M/s Brahmaputra Holdings (P) Ltd., New Delhi V. DCIT, New Delhi

ITA 3331/DEL/2017

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 7081 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 04-05-2020
• Assessment Year: 2009-2010
• Appeal Filed On: 26-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJAY GOEL
• Keywords: Unexplained cash credit; Search and seizure; Loose papers; Share purchase agreement; Principle of natural justice; Onus to prove
• Section: 153A; 143(1); 13; 153C; 68; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A: NEW DELHI (THROUGH VIDEO CONFERENCING) BEFORE, SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO.3331/DEL/2017 (ASSESSMENT YEAR: 2009-10) M/S BRAHMAPUTRA HOLDINGS (P) LTD., BRAHMAPUTRA HOUSE, A-7, NH-8, MAHIPALPUR CROSSING, MAHIPALPUR, NEW DELHI-110 037 PAN AACCB 5616N VS. DY.CIT, CENTRAL CIRCLE- 17, NEW DELHI (APPELLANT) (RESPONDENT) APPELLANT BY SH. GAUTAM JAIN, ADV. RESPONDENT BY SH. SANJAY GOEL, CIT-DR DATE OF HEARING 15.06.2020 DATE OF PRONOUNCEMENT 31.08.2020 ORDER PER SUDHANSHU SRIVASTAVA, JM: THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST OR DER DATED 27.03.2017 PASSED BY THE LEARNED COMMISSIONER OF IN COME TAX (APPEALS)-35, NEW DELHI {CIT(A)} FOR ASSESSMENT YE AR 2009-10. 2 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT 2.0 THE BRIEF FACTS OF THE CASE ARE THAT THE ASSE SSEE IS ENGAGED IN THE BUSINESS OF INVESTMENT. THE ORIGINAL RETURN OF INCOME WAS FILED DECLARING NIL INCOME WHICH WAS PROCE SSED U/S 143(1) OF THE INCOME TAX ACT, 1961 (HEREINAFTER CAL LED THE ACT). SUBSEQUENTLY, SEARCH AND SEIZURE OPERATION U/S 132 OF THE ACT WAS CONDUCTED IN THE BRAHMAPUTRA GROUP OF CASES ON 28.0 9.2010 AND VARIOUS BOOKS OF ACCOUNTS AND DOCUMENTS INCLUDING T HOSE ALLEGEDLY BELONGING TO THE ASSESSEE WERE FOUND AND SEIZED. SA TISFACTION WAS ALLEGEDLY RECORDED FOR INITIATION OF PROCEEDINGS U/ S 153C R.W.S 153A OF THE ACT AND, THEREAFTER, THE STATUTORY NOTICE WAS ISSUED REQUIRING THE ASSESSEE TO FILE ITS RETURN OF INCOME. IN RESPO NSE THERETO, THE ASSESSEE SUBMITTED THAT THE ORIGINAL RETURN FILED B Y THE ASSESSEE MAY BE TREATED AS HAVING BEEN FILED IN RESPONSE TO THE NOTICE. 2.1 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, I T WAS NOTED THAT THE ASSESSEE HAD RAISED SHARE CAPITAL MO NEY TO THE TUNE FROM THREE KOLKATA BASED COMPANIES. THE ASSESSEE WAS REQUIRED BY THE ASSESSING OFFICER (AO) TO FILE RELEVANT DETAILS AND COUNTERFOILS FOR ISSUE OF SHARE CERTIFICATES AND COPIES OF SHARE APP LICATION FORMS ETC. THE ASSESSEE WAS ALSO REQUIRED TO PRODUCE THE DIRECT ORS OF THE THREE 3 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT COMPANIES FOR THE PURPOSE OF VERIFICATION OF THE GE NUINENESS OF THE INVESTMENT AS CLAIMED. THE ASSESSING OFFICER ALSO R EFERRED TO A REPORT FROM THE INVESTIGATION WING AND OBSERVED THA T AS PER THE REPORT THESE COMPANIES WERE NOT EXISTING AT THE GIV EN ADDRESS AND/OR WERE MERELY EXISTING ON PAPER HAVING NO OFFI CE. THE ASSESSING OFFICER ALSO REFERRED TO THE STATEMENT OF SH. SAMPAT SHARMA, DIRECTOR IN SOME OF THE COMPANIES OF THE BR AHMPUTRA GROUP WHICH WAS RECORDED DURING THE COURSE OF SEARCH PROCEEDINGS WHEREIN HE WAS SAID TO HAVE STATED THAT HE HAD NO ID EA ABOUT HOW THE SHARE CAPITAL/SHARE APPLICATION MONEY WAS RECEIV ED. 2.2 IN RESPONSE TO THE QUERIES RAISED BY THE A SSESSING OFFICER, THE ASSESSEE AGAIN FILED THE CONFIRMATIONS FROM THE THREE PARTIES. HOWEVER, OTHER DETAILS AND DOCUMENTS AS RE QUIRED BY THE ASSESSING OFFICER WERE NOT FILED. THE ASSESSEE ALSO DID NOT PRODUCE THE DIRECTORS OF THE COMPANY. THE ASSESSING OFFICER WAS, THEREFORE, OF THE VIEW THAT THE ASSESSEE HAD FAILED TO DISCHARG E ITS ONUS TO PROVE THE IDENTITY OF THE SHARE APPLICANTS, THEIR C REDITWORTHINESS AND GENUINENESS OF THE TRANSACTIONS IN RESPECT OF T HE SHARE CAPITAL/ SHARE APPLICATION/ SHARE PREMIUM TO THE TUNE OF RS. 1.30 CRORES. 4 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT THE ASSESSING OFFICER HELD THE SAME TO BE UNEXPLAIN ED AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE UNDER THE PR OVISIONS OF SECTION 68 OF THE ACT. 2.3 AGGRIEVED, THE ASSESSEE APPROACHED THE LD. FIR ST APPELLATE AUTHORITY CHALLENGING THE ADDITION ON LEG AL GROUNDS AS WELL AS ON THE MERITS OF THE ADDITION. HOWEVER, THE APPEAL OF THE ASSESSEE WAS DISMISSED BY THE LD. FIRST APPELLATE A UTHORITY. 2.4 AGGRIEVED, THE ASSESSEE IS NOW BEFORE THI S TRIBUNAL AND HAS CHALLENGED THE DISMISSAL OF ITS APPEAL BY THE L D. FIRST APPELLATE AUTHORITY BY RAISING THE FOLLOWING GROUNDS OF APPEAL : 1. THAT BOTH THE NOTICE ISSUED U/S 153C OF THE A CT AND ASSESSMENT FRAMED U/S 153C OF THE ACT WERE WITHOUT SATISFYING THE STATUTORY PRECONDITIONS CONTAINED IN THE ACT AN D THEREFORE WITHOUT JURISDICTION. 1.1 THAT WHILE UPHOLDING THE ASSUMPTION OF JURISDIC TION THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FA ILED TO APPRECIATE THAT SINCE NO MONEY, BULLION JEWELLERY O R OTHER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNTS OR D OCUMENTS BELONGING TO THE APPELLANT WERE SEIZED AS A RESULT OF SEARCH ON BRAHMAPUTRA GROUP., NOTICE ISSUED U/S 153A OF THE A CT WAS ILLEGAL, INVALID AND UNSUSTAINABLE. 1.2 THAT FINDING OF THE LEARNED COMMISSIONER OF INC OME TAX (APPEALS) THAT ANNEXURE A23, A-25 AS REFERRED BY HIM IN THE ORDER AND, ALLEGEDLY SEIZED FROM PREMISES OF M/S BR AHMAPUTRA 5 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT GROUP WERE BELONGING TO THE APPELLANT IS MISCONCEIV ED AND MISPLACED. 1.3 THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS) HAS FAILED TO APPRECIATE THE JUDGMENT OF GUJARAT HI GH COURT IN THE CASE OF VIJAYBHAI N. CHANDRANI VS. ACIT REPORTE D IN 333 ITR 436 WHEREIN IT HAS BEEN HELD THAT, LOOSE PAPERS FOU ND AS A RESULT OF SEARCH CONTAINING APPELLANTS NAME CANNOT BE A BASIS TO ASSUME THAT, SUCH PAPERS BELONG TO THE APPELLANT AND IN ABSENCE THEREOF, CONDITION PRECEDENT FOR ISSUANCE O F NOTICE IS NOT FULFILLED AND AS SUCH ACTION TAKEN U/S 153C OF THE ACT STANDS VITIATED. 1.4 THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS) HAS FAILED TO APPRECIATE THAT IN ABSENCE OF ANY SAT ISFACTION HAVING BEEN RECORDED IN THE CASE OF SEARCHED PERSON , ACTION U/S 153C OF THE ACT WAS IN EXCESS OF JURISDICTION. 1.5 THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS) HAS ALSO FAILED TO APPRECIATE THAT DOCUMENTS AS SEI ZED FROM THE SEARCHED PERSON ARE DISCLOSED DOCUMENTS OF ASSESSEE COMPANY AND ARE NOT INCRIMINATING DOCUMENTS AND AS SUCH, CO ULD NOT OTHERWISE BE MADE A BASIS IN LAW OR ON FACT TO INIT IATE PROCEEDINGS UNDER SECTION 153C OF THE ACT. 1.6 THAT INITIATION OF PROCEEDINGS U/S 153C OF THE ACT AND, FRAMING OF ASSESSMENT U/S 153A/143(3) OF THE ACT IS OTHERWISE TOO BAD IN LAW AND, WITHOUT JURISDICTION SINCE A) THERE HAD BEEN NO SEARCH CONDUCTED ON THE ASSESSEE U/S 132(1) OF THE ACT; B) THERE HAD BEEN NO VALID SATISFACTION NOT RECORDED PRIOR TO ISSUE OF NOTICE, U/S 153C OF THE ACT, AS N ONE HAS BEEN CONFRONTED TO THE APPELLANT COMPANY; AND C) THERE HAD BEEN NO MONEY, BULLION, JEWELLERY OR OTHER VALUABLE OR THING OR BOOKS OF ACCOUNTS OR DOC UMENTS WAS SEIZED AND, BELONGING TO ASSESSEE FROM THE SEAR CHED PERSON (OTHER THAN SUCH BOOKS OF ACCOUNTS AND, DOCU MENTS 6 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT WHICH WERE DULY DISCLOSED) AND IN ANY CASE, NONE OF IT REPRESENTS INCRIMINATING FRESH MATERIAL. 2 THAT SINCE APPROVAL OBTAINED U/S 153D OF THE ACT WAS A MECHANICAL AND, INVALID APPROVAL HAVING BEEN GRANTE D WITHOUT DUE APPLICATION OF MIND TO THE FACTS OF THE ASSESSE E COMPANY, ORDER OF ASSESSMENT MADE U/S 153C/143(3) IS INVALID AND NOT IN ACCORDANCE WITH LAW. 3 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPE ALS) HAS ERRED BOTH IN LAW AND ON FACTS IN SUSTAINING AN ADDITION MADE BY LEARNED DEPUTY COMMISSIONER OF INCOME OF RS . 1,30,00,000/- (RS. 13,00,000/- + RS. 1,17,00,000) ON ACCOUNT OF FOLLOWING SUMS RECEIVED FROM THE SHAREHOLDERS AS SHARE CAPITAL AND SHARE PREMIUM AND ERRONEOUSLY HELD AS UNEXPLAINED CASH CREDITS UNDER SECTION 68 OF THE AC T PARTICULARLY WHEN NO INCRIMINATING MATERIAL EITHER IN THE SHAPE OF UNEXPLAINED CASH OR INVESTMENT OR DOCUMENT HAD B EEN DETECTED AS A RESULT OF SEARCH ON THE APPELLANT COM PANY OR EVEN GATHERED IN THE INSTANT ASSESSMENT PROCEEDINGS: SR. NO. NAME OF THE COMPANY NO OF SHARES NOMINAL VALUE OF SHARE (RS) PREMIUM PAID (RS) AMOUNT (RS) I) MOROTEX FINANCE (P) LTD. 50,000 5,00,000 45,00,000 50,00,000 II) SAHEJ TIE-UP (P) LTD. 30,000 3,00,000 27,00,000 30,00,000 III) VIBGYOR VINIMAY (P) LTD. 50,000 5,00,000 45,00,000 50,00,000 TOTAL 13,00,000 1,17,00,000 1,30,00,000 3.1 THAT WHILE SUSTAINING THE AFORESAID ADD ITION THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS CO MPLETELY OVERLOOKED THAT THERE WAS NO ADVERSE MATERIAL BROUG HT ON RECORD BY THE LEARNED ASSESSING OFFICER TO ASSUME T HAT CREDITS BY WAY OF SHARE CAPITAL REPRESENTS UNEXPLAINED CASH CREDIT AND, BURDEN WHICH LAY UPON THE ASSESSEE IN TERMS OF SECTION 68 OF THE ACT HAD NOT BEEN DISCHARGED. 7 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT 3.2 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) HAS FAILED TO APPRECIATE THAT ONCE THE AFORESAID SH ARE APPLICANT HAD DULY CONFIRMED THE INVESTMENT MADE, HE COULD NO T HAVE UPHELD THE ADDITION ON ARBITRARY GROUNDS AND THAT T OO WITHOUT BRINGING ANY EVIDENCE OR EVEN ALLEGING THAT AFORESA ID CREDITS BY WAY OF SHARE CAPITAL EMANATED FROM THE SOURCE OF FU NDS PROVIDED BY THE APPELLANT COMPANY. 3.3 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) HAS FAILED TO APPRECIATE THAT ALL THE SHAREHOLDERS WERE CORPORATE ENTITIES, DULY ASSESSED TO TAX AND, HAD S UBSCRIBED TO SHARE-CAPITAL BY ACCOUNT PAYEE CHEQUES AND SUPPO RTED BY NECESSARY DOCUMENTS AND THEREFORE, ONCE ALL SUCH SHAREHOLDERS WERE IDENTIFIABLE COMPANIES, SHARE CAP ITAL RECEIVED COULD NOT IN LAW OR ON FACT BE BROUGHT TO TAX U/S 68 OF THE ACT. 3.4 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEA LS) HAS FAILED TO APPRECIATE THAT MERE NON-COMPLIANCE O F SUMMONS BY THE SHARE APPLICANTS OR NON PRODUCTION O F THE SHARE APPLICANTS DURING THE COURSE OF ASSESSMENT PROCEEDINGS, COULD NOT BE A GROUND TO DENOMINATE A GENUINE TRANSACTION AS AN UNEXPLAINED CASH CREDIT UNDER SEC TION 68 OF THE ACT. 3.5 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) HAS ALSO FAILED TO APPRECIATE THAT APPELLANT HAD PL ACED ON RECORD VOLUMINOUS EVIDENCES IN THE SHAPE OF AUDITED FINANCIAL STATEMENT, ANNUAL RETURNS, ORDERS OF ASSE SSMENT OF THE SHARE APPLICANT TO DISCHARGE THE BURDEN WITH RE GARD TO BOTH GENUINENESS OF THE TRANSACTIONS AND CREDITWORT HINESS OF THE SHARE APPLICANTS AND THEREFORE, THERE IN ABSENC E OF ANY WHISPER TO REBUT THE SAID EVIDENCE, THE CREDITS COU LD NOT ARBITRARILY BE REGARDED AS UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF THE ACT. 8 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT 4. THAT BOTH THE AUTHORITIES BELOW HAVE FRAMED THE IMPUGNED ORDER WITHOUT GRANTING SUFFICIENT PROPER OPPORTUNIT Y TO THE APPELLANT COMPANY AND THEREFORE THE SAME ARE CONTRA RY TO PRINCIPLE OF NATURAL JUSTICE AND HENCE VITIATED. 5. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EALS) HAS ERRED BOTH IN LAW AND ON FACTS IN UPHOLDING THE LEV Y OF INTEREST UNDER SECTION 234A, U/S 234B, U/S 234C AND U/S 234D OF THE ACT WHICH ARE NOT LEVIABLE ON THE FACTS AND CIRCUMSTANCES OF THE CASE OF THE APPELLANT COMPANY. IT IS THEREFORE, PRAYED THAT IT BE HELD THAT BOTH T HE ASSESSMENT AND, ADDITION MADE AND CONFIRMED ARE WIT HOUT JURISDICTION AND THEREFORE ALONG-WITH INTEREST LEVI ED BE DELETED AND APPEAL OF THE APPELLANT COMPANY BE ALLO WED. 3.0 AT THE OUTSET, THE LD. AUTHORIZED REPRESE NTATIVE SUBMITTED THAT IN GROUND NO.1, THE ASSESSEE HAS CHALLENGED T HE VALIDITY OF THE NOTICE ISSUED U/S 153C OF THE ACT AND THE ASSESSMEN T FRAMED AS IT WAS FRAMED WITHOUT SATISFYING THE STATUTORY PRE-CONDI TIONS CONTAINED IN THE ACT AND WAS, THEREFORE, WITHOUT JURI SDICTION. THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT IN THE INSTANT CASE, THE ASSESSING OFFICER IN RESPONSE TO AN APPLICATION MOVED UNDER THE RIGHT TO INFORMATION ACT HAS ADMITTED AS UNDER: 1.1 IN THIS REGARD THIS IS TO STATE THAT REQU ISITE INFORMATION OF SATISFACTION NOTE OF BRAHMAPUTRA HOL DING PVT. LTD. (PAN:AACCB 5616N) FOR WHICH ASSESSMENT MA DE 9 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT U/S 153C OF THE INCOME TAX ACT FOR ASSESSMENT YEAR: 2009- 10 IS NOT FOUND IN OUR RECORD. IN CASE, YOU ARE NOT SATISFIED WITH THE ABOVE INFOR MATION YOU MAY FILE AN APPEAL BEFORE THE ADDL. CIT, CENTRA L RANGE-4, ROOM NO. 343, 3 RD FLOOR, E-2, ARA CENTRE, JHANDEWALAN EXTN. NEW DELHI-110 055. 3.1 THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED TH AT THIS REPLY IS PLACED ON AT PAGE 283 OF PAPER BOOK - 2 SU BMITTED BY THE ASSESSEE. IT WAS SUBMITTED THAT IT IS APPARENT THAT THERE IS NO SATISFACTION NOTE IN THE CASE OF THE ASSESSEE AND, THEREFORE, THE PROCEEDINGS WERE ALTOGETHER INVALID. THE LD. AUTHOR IZED REPRESENTATIVE PLACED RELIANCE ON NUMEROUS CASE LAWS AND ALSO CIRCULARS ISSUED BY THE CBDT TO CONTEND THAT SATISF ACTION NOTE BY THE ASSESSING OFFICER OF SEARCHED PERSONS IS PRE-CO NDITION AND IN ABSENCE OF SUCH SATISFACTION, THE ASSESSMENT WILL BE NULL AND VOID. THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT NO N-RECORDING OF SATISFACTION BY THE ASSESSING OFFICER OF THE PERSON S SEARCHED IS NOT CURABLE BY VIRTUE OF PROVISIONS OF SEC.292BB OF THE ACT. THE LD. AUTHORIZED REPRESENTATIVE ALSO ARGUED THAT NO INCRI MINATING 10 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT MATERIAL IN THE CASE OF THE ASSESSEE WAS FOUND DURI NG THE COURSE OF SEARCH AS WAS EVIDENT FROM THE PLAIN READING OF THE ASSESSMENT ORDER. THE LD. AUTHORIZED REPRESENTATIVE ALSO SUBMI TTED THAT THE ASSESSEES CASE FOR ASSESSMENT YEAR 2007-08 (ALSO B EING COVERED UNDER 153C) HAD BEEN DECIDED IN FAVOUR OF THE ASSES SEE BY A CO- ORDINATE BENCH OF THE TRIBUNAL VIDE ORDER DATED 29. 05.2018 IN ITA NO.3330/DEL/2017. WHILE REFERRING TO THE ORDER OF T HE ITAT, THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED THAT IN THIS OR DER, THE ITA HAD DISCARDED THE EVIDENTIARY VALUE OF THE STATEMENT OF SHRI SAMPAT SHARMA. THE AUTHORIZED REPRESENTATIVE SUBMITTED THA T IN VIEW OF THE SETTLED PRECEDENT IN THE EARLIER ASSESSMENT YEA R IN ASSESSEES OWN CASE, THE APPEAL FOR THIS YEAR ALSO DESERVED TO BE ALLOWED. 4.0 IN RESPONSE, THE LD. SR. DEPARTMENTAL REPRESEN TATIVE SUBMITTED THAT IT IS A FACT ON RECORD THAT THE THRE E INVESTING COMPANIES WHO HAD ALLEGEDLY SUBSCRIBED TO THE SHARE CAPITAL DID NOT EXIST AT THE ADDRESSES PROVIDED AND MERELY EXIS TED ON PAPER, HAVING NO OFFICE. IT WAS SUBMITTED THAT, THEREFORE, IT WAS APPARENT THAT THE IMPUGNED TRANSACTIONS WERE NOT GENUINE AND THAT THE 11 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT CREDITWORTHINESS AND IDENTITY OF THE COMPANIES COULD NOT BE ESTABLISHED. THE LD. DEPARTMENTAL REPRESENTATIVE AL SO REFERRED TO THE STATEMENT OF SHRI SAMPAT SHARMA AND SUBMITTED T HAT THE DIRECTOR HIMSELF HAD ADMITTED THAT HE HAD NO IDEA A BOUT THE SOURCE OF SHARE CAPITAL. THE LD. SR. DR ALSO REFERRED TO T HE OBSERVATIONS OF THE LD. CIT (A) ON THE SATISFACTION NOTE AS CONTAIN ED IN PAGE-5 OF THE IMPUGNED ORDER WHEREIN IT HAS BEEN OBSERVED THAT DUR ING THE SEARCH ACTION ON BRAHAMPUTRA GROUP OF COMPANIES, IN CRIMINATING DOCUMENTS/MATERIAL SUCH AS ANNEXURE A-23, A-25 BELO NGING TO THE APPELLANT COMPANY WERE FOUND AND SEIZED. IT WAS ALSO SUBMITTED THAT THE LD. CIT (A) HAS MADE A SPECIFIC OBSERVATIO N THAT THERE WAS A PROPER RECORDING OF SATISFACTION NOTE FOR INITIAT ION OF ACTION U/S 153C BY THE ASSESSING OFFICER. THE LD. SR. DR SAID THAT, THUS, IT WAS EVIDENT THAT THE INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH AND IT WAS ALSO EVIDENT THAT THE S ATISFACTION NOTE HAD BEEN RECORDED IN THE CASE OF THE ASSESSEE AND, THEREFORE, THE RESULTANT PROCEEDINGS WERE VALID. THE LD. SR. DR SUB MITTED THAT THE ASSESSEE SHOULD BE DIRECTED TO ARGUE THE CASE ON ME RITS RATHER THAN TRYING TO SEEK RELIEF BY RESORTING TO UNSUBSTANTIAT ED LEGAL GROUNDS. 12 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT 5.0 WE HAVE HEARD THE RIVAL SUBMISSIONS AND HA VE ALSO PERUSED THE MATERIAL ON RECORD. WE HAVE ALSO GONE T HROUGH THE REPLY OF THE ASSESSING OFFICER RECEIVED IN RESPONSE TO THE APPLICATION MOVED UNDER THE RIGHT TO INFORMATION ACT BY THE ASS ESSEE REGARDING THE RECORDING OF SATISFACTION NOTE. THE SAID REPLY IS BEING REPRODUCED AGAIN FOR A READY REFERENCE: 1.1 IN THIS REGARD THIS IS TO STATE THAT REQUISITE INFORMATION OF SATISFACTION NOTE OF BRAHMAPUTRA HOLDING PVT. LT D. (PAN:AACCB 5616N) FOR WHICH ASSESSMENT MADE U/S 153C OF THE INCOME TAX ACT FOR ASSESSMENT YEAR: 200 9-10 IS NOT FOUND IN OUR RECORD. IN CASE, YOU ARE NOT SATISFIED WITH THE ABOVE INFOR MATION YOU MAY FILE AN APPEAL BEFORE THE ADDL. CIT, CENTRA L RANGE-4, ROOM NO. 343, 3 RD FLOOR, E-2, ARA CENTRE, JHANDEWALAN EXTN. NEW DELHI-110 055. 5.1 THUS, AS PER THE REPLY TO THE ASSESSEES APPLI CATION UNDER THE RIGHT TO INFORMATION ACT, IT IS THE ASSESSING O FFICERS STATEMENT THAT THE SATISFACTION NOTE IS NOT FOUND IN THE RECO RDS OF THE DEPARTMENT. HOWEVER, THE SAID REPLY DOES NOT SAY AS TO WHETHER 13 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT SUCH SATISFACTION NOTE WAS RECORDED AT ALL OR NOT. T HIS IS A QUESTION WHICH GOES TO THE VERY FOUNDATION OF THE ASSESSMENT FRAMED IN THE INSTANT CASE. IT IS OUR CONSIDERED OPINION THAT IT WILL BE IN THE FITNESS OF THINGS, IF THE ISSUE IS RESTORED TO THE FILE OF THE LD. CIT (A) FOR ASCERTAINING FROM THE RECORDS AS TO WHETHER THE SATISFACTION NOTE WAS ACTUALLY RECORDED IN THIS CASE AS PER THE REQUIR EMENT OF LAW OR NOT. THE LD. CIT (A) IS DIRECTED TO ADJUDICATE THE APPEAL AS PER THE SETTLED LAW AFTER SPECIFICALLY RECORDING HIS FINDING ON THE RECORDING OF THE SATISFACTION NOTE. THE LD. CIT (A) SHALL PROVID E PROPER OPPORTUNITY TO THE ASSESSEE TO PRESENT ITS CASE BEF ORE PROCEEDING TO ADJUDICATE THE ISSUE AS PER OUR DIRECTIONS. WE ALSO MAKE IT CLEAR THAT WE ARE NOT EXPRESSING ANY OPINION ON THE MERITS OF THE CASE AT THIS JUNCTURE. 6.0 IN THE FINAL RESULT, THE APPEAL OF THE ASSESSE E STANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 31/08/2020. SD/- SD /- (PRASHANT MAHARISHI) (SUDHANSHU SRIVASTAVA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 31/08/2020 14 ITA NO.3331/DEL/2017 M/S. BRAHMAPUTRA HOLDINGS (P) LTD., VS . DCIT PK/PS COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI