ACIT, New Delhi V. M/s Sarvmangalam Builders & Developers Pvt. Ltd., New Delhi

ITA 196/DEL/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 74346 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-03-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 11-02-2014
• Assessment Year: 2002-2003
• Appeal Filed On: 13-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAMESH CHANDRA
• Keywords: Search and seizure; Document seized; Question of law; Competent authority; Documents seized
• Section: 153A; 14A; 132; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : G : NEW DELHI BEFORE SHRI A.D. JAIN, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER ITA NO.196 TO 198/DEL/2011 ASSESSMENT YEARS : 2002-03 TO 2004-05 ACIT, CENTRAL CIRCLE-2, ROOM NO.323, ARA CENTRE, JHANDEWALAN EXTN., NEW DELHI. VS. SARVMANGALAM BUILDERS & DEVELOPERS PVT. LTD., 6, COMMUNITY CENTRE, SAKET, NEW DELHI. PAN : AADCS6296A CO NO S . 1 15 TO 117 /DEL/201 1 ASSESSMENT YEARS : 2002-03 TO 2004-05 SARVMANGALAM BUILDERS & DEVELOPERS PVT. LTD., 6, COMMUNITY CENTRE, SAKET, NEW DELHI. PAN : AADCS6296A VS. ACIT, CENTRAL CIRCLE-2, ROOM NO.323, ARA CENTRE, JHANDEWALAN EXTN., NEW DELHI. ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY : SHRI GAUTAM JAIN, ADVOCATE DEPARTMENT BY : S HRI RAMESH CHANDRA, CIT, DR ORDER PER A.D. JAIN, JUDICIAL MEMBER: THESE ARE DEPARTMENTS APPEALS AND ASSESSEES CROSS OBJECTION S FOR ASSESSMENT YEARS 2002-03 TO 2004-05 AGAINST THE ORDERS D ATED 21.10.2010 PASSED BY THE LD. CIT(A)-III, DELHI. ITA NOS.196 TO 198/DEL/2011 CO NOS.115 TO 117/DEL/2011 2 2. THE SOLE GROUND RAISED BY THE DEPARTMENT IN ALL TH ESE APPEALS IS THAT THE LD. CIT (A) HAS ERRED IN RESTRICTING THE DISALLOWA NCE OF ` 17,33,118/- TO ` 70,000/- (FOR ASSESSMENT YEAR 2002-03) AND DELETING THE DISALLOWANCE OF ` 14,91,332/- (FOR ASSESSMENT YEAR 2003-04) AND OF ` 11,1 7,420/- (FOR ASSESSMENT YEAR 2004-05) MADE BY THE ASSESSING OFFICER IN A CCORDANCE WITH RULE 8D OF THE IT RULES, READ WITH SECTION 14A OF TH E INCOME-TAX ACT. FOR ASSESSMENT YEAR 2004-05, ANOTHER GROUND HAS BEEN TAKEN, AS PER WHICH, THE LD. CIT (A) HAS ERRED IN DELETING THE ADDITION OF ` 1,80,53,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNDISCLOSED INCOME ON TH E BASIS OF SEIZED DOCUMENTS. 3. THE COMMON CROSS OBJECTIONS RAISED BY THE ASSESSEE FOR ALL THESE THREE YEARS ARE AS FOLLOWS:- 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPE ALS) III, NEW DELHI HAS ERRED BOTH IN LAW AND ON FACTS IN UPHOLDIN G THE ASSESSMENT U/S 153A/143 (3) OF THE ACT DESPITE THE FACT THAT PROCEED INGS WERE WITHOUT JURISDICTION SINCE NO SEARCH HAS BEEN CONDUCT ED ON THE ASSESSEE AS ITS NAME WAS NOT MENTIONED IN ANY OF THE PA NCHNAMA. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEA LS) HAS FAILED TO APPRECIATE THAT UNTIL AND UNLESS, THERE IS A P ANCHNAMA DRAWN IN THE NAME OF THE APPELLANT, IT CANNOT BE HELD THAT THERE IS A SEARCH CONDUCTED UNDER SECTION 132 (1) OF THE ACT SO AS TO AS SUME JURISDICTION UNDER SECTION 153A OF THE ACT. IN VIEW OF THE DECISION OF HONBLE TRIBUNAL IN THE CASE OF J.M. TRADING CORPORATION VS. ACIT REPORTED IN 20 SOT 489 UPHELD BY BOMBAY HIGH COURT IN JUDGMENT DATED 29.06.2009 IN ITA NO.276/2009. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEA LS) HAS FURTHER ERRED BOTH IN LAW AND ON FACTS IS FAILED TO APP RECIATE THAT, DISALLOWANCE MADE OF RS.17,33,118/- BY INVOKING SEC TION 14A READ WITH RULE 8D OF THE INCOME TAX RULES WAS WITHOUT JURISDICTI ON AND, BEYOND THE SCOPE OF THE ASSESSMENT MADE U/S 153A/143 (3) OF TH E ACT. 4. SINCE THEY RAISE A JURISDICTIONAL ISSUE GOING TO THE ROOT OF THE MATTER, AT FIRST, WE ARE TAKING UP THE FIRST TWO CROSS OBJECTIONS R AISED BY THE ASSESSEE. AS PER THESE CROSS OBJECTIONS, NO SEARCH HAVING BEEN COND UCTED ON THE ASSESSEE, AS ITS NAME WAS NOT MENTIONED IN ANY OF THE PANC HNAMAS, THE ITA NOS.196 TO 198/DEL/2011 CO NOS.115 TO 117/DEL/2011 3 PROCEEDINGS WERE WITHOUT JURISDICTION AND SO, THE LD. CIT (A) HAS ERRED IN UPHOLDING THE ASSESSMENTS FRAMED UNDER SECTIONS 153A/143 (3) OF THE IT ACT. 5. IN THIS REGARD, THE LD. CIT (A) HAS OBSERVED THAT THE ASSESSEE HAD CHALLENGED THE JURISDICTION OF THE ASSESSING OFFICER U/ S 153A OF THE IT ACT ON TWO GROUNDS, I.E., THAT THERE WAS NO SEARCH WARRANT ISSU ED IN THE NAME OF THE ASSESSEE AND THAT NO PANCHNAMA WAS DRAWN IN ITS NAME; THA T THE ASSESSING OFFICER HAD HELD THE NAME OF THE ASSESSEE COMPANY WAS WR ITTEN IN THE WARRANT ISSUED FOR THE SEARCH OF THE PREMISES AT 3 RD FLOOR, GLOBAL ARCADE, MG ROAD, GURGAON AND, AS SUCH, THE OBJECTION OF THE ASSESS EE THAT NO SEARCH WARRANT WAS ISSUED IN ITS NAME, WAS NOT CORRECT; THAT SH E [LD. CIT (A)] WAS OF THE VIEW THAT ONCE A SEARCH IS INITIATED BY THE ISSUANC E AND EXECUTION OF A SEARCH WARRANT, THE ASSESSING OFFICER IS IN ITS JURISDICTIO N TO ISSUE A NOTICE U/S 153A OF THE ACT; AND THAT THUS, THE ASSESSING OFFICER H AD VALID JURISDICTION TO MAKE AN ASSESSMENT U/S 153A OF THE ACT. 6. CHALLENGING THE AFORESAID OBSERVATIONS OF THE CIT ( A), IT HAS BEEN CONTENDED BEFORE US ON BEHALF OF THE ASSESSEE THAT THE L D. CIT (A) HAS GONE WRONG IN REJECTING THE VALID OBJECTIONS RAISED BY THE ASSESSEE IN THIS REGARD; THAT EVEN AS PER ASSESSMENT ORDER, A SEARCH AND SEIZURE A CTION U/S 132 OF THE ACT WAS CARRIED OUT ON VIPUL GROUP OF CASES ON 01. 06.2006; THAT NOTICES U/S 153A OF THE ACT WAS ISSUED AND SERVED ON THE ASSESSEE ON 21.02.2007; THAT THE ASSESSEE, VIDE LETTER DATED 01.12.2008, ADDRESSE D TO THE ASSESSING OFFICER, HAD SUBMITTED THAT THE PROCEEDINGS WERE WITH OUT JURISDICTION, SINCE NO SEARCH HAD BEEN CONDUCTED ON THE ASSESSEE; THAT NEITH ER ANY WARRANT OF AUTHORIZATION U/S 132 (1) OF THE ACT HAD BEEN SERVED ON THE ASSESSEE NOR ANY PANCHNAMA HAD BEEN DRAWN IN ITS NAME AND THAT IN THE ABSENCE OF ANY SEARCH HAVING BEEN CONDUCTED, THE PROCEEDINGS WERE WI THOUT ANY JURISDICTION; THAT THE ASSESSING OFFICER HAS HIMSELF NOT DENIED THE ABSENCE OF THE ASSESSEES NAME IN THE PANCHNAMA; THAT THE ASSESSING OFF ICER HAS MADE TWO OBSERVATIONS IN THIS REGARD, I.E., IN THE WARRANT OF AUTHORIZATION EXECUTED ITA NOS.196 TO 198/DEL/2011 CO NOS.115 TO 117/DEL/2011 4 AT 3 RD FLOOR, GLOBAL ARCADE, MG ROAD, GURGAON (PARTY B-7) , THE NAME OF THE ASSESSEE COMPANY M/S SARVMANGALAM BUILDERS & DEVELOPERS PV T. LTD. WAS APPEARING AND THAT FURTHER, THE RESIDENCE OF THE DIR ECTOR, SHRI PUNIT BERIWALA WAS ALSO COVERED DURING THE SEARCH OPERATION; THAT THE ASSESSING OFFICER OBSERVED THAT IN THESE FACTS, THE PROCEEDINGS U/S 153A H AD BEEN RIGHTLY INITIATED IN THE CASE OF THE ASSESSEE AND THE OBJECTION OF THE ASSESSEE CHALLENGING THE VALIDITY OF THE ASSESSMENT PROCEEDINGS W AS BEING REJECTED; IN ITS WRITTEN SUBMISSIONS BEFORE THE LD. CIT (A) (COPY AT APB 125-139), THE ASSESSEE HAD TAKEN A SPECIFIC OBJECTION TO THE AFORESAID ACTION OF THE ASSESSING OFFICER; THE MATTER HAD BEEN REMITTED BY THE LD. CIT (A) TO THE ASSESSING OFFICER; THE ASSESSING OFFICER HAD FILED A REMAND REPORT; THE ASSESSEES REJOINDER TO SUCH REMAND REPORT IS CONTAINED AT APB 179-181; THAT THEREIN, THE ASSESSEE HAD TAKEN A FURTHER OBJECTION TH AT PREMISES SEARCHED WAS OCCUPIED BY THE VIPUL GROUP OF COMPANIES AND THE ASSESSEES DIRECTOR WAS ALSO A DIRECTOR IN THE VIPUL GROUP OF COMPANIES; T HAT NEITHER OF THE AUTHORITIES BELOW HAS DECIDED THE ASSESSEES OBJECTION THA T SINCE THERE IS NO PANCHNAMA IN THE ASSESSEES NAME, NO JURISDICTION U/S 153A OF THE ACT COULD HAVE BEEN INVOKED; AND THAT FURTHER, EVEN IF THE DE CISION OF THE AUTHORITIES BELOW BE TAKEN TO BE CORRECT QUA THE REJECTION OF T HE ASSESSEES CHALLENGE TO THE VALIDITY OF THE ASSESSMENT PROCEEDINGS, SINCE THE PRE MISES SEARCHED IS NOT OWNED BY THE ASSESSEE, AGAIN, NO JURISDICTION U/S 153 A OF THE ACT COULD BE INVOKED AGAINST THE ASSESSEE. FOR THE PROPOSITION THAT SINCE THE PREMISES SEARCHED DOES NOT BELONG TO THE ASSESSEE, NO JURISDICTION U/S 153A OF THE ACT COULD HAVE BEEN INVOKED, THE LD. COUNSEL FOR THE ASSESSE E HAS PLACED RELIANCE ON THE DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF J.M. TRADING CORPORATION VS. ACIT, 20 SOT 489 (MUM ), WHEREIN, IT WAS HELD THAT WHERE A SEARCH IS CARRIED OUT AT THE PREMISES OWNE D BY THE ASSESSEE, BUT RENTED TO ANY CONCERN, THE SAME DOES NOT PROVE CO NDUCT OF SEARCH AS ENUMERATED U/S 132 OF THE ACT. IT HAS BEEN POINTED OU T THAT VIDE ORDER DATED 29.06.2009, THE HONBLE HIGH COURT OF BOMBAY, IN TH E CASE OF CIT VS. J.M. TRADING COMPANY IN ITA NO.589 OF 2009 (COPY AT CLP B 200), DISMISSED THE ITA NOS.196 TO 198/DEL/2011 CO NOS.115 TO 117/DEL/2011 5 APPEAL FILED BY THE DEPARTMENT AGAINST THE AFORESAID TRIBUNAL ORDER. IT HAS FURTHER BEEN POINTED OUT THAT VIDE ORDER DATED 06.0 9.2010, THE HONBLE SUPREME COURT, IN CIT, MUMBAI VS. M/S J.M. TRADING C ORPORATION LTD. IN CC NO.13456/2010 (COPY AT CLPB 201), HAS DISMISSED THE OBJ ECTION FOR SPECIAL LEAVE TO APPEAL FILED BY THE DEPARTMENT AGAINST THE AFORESAID JUDGEMENT AND ORDER OF THE HONBLE HIGH COURT OF BOMBAY. IN THIS R EGARD, THE LD. COUNSEL FOR THE ASSESSEE HAS FURTHER SOUGHT TO PLACE RELIANCE ON JIN DAL STAINLESS STEELS LTD. VS. ACIT, CENTRAL CIRCLE-6, NEW DELHI, 120 ITD 301 (DEL) AND DR. MANSUKH KANJIBHAI SHAH VS. ACIT, CENTRAL CIR.2, 129 ITD 376 (AHM). 7. ON THE OTHER HAND, THE LD. DR, OPPOSING THE CROSS OBJECTION RAISED BY THE ASSESSEE, HAS MADE ORAL SUBMISSIONS AND WRITTEN SUBMISSIONS HAS BEEN FILED AS WELL. IT HAS BEEN CONTENDED THAT UNDISPUTEDLY , NO STATEMENT OF FACTS WAS FILED BEFORE THE LD. CIT (A), THOUGH IT IS STATUT ORY REQUIREMENT TO DO SO AND, THEREFORE, THE TRIBUNAL IS PRECLUDED FROM HEARI NG OBJECTION RAISED BY THE ASSESSEE; THAT EVEN OTHERWISE, NO CROSS APPEAL WAS FILED BY THE ASSESSEE TO THE APPEAL FILED BY THE DEPARTMENT AND IT IS ONLY TH AT THE ASSESSEE HAS COME UP BY WAY OF THE CROSS OBJECTIONS WHICH SHOWS THE CHANGE OF MIND OF THE ASSESSEE; THAT AS PER SECTION 153A OF THE ACT, A NOTICE THEREUNDER NEEDS MUST BE ISSUED WHERE A SEARCH IS INITIATED U/S 132; TH AT IN THE PRESENT CASE, THE ASSESSEES NAME WAS MENTIONED IN THE AUTHORISATION WAR RANT; THAT SO, THE SEARCH WAS VALIDLY INITIATED; THAT THEREFORE, THE NOTICE U/S 153A WAS VALIDLY ISSUED; THAT APROPOS THE HIGH COURT ORDER (SUPR A) IN THE CASE OF J.M. TRADING, THE DEPARTMENTS APPEAL WAS DISMISSED AS NO QUE STION OF LAW WAS FOUND TO BE INVOLVED; THAT THEREFORE, THIS ORDER IS O F NO HELP TO THE ASSESSEE; THAT EVEN THE TRIBUNAL ORDER IN THE CASE OF J.M. TRA DING (SUPRA) DOES NOT AID THE CASE OF THE ASSESSEE ON FACTS, SINCE, IN THAT CASE, THE PREMISES SEARCHED WAS OWNED BY THE ASSESSEE, BUT IT HAD BEEN RENTED TO ANO THER CONCERN, WHICH IS NOT THE CASE HEREIN; THAT APROPOS THE ASSESSEES O BJECTION OF THERE BEING NO PANCHNAMA IN THE ASSESSEES NAME, AS PER SECTIO N 153A(2) OF THE ACT, EXECUTION OF AUTHORIZATION IS DEEMED EXECUTED ON THE CONCLUSION OF THE ITA NOS.196 TO 198/DEL/2011 CO NOS.115 TO 117/DEL/2011 6 SEARCH AS RECORDED IN THE LAST PANCHNAMA DRAWN; THAT T HEREFORE, UNLESS THERE IS A PANCHNAMA, THE MACHINERY, AS PROVIDED U/S 1 53A CANNOT BE SET IN MOTION; THAT THE SIGNATURES OF THE WITNESSES AND THE ASSESSES/REPRESENTATIVES OF THE ASSESSES ON THE SEIZURE MEMOS A ND PANCHNAMA, ETC., IS THE PROOF OF THE SEARCH HAVING B EEN CONDUCTED AT THE PREMISES OCCUPIED/USED BY THEASSESSEES IN RESPONSE TO VALID WARRANT OF AUTHORIZATION; THAT THE SEARCH IS CONSIDERED TO BE IN ITIATED ONCE THE WARRANT HAS BEEN ISSUED BY THE COMPETENT AUTHORITY AND THE AUT HORIZED OFFICERS HAD ENTERED THE CORRECT PREMISES TO EXECUTE THE SEARCH WAR RANT; THAT IN M/S RAJAT TRADE COM INDIA PVT. LTD., 120 ITD 48 (INDOR E), WHEREIN A JOINT WARRANT OF AUTHORIZATION WAS ISSUED IN THE NAME OF M/S RAJAT GE MS & JEWELLERS (P) LTD. AND M/S RAJAT TRADE COM INDIA PVT. LTD., BUT T HE NAME OF M/S RAJAT TRADE COM INDIA PVT. LTD. WAS NOT MENTIONED IN THE PANCHNA MA DRAWN AT THE PREMISES, IT WAS HELD THAT IN THE EVENT OF WARRANT OF AUTHORISATION BEING IN THE JOINT NAMES OF THE ASSESSES OF THE GROUP, IT WAS NOT N ECESSARY TO WRITE ALL THE NAMES IN THE PANCHNAMA; THAT THEREFORE, DRAWING OF SEPARATE PANCHNAMA IN THE NAMES OF ALL THE PERSONS MENTIONED IN THE WARRANT OF AUTHORISATION IS NOT NECESSARY; THAT AS PER CIT VS. DR. C. BALAKRISHNAN NAIR, 282 ITR 158 (KAR), IT IS NOT SACROSANCT THAT THE PANC HNAMA MUST CONTAIN ALL THE NAMES OF THE PERSONS WHOSE NAMES ARE OTHERWISE MENTIO NED IN THE SEARCH AUTHORIZATION AND THE NON-MENTIONING OF NAMES OF ALL THE ASSESSEES MENTIONED IN THE WARRANT OF AUTHORISATION CAN AT TH E MOST BE SAID TO BE AN INADVERTENT MISTAKE OR OVERSIGHT OR IRREGULARITY, WHI CH CANNOT HOLD THE ENTIRE SEARCH PROCEEDINGS AS INVALID; THAT THIS VIEW IS ALSO SUPP ORTED BY THE HONBLE SUPREME COURT IN THE CASE OF M/S SETH BROTHERS AND OT HERS, 1970 AIR 292 (SC); THAT SECTION 292-CC OF THE ACT ALSO TALKS ABOUT ONLY AUTHORIZATION U/S 132 OF THE ACT AND NOT PANCHNAMA; THAT ACCORDING TO SECTION 292-CC, IF THE WARRANT OF AUTHORISATION HAS BEEN ISSUED IN MANY NAMES, THE ASSESSMENT OR RE-ASSESSMENT PROCEEDINGS ARE REQUIRED TO BE MADE SEPARAT ELY IN THE NAME OF EACH OF THE PERSONS MENTIONED IN THE AUTHORIZATIO N; THAT THIS SHOWS THAT THE BASIS FOR DETERMINING THE AUTHORITY OF THE PROCEE DINGS U/S 153A IS THE ITA NOS.196 TO 198/DEL/2011 CO NOS.115 TO 117/DEL/2011 7 EXISTENCE OF THE NAME IN THE AUTHORISATION WARRANT AN D NOT THE PANCHNAMA; THAT THEREFORE, ABSENCE OF SOME NAMES IN THE PANCHNAM A, WHICH OTHERWISE FIGURE IN THE WARRANT OF AUTHORISATION, IS NOT FATAL FOR THE FRAMING OF ASSESSMENT U/S 153A OF THE ACT; THAT IF FOR THE SAKE OF C ONVENIENCE, INSTEAD OF MENTIONING ALL THE NAMES OF THE PERSONS, THE PROCE EDINGS ARE CONCLUDED BY DRAWING A PANCHNAMA, WHEREIN, AFTER MENTIONING O NE OR TWO NAMES OUT OF THE MANY NAMES MENTIONED IN THE WARRANT OF AUTHORISA TION, THE WORD ETC. IS WRITTEN BY THE AUTHORISED OFFICER, THE PROCEEDINGS U/S 153A WILL NOT GET VITIATED; AND THAT IN THE WARRANT OF AUTHORISATION I SSUED IN THE CASE OF THE ASSESSEE, A COPY WHEREOF IS AT APB 177-178, THE NAME OF THE ASSESSEE HAS BEEN SPECIFICALLY MENTIONED. 8. WE HAVE HEARD THE PARTIES ON THESE PRELIMINARY OBJ ECTIONS RAISED BY THE ASSESSEE. THE ISSUES INVOLVED ARE TWO-FOLD AS TO WHET HER IN THE ABSENCE OF THE ASSESSEES NAME BEING MENTIONED IN THE PA NCHNAMA, JURISDICTION U/S 153A OF THE ACT WAS NOT VALIDLY INVOK ED AND AS TO WHETHER SINCE THE PREMISES SEARCHED WAS NOT OWNED BY THE ASSESSEE , THE SEARCH CONDUCTED WAS NOT A SEARCH AS ENVISAGED U/S 132 OF THE ACT, THEREBY VITIATING THE INVOCATION OF JURISDICTION U/S 153A OF THE ACT. 9. SO FAR AS REGARDS THE FIRST QUESTION, WE FIND FORCE IN THE CONTENTIONS OF THE DEPARTMENT. CLEARLY, THE WARRANT OF AUTHORISATIO N CONTAINS THE NAME OF THE ASSESSEE. THAT BEING SO, ABSENCE OF THE ASSESSEES NAME IN THE PANCHNAMA IS NOT FATAL TO THE CONDUCT OF THE SEARCH. IF THE AUTHORIZATION IS VALID, ABSENCE OF THE NAME OF THE ASSESSEE IN PANCHNAMA WILL NOT RENDER THE SEARCH OPERATION INVALID, IF OTHER REQUIREMENTS OF LA W ARE FULFILLED. IN M/S RAJAT TRADECOM (P) LTD. VS. DCIT, 2 (1), INDORE, 12 0 ITD 48 (INDORE), IT HAS BEEN HELD THAT FOR APPLICABILITY OF SECTION 153A, T HE INITIATION OF SEARCH IS NECESSARY; THAT SECTION 153A WOULD BE APPLICABLE WHER E, INTER ALIA, A SEARCH IS INITIATED U/S 132; AND THAT THEREFORE, BEFORE INVO KING THE PROVISIONS OF SECTION 153A, IT WOULD BE NECESSARY TO COMPLY WITH TH E PROVISIONS CONTAINED ITA NOS.196 TO 198/DEL/2011 CO NOS.115 TO 117/DEL/2011 8 IN SECTION 132 (1). IN THE PRESENT CASE, SINCE THE WAR RANT OF AUTHORISATION CONTAINS THE NAME OF THE ASSESSEE, SUCH PROVISIONS ARE AMPL Y COMPLIED WITH. IN VIEW OF THE ABOVE, THIS OBJECTION OF THE ASSESSEE, I. E., C.O. NO.2, IS MERITLESS AND IS REJECTED AND THE OBSERVATIONS OF THE L D. CIT (A) IN THIS REGARD, AS CONTAINED IN PARA 5 OF THE IMPUGNED ORDER , ARE REJECTED. 10. COMING TO THE OTHER QUESTION RAISED BY THE ASSESSEE, THE DEPARTMENT HAS RAISED A PRELIMINARY OBJECTION IN THIS REGARD, TO THE EFFECT THAT THIS ISSUE WAS NEVER RAISED BEFORE THE AUTHORITIES BELOW AND, THE REFORE, THE TRIBUNAL CANNOT GO INTO IT AT THIS STAGE. THIS, HOWEVER, IS NOT FOUND TO BE CORRECT. THIS ISSUE WAS RAISED BEFORE THE LD. CIT (A), BY WAY OF THE ASSESSEES REJOINDER DATED 20.05.2010 (PB 179-183, AT PB 181, PARA 6) TO THE ASSESSING OFFICERS REMAND REPORT. THE RELEVANT PORTION THEREOF IS AS FOL LOWS:- IT IS SUBMITTED THAT, THIS PREMISES NAMELY GLOBAL ARCADE , MG ROAD, GURGAON IS NOT PREMISES OF THE APPELLANT AS IS OTHERWIS E EVIDENT FROM THE CAPTION OF THE ORDER OF ASSESSMENT WHEREIN THE PREMI SES OF THE APPELLANT HAS BEEN STATED AS COMMUNITY CENTRE, SAKET, NEW DELHI. THIS IS ALSO SEEN FROM THE RETURN OF INCOME FILED BY THE APPELLANT FOR THE INSTANT ASSESSMENT YEAR, COPY OF WHICH IS PLACED AT PAGES 8 TO 23 OF PAPER BOOK AND FURTHER, FROM THE NOTICE UNDER SECTI ON 153A OF THE ACT WHICH IS PLACED AT PAGE 24 OF PAPER BOOK. IT WILL BE SEEN THAT IN NONE OF THE ABOVE, IT HAS EITHER BEEN ALLEGED AND IN F ACT, COULD NOT HAVE OTHERWISE BEEN ALLEGED THAT PREMISES AT 3 RD FLOOR, GLOBAL ARCADE, MG ROAD, GURGAON WAS PREMISES OF THE APPELLANT COMPAN Y AND SINCE THE PREMISES AT 3 RD FLOOR, GLOBAL ARCADE, MG ROAD, GURGAON WAS NOT PREMISES OF THE APPELLANT COMPANY, IT COULD NOT BE VALI DLY HELD THAT ANY SEARCH WAS CONDUCTED ON THE APPELLANT COMPANY. IN FACT, IT APPEARS THIS WAS THE VERY REASON, WHEREBY NO PANCHNAM A HAS BEEN PREPARED IN THE NAME OF THE APPELLANT COMPANY AND, THUS NO SEARCH WAS CONDUCTED ON THE APPELLANT COMPANY. IN VIEW THEREO F, IT IS RESPECTFUL SUBMISSION OF THE APPELLANT THAT THE COMMENTS O F THE LEARNED ASSISTANT COMMISSIONER OF INCOME TAX ARE ARGU MENTS IN DESPAIR AND ARE NOT SUPPORTED BY ANY VALID, LEGAL JUS TIFICATION MUCH LESS FACTUAL SUBSTANCE. THE APPELLANT HERE, SEEKS TO RE FER TO THE JUDGMENT OF THE MUMBAI BENCH IN THE CASE OF J.M. TRAD ING CORPORATION VS. CIT REPORTED IN 22 SOT 489 WHEREIN IT HAS BEEN H ELD THAT, EVEN IF SEARCH CARRIED OUT ON THE PREMISES OWNED BY THE ASSESS EE BUT RENTED TO ANY CONCERN, THE SAME DOES NOT ANY IMPLICATION AS A PROOF OF CONDUCT OF SEARCH ON THE APPELLANT. IT WAS FURTHER HELD THAT, MERE MENTIONING NAME IN THE PANCHNAMA DOES NOT LEAD TO A CONCLUSION THAT SEARCH WAS CONDUCTED ON THE ASSESSEE. A COPY OF THE S AID DECISION IS ITA NOS.196 TO 198/DEL/2011 CO NOS.115 TO 117/DEL/2011 9 PLACED AT PAGES 79 TO 94 OF PAPER BOOK. THE PRINCIPLE S LAID DOWN IN THE AFORESAID JUDGMENT ARE SQUARELY APPLICABLE TO THE FACTS OF THE CASE OF THE APPELLANT AND HENCE, IT IS RESPECTFUL SUBMISSION OF THE APPELLANT THAT BY NO STRETCH OF IMAGINATION, IT COULD EITHER HELD MU CH LESS CONCLUDE THAT THERE WAS ANY VALID INITIATION OF PROCEEDI NGS UNDER SECTION 153A OF THE ACT ON THE APPELLANT AND HENCE, AS SUMPTION OF JURISDICTION TO INITIATE PROCEEDINGS UNDER SECTION 15 3A OF THE ACT AND FRAMING OF ASSESSMENT UNDER SECTION 153A/143 (3) OF TH E ACT ARE NOT IN ACCORDANCE WITH LAW AND HENCE UNSUSTAINABLE. FURTHER, SO FAR AS THE MERITS OF THE CASE, THE APPELLANT APART FROM JUDICIAL D ECISIONS CITED EARLIER, ALSO SEEKS TO RELY UPON THE RECENT DECISION OF THE MUMBAI BENCH IN THE CASE OF ANIL P KHIMANI IN ITA NO (S) 28 55 TO 2860/MUM/2008 FOR ASSESSMENT YEAR 1999-2000 TO 2004- 05 AND, MEGHMANI ORGANICS LTD. VS. DCIT REPORTED IN 36 DTR 1 87 (AHD) ARE BEING ENCLOSED (PAGES 6 TO 13 AND, 14 TO 27 TO THIS SUB MISSIONS) HEREWITH TO SUBMIT THAT, IN ABSENCE OF ANY MATERIAL FOUND AS A RESULT OF SEARCH OF THE APPELLANT, NO ADDITION COULD HAVE BEEN O THERWISE MADE IN THE ORDER OF ASSESSMENT MADE UNDER SECTION 153A/14 3 (3) OF THE ACT. 7. IN VIEW OF THE ABOVE, IT IS SUBMITTED THAT THE ASSES SMENTS FRAMED MAY KINDLY BE QUASHED AND IN THE ALTERNATIVE, D ISALLOWANCES ADDITION MADE MAY KINDLY BE DELETED AND APPEALS OF TH E APPELLANT COMPANY BE ALLOWED. SHOULD YOUR GOODSELF REQUIRE AN Y FURTHER INFORMATION, THE APPELLANT IS TOO WILLING TO FURNISH THE SAME. 11. IT CANNOT BE DENIED THAT THIS IS AN ISSUE PERTAINI NG TO JURISDICTION. IT GOES TO THE VERY ROOT OF THE MATTER. THE FACTS WITH R EGARD THERETO ARE AVAILABLE BEFORE US. AS SUCH, WE CAN VERY WELL GO INTO THIS ISSUE AT THIS STAGE. THE WARRANT OF AUTHORISATION (APB PAGE 177-178) SHOWS THE ADDRESS OF THE PREMISES TO BE SEARCHED AS 3 RD FLOOR, GLOBAL ARCADE, MG ROAD, GURGAON. THE ASSESSMENT ORDER AS WELL AS THE ORDER UNDER APPEAL HA VE TAKEN NOTE OF THE FACT OF THIS ADDRESS BEING THE ADDRESS OF THE PREMIS IS SEARCHED. THE ASSESSEE CONTENDS THAT THIS PREMISES IS NOT OWNED BY IT AN D, THEREFORE, THE SEARCH CARRIED OUT IS INVALID QUA THE ASSESSEE. THE DEPAR TMENT HAS NOT DISPUTED THE FACTUM OF THE SAID PREMISES NOT BELONGING TO THE ASSESSEE. EVEN THE DOCUMENT PERTAINING TO THE ASSESSEE, WHICH WAS FOUND FROM THIS PREMISES IN THE SEARCH WAS, AS STATED BY THE LD. COUNSEL F OR THE ASSESSEE BEFORE US ON QUERY, OWNED UP BY THE VIPUL GROUP AND SURRENDER WAS MADE BY THEM ON THE BASIS THEREOF. THUS, INDISPUTABLY, THER E IS NOTHING ON RECORD TO CONNECT THE ASSESSEE WITH THE PREMISES SEARCHED. NOW, IN JM TRADING ITA NOS.196 TO 198/DEL/2011 CO NOS.115 TO 117/DEL/2011 10 CORPORATION, 20 SOT 489 (MUM) (SUPRA), IT HAS BEEN OBSERVED, INTER ALIA, THAT MERE SEARCH OF THE PREMISES OWNED BY THE ASSESSEE BUT RENTED TO ANOTHER CONCERN DOES NOT BY ANY IMPLICATION, PROVE T HE CONDUCT OF SEARCH AGAINST THE ASSESSEE, IN VIEW OF THE FACT THAT THE ASSESSEE WAS NOT AVAILABLE AT THE ADDRESS SEARCHED UPON. IN THE PRESENT CASE, THE SI TUATION IS RATHER MORE IN FAVOUR OF THE ASSESSEE. HERE, IT IS NOT THAT THE PREMISES WAS OWNED BY THE ASSESSEE BUT WAS RENTED OUT. RATHER, UNDISPUTEDLY, THE PREMISES SEARCHED DOES NOT BELONG TO THE ASSESSEE. THE DEPARTMENT S APPEAL IN THE CASE OF JM TRADING CORPORATION WAS DISMISSED IN LIMINE FOR WANT OF SUBSTANTIAL QUESTION OF LAW BY THE HONBLE HIGH COURT OF BOMBAY. WHILE DOING SO, THE FINDING OF THE TRIBUNAL TO THE EFFECT THAT NON-COMPLIANCE OF THE PROVISIONS OF THE INCOME-TAX ACT BY THE AUTHORIZED OF FICER RENDERS A SEARCH INVALID AND ILLEGAL. THE HONBLE SUPREME COURT HAS A LSO DISMISSED THE SLP FILED BY THE DEPARTMENT. IN DR. MANSUKH KANJIBHAI SHAH VS. ACIT, CENTRAL CIRCLE-2, 129 ITD 376 (AHM) (SUPRA) ALSO, SINCE, INTE R ALIA, NO SEARCH OPERATION WAS CONDUCTED IN THE PREMISES OF THE ASSESSEE, I T WAS HELD THAT THE PROCEEDINGS U/S 153A OF THE ACT WERE INVALID AND BAD IN LAW. 12. NO DECISION TO THE CONTRARY HAS BEEN BROUGHT TO O UR NOTICE. 13. IN VIEW OF THE ABOVE DISCUSSION, WE HOLD THAT SINCE NO SEARCH WAS CONDUCTED ON THE PREMISES OF THE ASSESSEE AND THE SEARCH C ONDUCTED WAS CONDUCTED ON A PREMISES NOT OWNED BY THE ASSESSEE, THE PR OCEEDINGS U/S 153A OF THE ACT ARE INVALID AND BAD IN LAW. ACCORDI NGLY, THE ORDERS OF THE AUTHORITIES BELOW ARE SET ASIDE AND QUASHED. HENCE, CO NO.1 IS ACCEPTED AND CO NO.2 IS REJECTED. CO NO.3, BEING ON MERITS, RE QUIRES NO ADJUDICATION. 14. SINCE THE PROCEEDINGS U/S 153A OF THE ACT AND THE ORDERS PASSED BY THE TAXING AUTHORITIES HAD BEEN QUASHED BY US AS ABOVE, NOTHING REMAINS FOR FURTHER ADJUDICATION. THESE BEING JURISDICTIONAL ISSUES GOING TO THE ROOT OF THE MATTER, ARGUMENTS OF THE PARTIES WERE HEARD QUA THESE QUESTIONS ONLY. ITA NOS.196 TO 198/DEL/2011 CO NOS.115 TO 117/DEL/2011 11 15. IN THE RESULT, THE APPEALS FILED BY THE DEPARTMEN T ARE DISMISSED AND THE CROSS OBJECTIONS FILED BY THE ASSESSEE ARE PARTLY ALLO WED, AS ABOVE. THE ORDER PRONOUNCED IN THE OPEN COURT ON 14.03.201 4. SD/- SD/- [ SHAMIM YAHYA ] [A.D. JAIN] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED, 14 TH MARCH, 2014. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.