not sought any other alternate remedy before any authority or court of law. Submissions on the Grounds of appeal: Gr No 1- Ground number 1 is general ground common to all the appeals. Gr No 2, The Ld CIT(A) has erred in law as well as on the facts and circumstances of the case in dismissing the appeal of the appellant without providing adequate opportunity and also in confirming in full the absolutely illegal , arbitrary and void ab initio order of the Ld Assessing Officer without even considering the self-speaking facts of the impugned assessment order, which need no further examination of records or any other documents. Most humbly it is submitted that the appellant company suffered huge setback during the covid period and business of the appellant was in total disarray. Appellant was finding it difficult to organise its affairs. Also during the pandemic, father of one of the Directors of the appellant company got seriously ill , and expired after remaining in critical condition in the Hospital for long time. Therefore, the humble appellant could not present its case before the Ld CIT(A) well in time. 26 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR However, the appellant submits that the Ld CIT(A) failed in discharging her statutory duties in dismissing the appeals though ostensibly after considering the facts available on record. However, as the humble appellant would demonstrate in the subsequent paragraphs, the Ld CIT(A) acted in an absolutely illegal and arbitrary manner in confirming the patently illegal and void ab initio order of the Assessing Officer. Illegal assumption of jurisdiction by the Assessing Officer in issuing Notices u/s 153C of the Act to the appellant and in assessing the income of the appellant under the provisions of Section 153C of the Income Tax Act is clearly evident from the impugned assessment orders itself and do not require looking into any other documents/ records.. Ground No 3 & 3.1 3. Ld CIT(A) has erred in law as well as on facts and circumstances of the case in not quashing the illegal Assessment order passed by the Assessing Officer without assumption of proper jurisdiction as no proper satisfaction as mandated u/s 153C of the I.T.Act was recorded by the Assessing Officer. 3.1 Ld CIT(A) has erred in law as well as on facts and circumstances of the case in completely ignoring the fact that the Assessing Officer has not recorded satisfaction about any seized paper belonging to the Assessee for the impugned Assessment Year. The appellant submits that the provisions of Section 153C of the Income Tax Act as amended by Finance Act of 2015 read as under: “ Section 153C - (1) Notwithstanding anything contained in Section 139, Section 147, Section 148, Section 149, Section 151 and Section 153, where the Assessing Officer is satisfied that, (a) any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, belongs to; or (b) any books of account or documents, seized or requisitioned, pertains or pertain to, or any information contained therein, relates to, a person other than the person referred to in Section 153-A, 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 person and issue notice and assess or reassess the income of the other person in accordance with the provisions of Section 153A, if, that Assessing Officer is satisfied that the books of account or documents or assets seized or requisitioned have a bearing on the determination of the total income of such other person for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made and for the relevant assessment year or years referred to in sub-section (1) of Section 153-A:..... 27 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR From the bare perusal of the above provisions of Section 153C of the Income Tax Act it is evident that for the purpose of invoking the provisions of section 153C against any person, any books of account or documents, seized during the course of search in the case of other person must either pertain to the assessee or should contain any information therein which relates to the assessee. Additionally, Assessing Office must also record his satisfaction that the books of account or documents or assets seized or requisitioned have a bearing on the determination of the total income of the assessee. Facts as to the non compliance with the provisions of Section 153C of the Income Tax Act made by the Assessing Officer in the present case- 1. Prior to the issuance of Notice u/s 153 C of the Income Tax Act the Assessing Officer has not recorded any satisfaction whatsoever . 2. Even assuming that the Assessing Officer has recorded a satisfaction in his file, the satisfaction note was never provided/ confronted to the appellant. Even during the course of assessment proceedings, no seized document/Books of account belonging to or related to or containing any information about the appellant was ever confronted to the appellant. Nor any such document formed the basis of making any addition to the total income of the appellant in the impugned assessment orders. Thus it is evident that even if the assessing officer had made a secret satisfaction note in his office, the same does not indicate any incriminating nature of the document/ Books of accounts etc. 3. The Assessing Officer in the assessment order has no where mentioned the fact of recording of any valid satisfaction which is clearly evident from the observations of the Assessing Officer reproduced verbatim in these submissions. However, for the sake of completeness and clarity, the humble appellant seeks leave of the Hon’ble Bench for reproducing the same again even at the cost of brevity: “ A search and seizure action u/s 132 of the Income Tax Act 1961( “the Act”) and/or survey action u/s 133A of the Act was carried out by the Income Tax Department on the members of Kiran Fine Jewellers Group on 02.08.2017 of which the assessee is one of the members. .... Thus being satisfied that the Books of accounts or documents found and seized during the search belonged to a person other than the person in the case of whom the search u/s 132 of the Act was carried out, Notice (s) under Section(s) 153C of the Act dated 08.08.2019 was issued and served upon the assessee, requiring him to file a true and correct return of income as prescribed under rule 12 of the Income Tax Rule 1962 within 15 days of the service of the said notice.” 4. From the plain reading of the above notingsof the assessing officer , it is evident that the satisfaction, if any formed by the Assessing Officer is absolutely vague and not in conformity with the statutory mandate as explained by the 28 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR Hon’ble Supreme Court, various High Courts and coordinate Benches of the Hon’ble Tribunal. The Assessing Officer has vaguely referred to the Books of accounts or documents seized during the course of search belonged to a person other than the person in the case of whom search has been carried out. The Assessing Officer has miserably failed in mentioning in unequivocal terms; (i) Which specific Books of accounts or documents found and seized during the course of search belonged to the assessee? (ii) During the course of search in whose case, Books of accounts or documents, if any belonging or related to the assessee were seized? Mere mentioning of the words ‘ search and survey in the case of Kiran Fine Jewellers Group of which assessee is a member, does not satisfy the requirement of law. (iii) ‘Kiran Fine Jewellers Group’ may be a recognisable entity to the Assessing Officer or to the Investigation wing of the Income Tax Department but is neither recognisable to the assessee nor to the law. The Assessing Officer is obligated to record his satisfaction with respect to the Books of accounts and documents belonging to the assessee/related to the assessee or containing any information related to the assesseee, seized during the course of search action in the case of a person in whose case warrant u/s 132(1) of the income tax act was issued. Needless to say that “Kiran fine Jewellers Group’ is not a person and no search and seizure action has been carried out in the case of any such entity/person by the name of “Kiran Fine Jewellers Group”. The Search and seizure action has been carried out in the cases of certain persons and the Assessing Officer should satisfy himself about the documents belonging to the assessee, if any found from the premises of searched person/persons. 5. Evidently, the Assessing Officer is not sure of the identity of the person from whom the documents belonging to the assessee were seized. Kiran Fine Jewellers Group is neither any entity in itself and no search action was carried out against Kiran Fine Jewellers Group . Therefore, satisfaction if any has at all been recorded by the Assessing Officer; the satisfaction is general, vague and does not satisfy the preconditions of section 153C of the Act so as to force the humble appellant to undergo the rigors of Section 153C of the Income Tax Act. 6. The Assessing Officer has not recorded satisfaction in respect of each of the assessment years before issuing notice u/s 153C of the Income Tax Act relating seized Books of accounts or documents to each assessment year separately. 7. The Assessing Officer has not recorded satisfaction about incriminating nature of the Books of accounts or document belonging to the appellant for each of the assessment years i.e , the seized Books of accounts or document having a bearing on the determination of total income of the appellant. Therefore, absent any satisfaction as mandated u/s 153C of the Act, the very initiation of proceedings u/s 153C of the Income Tax Act is totally illegal, bad in law and without jurisdiction and need to be quashed. 29 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR The appellant herein submit that no Books of Accounts or documents seized during the course of search action in Kiran Fine JewellersGroup , pertain to the assessee or related to the assessee, or contain any information related to the assessee. The seized Books of accounts or documents also have no bearing on determination of total income of the appellant for any of the impugned assessment years. Assessment year wise additions made by the Assessing Officer vis a vis basis of addition as discernible from Assessment orders: A.Y. 2013-14 -In the impugned assessment order, the additions made by the AO and the basis of such addition as has been discussed by the AO in the assessment order is as below: i. Addition of Rs 1,40,75,700/ u/s 69 of the Act on account of alleged cash investment in property purchased by one ShPooranmal Kanwat. Assessing Officer has referred to a sale agreement seized from the premises of Sh Charan Singh Khangarot in which the appellant is neither a seller or the buyer, nor name of appellant appear anywhere in the documents. (Ref Asst Order Para 7, Pg 2) (Document referred to as Pg 21-28 Annexure AS Exhibit -3) . AO has also referred to another sale agreement dated 25.05.2012 between the same parties. (Ref –Asst Order Para 7.2 Pg 3) (Document referred to as Pg 1-8 Annexure AS -6) AO has also referred to copy of another sale agreement dated 02.03.2012 completely unconnected with the appellant (Ref –Asst Order Para 7.6 Pg 5) (Document referred to as annexure AS-3 Pages No 13-2) AO has also referred to copy of another sale deed dated 11.07.2012 seized from the premises of Sh Ashok Singh entered into between Sellers and Sh Pooran Mal Kanwat. (Ref –Asst Order Para 7.6 Pg 6) (Document referred to as Pg 17-41 of Annexure- AS ) None of the documents referred to by the AO neither belong to the assessee nor related to the assessee nor contain any information related to the assessee. The Assessing officer has also nowhere mentioned in the assessment order that any of the documents contain information related to the assessee (Also Refer show cause notice issued by the AO, reproduced in the assessment order in Para 8.7 Pgs 22-23) ii. Addition of Rs 1,34,84,685/ on account of alleged short term capital gains- Documents referred to are data received from tally software installed at the office premises of M/s F.S. Housing Pvt Ltd during the course of survey action relating to sale of property by Sh Pooran Mal Kanawat (Ref. Assessment order Para 9.1 & 9.2 Pg 29-30) and information gathered by the AO from the website of Rajasthan Govt (Ref Asst Order para 9.4 Pg 30) . 30 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR iii. Addition of Rs 3,68,874/ u/s 69 of the Act on account of alleged investment in the property purchased by Sh Vishnu Kumar Nakwal. Documents referred to by the AO ,Annexure A, Exhibit -1 to 60 impounded during the course of survey action at the premises of M/s F S Housing Pvt Ltd iv. Addition of Rs 29,95,596/ on account of alleged cash investment in property purchased by Smt Vijay Laxmi. Document referred to is Annexure A Exhibit 1-60 impounded during the course of survey at the premises of FS Housing Pvt Ltd.( Refer Asst Order Para 11, Pg49) v. Disallowance of expenses amounting to Rs 3,55,714/- No reference to any material seized or impounded has been made in making the disallowance. Addition made by the AO at (i) above mentions seized documents however, the documents mentioned by AO neither belong to the assessee, nor are related to the assessee. The Documents do not contain any information concerning the assessee. The AO has in the assessment order nowhere mentioned the information concerning or related to the assessee contained in the said documents. Evidently the documents are completely unrelated to the assessee. Detailed discussion is being made in the submissions on merits. In making additions mentioned at (ii), (iii) and (iv ) above the documents though completely unrelated to the assessee have been impounded during the course of Survey proceedings and thus cannot otherwise form the basis of initiating action u/s 153C.. No document is mentioned in relation to the addition made at (v) above. A.Y. 2014-15 -In the impugned assessment order, the additions made by the AO and the basis of such addition as discussed by him in the assessment order is as below: i. Disallowance of claim of Brought forward losses of A.Y. 2012-13 and 2013- 14 claimed at Rs 5,98,326/ - No reference to any seized or impounded material. ii. Addition of Rs 46,62,867 / on account of alleged short term capital gains- Documents referred to are data received from tally software installed at the office premises of M/s F.S. Housing Pvt Ltd during the course of survey action. (Ref. Assessment order Para 9.1 & 9.2 Pg 28-29) and information gathered by him from the website of Rajasthan Govt (Ref Asst Order para 9.4 Pg 30) . iii. Addition of Rs 14,00,000/ u/s 69 of the Act on account of alleged investment in the property purchased by Sh Vishnu Kumar Nakwal. Documents referred to by the AO ,Annexure A, Exhibit -1to 60 impounded during the course of survey action at the premises of M/s F S Housing Pvt Ltd ((Ref Asst Order para 10, pg 38-39). 31 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR iv. Addition of Rs 60,00,000/ on account of alleged bogus unsecured loan from M/s Inner Merchantile Pvt Ltd. No reference to any seized or impounded material.(Ref. Asst Order Para 11 Pg 49) v Disallowance of Rs 2001/ u/s 14A- No reference to any seized or impounded material. Addition made by the AO at (i), (iv) and (v) are not related to any seized or impounded documents. In making addition at (ii) and (iii) above, the documents though completely unrelated to the assessee but finding mention in the discussions made by the AO in the assessment order, have been impounded during the course of Survey proceedings. Thus, no mention of any seized document in the entire order A.Y. 2015-16 -In the impugned assessment order, the additions made by the AO and the basis of such addition as disclosed in the assessment order is as below: i. Addition of Rs 7,00,000/ u/s 69 of the Act on account of alleged investment in the property purchased by Sh Vishnu Kumar Nakwal. Documents referred to by the AO ,Annexure A, Exhibit -1to 60 impounded during the course of survey action at the premises of M/s F S Housing Pvt Ltd ((Ref Asst Order para 7, pg 2- 3). ii. Addition of Rs 1,06,19,558/ on account of alleged unexplained cash credit from Sh Sita Ram Meena. No reference to any seized or impounded material.(Ref. Asst Order Para 8 Pg 13) iii Disallowance of Rs 2001/ u/s 14A- No reference to any seized or impounded material. Addition at (i) refers to the documents though completely unrelated to the assessee but the same were impounded during the course of Survey proceedings. Addition made by the AO at (ii) and (iii) above are not related to any seized or impounded documents. Thus there is absolutely no reference to any seized document in the entire order. A.Y. 2016-17 -In the impugned assessment order, the additions made by the AO and the sasis of such addition as disclosed in the assessment order is as below: i. Addition of Rs 15,89,250/ on account of alleged undisclosed profit on sale of property made by Smt Vijay Laxmi. Document referred to is Annexure A Exhibit 1-60 impounded during the course of survey at the premises of FS Housing Pvt Ltd.( Refer Asst Order Para 7, Pgs 3) ii Disallowance of Rs 2001/ u/s 14A- No reference to any seized or impounded material. 32 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR In making the addition at (i) above, the assessing Officer has referred to some documents however, the documents referred to are completely unrelated to the assessee and the same were also impounded during the course of Survey proceedings. Addition made by the AO at (ii) above is not related to any seized or impounded documents. Thus, there is no mention of any seized document in the entire assessment order. It is thus evident that the impugned assessments made u/s 153C of the Income Tax Act by the AO are absolutely illegal and void ab initio as the Assessing Officer never met the jurisdictional requirement for issuing notices u/s 153C of the Income Tax Act in the case of the appellant either before issuing Notices u/s 153C or even after culmination of the assessment proccedings. . As has been demonstrated above, out of 4 assessments, there is absolutely no reference to any seized Books of accounts or documents in the assessments for A.Y. 2014-15, 2015-16 and 2016-17. So far as the assessment for assessment year 2013-14 is concerned, it is evident from the bare perusal of the assessment order that in making a couple of additions, the Assessing Officer has discussed certain seized documents but in the entire order, the Assessing Officer has nowhere mentioned that any of the documents is related to the assessee or contain information about the assessee. The additions have been made absolutely on the basis of conjectures and surmises and without any factual foundation. None of the documents discussed by the AO contain any reference whatsoever to the assessee. The Assessing officer based his addition only on the statement of the Investor wherein he stated that the funds for investment were provided by Sh Charan Singh Khangarot and his companies. Statement which too was recorded in the post search proceedings u/s 131 of the Income Tax Act can never lent any legality to the proceedings initiated u/s153C of the Act. The addition made by the AO is also not based on any document but on assumptions made by the AO. Assumptions made by the Assessing Officer also suffer from complete perversity of facts. In the light of the above self evident facts, the assumption of jurisdiction by the Assessing Officer u/s 153C of the Income Tax Act is completely arbitrary and illegal. There was no occasion for the Assessing Officer to invoke the provisions of Section 153C of the Income Tax Act against the assessee, as the preconditions of Section 153C have not been met by the Assessing Officer. It is therefore requested that all the impugned assessment orders may kindly be quashed for lack of jurisdiction with the Assessing Officer. Decision of the Ld CIT(A) The Ld CIT(A) dismissed the related Grounds of appeal of the appellant for all the assessment years with identical observations which are reproduced as under: 33 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR “The first Ground of appeal that the appellant has raised is purely a legal ground vis a vis the assessment completed u/s 153C. Based on whatever material is available on file, I do not find any infirmity in the assessment made as per the Section 153C of the Act. This Ground of the appeal is rejected.” From the above observations of the Ld CIT(A) it is evident that the Ld CIT(A) has acted in the most arbitrary, illegal and whimsical manner. The Ld CIT(A) has not mentioned which material available on the file prompted her to upheld the absolutely illegal assessment orders. On the contrary, as discussed above, it is evident even from the bare perusal of the assessment orders that the Assessing Officer has in the absence of any material belonging to the assessee or related to the assessee or containing any information related to the assessee , seized from a searched person, much less any incriminating material, acted in the complete illegal and arbitrary manner in assigning to himself the jurisdiction to reassess the income of appellant under the provisions of section 153C of the Income Tax Act. The humble appellant submits that a speaking order ensure that the principles of natural justice are followed by the authority. To give reasons for the decision is a requirement of the principle of natural justice. The order would show which particular circumstances received due consideration while arriving at the decision. It is a settled legal proposition that every administrative as well as judicial order must be supported by cogent reasons. Reasons have been held to be sacrosanct to the judicial process. The Hon’ble Supreme court has been consistently insisting on this fundamental requirement. The giving of reasons for decision has been held to be an essential attribute of judicial and judicious disposal of a matter before the courts. Reason, it is said, introduces clarity in an order and without the same, it became life less. Reasons substitute subjectivity by objectivity. Absence of reasons renders indefensible / unsustainable, particularly when the order is subject to further challenge before a higher forum. Time and again Hon’ble Supreme court has observed that giving of reasons in support of their conclusions by judicial and quasi judicial authorities when exercising initial jurisdiction is essential for various reasons. Firstly, it is calculated to prevent unconscious unfairness or arbitrariness in reaching the conclusions. The very search for reason will put the authority on the alert and minimize chances of unconscious infiltration of personal bias or unfairness in the conclusion. The authority will adduce reasons which will be regarded as fair and legitimate by a reasonable man and will discard irrelevant or extraneous considerations. Second, it is a well known principle that justice should not only be done but should also appear to be done. Unreasoned conclusions may be just but they may not appear to be just to those who read them. Reasoned conclusions, on the other hand will have also the appearance of justice. Third, it should be remembered that an appeal generally lies from the decision of judicial and quasi judicial authorities to this court by special leave granted under Article 136. A judgement which does not disclose the reasons will be of little assistance to the court. The court will have to 34 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR wade through the entire record and find for itself whether the decision in appeal is right or wrong. In many cases the investment of time and industry will be saved if reasons are given in support of the conclusions. So it is necessary to emphasize that judicial and quasi judicial authorities should always give the reasons in support of their conclusions. { woolcombers of India Ltd Vs Woolcombers Worker Union AIR 1973 SC 2758: Baidya Nath Sharma Vs CWT (1983) 140ITR 801(Gau): Mool Chand Mahesh Chand Vs CIT (1978) 115ITR1 (All) : Siemens India Ltd VS ITO(1983) 143ITR120(Bom) In view of the above submissions, it is submitted that the orders passed by the Ld CIT(A) and the Assessing Officer need to be quashed in entirety. Undisputed legal position with regard to the provisions of Section 153C, as settled by the Hon’ble Supreme Courtl: Satisfaction of the Assessing Officer should be based on cogent material and should not be arrived at in a casual manner It is submitted that Section 132(4A)(i) clearly stipulates that when inter alia any document is found in the possession or control of any person in the course of a search it may be presumed that such document belongs to such person. The presumption as to asset, books of accounts, etc. is governed by section 292C(1)(i) belong or belongs to the person from whom said were found during the course of search u/s 132. Therefore , whenever a document is found from a person who is being searched the normal presumption is that the said document belongs to that person. It is for the Assessing Officer to rebut that presumption and come to a conclusion or 'satisfaction' that the document in fact belongs to somebody else. There should be some cogent material with the Assessing Officer to arrives at his satisfaction that the seized document does not belong to the searched person but to somebody else. Surmise and conjecture cannot take the place of 'satisfaction. This interpretation is in accord with the Interpretation given by various courts on umpteen occasions. The appellant place reliance on some of the following authoritative decisions of various courts in this regard: PCIT v. Himanshu ChandulalPatel [2019]109 taxmann.com 202 (Gujarat High Court) CIT v. Raj Pal Bhatia [2011] 10 taxmann.com 191 (High Court of Delhi)- CIT v. Smt. Chitra Devi Soni [2008] 170 Taxman 164 ( High Court of Rajasthan)- PCIT v. Star PVG Exports [2019]112 taxmann.com 163 (Karnataka High Court) DCIT v. Qualitron Commodities (P.) Ltd [2015] 54 taxmann.com 295 (Delhi - Trib.)- 35 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR Assessing Officer should record satisfaction in respect of each of the assessment years: The appellant submits that the law in this regard is well settled by the decision of the Hon’ble Supreme Court in the case of Commissioner of Income Tax –III, Pune Vs Singhad Technical Education Society (397ITR 344 SC) . The Hon’ble Supreme Court has held as under: “16. In these appeals, qua the aforesaid four Assessment Years, the assessment is quashed by the ITAT (which order is upheld by the High Court) on the sole ground that notice under Section 153C of the Act was legally unsustainable. The events recorded above further disclose that the issue pertaining to validity of notice under Section 153C of the Act was raised for the first time before the Tribunal and the Tribunal permitted the assessee to raise this additional ground and while dealing with the same on merits, accepted the contention of the assessee. 17. First objection of the learned Solicitor General was that it was improper on the part of the ITAT to allow this ground to be raised, when the assessee had not objected to the jurisdiction under Section 153C of the Act before the AO. Therefore, in the first instance, it needs to be determined as to whether ITAT was right in permitting the assessee to raise this ground for the first time before it, as an additional ground 18. The ITAT permitted this additional ground by giving a reason that it was a jurisdictional issue taken up on the basis of facts already on the record and, therefore, could be raised. In this behalf, it was noted by the ITAT that as per the provisions of Section 153C of the Act, incriminating material which was seized had to pertain to the Assessment Years in question and it is an undisputed fact that the documents which were seized did not establish any co-relation, document-wise, with these four Assessment Years. Since this requirement under Section 153C of the Act is essential for assessment under that provision, it becomes a jurisdictional fact. We find this reasoning to be logical and valid, having regard to the provisions of Section 153C of the Act. Para 9 of the order of the ITAT reveals that the ITAT had scanned through the Satisfaction Note and the material which was disclosed therein was culled out and it showed that the same belongs to Assessment Year 2004-05 or thereafter. After taking note of the material in para 9 of the order, the position that emerges there from is discussed in para 10. It was specifically recorded that the counsel for the Department could not point out to the contrary. It is for this reason the High Court has also given its imprimatur to the aforesaid approach of the Tribunal. That apart, learned senior counsel appearing for the respondent, argued that notice in respect of Assessment Years 2000-01 and 2001-02 was even time barred. 19. We, thus, find that the ITAT rightly permitted this additional ground to be raised and correctly dealt with the same ground on merits as well. Order of 36 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR the High Court affirming this view of the Tribunal is, therefore, without any blemish. Before us, it was argued by the respondent that notice in respect of the Assessment Years 2000-01 and 2001-02 was time barred. However, in view of our aforementioned findings, it is not necessary to enter into this controversy Insofar as the judgment of the Gujarat High Court relied upon by the learned Solicitor General is concerned, we find that the High Court in that case has categorically held that it is an essential condition precedent that any money, bullion or jewellery or other valuable articles or thing or books of accounts or documents seized or requisitioned should belong to a person other than the person referred to in Section 153A of the Act. This proposition of law laid down by the High Court is correct, which is stated by the Bombay High Court in the impugned judgment as well. The judgment of the Gujarat High Court in the said case went in favour of the Revenue when it was found on facts that the documents seized, in fact, pertain to third party, i.e. the assessee, and, therefore, the said condition precedent for taking action under Section153C of the Act had been satisfied.” Hon’ble High Court of Madras in the judgment dated 24.11.2020 in Tax Case appeal No 161 to 167 of 2020 in the case of Pr CIT Central -2 Chennai Vs M/s S. R. Trust Madurai held as under: “ para 7- The law on the subject with regard to an assessment under section 153C of the Act qua the necessity to establish the correlation the document wise with the assessment eyars in question was considered by the Hon’ble Supreme Court in the case of CIT-III, Pune Vs Singhad Technical Education Society (reported in (2017) 84 Taxmann.com 290} ... Para 10- The Tribunal further noted that the said Mr T John Rajasekhar approached the Income Tax Settlement Commission and submitted an application wherein the commissioner of Income Tax stated that there was no supporting evidence of returning cash withdrawn by the said Mr T John Rajashekhar to the hospital, which was established and being administered by the assessee Trust. The Tribunal rightly took note of the decision in the case of Singhad Technical Education Society that in proceedings under section 153C of the Act , in the absence of any incriminating documents or evidence discovered during the course of search under section 132 of the Act in the case of searched person against the assessee, the jurisdiction under the provisions of section 153C of the Act cannot be assumed...” Hon’ble Delhi High Court in the case of PrCIT (Central)-2 New Delhi Vs Panchmukhi Management Services Pvt Ltd in decision dated 26.09.2022 held as under: “ Para 7- Perusal of the satisfaction note reveals that no documents pertaining to Assessment year 2011-12 was seized during search. The Supreme Court in Commissioner of Income Tax –III Pune Vs Singhad Technical Education Society 37 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR reported in (2017) 397 ITR 344 has held that seized material can be considered to be incriminating in terms of section 153C of the Act only if the said material pertains to the assessment year in question. Para 8- With respect to Assessment year 2010-11 and 2012-13, this court is of the view that the recovery of the annual report and the share certificate of the Petitioner from premises of Minda Group cannot be considered to be incriminating documents. After all, the Minda group was not a third party but the issuing authority of the share certificates. In fact , both the appellate authorities below have given a concurrent finding that no incriminating material had been brought on record by the Assessing Officer to sustain the addition on merit. Also, the genuineness of the share capital has been accepted both by CIT(A) and ITAT and also there is no live link between seized material and the additions made. Therefore this court is of the view that assumption of jurisdiction in the present cases by the Assessing Officer was erroneous.” Reliance is also placed on the following decisions where various High Courts have held that in the absence of incriminating material powers u/s 153C can not be exercised ; 1. Decision dated 7 th Feb 2017 of the Bombay High Court in ITA No 83 of 2014 in the case of CIT-Central-III, Mumbai Vs M/ Arpit Land Pvt Ltd and ITA No 150 of 2014 in the case of CIT-Central-III, Mumbai Vs M/ Ambit Realty Pvt Ltd . 2. Delhi High Court decision dated 25 th April 2017 in WP(C) No 2768 & 2769 /2016 in the case of ARN Infrastructure India Ltd Vs ACIT 3. Delhi High Court decision dated 18 th April 2018 in ITA No 791/2017 in the case of Pr CIT Delhi-8 Vs M/s N.S. Software (Firm) 4. PCIT Vs Vikas Telecom Ltd ITA No 112/2020 dated 15/12/2021 (Delhi High Court )5. CIT Kolkatta- III Vs Veer Prabhu Marketing Ltd ITA No 601 of 2008 Dated 4August 2016 (Kolkatta HC) 6. CIT Vs IBC Knowledge Park (P) Ltd (2016) 69 Taxmann.com 108 (Karnataka High Court) 7. Decision dated 04.05.2022 of Hon’ble ITAT Delhi Bench in ITA No 365/Del/2018 in the case of M/s Heavens Suppliers Ltd Vs ACIT 8. M/s Green Range Farms (P) Ltd Vs DCIT (2018) Taxmann.com 249 Delhi Tribunal 9. Hon’ble ITAT Ahmedabad Bench decision dated 22/04/2022 in IT(SS) A No 114 to 117/Ahd/2017 in the case of M/s Neesa Technologies (P) Ltd Vs DCIT 10. Hon’ble ITAT Ahmedabad Bench decision dated 09/11/2022 in IT(SS) A No 248/Ahd/2018 in the case of ACIT Vs Ashrita Construction Pvt Ltd No addition can be made in the assessments in the absence of incriminating material; Without prejudice to the submissions, that initiation of proceedings u/s 153C of the Income Tax Act is absolutely illegal and without authority of law, the appellant 38 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR submits that even after initiation of proceedings, addition to the returned income in respect of unabated assessments can only be made on the basis of incriminating material. In the absence of incriminating material no addition can be made in the assessments made u/s 153C of the Income Tax Act. In support of this proposition, the appellant relies on the following decisions of various high courts including the decision of the Hon’ble Jurisdictional High Court: Pr. Commissioner of IncomeTax-Central, Jaipur Vs. Smt.Daksha Jain, Sirohi 2019 (8) TMI 474 (Rajasthan) Commissioner of Income Tax (Central)-III Vs. Kabul Chawla (2016) 380 ITR 573 (Delhi) Principal Commissioner of Income Tax, Central -2, New Delhi Vs. Meeta Gutgutia (2017) 395 ITR 526 (Delhi) Chintels India Ltd. Vs. Deputy Commissioner of Income Tax –Circle -8, Delhi (2017) 397 ITR 416 (Delhi) Principal Commissioner of Income Tax-4 Vs. Saumya Construction (2016) 387 ITR 529 (Gujarat) Principal Commissioner of Income Tax, Ahmedabad Vs.DipakJashvantlal Panchal 2017 (2) TMI 862(Gujarat) Principal Commissioner of Income Tax-2 Vs. Jay Infrastructure and Properties Pvt. Ltd.2016 (10) TMI 1022 (Gujarat) Commissioner of Income Tax-II, Thane Vs. Continental Warehousing Corporation (Nhava Sheva) Ltd. (2015) 374 ITR 645 (Bombay) Pr. Commissioner of Income Tax (Central), Bangalore and Ors. Vs. M/s . Delhi International Airport Pvt. Ltd. and Ors.(2022) 443 ITR 382 (Karnataka) Sri. S.M. Kamal Pasha Vs. The Deputy Commissioner of Income-Tax Central Circle – 6 (3) (2) Bangalore (2022 (8) TMI 966 (Karnataka) Smt. Jami Nirmala Vs. Principal Commissioner of Income Tax (2021) 437 ITR 573(Orissa) Smt. Smrutisudha Nayak Vs.Union of India (2021) 439 ITR 193 (Orissa) Commissioner of Income Tax,Kolkata Vs. Veerprabhu Marketing Limited (2016) 388 ITR 574 (Calcutta) Principal Commissioner of Income Tax-2, Kolkata Vs. M/s.Salasar Stock Broking Ltd.2016 (8) TMI 1131(Calcutta) Dr. A.V. Sreekumar Vs. The Commissioner of Income Tax,Kochi and Assistant Commissioner of Income Tax,Calicut (2018) 404 ITR 642 (Kerala) The appellant further submits that the above legal position with regard to the assessments u/s 153A/153C as enunciated by various high courts, has now been affirmed by the Hon’ble Supreme Court in the decision dated 20 th April 2023 in Civil Appeal No 6580 of 20021 in the case of Pr CIT Central-3 Vs Abhisarbuildwel Pvt Ltd laying down the following clear and unambiguous position of law: “ 9. While considering the issue involved, one has to consider the object and purpose of insertion of Section 153A in the Act, 1961 and when there shall be a block assessment under Section 153A of the Act, 1961. 39 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 9.1 That prior to insertion of Section 153A in the statute, the relevant provision for block assessment was under Section 158BA of the Act, 1961. The erstwhile scheme of block assessment under Section 158BA envisaged assessment of ‘undisclosed income’ for two reasons, firstly that there were two parallel assessments envisaged under the erstwhile regime, i.e., (i) block assessment under section 158BA to assess the ‘undisclosed income’and (ii) regular assessment in accordance with the provisions of the Act to make assessment qua income other than undisclosed income. Secondly, that the ‘undisclosed income’ was chargeable to tax at a special rate of 60% under section 113 whereas income other than ‘undisclosed income’ was required to be assessed under regular assessment procedure and was taxable at normal rate. Therefore, section 153A came to be inserted and brought on the statute. Under Section 153A regime, the intention of the legislation was to do away with the scheme of two parallel assessments and tax the ‘undisclosed’ income too at the normal rate of tax as against any special rate. Thus, after introduction of Section 153A and in case of search, there shall be block assessment for six years. Search assessments/block assessments under Section 153A are triggered by conducting of a valid search under Section 132 of the Act,1961. The very purpose of search, which is a prerequisite/trigger for invoking the provisions of sections 153A/153C is detection of undisclosed income by undertaking extraordinary power of search and seizure,i.e., the income which cannot be detected in ordinary course of regular assessment. Thus, the foundation for making search assessments under Sections 153A/153C can be said to be the existence of incriminating material showing undisclosed income detected as a result of search. 14. In view of the above and for the reasons stated above, it is concluded as under: i) that in case of search under Section 132 or requisition under Section 132A, the AO assumes the jurisdiction for block assessment under section 153A; ii) all pending assessments/reassessments shall stand abated; iii) in case any incriminating material is found/unearthed, even, in case of unabated/completed assessments, the AO would assume the jurisdiction to assess or reassess the ‘total income’ taking into consideration the incriminating material unearthed during the search and the other material available with the AO including the income declared in the returns; and iv) in case no incriminating material is unearthed during the search, the AO cannot assess or reassess taking into consideration the other material in respect of completed assessments/unabated assessments. Meaning thereby, in respect of completed/unabated assessments, no addition can be made by the AO in absence of any incriminating material found during the course of search under Section 132 or requisition under Section 132A of the Act, 1961. However, the completed/unabated assessments can be re-opened by the AO in exercise of powers under Sections 147/148 of the Act, subject to 40 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR fulfilment of the conditions as envisaged/mentioned under sections 147/148 of the Act and those powers are saved The Hon’ble Supreme court has clearly laid down that subject to fulfilment of the conditions as envisaged/mentioned there under , powers could only be exercised u/s 147/148of the Act in case search and seizure action has not unearthed any incriminating material. Thus, irrespective of the fact whether exercise of powers under section 153C of the Act by the AO in the present case suffers from illegality or not, no addition to the total income of the appellant could have been made by the AO as no incriminating material relating to the assessee was neither found during the course of search, nor has been relied upon by the AO in the assessments. Therefore, additions made by the AO to the total income of the assessee in the assessments completed u/s 153C of the Act deserve to be quashed in toto.’’ 7. Further, the ld. AR of the assessee filed the following documents/papers to support the contentions so raised in this appeal : S.N. Date Particulars Pages 1. 23-08-2019 Notice u/s 153C of the Income Tax Act 1 2. 30-09-2019 Notice under sub-section (1) of Section 142 of the Income Tax Act, 1961 2-3 3. 30-09-2019 Notice under section 143(2) of the Income Tax Act, 1961 4 4. 30-12-2019 Notice under section 156 of the Income Tax Act, 1961 5 5. 30-12-2019 Intimation letter 6 6. 30-12-2019 Notice under section 271 of the Income Tax Act, 1961 7 7. 30-12-2019 Assessment order 8-66 8. The AR of the assessee also submitted Memo of Survey conducted at premises of F.S.Housing Pvt. Ltd. as on 02-08-2017 u/s 133A and the documents found, thereby placing on record the fact that the said 41 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR documents found not related to M/s. Macro Properties (P) Ltd. and thus, submitted that when the material is gathered in the survey,no notice u/s. 153C can be issued and ifso issued in this case is bad in law. Therefore, based on the inappropriate appreciation of facts the addition so made also does not survive. The details of the material found in survey proceeding and relied tabulated here in below :- Particulars Copy found Search/survey Seller Buyer Document found Disclosed short term capital earned on sale of land situated at Ajayrajpura&Mathurawala, Tehsil-Sanganer, Jaipur, seized sale agreement dated 25-05-2012 Premises of Shri Charan Singh Khangarot Search Shri Toofan, Kalyan S/o Shri Mahadev, Shri Foolchand, Shri Mangilal,ShriBabu Lal,ShriChhotu S/o Shri Jagannath, Smt. Naina Devi W/o Shri Jangannath Meena R/o vill. NaglaiyaManpur, Dhani, Bainada,Teh- Sanganer, Jaipur Shri Pooran Mal Kanwat S/o Shri Mehtab Singh Kanawat Page No. 21 to 28 of Annexure –AS, Exhibit-3 Meanwhile, from details available in hard disc contaiing computer imaging data of various computers installed at office premises of M/s. F.S. Housing Private Ltd. & tally software of various concerns related toF.S. Group were impounded during eh course of survey action Premises of F.S. Housing Pvt. Ltd. Survey Tally data of Shri Pooran Mal Kanwat for the A.Y. 2013-14 & 2014-15 were found Smt. Sunita Mathur W/o Shri Harish Mathur Unexplained investment in the immovable property in the name of benamidar Shri Vishnu Kumar Nakwal Premises of F.S. Housing Pvt. Ltd Survey Annexure ‘A’ exhibit 1 to 60 investment of Rs.14,00,000/- 9. On the other hand, the ld. DR supported the order of the ld. AO wherein he recorded finding that Shri Pooran Mal Kanwat is a retired 42 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR government employee and he is showing his income from pension and interest. He has not filed any return of income for A. Y. 2011-12 to 2012-13. He is a person of no means as per his return of income filed for the A. Y. 2013-14 shows that his net income is at Rs. 3,65,130/- whereas he purchased agricultural land amounting to crores of rupees. He has also not paid any single amount for purchase of property and consideration was paid by the assessee company. Further relying on the statement of Shri Pooran Mal Kanwat recorded on 24.10.2017 stated that the land under reference was belonging to Schedule Tribes and Schedule Tribe land cannot be purchased by the person of other community and therefore he has purchased the land in his name. The statement so recorded also support on the fact that Shri Ratan Lal Agarwal is close associates of Shri Charan Singh Khangarot and Shri Dipendra Singh is the cousin of Shri Charan Singh Khangarot who are the director of the assessee company. As the law does not permit to hold such land they hold the land to their close associates / employees and thereby they convert the land into nonagricultural land. After purchase of land the same was converted in commercial and residential purpose and the person who was doing this work was also director in the company. The consideration was paid by the assessee company to buy the impugned land. Based on these set of facts 43 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR the ld. AO has rightly hold that the assessee company is beneficial owner of the land. The ld. DR in addition also relied upon the orders of the ld. AO and ld. CIT(A) and has also filed a letter No. 47 dated 04-05-2023 issued by the ACIT,Central Circle-2, Jaipur the contents of which are reproduced as under:- Office of the ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRLCLE-2, JAIPUR Room 410, 4th Floor Jeevan Nidhi-II, LIC Building, Bhawani Singh Road, Jaipur-302005 ACIT(CC)-2/1pr/ITAT Appeal/2023-24/47 Dated:04.05.2023 To. The Pr. Commissioner of Income Tax (Central) Rajasthan, Jaipur (Through Proper Channel) Sir, Sub: Appeal in the case of M/s Macro Properties Pvt Ltd (ITA No 174 to 176/JPR/23) before Hon'ble ITAT for AY 2013-14, 2014-15, 2015-16 & 2016-17- reg. Ref: (1) Letter No. CITEDR-1)/ITAT/JPR/2023-24/70 dated 03.05.2023. (ii) Letter No. CIT(DR-1)/ITAT/JPR/2023-24/71 dated 03.05.2023. Kindly refer to the above mentioned subject. In this connection, the requisite details/documents as desired vide the letter referred above, is submitted hereunder 44 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 1 (a) Contention of the assessee that the reasons for reopening of the assessment u/s 1530 has not been recorded by the Assessing Officer before issuing the notice u/s 153C, is found incorrect as the satisfaction note has been properly recorded by the Assessing Officer online electronically on ITBA (copy of screen shot taken from ITBA system enclosed as per Annexure 'A' & word file of the same copied from ITBA enclosed as per Annexure "B"). (b) Regarding the non-submission of the reasons for reopening the assessment u/s 153C to theassessee, it is submitted on perusal of the assessment record for AY 2013-14 to AY 2016-17, it isfound that the assessee has never asked for the reasons or satisfaction note during the course ofthe assessment proceedings for AY 2013-14 to AY 2016-17. 2. Other contention raised by the assessee is that the case was reopened u/s 153C for all the years on the basis of documents found and seized during survey u/s 133A and not on the basis of documents found and seized during search action u/s 132. In this regard relevant paras of the satisfaction note as drawn by the assessing officer are reproduced hereunder "A search & seizure action u/s 132(1) of the IT. Act, 1961 was carried out of residential premises of Shri Charan Singh Khongorot s/o Shri Mukut Singh Khangarot, situated of M-28, Income Tax Colony. Durgapura, Tonk Road, Jaipur, on dated 02-08-2017 wherein certain documents were found and seized and inventorizedos Annexure-A5, Exhibits 1 to 06. Exhibit AS-3 contains 102 pages. Page nos 21 to 28 is a duly notarized sole ogreement dated 25.05.2012 executed between Shri Tofon, Kalian s/o Shri Mahadev, Shri Foolchand, Shri Mangilal, Shri Babulal, Shri Chhotu s/o Shri Jogananth, Smt Naina Devi w/o Shri Jaganath Meena, R/o Vill, NaglaiyaMonpur, Dhani Boinada, Tehsil- Sanganer, Jaipur (Sellers) & Shri Pooran Mal Konwar S/o Shri Mahtab Singh kanwat (purchaser) for sale of immovable property of 26 khosra no having total area 3.87 hectare khasras in village Ajayrajpura&Mathurawala. Tehsil Sanganer, Jaipur at the sale consideration of Rs 17,10,70,000/- for the land situated otoforementioned. These land were purchased by Shri Pooran Mal Konwat through three sale deeds duly registered with the SR- Sanganer-1, Jalpar on 11.07.2012. During the course of search proceedings of residence of Shri Ashok Singh situated at M-21, Income Tax Colony, Durgapuro, Jaipur 3 sale deeds of these aforesaid land as mentioned in sole ogreement were found and seized as aspoge no no. 17- 24, 25-33 & page no: 34-41 of Exhibit 4 of Annexure-AS which reveals that sale consideration reported in these sale deeds is shown of much below the actual consideration reported in sale agreement." 45 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR From the above part of the satisfaction note, it is quite clear that the assessment proceedings u/s 1530 of the Act in this case was initiated by the assessing officer on the basis of the documents found and seized during the course of: (1) search and seizure action u/s 132(1) of the Income Tax Act, 1961 conducted at residential premises of Shri Charan Singh Khangarot s/o Shri Mulut Singh Khangarot, situated at M-28, Income Tax Colony, Durgapura, Tonk Road, Jaipur, on dated 02- 08- 2017 and (ii) search proceedings at residence of Shri Ashok Singh situated at M-21, Income Tax Colony, Durgapura, Jaipur. Further, these facts of the case were also duly noted by the assessing officer at para 7.1 & 7.2 (Page 2 & 3) in the assessment order for AY 2013-14 & AY 2014-15. 3. In addition to the above, further detailed coordinated investigation was made by the assessing officer by considering the documents found and impounded during the course of survey action at the business premises of M/s F S Housing Private Limited situated at A-4, Airport Enclave Scheme, Durgapura, Jaipur as mentioned by the assessing officer at para 11 (Page 49) inthe assessment order for AY 2013- 14, at para 10 (page 38) in the assessment order for AY 2014-15, at para 7 (page2) in the assessment order for AY 2015-16 and AY 2016-17 4. With regard to the necessary approval obtained by the assessing officer, it is stated that the only requirement for issuance of Notice a/s 1530 of the Act is drawing of the satisfaction note on the basis of documents seized during the Search, further, no approval is required to issue the Notice u/s 1530 as the AD himself empowered for the same as per the Income Tax Act, 196) 5. In view of the above facts of the case, it is ascertained that the assessment in the case of the assessee u/s 1536 was duly adhered as per the provisions of the Income Tax Act, 1961 and also followed by the due procedure as per both act and law. Therefore, contention of the assessee are found not tenable on the basis of the facts and relevant evidences thereof discussed as above. Submitted please Sd/- Yours faithfully (Rajesh Gupta) Asst Commissioner of Income tax Central Circle-2, Jaipur Encl: (1) copy of screen shot of satisfaction note taken from ITBA system enclosed as per Annexure A 00word file of satisfaction note copied from 1784 enclosed as per Annexures Annexure A – Screen shot of record of satisfaction 46 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR Annexure B as under:- Record Satisfaction (Stage 1) [Satisfaction remarks for recommending the case u/s 153C to jurisdictional AO] A search &seizure action u/s 132(1) of the 11 A 19-1 was carried out at the residential premises of Shri Charan Singh Khangaros s/o Shri Mukut Singh Khangarot, started at M-28, Income Tax Colony, Durgapura, Tonk Road, Jaipur on dated 02-08-2017 wherein certain documents were found and seized and inventorized as Annexure AS, Exhibit 1 to 06. Exhibit AS-3 contains 102 pages. Page No. 21 to 28 is a duly notorized sale agreement dated 25-05-2012 executed between Shri Tofan, Kalyan S/o Shri Mahadev, Shri Foollchand, Shri Mangilal, Shri Babula, Shri Chhotu S/o Shri Jagannath Meena, R/o Vill. NagaliyaManpur, Dhani Bainada, Tehsil- Sanganer, Jaipur (Sellers) and Shri Pooran Mal Kanwat S/o Shri Mahtab Singh Kanwat (Purchaser) for sale of immovable property of 26 Khasra No. having total area 3.87 hectare in village Ajayrajpuria&Mathurawala, Tehsil-Sanganer, Jaipur at the sale consideration of Rs.17,10,70,000/- for the land situated at aforementioned. These lands were purchased by Shri Pooran Mal Kanwat through three sale deeds duly registered with SR-Sanganer-1, Jaipur on 11-07-2012 During the course of search proceedings at residence of Shri Ashok Singh situated at M-21. Income Tax Colony, Durgapura, laipur 3 sale deeds of these aforesaid land as mentioned in sale agreement were found and seized as as page no, no. 17-24, 25-33 & page no. 14-41 of Exhibit-4 of Annexure-AS, which reveals that sale consideration reported in these sale deeds is shown at much below the actual considerationreported in sale agreement. Details of these sale deeds are as under:- (a) 1st Registered Deed: Property admeasuring .80 hectare hectares of land purchased from Shiri Tofan, Shri Kalyan s/o Shri Mahadev, Shiri Foolchand, Shri Mangi tal, Shri Babulal, Shri Chnotu s/o Shri Jagannath, Smt Naini Devi w/oShriJagananth, Viit. NangaliyaManpur, Dhani Bainada, Sanganer, Jaipur by Shri Pooran Mal Kanwat on 11/07/2012 for total sale consideration of Rs. 1,18,40,000/- out of land located at Village Mathurawala, Tehsil Sanganer. District Jaipur However, the actual sale consideration of the land as per the duly notarized sale agreement dated 25.05.2012 is at Rs 3,53,63,307/-whereas in the registered sale deed sale consideration reported to have been paid to the sellers at Rs 1,18,40,000/- thus there is difference in sale consideration amounting to Rs. 2,35,23,307/- between sale agreement and registered sale deed which has been paid to the sellers in cash by the purchaser out of his unaccounted income. However, the cheques numbers mentioned in the sale deed belong to the Malviya Urban Co-operative Bank account number 0020301000001468, which is found to be in the name of M/s Macro Township Private Limited. Hence it is also evident 47 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR that the cash consideration of Rs. 2.35 crore was also paid by M/s M/s Macro Township Private Limited to the seller (b) 2nd registered deed: A property admeasuring 2.56 hectare hectares of land was purchased by Shri Pooran Mal Kanwat on 11-07-2012 from Shri Tofan, Shri Kalyan s/o Shri Mahadev, Shri Foolchand Shri Mang Lal Shri Babulal, Shri Chhotu s/o Shri Jagannath, Smt Naini Devi w/c5hri Jagananth, Vill NangaliyaManpur, Dhani Bainada, Sanganer, Jaipur out of land located at Village Mathurawala, Tehsil Sanganer, District Jaipur. For the consideration of Rs. 2,76,48,000/- However, the actual sale consideration of the land as per aforesaid duly notarized sale agreement is at Rs. 11,31,62,583/- thus there is a difference in sale consideration amounting to Rs. 8,55,14,583/ between sale agreement and registered sale deed which has been paid to the sellers in cash by the purchaser out of his unaccounted income. However, the cheques numbers mentioned the sale deed belong to the Malviya Urban Cooperative Bank account number 0020201000001019, which are respectively found to be in the name of M/s. Macro Township Private Limited & M/s. Macro Developers Private Limited. 2. Record Satisfaction (Stage 2)[Satisfaction remarks for marking the care for notice generation u/s 153C] I am therefore, satisfied that the document seized belong to M/s. Macro Properties Private Limited (PAN AAFCM3633D) other than the search person and have bearing on the determination of his total income. Hence notice u/s 153C of the IT Act, for the AYs 2012-13 to 2017-18 and notice u/s 142(1)/143(2) for AY 2018-19 are to be issued for the purpose of assessment and reassessment of income of Shri Pooran Mal Kanwat in accordance with provision of Section 153A’’ 10. We have heard both the parties and perused the material available on record and have also gone through the judicial decisions relied upon by both the parties to drive home to their contentions raised. The bench noted the Ground No. 3 and 3.1 is a ground raised for legal issue which is the main issue as to whether the satisfaction was recorded correctly and if so then whether the same is related to any material or documents relates or pertains to the assessee for the year under consideration. Thus, whether 48 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR the provision of section 153C of the Act is applicable based on the facts of the case or not, in the case of the assessee and the assessee pressed vehemently to decide it first. 11. Brief facts of the case are that a search and seizure action 132 of the Act and or survey action u/s 133A of the Act was carried out by the Income Tax Department on the members of Krian Fine Jewellers Group on 02-08- 2017 on which the Assessee is one of the members. The jurisdiction over the case was assigned to Central Circle-2 Jaipur by the ld. Pr.CIT, Jaipur II by an order u/s 127 of the Act dated 14-08-2019. Thus being satisfied that the Books of accounts or documents found and seized during the search belonged to a person other than the person in the case of whom the search u/s 132 of the Act was carried out, Notice (s) under Section(s) 153C of the Act dated 23.08.2019 was issued and served upon the assessee, requiring the assessee to file a true and correct return of income as prescribed under rule 12 of the Income Tax Rule 1962 within 15 days of the service of the said notice. From the assessment order, it is noted that in response to the said notice(s), a return declaring a loss of Rs.3,55,714/- was filed by the assessee on 10-09-2019. In the return of income, originally filed by the assessee u/s 139(1) of the Act on 18-09-2013at a loss of Rs.3,55,714/- 49 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR was declared. However, in the return of income in response to notice u/s 153C of the Act, no undisclosed income pertaining to the relevant assessment year has been declared by the assessee. The proceeding of assessment of income was commenced by issue of notice u/s 143(2) of the Act on 30-09-2019. Later queries were raised vide notices u/s 142(1) and or order sheet entries, wherever deemed fit by the AO. The informationcalled were furnished by the assessee’s counsel and placed on record. 12. It is notable from the copies of assessment orders served upon the assessee wherein it is seen that the Assessing Officer has made the following common observations in respect of all the assessment years in appeal : “ A search and seizure action u/s 132 of the Income Tax Act 1961( “the Act”) and/or survey action u/s 133A of the Act was carried out by the Income Tax Department on the members of Kiran Fine Jewellers Group on 02.08.2017 of which the assessee is one of the members. The Jurisdiction over the case was assigned to Central Circle-2 Jaipur by the Pr Commissioner of Income Tax Jaipur-1, Jaipur by means of an order u/s 127 of the Act circulated vide Pr CIT-2/)/JPR/ 127/2019-20/1283 dated 14.08.2019. Thus being satisfied that the Books of accounts or documents found and seized during the search belonged to a person other than the person in the case of whom the search u/s 132 of the Act was carried out, Notice (s) under Section(s) 153C of the Act dated 23.08.2019 was issued and served upon the assessee, requiring him to file a true and correct return of income 50 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR as prescribed under rule 12 of the Income Tax Rule 1962 within 15 days of the service of the said notice.” Though the Assessing Officer has mentioned that on being satisfied that the Books of accounts or documents found and seized during the course of search belonged to a person other than the person in the case of whom search u/s 132 of the Act was carried out, however, no such satisfaction is manifest in the assessment order. The Assessing Officer has neither referred to the specific person searched nor referred to any specific books of account or document. Thus from the plain reading of the facts noted by the Assessing Officer, it is crystal clear that the assumption of jurisdiction by the Assessing Officer in issuing Notice u/s 153C of the Income Tax Act was totally illegal and bad in law and thereby renders the assessments made pursuant thereto as illegal and void ab inito. The Assessing Officer in a completely arbitrary and illegal manner violated the statutory provisions of section 153C of the Income Tax Act and proceeded to complete the assessments without any authority legal or otherwise. Continuing with the illegal assumption of jurisdiction without complying with the statutory mandate of Section 153C of the Act, the Assessing Officer made huge additions to the total income of the Appellant without making any reference to any seized material belonging or related to the appellant for any of the 51 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR assessment years, which are not in the nature of incriminating in nature. It is also noted that the ld.CIT(A) has not adjudicated upon the issue of Section 153 C of the Act very deeply but considered the assessment order and the documents narrated by the AO therein.In this case we note that the AO had recorded a satisfaction in his file but the satisfaction note was not provided to the assessee nor the fact of the same is disclosed in the order of the assessment. Even during the course of assessment proceedings, no seized documents / books of account belonging to or related to or containing any information about the assessee was confronted to the assessee which are in the nature of incriminating in nature. No any such document formed the basis of making any addition to the total income of the assessee in the impugned assessment order, the addition or the amount disputed are already recorded in the books of accounts and the facts related to the case of the assessee all the payment found in the documents are duly recorded in the books of account of the assessee company. Thus it is evident that even if the AO had made a secret satisfaction note in his office, the same does not indicate any incriminating nature of documents/ books of accounts etc. It is also noted that AO in the assessment order has nowhere mentioned the fact of recording of any valid 52 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR satisfaction which is clearly evident from the observation of the AO which is verbatim as under:- “ A search and seizure action u/s 132 of the Income Tax Act 1961( “the Act”) and/or survey action u/s 133A of the Act was carried out by the Income Tax Department on the members of Kiran Fine Jewellers Group on 02.08.2017 of which the assessee is one of the members. ...... Thus being satisfied that the Books of accounts or documents found and seized during the search belonged to a person other than the person in the case of whom the search u/s 132 of the Act was carried out, Notice (s) under Section(s) 153C of the Act dated 23.08.2019 was issued and served upon the assessee, requiring him to file a true and correct return of income as prescribed under rule 12 of the Income Tax Rule 1962 within 15 days of the service of the said notice.” Thus it is noted that the AO has not recorded satisfaction in respect of each of the assessment years before issuing notice u/s 153C of the Act relating to seized books of accounts or documents to each assessment year separately. It also observed AO has not recorded satisfaction about incriminating nature of books of account or documents belonging to the assessee for each of the assessment years i.e. seized books of account or document having a bearing on the determination of total income of the assessee. The bench also notes the fact that the addition so made based on the search action for which all the transactions are already recorded and in respect of the other material found from the survey action. 53 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 13. It is noted that the AO while making the assessment noted the unexplained investment in the immovable property at Ajayrajpura and Mathrawala,Teshil Sanganer, Jaipur. The AO thus found that a search and seizure action u/s 132(1) of the Act was carried out at residential premises of Shri Charan Singh Khangarot S/o Shri Mukut Singh Khangarot, situated at M-28, Income Tax Colony, Durgapura, Tonk Road, Jaipur on 02-08- 2017wherein a duly notorized sale agreement dated 25-05-2012 executed between Shri Tofan, Kalyan S/o Shri Mahadev, Shri Foolchand, Shri Mangilal, Shri Babulal,ShriChhotu S/o Shri Jagananth, Smt Naina Devi W/o Shri Jagannath Meena, R/o Vill. NagaliyaManpur, Dhani Bainada, Tehsil, Jaipur (Seller) and Shri Pooran Mal Kanwat S/o Shri Mehtab Singh Kanwat (Purchaser) for sale of immovable property of 26 Khasra No. having total area of 3.87 hectarekhasra in village Ajayrajpura and Mathurawala, Tehsil- Sanganer at the sale of consideration of Rs.17,10,70,000/- for the land situated at the above places found and seized as page nos. 21 to 28 of Annexure AS Exhibit-B. Further another copy of sale agreement dated 25- 05-2012 duly notorized and signed by the concerned parties have been found and seized during the course of search action at the residential premises of Shri Charan Singh Khangarot S/o Shri Mukuit Singh Khangarot situated at M-28, Income Tax Colony, Malviya Nagar, Jaipur which has 54 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR been inventorised as page No. 1-8 of Annexure AS-6. The AO also noted that the contents of the aforementioned sale agreement are duly tallied with this sale agreement in term of name of sellers, area of land, khasra nos. sale considerationand amount paid till date of agreement etc. but on the back side of page no. 8, it is written that on 07-02-2012 two postdated cheque 338706 and 338707 dated 10-07-2012 each of Rs.50,000/- were paid to Shri Tofan and Shri Kalyan S/oShri Mahadev as sale consideration for sale of their land. Both the cheques were payable on account No. 1468 which belongs to M/s. Macro Township Private Ltd., a sister concern of the assessee company, held in Malviya Urban Cooperative Bank Ltd. Vasundhara, Tonk Road, Jaipur. At the end of this page Shri Charan Singh Khangarot, Shri Phool Chand Meena (Witness) have put their signature and Shri Tofan and Shri Kalyan S/o Shri Mahadev have put their thumb impressions. The AO has given a table at page 3 &4 of assessment order wherein some payments amounting to Rs.51.00 lacs were made to sellers i.e. Shri Tofan (Rs.10 lacs), Shri Kalyan (R.10 lacs), Shri Foolchand (Rs.4.00lacs), Shri Mangilal Rs.4.00 lacs), Shri Chhotu (Rs.4.00lacs), Shri Naini (Rs.4.00lacs), Shri Babu Lal (Rs.4.00 lacs) and all sellers (Rs.11.00 lacs) by the purchasers through cheques on various dates. The AO at para 7.3 of the assessment order noted that following postdated cheques were 55 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR also received by the sellers from Shri Pooran Mal Kanawat on the date of agreement. S.N. Receiver name Amount in Rs. Cheque No. Dated Name of bank & account holder 1. Shri Tofan 37,75,000 392001 28-05-12 MUCBL, Macro Township Private Ltd. 2. Shri Kalyan 37,75,000 392003 28-05-12 Do 3. Shri Fool chand 15,00,000 392004 28-05-12 Do 4. Shri Mangilal 15,00,000 392005 28-05-12 Do 5. Shri Chhotu 15,00,000 392006 28-05-12 Do 6. Shri Naini 15,00,000 392007 28-05-12 Do 7. Shri Babu Lal 15,00,000 392008 28-05-12 Do Total 1,50,00,000 The AO further noted that following amounts received through postdated cheques on the date of agreement. S.N. Receiver name Amount in Rs. Cheque No. Dated Name of bank &account holder 1. Shri Tofan 25,00,000 392009 10-07-12 MUCBL, Macro Township Private Ltd. 2. Shri Kalyan 25,00,000 392010 10-07-12 Do 3. Shri Fool chand 10,00,000 392011 10-07-12 Do 4. Shri Mangilal 10,00,000 392012 10-07-12 Do 56 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 5. Shri Chhotu 10,00,000 392013 10-07-12 Do 6. Shri Naini 10,00,000 392014 10-07-12 Do 7. Shri Babu Lal 10,00,000 392015 10-07-12 Do Total 1,00,00,000 The AO further noted in the assessment order that as per notarized sales agreement the sellers had received a sum of Rs. 3.01Crores till the agreement and it was agreed upon by them that the remaining payment will be paid by purchaser to sellers as under:- 50% excluding above advance payments Till 15-08-2012 (and at the time of registration of sale deeds) Remaining 50% Till 20-01-2013 (through postdated cheques) The AO further noted that a similar sale agreement dated 02-03-2012 duly notorized by the notary public on02-03-2012 executed between Shri Tofan, , Shri Kalyan S/o Shri Mahadev, Shri Foolchand, Shri Mangilal, Shri Babulal,ShriChhotu S/o Shri Jagananth, Smt Naina Devi W/o Shri Jagannath Meena, R/o Vill. NagaliyaManpur, Dhani Bainada, Tehsil, Jaipur (Sellers) and Shri Jitendra Meena S/o Shri Ram Kishore Meena, 8/7, Malviya Nagar, Jaipur (purchaser) for sale of immovable property situated at Vill. Mathurawala&Ajayrajpur, Teshsil-Sanaganer, Jaipur (same khasra as mentioned in the table depicted hereinabove) was also found and seized 57 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR as annexure AS-3, Pages No. 13—2, during the course of search and seizure action at the residential premises of Shri Charan Singh Khangarot. The AO further mentioned in the assessment order that the contents of the sale agreement are same as mentioned in sale agreement executed betweensellers & Shri Pooran Mal Kanwat in terms of value of land, mode of payment etc. This sale agreement was cancelled vide Ikrarnama Nirastikaran dated 25-05-2012 which was also duly notarized by the notary public. In this agreement, it is also mentioned that the advance amount of Rs.51.00lacs paid by Shri Jitendra Meena to the land owners will be adjusted in the name of Shri Pooran Mal Kanwat with whom a sale agreement had been executed for sale of land under reference. The entire amount paid in cash or through cheque as per sale agreement executed with the land owners by Shri Jitendra Meena are duly tallied with the sale agreement executed by Shri Pooran Mal Kanwat with the land owner. The AO noted that as the sale agreement executed by Shri Jitendra Meena was cancelled vide ikrarnama niristikaran dated 25-05-2012 and a new sale agreement dated 25-05-2012 was executed with Shri Pooran Mal Kanwat and sale consideration in both the sale agreement is same. Registered sale deeds of the land under reference was also executed in the name of Shri Pooran Mal Kanwat which makes it clear that the contents of the sale 58 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR agreement dated 25-05-2013 are true. The AO further noted that during the course of search at residence of Shri Ashok Singh situated at Khasra M-21, Income Tax Colony, Durgapura, Jaipur copy of these sale deeds were found and seized and inventorized as page No. 17-41 of Exhibit-4 of Annexure AS. These copies reveals that the aforesaid sale agreement between the seller ad purchaser Shri Pooran Mal Kanwat was subsequently executed through sale deeds duly registered with the SR- Sanganer-1, Jaipur on 11-07-2012 i.e. just 04 days before the date mentioned in the sale agreement. However, sale consideration reported in these sale deeds are shown at much below the actual consideration reported in the sale agreement. It is noted that the AO has elaborately discussed about these three Registered Sale Deeds and further submitted at para 8.3 that statement of Shri Pooran Mal Kanwat establishes that the actual legal owner of the land is Shri Pooran Mal Kanwat but M/s. Macro Properties Pvt Ltd. and M/s. Macro Township Pvt. Ltd are the beneficial owner of the land. Based on these finding as recorded in the assessment order the ld. AO made following additions in the hands of the assessee company. (1) Rs.1,40,75,700/- while making this addition , the AO observed that working of cash payment of Rs.8,55,14,583/- is being made in 59 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR accordance with the share of sale consideration paid by them as per registered sale deed which comes at Rs.1,40,75,700/- (16.46% of 8,55,14,583/- in the hands of M/s. Macro Properties Pvt. Ltd. and Rs.7,14,38,883/- (83.54% of Rs.8,55,14,583/-) in the hands of M/s.Macro Township Private Ltd. The same is held unexplained investment in the hands of the assessee company and a sum of Rs.1,40,75,700/- is added to the total income of the assessee u/s 69 of the Act and taxableat the rate of 30% as provision u/s 115BBE of the Act. (2) Rs.1,34,84,685/- while making this addition, the AO observed that the evidence brought on record it is evident that the land under consideration was purchased and sold in the name of Shri Pooran Mal Kanwat who is only name lender whereas the assessee is actual beneficial owner alongwith M/s. Macro Township Pvt. Ltd. The assessee has earned short term capital gain in the transaction of land under reference which has not been disclosed by the assessee. Thus, short term capital gain so earned is held undisclosed short term capital gain of the assessee and addition of Rs.1,34,84,865/- is made as undisclosed income of the assessee for the year under consideration. (3) Rs.3,68,874/- A survey action at the business premises of M/s. F.S. Housing Private Ltd. at A-4, Airport Enclave Scheme, Durgapura, 60 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR Jaipur was conducted on 02-08-2017 wherein certain loose papers/ documents /sale agreements/ sale deed were found and impounded which were inventorised as Annexure ‘’A’’ exhibit-1 to 60 which included exhibit - 44 and the AO gathered that some of the sale deeds are related to Shri Vishnu Kumar Nakwal S/o Shri Ram Pal, Nakwal, 97/2, Valmiki Colony, Malviya Nagar, Jaipur . The sale deed relating to Shri Vishnu Kumar Nakwal narrated by the AO at pages 39 to 41. The AO has discussed the case deeply and made addition of Rs.3,68,874/- with the observation that the actual owner of the land is assessee and not Shri Vishnu Kumar Nakwal and thus made the addition of Rs.3,68,874/- in the hands of the assessee as unexplained investment u/s 69 of the Act and taxable @ the rate of 30% as provision/s 115BBE. (4) Rs. 29,95,596/-. During the course of survey action at the business premises of M/s.F.S. Housing Private Ltd. situated at A-4, Airport Enclave Scheme, Durgapura, Jaipur certain loose papers/ documents/ sale agreements / sale deeds were found and impounded which were inventorised as annexure ‘’A’’ exhibit-1 to 60 which include some of the sale deeds related to Nawai, Tonk and pertains to Smt. Vijay Laxmi Verma D/o Shri Chunni Lal Verma, 40- Bhagwati Nagar-II, Jaipur whose details are as under:- 61 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR S.N Khsra No & share Name of seller Sale consideration & mode Rs. Date of transaction Remarks 1. 4824 area 402 bighas Shri Jagdish Prasad s/o Shri Babu Lal , Shri Om Prakash & Shri Tota Ram S/o Shri Roopnarayan Smt. Heera W/o Roop Narayan, Shri Ramkishore S/o Shri Jamna Lal, Koli, New Tonk 12,71,000 Cash 14-08- 2012 2. Khasra No. 4783, 4809 & 4839 area 518 Bigha me se 219 bigha Shri Bhuru S/o Shri Budhiya Koli, Newai, Tonk 9,10,000 Cash 16-07- 2012 3. 4752 me se 405 biswa Smt.Sarju W/o Shri RamniwasBairwaVill. Rajwas ,Newai, Tonk 8,14,596 cash 27-08- 2012 The AO noted that the above-mentioned properties were purchased in cash by Smt. Vijay Laxmi Verma during the F.Y. 2012-13. Subsequently, aforesaid land properties mentioned at Sr. NO. 1& 2 were sold during the F.Y. 2015-16 in cash whose details are as under:- S.N Khasra No Name of seller Face Valuation DLC valuation Date of transaction 62 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR Rs. Rs. 1. 4824 area 4 bigha 02 biswa Smt. Vijay Laxmi verma D/o Shri Chunni Lal Verma 21,93,000 cash 21,92,500 04-06-2015 2 47832, 48092 & 48392 total 02 bigha 19 biswa Smt. Vijay Laxmi verma D/o Shri Chunni Lal Verma 13,37,000 cash 15,78,250 03-062015 The AO noted that huge investment was made in cash therefore, during post search investigation the purchaser Smt. Vijay Laxmi Verema was examined and the statement of her was recorded u/s 131 of the Act. During the enquiry, she had furnished the copy of return of income for A.Y. 2011- 12 to 2016-17 alongwith computation of income and copy of bank statement of account held in Malviya Urban Cooperative Bank Ltd. On perusal of her bank account statement, it is gathered that from 01-04-2011 to 27-08-2011, she had withdrawn a sum of Rs.1,36,000/- in cash only and during the same period she had deposited cash amounting to Rs.1,54,800/- thus availability of cash in hand amounting to Rs.29,95,596/- for purchase of immovable property remained unexplained. Further the AO noted and examined from her bank statement of Malviya Urban Cooperative Bank Ltd that for the period 03-06-2015 to 30-06-2017 and it is gathered that even a single penny has not been deposited in cash by her in her bank account 63 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR despite the fact that she had sold two immovable properties situated at Newai town for sale consideration of Rs.32,29,500/- in cash. This fact also strengthens that the sale consideration must have been received by the real beneficial owner of the properties M/s. Macro Properties (P) Ltd. The AO also observed that looking to the financial worth of Smt. Vijay Laxmi Verma and transaction pattern undertaken by her, it is apparent that the transactions of purchase of land are Benami Transactions. In this transactions, Smt. Vijay Laxmi Verma is only a name lender and M/s. Macro Properties (P) Ltd is a real beneficial owner of the property and cash payment has been made by the assessee company. Accordingly, a detailed show cause was issued on 04-11-2019 asking the assessee to explain the same failing which as to why the investment should not be considered as unexplained investment in the relevant year. In reply to the same, the assessee vide letter dated 20-11-2019 furnished that the assessee company advanced money to Smt. Vijay Laxmi Verma in various years through account and thus furnished the confirmation of the same. The AO did not find the reply of the assessee tenable. According to the AO, the assessee company failed to explain as to why the loan was advanced to Smt. Vijay Laxmi Verma to the tune of Rs.36,52,276 when Smt. Vijay Laxmi Verma is a person of no means and shown income which is meager 64 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR and the same is evident from ITR filed for the various year which is tabulated as under:- A.Y. Total income in Rs. 2011-12 2,51,530 2012-13 3,01,750 2013-14 3,15,450 2014-15 3,30,850 The AO recorded that the statement of Smt. Vijay Laxmi Verma u/s. 131 wherein she admitted that she is housewife and does not have any source of income. Conclusively, the AO noted that the cash payment amounting to Rs.29,95,596/- made in the aforesaid land deed had also been paid by the assessee company only being an actual owner of the lands the source of which has not been explained by the assessee company. Thus the AO held that that cash payment of Rs.29,95,596/- in the aforesaid land deals is unexplained investment of the assessee company u/s. 69 of the Act and the AO added an amount of Rs.29,95,596/- in the hands of the assessee company. (5) 3,55,714/-/. On perusal of the Profit and Loss account of the company ld. AO noticed that no revenue had been gathered from operation which clearly established that business was not commenced during the period. Therefore, expenditure has to be capitalized. However, expenditure under the head other expenses totaling to Rs.3,55,714/- had been debited 65 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR which is not allowable being capital expenditure. The assessee was show caused as to how the same is allowable for which no reply was received from the assessee. The AO taking the decision of Hon’ble Supreme Court in the case of Tuticorin Alkali Chemicals and Fertilizers (P)Ltd. in 277 ITR 172 observed that expenditure on account of other expenses totaling to Rs.3,55,714/- are held in capital in nature and thus added the same in the hands of the assessee by disallowing amount of Rs. Rs.3,55,714/-. 14. Aggrieved from the aforesaid finding of the ld. AO the assessee preferred and appeal before the ld. CIT(A). The ld. CIT(A) dismissed the appeal of the assessee. Since we are taking up the legal issue of applicability of section 153C of the Act for adjudication first, it is noted that the ld. CIT(A) has not entirely discussed this issue of Section 153C but rejected this ground holding that the first ground of appeal that the appellant has raised a purely legal ground viz.a. viz the assessment completed u/s 153C. Based on whatever material is available on file, I do not find any infirmity in the assessment order as per Section153C of the Act. This ground of appeal is rejected. 66 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR 15. At this stage, so as decide the legal ground of the assessee it would be better to deal with the provision of section 153C of the Act and have to analyze the law pursuant to the legal decisions. First of all section this section deals with the search assessment of person other than the searched person. This section was introduced by the Finance Act, 2003 w.e.f. 01-06-2002. It replaced the provisions relating to block assessment contained in Chapter XIVB. In this case as the assessment has been made as per provision of section 153C of the Act, we extract the provision of section 153C of the Act. Provision of section 153C of the Act Assessment of income of any other person. 153C. (1) Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that,— (a) any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, belongs to; or (b) any books of account or documents, seized or requisitioned, pertains or pertain to, or any information contained therein, relates 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 person and issue notice and assess or reassess the income of the other person in accordance with the provisions of section 153A, if, that Assessing Officer is satisfied that the books of account or documents or assets seized or requisitioned have a bearing on the determination of the total income of such other person for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made and for the relevant assessment year or years referred to in sub-section (1) of section 153A : Provided that in case of such other person, the reference to the date of initiation of the search under section 132 or making of requisition under section 132A in the 67 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR second proviso to sub-section (1) of section 153A shall be construed as reference to the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person : Provided further that the Central Government may by rules 69 made by it and published in the Official Gazette, specify the class or classes of cases in respect of such other person, in which the Assessing Officer shall not be required to issue notice for assessing or reassessing the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made and for the relevant assessment year or years as referred to in sub-section (1) of section 153A except in cases where any assessment or reassessment has abated. (2) Where books of account or documents or assets seized or requisitioned as referred to in sub-section (1) has or have been received by the Assessing Officer having jurisdiction over such other person after the due date for furnishing the return of income for the assessment year relevant to the previous year in which search is conducted under section 132 or requisition is made under section 132A and in respect of such assessment year— (a) no return of income has been furnished by such other person and no notice under sub-section (1) of section 142 has been issued to him, or (b) a return of income has been furnished by such other person but no notice under sub-section (2) of section 143 has been served and limitation of serving the notice under sub-section (2) of section 143 has expired, or (c) assessment or reassessment, if any, has been made, before the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person, such Assessing Officer shall issue the notice and assess or reassess total income of such other person of such assessment year in the manner provided in section 153A. 70 [(3) Nothing contained in this section shall apply in relation to a search initiated under section 132 or books of account, other documents or any assets requisitioned under section 132A on or after the 1st day of April, 2021.] 16. Now understanding the provision of section 153C of the Act, it would also be appropriate to understand that before issuing notice u/s 153C of the Act, the TO (Tax Officer) of the searched person must be ‘’satisfied’’ that inter alia, any document seized or requisitioned ‘’belongs to ‘’ a person other than the searched person. On this issue apex court holds that a 68 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR satisfaction note prepared by the TO (Tax Officer) of the other person is sufficient for initiating proceedings u/s 153C of the Act, where the Tax Officer of the searched person and other person is the same.The apex court further held that when the Tax Officer (TO) of a searched person is different from the TO (Tax Officer) of the other person as referred u/s 153C of the Act, there shall be a satisfaction note by the TO of the searched person. Thereafter, the TO of the searched person is required to transmit the documents so seized to the TO of the other person. When the TO of the searched person and the other person is the same, there can be one satisfaction note prepared by the TO and there would be no requirements of transmitting documents so seized.When proceedings are proposed to be initiated under section 153C of the Act against the ‘’other person’’ it has to be preceded by a satisfaction note recorded by the TO of the ‘’searched person’’. 17. On going through the satisfaction note so presented by the ld. DR, the bench noted that looking to the satisfaction note bench observed that there is finding of the assessing officer so as to material relied upon and thereby also the same is in the nature of incriminating in nature or not so far as it relates to the assessee company. Thus, in this case section 153 69 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR C plays a vital role whether it is applicable on the assessee or not. Here in the case, on perusal of the satisfaction note of the assessing officer though not provided to the assessee nor discussed in the order of the assessment. But when the record called for by the bench, we note that the recording of the satisfaction note does not speak to any incriminating material related to the assessee company. The transaction mentioned in the said satisfaction note are duly recorded in the books of the assessee company. Not only that the alleged deed mentioned as in the nature of incriminating in nature is already cancelled and thereafter whatever transaction referred in the order of the assessment are duly recorded transaction and for that the ld. AO is not permitted to assessee the same u/s 153C of the Act for the year under consideration.Therefore, here it the important question as to whether the revenue consequent to the search make the de novo assessment regardless of any incriminating material found during the course of search. The issue is no longer res integra as the same has already been decided by a Division Bench of theHon'ble Supreme Court in the case of CIT v. Sinhgad Technical Education Society [2017] 84 taxmann.com 290/250 Taxman 225/397 ITR 344. In the case of Sinhgad (supra), the disputed questions for adjudication were primarily two fold :- 70 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR A. Whether the additional ground raised for the first time before the Hon'ble Income-tax Appellate Tribunal ("ITAT") questioning the validity of the notice u/s 153C of the Act (in the case of a person other than that searched) on the ground that satisfaction was not properly recorded and also that the said notice was time barred in respect of AYs 2000-01 to 2003-04, could be permitted or not? B. Whether as per the provisions of section 153C of the Act, the incriminating material which was seized had to pertain to the assessment years (i.e. completed assessments for the AYs 2000- 01 to 2003-04) in question and the same constituted a jurisdictional requirement which is essential for assessment under the provisions of section 153C of the Act? In respect of the first question, the Hon'ble Supreme Court at para-19 of their order concluded that the ITAT had correctly permitted the additional ground to be raised and correctly dealt with the same on merits as well. As regards the second question, the Hon'ble Supreme Court held, inter alia, that the existence of incriminating material for interfering with completed assessments on the date of search was a jurisdictional fact failing which, no assessment was possible for those years u/s 153C of the Act. It was 71 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR further affirmed that the incriminating material had to pertain to the four assessment years in question i.e.A.Ys 2000-01 to 2003-04 and since the finding of the facts at para-9 of the order of ITAT revealed that the material as per the satisfaction note belonged to A.Y. 2004-05 or thereafter which were not the four assessment years in question, no addition could be made in respect of the said assessment years. The ratio decidendi of the Hon'ble Supreme Court's judgement appears at para-18 of their order and the same is reproduced as under :- "18. The Income-tax Appellate Tribunal (ITAT) permitted this additional ground by giving a reason that it was a jurisdictional issue taken up on the basis of facts already on the record and, therefore, could be raised. In this behalf, it was noted by the Income-tax Appellate Tribunal (ITAT) that as per the provisions of section 153C of the Act, incriminating material which was seized had to pertain to the Assessment Years in question and it is an undisputed fact that the documents which were seized did not establish any co-relation, document-wise, with these four Assessment Years. Since this requirement under section 153C of the Act is essential for assessment under that provision, it becomes a jurisdictional fact. We find this reasoning to be logical and valid, having regard to the 72 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR provisions of section 153C of the Act. Para 9 of the order of the ITAT reveals that the Income-tax Appellate Tribunal (ITAT) had scanned through the satisfaction note and the material which was disclosed therein was culled out and it showed that the same belongs to Assessment Year 2004-05 or thereafter. After taking note of the material in para 9 of the order, the position that emerges therefrom is discussed in para 10. It was specifically recorded that the counsel for the Department could not point out to the contrary. It is for this reason the High Court has also given its imprimatur to the aforesaid approach of the Tribunal. That apart, learned senior counsel appearing for the respondent, argued that notice in respect of Assessment Years 2000-01 and 2001-02 was even time barred." As it is evident from the provision of section 153C, which provides for assessment/ reassessment to be made as per section 153A of the Act.The requirement of the existence of incriminating material to interfere and assess or reassess the income of the assessment years that stand completed/are not pending on the date of search, is a mandatory requirement as per the provisions of section 153A of the Act and this mandatory requirement comes into play under section 153C of the Act due 73 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR to the provision of sub-section (1) of section 153C according to which once the initial requirements for the invocation of section 153C have been complied with, the assessment u/s 153C shall be made in accordance with the provisions of section 153A of the Act. Section 153C of the Act comes into play when any money, bullion, jewellery or other valuable article or thing or any books of account or documents seized or requisitioned belongs or belong to a person other than the person referred to in section 153A of the Act. This implies that if a person is searched u/s 132(1) of the Act and there are documents found on him which lead to the inference that the same belong to any other person, the provisions of section 153C of the Act would be invoked for making an assessment on such other person. Drawing of a satisfaction note by the Assessing Officer of the person searched by listing and describing the documents belonging to the other person is a pre-condition for initiation of the proceedings u/s 153C of the Act. After having recorded the satisfaction, as per the requirement of section 153C(1) of the Act, the books of account or documents or assets seized shall be handed over to the Assessing Officer having jurisdiction over the other person and the said officer shall issue notice and assess or re-assess the income of the other person in accordance with the provisions of section 153A of the Act. It will thus be seen that once the 74 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR requirement of satisfaction wherein the Assessing Officer of the searched person records that documents belong to the other person is met, the assessment or re-assessment of the income of the other person shall have to take place in accordance with section 153A of the Act. Various high courts have that the existence of incriminating material, in respect of the assessment years whose assessment stood completed on the date of the search, is a mandatory requirement to assess or reassess those years. Now the issue is finally decided by the apex court so fars as the section 153A of the Act in the case of Pr. Commissioner Of Income Tax ... vs AbhisarBuildwell P. Ltd. and so far as regards the issue of section 153C is concerned same is decided in the case of DCIT Vs. M/s. U. K. Paints ( Overseas) Limited 18. Thus, as it has been observed that the ld. AO did not bringanything on record stating the fact that there exist any document found in the search and seizure operation conducted so as to prove that how the transaction recorded in the seized material with that of the transactions already recorded are in the nature of incriminating in nature. Merely the company has advanced the money which is lying the books of account and the person to whom money paid by the assessee has entered into agreement for sale and there is no reference of cash trail flowing to or from the 75 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR assessee company. The finding are purely based on the presumptions and assumptions basis and against the real transaction that has been taken place between the buyer and seller and the same are already registered as per the Transfer of Property of Act and bench observed that neither in the Transfer of Property Act nor in the Income Tax concept of beneficial owner and that too without bringing any evidence on record. In view of the above facts and circumstances of the case, the Bench is of the view that in absence of a valid satisfaction note recorded clearly justifying the material that the same are in the nature of incriminating in nature qua the assessee, we are of the considered view that the notice issued u/s 153C of the I.T. Act 1961 is bad in law and consequently whole proceedings including the assessment order passed u/s 143(3) r.w.s. 153C of the Act is void ab initio and liable to be quashed.To this effect, we rely upon the decision of Hon’ble Supreme Court in the case of DCIT vs M/s. U.K. Paints (Overseas) Ltd. (Civil Appeal No. 6634 of 2021dated 25-04-2023 wherein the Hon’ble Supreme Court held as under:- ‘’In this batch of appeals, the assessments in case of each Assessee were under Section 153-C of the Income Tax Act, 1961 (for short, `the Act’). As found by the High Court in none of the cases any incriminating material was found during the search either from the Assessee or from third party. In that view of the matter, as such, the assessments under Section 153-C of the Act are rightly set aside by the High Court. However, Shri N Venkataraman, learned ASG appearing on behalf of the Revenue, taking the clue from some of the observations made by this Court in the recent decision in the case of Principal Commissioner of Income Tax, Central -3 Vs. AbhisarBuildwell P. Ltd., Civil Appeal No. 6580/2021, more 76 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR particularly, paragraphs 11 and 13, has prayed to observe that the Revenue may be permitted to initiate re-assessment proceedings under Section 147/148 of the Act as in the aforesaid decision, the powers of the re-assessment of the Revenue even in case of the block assessment under Section 153-A of the Act have been saved. As observed hereinabove, as no incriminating material was found in case of any of the Assessees either from the Assessee or from the third party and the assessments were under Section 153-C of the Act, the High Court has rightly set aside the Assessment Order(s). Therefore, the impugned judgment and order(s) passed by the High Court do not require any interference by this Court. Hence, all these appeals deserve to the dismissed and are accordingly dismissed.’’ 19. In view of the above discussion and for the reasons stated above and considering the binding decisions of the apex court resting the issue that no addition can be made de hors the incriminating material in the proceeding u/s. 153C of the Act and thus by considering the totality of the facts, circumstances of the case and the decisions cited supra, we do not concur with the findings of the ld. CIT(A) Thus the appeal of the assessee for the assessment year 2013-14 is allowed. 20. Since we have decided the appeal of the assessee for the assessment year 2013-14, therefore, the decision taken therein, being similar case of the assessee, shall apply mutatis mutandis in the appeals of the assessee for the assessment years 2014-15 to 2016-17 in ITA 77 ITA NO. 174/JP/2023 MACRO PROPERTIES PVT LTD. VS DCIT, CENTRAL CIRCLE-2, JAIPUR No.175/JP/203, ITA No.176/JP/203,and ITA No.177/JP/203.Thus the appeals of the assessee are allowed. 21. In the result, the appeals of the assessee are allowed Order pronounced in the open court on 17 /07/2023 Sd/- Sd/- ¼Mk0 ,l- lhrky{eh ½ ¼jkBksMdeys'kt;UrHkkbZ ½ (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) U;kf;dlnL;@Judicial Member ys[kklnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 17 /07/2023 *Mishra vkns'k dh izfrfyfivxzsf’kr@Copy of the order forwarded to: 1. The Appellant- M/s. Macro Properties Private Ltd., Jaipur 2. izR;FkhZ@ The Respondent- The DCIT, Central Circle-2 Jaipur . 3. vk;djvk;qDr@ The ld CIT 4. vk;dj vk;qDr¼vihy½@The ld CIT(A) 5. foHkkxh; izfrfuf/k] vk;djvihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur 6. xkMZQkbZy@ Guard File (ITA No. 174/JP/2019) vkns'kkuqlkj@ By order, lgk;diathdkj@Asstt. Registrar