Rajendra Motmal Shah, Kolhapur V. Assistant Commissioner of Income-tax,

ITA 1877/PUN/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9389 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 7 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 22-12-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 18-10-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIL CHAWARE
• Assessee Lawyers: MAYURESH DOSHI
• Keywords: Unexplained investment; Search and seizure; Loose papers; Document seized; Share purchase agreement; Cost of acquisition; Documents seized
• Section: 69C; 143(3); 153A; 132; 15; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUNE , , , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI , AM . / I TA NO. 1877 /PUN/20 13 / ASSESSMENT YEAR : 2009 - 10 RAJENDRA MOTMAL SHAH 32 B WARD, GHATI DARWAJA, KOLHAPUR - 416001 PAN : AEJPS9847Q ....... / APPELLANT / V/S. THE ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE, KOLHAPUR. / RESPONDENT A PPELLANT BY : SHRI NIKHIL PATHAK & SHRI MAYURESH DOSHI R ESPONDENT BY : SHRI ANIL CHAW A RE / DATE OF HEARING : 03.04.2017 / DATE OF PRONOUNCEMENT : 31 . 05.2017 / ORDER PER SUSHMA CHOWLA , JM THIS APPEAL FILED BY THE ASSES SEE IS AGAINST THE ORDER OF CIT(A) , KOLHAPUR DATED 28 .08.20 13 RELATING TO ASSESSMENT YEAR 2009 - 10 PASSED UNDER SECTION 143(3) R.W.S 153C OF THE INCOME - TAX ACT, 1961 (IN SHORT THE ACT). 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. THE ASST. ORDER PASSED U/S 143(3) R.W.S 153C IS BAD IN LAW AND THE SAME MAY BE DECLARED NULL AND VOID. 2. THE ASSESSEE SUBMI TS THAT THE NOTICE ISSUED U/S 153 C IS INVALID IN LAW AND THE CONSEQUENTIAL ASST. PASSED BY THE LEARNED A.O BE DECLARED NULL AND VOID. 2 ITA NO. 1 877 /PUN/2013 3. THE LEARNED CIT(A) ERRED IN CONFIRMING AN ADDITION OF RS. 34,12,230/ - ON THE GROUND THAT THE ASSESSEE HAD MADE AN UNACCOUNTED INVESTMENT OF THE SAID AMOUNT FOR PURC HASE OF LAND AT GAT NO. 40/4/5/ 6, RANKALA, KOLHAPUR. 4. THE LEARNED CIT(A) ERRED IN CONFIRMING THE ADDITION BY PLACING RELIANCE ON SEIZED PAPER NO. 18 FOUND IN TH E COURSE OF SEARCH ON SHRI VIJAY RAJARAM SHAH WITHOUT APPRECIATING THAT NO ADDITION COULD BE MADE IN THE HANDS OF THE ASSESSEE ON THE BASIS OF EVIDENCE FOUND WITH THIRD PARTY. 5. THE LEARNED CIT(A) FAILED TO APPRECIATE THAT THE PRESUMPTION U/S 132(4A) WAS APPRECIABLE TO THE PERSON SEARCHED AND NOT TO THE THIRD PARTY AND HENCE, NO ADDITION WAS WARRANTED IN THE HANDS OF THE ASSESSEE ON THE BASIS OF SEIZED PAPER NO. 18 FOUND WITH SHRI VIJAY SHAH. 6. THE LEARNED CIT(A) FURTHER ERRED IN NOT APPRECIATING THAT THE PAPER SEIZED IN THE C OURSE OF SEARCH ON SHRI VIJAY SHAH WAS NOT BELONGING TO THE ASSESSEE NOR THE NAME OF THE ASSESSEE WAS MENTIONED ON THE SEIZED PAPER AND HENCE, THE ADDITION MADE WAS NOT JUSTIFIED IN LAW. 7. THE LEARNED CIT(A) OUGHT TO HAVE APPRECI ATED THAT THE ASSESSEE HAD NOT MADE ANY UNACCOUNTED INVESTMENT OF RS. 34,12,230/ - FOR PURCHASE OF THE SAID LAND AND HENCE, THE ADDITION MADE MAY KINDLY BE DELETED. 8. THE APPELLANT CRAVES LEA V E TO ADD, ALTER , AMEND OR DELETE ANY OF THE ABOVE GROUNDS OF APPEAL. 3. THE ASSESSEE HAS ALSO RAISED ADDITIONAL GROUNDS OF APPEAL, WHICH READ AS UNDER: - 1] THE ASSESSMENT ORDER PASSED U/S. 143(3) R.W.S. 153C IS BAD IN LAW AND THE SAME MAY BE DECLARED AS NULL AND VOID. 2] THE ASSESSEE SUBMITS THAT THE NOTICE ISSU ED U/S. 153C IS INVALID IN LAW AND THE CONSEQUENTIAL ASSESSMENT PASSED BY THE LD. A.O. BE DECLARED AS NULL AND VOID. 4. THE LD. AR FOR THE ASSESSEE POINTED OUT THAT THE ADDITIONAL GROUNDS OF APPEAL RAISED IN THE PRESENT APPEAL GOES TO THE RO OT OF ISSUE WHEREIN PRE - AMENDED PROVISIONS OF SECTION 153C OF THE ACT ARE TO BE APPLIED. HE POINTED OUT THAT FOR INVOKING THE SAID SECTION THE DOCUMENT SHOULD BELONG TO THIRD PARTY OTHER TH A N THE PERSON SEARCHED AND WHERE NONE OF THE SEIZED DOCUMENT BELONGS TO THE ASS ESSEE , THEN HOW PROVISIONS OF SECTION 153C OF THE ACT ARE APPLICABLE . HE ALSO STATED THAT THE ASSESSING OFFICER CAME TO THE FINDINGS THAT THE SAID 3 ITA NO. 1 877 /PUN/2013 DOCUMENT BELONGS TO THE SEARCHED PERSON . HE POINTED OUT THAT NO ADDITION CAN BE MADE IN THE HANDS OF THE ASSESSEE ON THE BASIS OF SUCH DOCUMENT . THE LD. AR PLACED RELIANCE ON THE FOLLOWING DECISIONS: - 1) COMMISSIONER OF INCOME TAX, CENTRAL - III, MUMBAI VS. M/S AMBIT REALTY PVT LTD., IN ITA NO. 150 OF 2014. 2) PR. COMMISSIONER OF INCOME TAX & ORS VS. NIKKI DRUGS & CHEMICALS PVT. LTD & ORS, (2016) 129 DTR 0393 ( DEL) 3) PEPSI FOODS PVT. LTD. VS. ASSISTANT COMMISSIONER OF INCOME TAX, (2014) 90 CCH 0059 DELHC. 5 . THE LD. DR ON THE OTHER HAND POINTED OU T THAT THE ASSESSING OFFICER HAD RECORDED THE REASONS OF SEARCH ACTION AND HENCE, NOTICE U/S 153C OF THE ACT WAS ISSUED. HE DISTINGUISHED THE DECISION RELIED UPON BY THE LD. AR FOR THE ASSESSEE. 6 . WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE HAD FILED ITS RETURN OF INCOME DECLARING TOTAL INCOME OF RS. 1,25,950/ - . THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF JEWELLERY. SEARCH U/S 132 OF THE ACT WAS CARRIED OUT IN THE CASE OF LAXMI CIVIL ENGINEERING PVT LTD, KOLHAPUR ON 15.0 6.2010. RESIDENCE OF ITS DIRECTOR, SHRI VIJAY RAJARAM SHAH WAS ALSO COVERED FOR SEARCH ACTION. DURING THE COURSE OF SEARCH ACTION, TWO LOOSE PAPERS WERE SEIZED WHICH INDICATED TRANSACTIONS IN RESPECT OF CERTAIN LAND PURCHASED/ SOLD. THE ASSESSEE WAS ONE OF THE PARTIES INVOLVED IN THE LAND TRANSACTIONS. THE ASSESSING OFFICER NOTED THAT THE SAID TWO LOOSE PAPERS AT SERIAL NO. 18 AND 21 OF THE BUNDLE NO.2 SEIZED FROM THE RESIDENCE OF SHRI VIJAY RAJARAM SHAH WHO IS THE DIRECTOR OF LAXMI CIVIL ENGINEERING SERVIC ES PVT LTD AND IT DEPICT ED THE DETAILS OF PURCHASE OF AGRICULTURAL LANDS SITUAT ED AT RANKALA , KOLHAPUR AND AT W ADIPUR, KOLHAPUR. THE COST OF LAND AS WELL AS EXPENDITURE HAS BEEN CODED. AS PER THE NOTING ON PAGE 4 ITA NO. 1 877 /PUN/2013 NO. 18, THE TOTAL COST OF ACQUISITION OF AGRICULTURAL LAND WA S RS. 86,74,487/ - AND THAT OF PAGE NO. 21 WA S RS. 1,62,60,100/ - . THE SAID VALUE WAS LESS THEN COST SHOWN IN THE RELEVANT SALE DEEDS. SHRI VIJAY RAJARAM SHAH DID NOT FURNISH DETAILS IN THIS REGARD . HENCE, INQUIRIES WERE MADE BY DDIT (INV) AND IT TRANSPIRE D THAT THE FIRM M/S INDIA GLOBAL AGRO & REALTY AND VIJAY RAJARAM SHAH WERE MAIN PERSONS BEHIND THE TRANSACTIONS AND HAVE FINANCED THE MONEY IN CASH OVER AND ABOVE AMOUNTS MENTIONED IN THE SALE DEED S. THE ASSESSING OFFICER FURTHER OBSERVED THAT DIFFERENCE IN AMOUNTS MENTIONED IN THE TWO LOOSE PAPERS AND THE SALE DEEDS WERE REQUIRED TO BE TAXED IN THE HANDS OF THE FIRM M/S INDIA GLOBAL AGRO & REALTY AND ITS PARTNERS ON SUBSTANTIVE BASIS. THE ASSESSING OFFICER THEREAFTER, RECORDED REASONS FOR REOPENING THE ASSESSMENT OF THE ASSESSEE. FOR THE REASONS RECORDED, ACTION WAS INITIATED BY ISSUING NOTICE U/S 153C OF THE ACT. IN RESPONSE TO THE SAID NOTICE, THE ASSESSEE FILED A LETTER STATING THAT THE ORIGINAL RETURN OF INCOME FILED BY IT SHOULD BE TREATED AS RETURN FILED IN RESPONSE TO THE NOTICE U/S 153C OF THE ACT. THE ASSESSING OFFICER AT PAGE NO. 6 AND 7 HAS PLACED SCANNED COPY OF THE SAID DOCUMENT S . SINCE ASSESSEE WAS ONE OF THE PARTNER OF M/S INDIA GLOBA L AGRO & REALTY, TRANSACTIONS WERE LOOKED INTO AND THEREFORE, THE ASSESSEE WAS SHOW CAUSED TO EXPLAIN AS TO WHY UNEXPLAINED INVESTMENT MADE ON THE BASIS OF LOOSE PAPERS NO. 18 AND 21 OF SEIZED BUNDLE NO. 2 , SHOULD NOT BE TAXED ON SUBS TANTIVE BASIS IN THE H ANDS OF THE ASSESSEE. THE ASSESSING OFFICER WORKED OUT THE AMOUNT OF UNEXPLAINED INVESTMENT OF RS. 34,12,230/ - . THE ASSESSEE COULD NOT EXPLAIN THE SOURCE OF INVESTMENT IN THE SAID PROPERTY. THE ASSESSEE FILED THE EXPLANATION AND CONTENDED THAT NO ON - MONEY WA S TO BE ASSESSED IN HIS HAND. HOWEVER, THE ASSESSING OFFICER MADE ADDITION OF RS. 34,12,230/ - , WHICH WAS CONFIRMED BY CIT(A). 5 ITA NO. 1 877 /PUN/2013 7 . NOW THE ASSESSEE IS IN APPEAL AGAINST THE SAID ORDER OF CIT(A) AND HAS OBJECT ED TO THE INITIATION OF PROCEEDINGS U/ S 153C OF THE ACT. 8 . THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT SEARCH WAS CONDUCTED ON ONE SHRI VIJAY RAJARAM SHAH, DIRECTOR OF LAXMI CIVIL ENGINEERING PVT LTD., WHICH IS NOT A RELATED PARTY OF THE ASSESSEE. THE SAID SEARCH WAS CONDUCTED ON 15.06.2010 AND LOOSE PAPERS IN BUNDLE NO.II AT PAGES 18 AND 21 WERE SEIZED. OUR ATTENTION WAS DRAWN TO THE DOCUMENTS PLACED AT PAGES 5 AND 6 OF THE PAPER BOOK ALONG WITH ITS ENGLISH TRANSLATION AT PAGE 7 OF THE PAPER BOOK. HE POINTED OUT THAT THE DOCUMENT SEIZED WAS IN RELATION TO SALE OF LAND BY RANAKLA RAHUL MANE, UNDER WHICH 38 .5 GUNTAS W ERE SOLD, WHEREIN THE ASSESSEE PURCHASED 9.5 GUNTAS, SHRI BHARATKUMAR KUNDANLAL JAIN PURCHASED 13.5 GUNTAS , FIRM AND RELATIVES PURCHASED 15.5 GUNTAS. THE TOTAL CONSIDERATION FOR THE SAID DEAL WAS RS.35 LAKHS. HE FURTHER POINTED OUT THAT ON THE BASIS OF SAID PIECE OF PAPER, NOTICE WAS ISSUED UNDER SECTION 1 53C OF THE ACT, UNDER WHICH TOTAL CONSIDERATION OF SALE OF LAND WAS TAKEN AT RS.1.62 CRORES AND THE ASSESSEES SHARE OF 9.5 GUNTAS WAS WORKED OUT AT RS.34,12,230/ - . 9 . THE ISSUE WHICH ARISES BY WAY OF ADDITIONAL GROUNDS OF APPEAL BEFORE THE TRIBUNAL IS WHETHER IN VIEW OF PRE - AMENDED PROVISIONS OF SECTION 153C OF THE ACT, WHERE THE WORD WAS USED BELONGING AND WHERE THE TRANSACTION RECORDED ON SEIZED DOCUMENT RELATED BET WEEN THE FIRM AND MR. VIJAY RAJARAM SHAH AND WHERE THE ASSESSING OFFICER ALSO SAYS THAT THE DOCUMENT BELONGS TO MR. VIJAY SHAH, THEN NO PROCEEDINGS UNDER SECTION 153C OF THE ACT COULD BE INITIATED AGAINST THE ASSESSEE , WHO IS NOT RELATED TO THE FIRM OR MR. VIJAY SHAH . 6 ITA NO. 1 877 /PUN/2013 10. THE HONBLE HIGH COURT OF DELHI IN PR. CIT & ORS. VS. NIKKI DRUGS & CHEMICALS PVT. LTD. & ORS. (2016) 129 DTR 393 (DEL) WHILE INTERPRETING THE PROVISIONS OF SECTION 153C OF THE ACT OBSERVED THAT IN CASE ANY LOOSE DOCUMENTS WERE FOUND DU RING THE COURSE OF SEARCH, WHICH BELONG TO A PERSON OTHER THAN THE SEARCHED PERSON, THEN THE FIRST STEP FOR INITIATION OF PROCEEDINGS UNDER SECTION 153C OF THE ACT WAS FOR THE ASSESSING OFFICER OF THE SEARCHED PERSON TO BE SATISFIED THAT THE ASSETS OR DOCU MENT S SEIZED DID NOT BELONG TO THE SEARCHED PERSON , BUT TO THE ASSESSEE SOUGHT TO BE ASSESSED UNDER SECTION 153C OF THE ACT. ONCE THE ASSESSING OFFICER OF THE SEARCHED PERSON WAS SO SATISFIED, HE WAS REQUIRED TO TRANSFER THE ASSETS OR DOCUMENTS, WHICH HE BELIEVES BELONGS TO THE ASSESSEE TO THE ASSESSING OFFICER HAVING JURISDICTION OVER THAT ASSESSEE , WHO IN TURN, WOULD COMMENCE THE PROCEEDINGS UNDER SECTION 153C OF THE ACT. IN THE FACTS OF THE CASE BEFORE THE HONBLE HIGH COURT OF DELHI, THE ASSESSING OFFICER OF THE SEARCHED PERSON HAD NOT RECORDED SATISFACTION NOTE ON THE GROUND THAT THE ASSESSING OFFICER OF THE SEARCHED PERSON AND THE ASSESSEE TO BE ASSESS ED UNDER SECTION 153C OF THE ACT WERE BEING ASSESSED BY THE SAME OFFICER. THE HONBLE HIGH COURT IN SUCH CIRCUMSTANCES HAD HELD THAT THE ASSESSING OFFICER HAVING JURISDICTION WOULD FORM AN INDEPENDENT VIEW BEFORE ISSUING NOTICE TO THE OTHER PERSON UNDER H IS JURISDICTION ON THE BASIS OF HIS OWN ENQUIRY. THE HONBLE HIGH COURT HELD AS UNDER: - 16. IT IS APPARENT FROM THE ABOVE THAT THE FIRST STEP FOR INITIATION OF PROCEEDINGS UNDER SECTION 153C OF THE ACT IS FOR THE ASSESSING OFFICER OF THE SEARCHED PERSON TO BE SATISFIED THAT THE ASSETS OR DOCUMENTS SEIZED DO NOT BELONG TO THE SEARCHED PERSON B UT TO THE ASSESSEE SOUGHT TO BE ASSESSED UNDER SECTION 153C OF THE ACT. ONCE THE ASSESSING OFFICER OF THE SEARCHED PERSON IS SO SATISFIED, HE IS REQUIRED TO TRANSFER THE ASSETS OR DOCUMENTS, WHICH HE BELIEVES BELONGS TO THE ASSESSEE, TO THE ASSESSING OFFIC ER HAVING JURISDICTION OVER THAT ASSESSEE. THE ASSESSING OFFICER OF THE ASSESSEE ON RECEIPT OF SUCH ASSET OR DOCUMENT SEIZED WOULD HAVE JURISDICTION TO COMMENCE PROCEEDINGS UNDER SECTION 153C OF THE ACT. THE ASSESSING OFFICER HAS, THEREAFTER, TO APPLY HIS MIND AS TO WHETHER THE ASSETS AND DOCUMENTS RECEIVED HAVE A BEARING ON THE DETERMINATION OF THE TOTAL INCOME OF THE ASSESSEE AND IF HE IS SO SATISFIED THAT 7 ITA NO. 1 877 /PUN/2013 THE SAME HAVE A BEARING ON THE DETERMINATION OF THE INCOME OF THE ASSESSEE, HE HAS TO ISSUE NOTICE A ND ASSESS OR REASSESS THE INCOME OF THE ASSESSEE IN ACCORDANCE WITH THE PROVISIONS OF SECTION 153A OF THE ACT. SECTION 153A OF THE ACT REQUIRES THAT A NOTICE BE ISSUED TO THE PERSON SOUGHT TO BE ASSESSED, CALLING UPON THE SAID ASSESSEE TO FILE HIS RETURN O F INCOME IN RESPECT OF EACH YEAR FALLING WITHIN THE SPECIFIED SIX AYS. IT IS FURTHER SPECIFIED THAT THE PROVISIONS OF THE ACT SHALL, SO FAR AS MAY BE, APPLIED AS IF SUCH RETURNS WERE RETURNS REQUIRED TO BE FURNISHED UNDER SECTION 139 OF THE ACT. THUS, THE ASSESSING OFFICER HAS TO, THEREAFTER, PROCEED WITH THE ASSESSMENT/REASSESSMENT IN ACCORDANCE WITH THE PROVISIONS OF THE ACT; THAT IS, ACCEPT THE RETURN WITH OR WITHOUT SUCH ADJUSTMENTS AS PERMISSIBLE UNDER SECTION 143(1) OF THE ACT OR IF THE CLAIMS MADE BY THE ASSESSEE ARE CONSIDERED AS INADMISSIBLE AND/OR IT IS CONSIDERED NECESSARY AND EXPEDIENT TO SUBJECT THE RETURNS TO FURTHER SCRUTINY, ISSUE THE REQUISITE NOTICE UNDER SECTION 143(2) OF THE ACT AND FRAME THE ASSESSMENT IN ACCORDANCE WITH THE ACT. 17. IN THE PRESENT CASE, THE ITAT SPECIFICALLY RECORDED THAT, ADMITTEDLY, A SATISFACTION NOTE HAD NOT BEEN RECORDED BY THE ASSESSING OFFICER OF THE SEARCHED PERSON. IT WAS CONTENDED BY THE REVENUE BEFORE THE ITAT THAT THE ASSESSING OFFICER OF THE SEARCHED I.E. S VP GROUP WAS NOT REQUIRED TO RECORD SUCH SATISFACTION AS BOTH THE ASSESSEE AND THE SVP GROUP WERE BEING ASSESSED BY THE SAME OFFICER. THIS CONTENTION WAS REJECTED BY THE ITAT BY FOLLOWING THE DECISION OF THIS COURT IN PEPSI FOODS (P.) LTD V. ASSTT CIT [201 4] 367 ITR 112 /52 TAXMANN.COM 220/[2015] 231 TAXMAN 58 . THE ALLAHABAD HIGH COURT IN THE CASE OF CIT V. GOPI APARTMENTS [2014] 365 ITR 411 /46 TAXMANN.COM 280 HAS ALSO HELD THAT EVEN IN CASES WHERE THE ASSESSING OFFICER OF THE PERSON SEARCHED AND THE ASSESSEE WHO IS SOUGHT TO BE ASSESSED UNDER SECTION 153C IS THE SAME, THE ASSESSING OFFICER IS REQUIRED TO RECORD HIS SATISFACTI ON THAT THE ASSETS/ DOCUMENTS SEIZED BELONG TO A PERSON (THE ASSESSEE) OTHER THAN THE SEARCHED PERSON. IN CIT V. MECHMEN 11 - C [2015] 60 TAXMANN.COM 484 (MP) A DIVISION BENCH OF THE MADHYA PRADESH HIGH COURT HAD EXPRESSED THE ABOVE VIEW IN THE FOLLOWING MAN NER' 1 1 . ANOTHER ASPECT WHICH WAS NOTED BY THE HONBLE HIGH COURT WAS THE DIFFERENCE BETWEEN EXPRESSION BELONGS TO AND RELATES TO AND IT WAS OBSERVED AS UNDER: - 20. THE ASSESSEE DISPUTED THAT THE SAID DOCUMENTS COULD BE STATED TO BE BELONGING TO THE ASSESSEE. INSOFAR AS THE RESOLUTIONS, AFFIDAVITS, COUNTER FOILS OF THE INCOME TAX RETURNS, COPIES OF THE INCORPORATION CERTIFICATE, MEMORANDUM OF ASSOCIATION, RESOLUTI ONS, AFFIDAVITS, AND SHARE APPLICATION FORMS ARE CONCERNED, THE ASSESSEE EXPLAINED THAT THESE DOCUMENTS WERE HANDED OVER TO THE SVP BUILDERS INDIA LTD. IN CONNECTION WITH THE INVESTMENT MADE BY THE ASSESSEE. ALTHOUGH THESE DOCUMENTS PERTAINS TO AND EMANATE FROM THE ASSESSEE, THESE DOCUMENTS COULD NOT BE STATED TO BELONG TO THE ASSESSEE AS THEY HAD BEEN HANDED OVER TO SVP BUILDERS INDIA LTD. AND NOW FORMED A PART OF THEIR RECORDS AND NOT THAT OF THE ASSESSEE'S. IT WAS CONTENDED THAT, THEREFORE, THESE DOCUMEN TS DID NOT BELONG TO THE ASSESSEE. INSOFAR AS THE COUNTER FOILS OF THE SHARE CERTIFICATES ARE CONCERNED, IT CANNOT BE DISPUTED THAT THE SAID DOCUMENTS NEVER BELONGED TO THE ASSESSEE BUT WERE A PART OF THE RECORDS OF THE COMPANY ISSUING CERTIFICATES, I.E., SVP BUILDERS INDIA LTD. AS FAR AS THE SHARE CERTIFICATES OF THE SVP BUILDERS INDIA LTD. IS CONCERNED, IT WAS SUBMITTED THAT THE SAME PERTAINS TO THE SHARES THAT HAD ALREADY BEEN SOLD AND THE ENDORSEMENT MADE ON 8 ITA NO. 1 877 /PUN/2013 THE REAR OF THE SHARE CERTIFICATES CLEARLY IN DICATED THAT THE ASSESSEE WAS NO LONGER THE HOLDER OF THE SAID SHARES AND THE SAME STOOD REGISTERED IN THE NAME OF ONE SATPAL ON 26TH MARCH, 2004. 21. THE ITAT CONSIDERED THE ABOVE CONTENTIONS AND FOLLOWING THE DECISION OF THIS COURT IN PEPSICO INDIA HOL DINGS (P.) LTD. V. ASSTT.CIT [2015] 370 ITR 295 / 228 TAXMAN 116 (MAG.)/[2014] 50 TAXMANN.COM 299 HELD THAT THE DOCUMENTS IN QUESTION COULD NOT BE SAID TO BELONGING T O THE ASSESSEE. IN PEPSICO INDIA HOLDINGS (P.) LTD'S CASE. (SUPRA), THIS COURT HAS EXPLAINED THAT THE EXPRESSION 'BELONGS TO' MUST NOT BE CONFUSED WITH THE EXPRESSION 'RELATES TO'. AS AN ILLUSTRATION, THIS COURT HAS REFERRED TO A REGISTERED SALE DEED WHICH , ALTHOUGH, REGISTERED BY THE VENDOR WOULD BELONG TO THE PURCHASER OF THE PROPERTY AND COULD NOT BE CONSIDERED TO BE BELONGING TO THE VENDOR ONLY BECAUSE THE VENDOR'S NAME WAS MENTIONED IN THE DOCUMENTS. IN THE PRESENT CASE, ALTHOUGH THE PHOTOCOPIES OF THE DOCUMENTS HANDED OVER TO SVP BUILDERS INDIA LTD. MAY BE COPIES OF THE ORIGINAL DOCUMENTS THAT BELONG TO THE ASSESSEE, THE SAID PHOTOCOPIES WOULD BELONG TO SVP BUILDERS INDIA LTD. AS THE SAME WERE HANDED OVER TO IT IN CONNECTION WITH THE INVESTMENT MADE BY THE ASSESSEE. SIMILARLY, A CERTIFIED COPY OF THE ASSESSEE'S RESOLUTION SIGNED BY ITS DIRECTORS, WOULD ALSO BELONG TO THE SVP BUILDERS INDIA LTD. EVEN THOUGH THE MINUTES OF THE BOARD MEETING FORM A PART OF THE RECORD OF THE ASSESSEE. WE FIND NO INFIRMITY W ITH THE VIEW TAKEN BY THE ITAT IN THIS REGARD. THUS, NOTWITHSTANDING THE CONTROVERSY WHETHER THE ASSESSING OFFICER OF THE SEARCHED PERSONS HAD RECORDED HIS SATISFACTION THAT THE SPECIFIED SEIZED DOCUMENTS BELONGED TO THE ASSESSEE, THE INITIATION OF PROCEED INGS UNDER SECTION 153C OF THE ACT, IN RESPECT OF THE ASSESSEE WOULD BE WITHOUT JURISDICTION. 1 2 . IN THE FACTS OF THE PRESENT CASE, SEARCH AT THE RESIDENCE OF MR. VIJAY SHAH WAS CONDUCTED ON 15.06.2010 AND LOOSE PAPER AT SERIAL NOS.18 AND 21 OF THE BUNDLE NO.II WERE SEIZED. THE SCANNED COPY OF BOTH THE DOCUMENTS ARE PLACED AT PAGES 6 AND 7 OF THE ASSE SSMENT ORDER. ON PERUSAL OF THE DETAILS RECEIVED FROM INVESTIGATION WING, THE ASSESSING OFFICER NOTED THAT (1) MR. BHARATKUMAR KUNDANLAL JAIN, (2) MR. BHARAT CHANDRAKANT MEHATA AND (3) MR. RAJENDRA MOTMAL SHAH , PARTNER OF M/S. INDIA GLOBAL AGRO & REALTY, KOLHAPUR HAD ALSO PURCHASED ANOTHER AGRICULTURAL LAND SITUATED AT KASBA KARVEER RANKALA, KOLHAPUR ON 10.11.2008 , ADMEASURING 38.5 GUNTAS FROM SHRI SHIVAJI PANDURANG MANE FOR SALE CONSIDERATION OF RS.35 LAKHS. SHRI VIJAY SHAH WAS CONFRONTED WITH THE SEIZED PAPER NO.18, WHO IN REPLY MENTIONED THAT THERE IS MENTION OF SAID LAND ; SIMILARLY ON PAPER NO.21 I.E. LAND SITUATED AT RANKALA, KOLHAPUR. HOWEVER, NO OTHER DETAILS WERE GIVEN AND ALSO DENIED HAVING GIVEN ANY AMOUNT IN CASH . THE ASSESSING OFFICER OBTAINED THE COPIES OF SALE DEED FROM THE SUB - 9 ITA NO. 1 877 /PUN/2013 REGISTRARS OFFICE. THE LOOSE PAPER 18 FOUND WAS NOT IN CONNECTION WITH THE ASSESSEE. HOWEVER, LOOSE PAPER 21 BUNDLE NO.II WAS FOUND IN CONNECTION WITH THE ASSESSEE. THE ASSESSING OFFICER VIDE PARA 9.3 OF AS SESSMENT ORDER ANALYZED THAT SHRI SHIVAJI PANDURANG MANE SOLD THE AGRICULTURAL LAND ADMEASURING 38.05 GUNTAS FOR SALE CONSIDERATION OF RS.35 LAKHS TO THREE PERSONS INCLUDING THE ASSESSEE WHO WAS PARTNER OF M/S. INDIA GLOBAL AGRO & REALTY, KOLHAPUR. THE AS SESSING OFFICER ON THE BASIS OF INFORMATION AND DETAILS RECEIVED FROM INVESTIGATION WING CALCULATED THE UNEXPLAINED INVESTMENTS BEING UNACCOUNTED INVESTMENT IN ACQUISITION OF AGRICULTURAL LAND AT RANKALA, KOLHAPUR OF 38.5 GUNTAS . A S PER LOOSE PAPER 21 FOR PURCHASE OF 13.5 GUNTAS IN THE NAME OF RAJENDRA MOTMAL SHAH , PROPORTIONATE AMOUNT OF INVESTMENT WAS RS. 1,62,60,100/38.5 = 422340X9.5 = 40,12,230/ - . THE ASSESSEE HAD SHOWN SALE CONSIDERATION OF RS.6 LAKHS IN THE SALE DEED DATED 01.10.2008 AND THE AMOUNT O F UNEXPLAINED INVESTMENT WAS WORKED OUT AT RS.34,12,230/ - . THE ASSESSING OFFICER NOTED THAT THE ASSESSEE WAS ONE OF PURCHASERS OF AGRICULTURAL LAND AND HIS STATEMENT WAS RECORDED IN WHICH HE SPECIFICALLY DENIED TO HAVE GIVEN ANY EXCESS AMOUNT IN CASH OVER AND ABOVE THE SALE CONSIDERATION. THE RELEVANT PORTION OF THE STATEMENT RECORDED OF THE ASSESSEE IS REPRODUCED AT PAGES 11 TO 13 OF THE ASSESSMENT ORDER. THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS VEHEMENTLY STATED THAT THE TOTAL INVESTMEN T IN THE SAID LAND WAS ONLY RS.6 LAKHS. THE ASSESSING OFFICER COLLECTED INFORMATION FROM VARIOUS DEPARTMENTS AND APPLIED THE SAME AND HELD THAT AS PER SEIZED PAPERS, THE VALUE OF TRANSACTION WAS SHOWN AS RS.1.62 CRORES, WHICH WAS DECODED FROM THE FACT THA T THE VALUE OF STAMP PAPER WAS RS.1,75,000/ - , WHICH WAS NOTED AS 1750=00 IN THE SAID SEIZED PAPER. THE ASSESSING OFFICER THUS, ADDED ON - MONEY OF RS. 34,12,230/ - IN THE HANDS OF ASSESSEE. 10 ITA NO. 1 877 /PUN/2013 1 3 . THE LIMITED ISSUE WHICH HAS BEEN RAISED BEFORE US IS THAT IN PROCEEDINGS UNDER SECTION 153C OF THE ACT, THE ADDITION IF ANY, IN THE HANDS OF PERSON OTHER THAN SEARCHED PERSON CAN BE MADE ON THE BASIS OF DOCUMENT FOUND AND SEIZED DURING THE COURSE OF SEARCH , WHICH BELONGS TO SUCH PERSON I.E. THE PERSON OTHER THAN PERSON SEARCHED , AS REFERRED TO IN SECTION 153A OF THE ACT. 1 4 . THE HONBLE BOMBAY HIGH COURT IN CIT VS. M/S. ARPIT LAND PVT. LTD. IN INCOME TAX APPEAL NO.83 OF 2014 AND 150 OF 2014, JUDGMENT DATED 07.02.2017 TOOK NOTE OF POSITION OF LAW UNDER SECTION 153C OF THE ACT W.E.F. 01.06.2015 AND OBSERVED AS UNDER: - 6. WE NOTE THAT IN TERMS OF SECTION 153C OF THE ACT AT THE RELEVANT TIME I.E. PRIOR TO 1ST JUNE, 2015 THE PROCEEDINGS UNDER SECTION 153C OF THE ACT COULD ONLY BE INITIATED/PROCEEDED AGAINST A PARTY - ASSESSEE IF THE DOCUMENT SEIZED DURING THE SEARCH AND SEIZURE PROCEEDINGS OF ANOTHER PERSON BELONGED TO THE PARTY - ASSESSEE CONCERNED. THE IMPUGNED ORDER RECORDS A FINDING OF FACT THAT THE SEIZED DOCUMENTS WHICH FORMED THE BASIS OF INITIATION OF PROCEEDINGS AGAINST THE RESPONDENT ASSESSEES DO NOT BELONG TO IT. THIS FINDING OF FACT HAS NOT BEEN SHOWN TO US TO BE INCORRECT. FURTHER, THE IMPUGNED ORDER PLACED RELIANC E UPON A DECISION OF GUJARAT HIGH COURT IN VIJAYBHAI CHANDRANI VS. ACIT 333 ITR PAGE 436 WHICH RECORDS THAT THE CONDITION PRECEDENT FOR ISSUING NOTICE UNDER SECTION 153C OF THE ACT IS THAT THE DOCUMENT FOUND DURING SEARCH PROCEEDINGS SHOULD BELONG TO ASSES SEE TO WHOM NOTICE IS ISSUED UNDER SECTION 153C OF THE ACT. IT WAS FAIRLY POINTED OUT TO US BY MR.MISTRY, THE LEARNED SENIOR COUNSEL FOR THE RESPONDENT ASSESSEE THAT THE ABOVE DECISION WAS REVERSED BY THE SUPREME COURT IN CIT VS. VIJAYBHAI N. CHANDRANI ( 2013) 357 ITR 713. HOWEVER, WE FIND THAT THE APEX COURT REVERSED THE VIEW OF GUJARAT HIGH COURT ON THE GROUND THAT EFFICACIOUS ALTERNATIVE REMEDY WAS AVAILABLE TO THE PETITIONER TO RAISE ITS OBJECTIONS BEFORE THE AUTHORITIES UNDER THE ACT. THEREFORE, THE G UJARAT HIGH COURT SHOULD NOT HAVE EXERCISED ITS EXTRA ORDINARY WRIT JURISDICTION TO ENTERTAIN THE PETITION. HOWEVER, THE APEX COURT ALSO CLARIFIED THAT IT WAS NOT EXPRESSING ANY OPINION OF THE CORRECTNESS OR OTHERWISE OF CONSTRUCTION PLACED BY THE HIGH COU RT ON SECTION 153C OF THE ACT. THE REVENUE HAS NOT POINTED OUT ANY REASON WHY THE CONSTRUCTION PUT ON SECTION 153C OF THE ACT BY GUJARAT HIGH COURT IS NOT CORRECT/APPROPRIATE. WE FIND THAT IN ANY CASE OUR COURT HAS ALSO TAKEN A SIMILAR VIEW IN CIT VS. SINH GAD TECHNICAL EDUCATION SOCIETY (2015) 378 ITR 84 AND REFUSED TO ENTERTAIN REVENUE'S APPEAL. 7. THE GRIEVANCE OF THE REVENUE AS SUBMITTED BY MR.KOTANGALE IS A SUBMISSION MADE ON THE BASIS OF SUSPICION AND NOT ON THE BASIS OF ANY EVIDENCE ON RECORD WHICH W OULD INDICATE THAT THE RESPONDENT ASSESSEE AND PERSONS SEARCHED WERE ALL PART OF THE SAME GROUP. BE THAT AS IT MAY, THE REQUIREMENT OF SECTION 153C OF THE ACT CANNOT BE IGNORED AT THE ALTER OF SUSPICION. THE REVENUE HAS TO STRICTLY COMPLY WITH SECTION 15 3C OF THE ACT. WE ARE OF THE VIEW THAT NON SATISFACTION OF THE CONDITION PRECEDENT VIZ. THE SEIZED DOCUMENT MUST BELONG TO THE RESPONDENT ASSESSEE IS A JURISDICTIONAL ISSUE AND NON SATISFACTION THEREOF WOULD MAKE THE ENTIRE PROCEEDINGS TAKEN THEREUNDER N ULL AND VOID. THE ISSUE OF 11 ITA NO. 1 877 /PUN/2013 SECTION 69C OF THE ACT CAN ONLY ARISE FOR CONSIDERATION IF THE PROCEEDINGS UNDER SECTION 153C OF THE ACT ARE UPHELD. THEREFORE, IN THE PRESENT FACTS, THE ISSUE OF SECTION 69C OF THE ACT IS ACADEMIC. 1 5 . IN ORDER TO INVOKE THE P ROVISIONS OF SECTION 153C OF THE ACT IN RESPECT OF POSITION OF LAW PRIOR TO 01.06.2015, THE SAID PROCEEDINGS UNDER SECTION 153C OF THE ACT COULD ONLY BE INITIATED / PROCEEDED AGAINST A PERSON , OTHER THAN THE PERSON SEARCHED, IF THE DOCUMENT SEIZED DU RING T HE COURSE OF PROCEEDINGS , BELONGED TO SUCH PERSON CONCERNED. THE ASSESSEE HAS FILED ON RECORD THE COPY OF SEIZED DOCUMENT WHICH IS PLACED AT PAGES 5 AND 6 OF THE PAPER BOOK, UNDER WHICH THE DOCUMENT AT PAGE 5 IS IN MARATHI IN THE HANDWRITING OF THE SEARCHED PERSON WITH TYPED COPY IN MARATHI WHICH IS PLACED AT PAGE 6 . THE ENGLISH TRANSLATION OF THE SAID DOCUMENT IS PLACED AT PAGE 7 OF THE PAPER BOOK. 1 6 . NOW, WE SHALL TAKE NOTE OF THE NOTINGS ON DOCUMENT SEIZED DURING THE COURSE OF SEARCH. AS PER THE ASSESSING OFFICER, THE DOCUMENT WHICH RELATES TO THE ASSESSEE IS PAGE 21 OF BUNDLE NO.II SEIZED FROM SHRI RAHUL MANE, THE SEARCHED PERSON OF 3 8.5 GUNTAS. THE LAND IN QUESTION WAS AT RANKALA AND THE SELLER WAS SHRI RAHUL MANE. THE TOTAL LANDHOLDING WAS 38.5 GUNTAS. UNDOUBTEDLY, THE NEXT NOTING ON THE SAID SEIZED DOCUMENT IS 15.5 GUNTAS PURCHASED FOR FIRM. THE TOTAL COST OF 38.5 GUNTAS INCLUDING THE COST OF STAMP PAPER, REGISTRATION IS MENTIONED IN CODED FORM AND OTHER EXPENSES AND THE TOTAL IS MENTIONED AS 162601 - 00, WHICH THE ASSESSING OFFICER INTERPRETS AS THE TOTAL COST OF SALE OF LAND AT RS. 1,62,60,100/ - . THEREAFTER, THE CONSIDERATION IN RESPECT OF 15.5 GUNTAS AND THE SHARE OF MR. VIJAY SHAH @ 4.44% IS MENTIONED AND THE DETAILS OF CASH RECEIPT HAVE BEEN WORKED OUT. THE SAID DOCUMENT WAS SEIZED FROM MR. VIJAY SHAH WHO IS IN BETWEEN PERSON AND THE SAID SEIZED PAPER BELONGS TO MR. VIJAY SHAH. THE ASSESSING OFFICER ALSO ADMITS THAT THE SAID 12 ITA NO. 1 877 /PUN/2013 DOCUMENT BELONGS TO MR. VIJAY SHAH. WHERE THE DOCUMENT BELONGS TO THE SEARCHED PERSON, THEN IT CANNOT BE HELD THAT THE SAM E DOCUMENT BELONGS TO A PERSON OTHER THAN THE PERSON SEARCH ED , IN ORDER TO INVOKE THE PROVISIONS OF SECTION 153C OF THE ACT. THE PRE - AMENDED PROVISIONS OF SECTION 153C OF THE ACT COULD BE TRIGGERED OFF WHERE DURING THE COURSE OF SEARCH OF SEARCHED PERSON, DOCUMENT BELONGING TO A PERSON OTHER THAN SEARCHED PERSON IS FOUND AND THE SAME IS TO BE HANDED OVER , AFTER RECORDING SATISFACTION TO THE ASSESSING OFFICER INCHARGE OF THE PERSON , OTHER THAN THE PERSON SEARCH ED . HOWEVER, IN THE PRESENT CASE, THE CONDITIONS LAID DOWN IN SECTION 153C OF THE ACT ARE NOT FULFILLED . WHERE THE DOCUMENT HAS BEEN SEIZED FROM THE PERSON SEARCHED, WHICH IN TURN, BELONGS TO THE PERSON SEARCHED AND HAS BEEN SO HELD BY THE ASSESSING OFFICER, THEN THE NOTINGS ON THE SAID DOCUMENT ITSELF CANNOT BE HELD TO BELONG TO THE ASSESSEE, WHO IS A PERSON OTHER THAN THE PERSON SEARCHED. IN THE ABSENCE OF FULFILLMENT OF BASIC CONDITIONS OF SECTION 153C OF THE ACT AND APPLYING THE RATIO LAID DOWN BY THE HON BLE HIGH COURT OF DELHI IN PR. CIT & ORS. VS. NIKKI DRUGS & CHEMICALS PVT. LTD. & ORS. (SUPRA) AND THE HONBLE BOMBAY HIGH COURT IN CIT VS. M/S. ARPIT LAND PVT. LTD. (SUPRA), WE HOLD THAT THERE IS NO MERIT IN THE INITIATION OF PROCEEDINGS UNDER SECTION 1 53C OF THE ACT IN THE CASE OF ASSESSEE. IN THE ABSENCE OF ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH OF THE PERSON , WHO IS COVERED UNDER SECTION 153A OF THE ACT, WHICH IN TURN, BELONGS TO THE PERSON , OTHER THAN THE SEARCHED PERSON I.E. A SSESSEE BEFORE US, THEN THE PROCEEDINGS UNDER SECTION 153C OF THE ACT CANNOT BE TRIGGERED . ACCORDINGLY, WE HOLD SO. ACCORDINGLY, THE PROCEEDINGS COMPLETED THEREAFTER I.E. THE ORDER PASSED UNDER SECTION 143(3) R.W.S. 153C OF THE ACT IS INVALID AND WITHOUT ANY JURISDICTION AND THE SAME IS CANCELLED. CONSEQUENTLY, THE ADDITIONAL GROUND OF APPEAL RAISED BY THE ASSESSEE IS ALLOWED AND THE ASSESSMENT ORDER PASSED IN 13 ITA NO. 1 877 /PUN/2013 THE CASE IS HELD TO BE NULLITY. THE GROUNDS OF APPEAL RAISED ON MERITS THUS, BECOME ACADEMIC IN NATURE. 1 7 . IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED. ORDER PRO NOUNCED ON THIS 31 ST DAY OF MAY , 201 7 . SD/ - SD/ - (ANIL CHATURVEDI) ( SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE; / DATED : 31 ST MAY , 2017 . SB / GCVSR / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT (APPEALS), KOLHAPUR. 4. THE CIT - I/II, KOLHAPUR. 5. , , , / DR, ITAT, A BENCH, PUNE. 6. / GUARD FILE. / BY ORDER, // TRUE COPY // /ASSISTANT REGISTRAR , / ITAT, PUNE .