M/s Vision Promoters & Builders (P) Ltd., Mohali V. CIT, Gurgaon

ITA 401/CHANDI/2012

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 6796 (ITAT-CHANDIGARH)
• Duration Of Justice: 5 year(s) 5 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 09-03-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 09-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAVI SARANGA L
• Keywords: Document seized; Deemed dividend; Documents seized
• Section: 143(3); 148; 263; 132; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, B CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND DR. B.R.R.KUMAR, ACCOUNTANT MEMBER ITA NO. 401/CHD/2012 ASSESSMENT YEAR: 2007-08 M/S VISION PROMOTERS & VS THE CIT, BUILDERS (P) LTD., (CENTRAL), HOUSE NO. 123, GURGAON. PHASE 3B1, MOHALI. PAN: AACCV1050E & ITA NO. 483/CHD/2013 ASSESSMENT YEAR: 2007-08 THE DCIT, VS M/S VISION PROMOTERS & CENTRAL CIRCLE-1, BUIL DERS (P) LTD., CHANDIGARH. HOUSE NO. 123, PHASE 3B1, MOHALI. PAN: AACCV1050E (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI PARIKSHIT AGGA RWAL RESPONDENT BY : SHRI RAVI SARANGAL, CIT-DR DATE OF HEARING : 20.09.2017 DATE OF PRONOUNCEMENT : 28.09.2017 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE ABOVE CAPTIONED ARE TWO APPEALS, ONE BY THE ASSESSEE AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (HEREINAFTER REFERRED TO AS CIT) DATED 06.02.2012 PASSED UNDER SECTION 263 OF INCOME TAX A CT 2 AND THE OTHER IS BY THE REVENUE AGAINST THE ORDER O F THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HEREINAFTE R REFERRED TO AS CIT(APPEALS) DATED 28.02.2013 IN REL ATION TO QUANTUM ASSESSMENT. SINCE THE PRESENT APPEALS A RE RELATING TO THE SAME ASSESSEE AND THE SAME ASSESSME NT YEAR I.E. ASSESSMENT YEAR 2007-08, HENCE THESE WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY THIS COMMON ORDER. FOR THE SAKE OF CONVENIENCE, FACTS H AVE BEEN TAKEN FROM ASSESSEE'S APPEAL ITA NO. 401/CHD/2012. 2. THE BRIEF FACTS RELATING TO THE MATTER UNDER CONSIDERATION ARE THAT A SEARCH & SEIZURE ACTION UN DER SECTION 132 OF INCOME TAX ACT WAS CARRIED OUT AT TH E PREMISES OF ONE M/S S.L. ARORA GROUP ON 10.08.2006. DURING THE COURSE OF SEARCH, CERTAIN DOCUMENTS WERE FOUND AND SEIZED. IT WAS NOTICED THAT SOME OF THE DOCUMENTS WHICH WERE SEIZED FROM THE PREMISES OF M/ S S.L. ARORA GROUP OF CASES WERE ALSO RELATED TO THE ASSESSEE M/S VISION PROMOTERS & BUILDERS PVT. LTD. RELATING TO CERTAIN SALE AND PURCHASE OF PROPERTY B Y THE ASSESSEE. THEREAFTER, ASSESSEE'S CASE WAS COVERED UNDER SECTION 153C OF THE ACT AND ACCORDINGLY, ASSESSMENT WAS COMPLETED IN THE CASE OF THE ASSESSEE BY THE ASSESS ING OFFICER (IN SHORT AO) VIDE ORDER DATED 13.12.2009 U NDER SECTION 143(3) READ WITH SECTION 153C OF INCOME TAX ACT. IT IS PERTINENT TO MENTION HERE THAT IN THE SAID ASSESSMENT PROCEEDINGS UNDER SECTION 153C OF THE AC T, 3 NO ADDITION ON CAPITAL GAINS WAS MADE BY THE ASSESS ING OFFICER IN RELATION TO THE SALE AND PURCHASE OF PRO PERTIES. HOWEVER, CERTAIN OTHER ADDITIONS WERE MADE ON ACCOU NT OF DISALLOWANCE OF CERTAIN EXPENDITURE. THEREAFTER , THE LD. CIT (CENTRAL) EXERCISING HIS REVISION JURISDICT ION UNDER SECTION 263 OF THE ACT, PASSED AN ORDER UNDER SECTION 263 OF THE ACT DIRECTING THE ASSESSING OFFI CER TO MAKE CERTAIN ADDITIONS ON ACCOUNT OF CAPITAL GAINS AND ON ACCOUNT OF DEEMED DIVIDEND UNDER SECTION 115 OF THE ACT. THE ASSESSEE PREFERRED THE PRESENT APPEAL AGAI NST THE ORDER OF CIT UNDER SECTION 263 OF THE ACT. 3. HOWEVER, IN THE MEANTIME, THE ASSESSING OFFICER PASSED A FRESH ASSESSMENT ORDER GIVING EFFECT TO TH E ORDER OF LD. CIT PASSED UNDER SECTION 263 OF THE ACT. TH E ASSESSEE ALSO PREFERRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY AGAINST THE SAID ORDER DATED 22.02.2012 PASSED BY THE ASSESSING OFFICER GIVING E FFECT TO THE ORDER OF THE CIT U/S 263 OF THE ACT. IT WAS CONTENDED IN THE SAID APPEAL BEFORE THE LD. CIT (AP PEALS) THAT NO OPPORTUNITY OF HEARING WAS GIVEN TO THE ASS ESSEE WHILE MAKING THE FRESH ASSESSMENT WHILE GIVING EFFE CT TO THE ORDER OF THE CIT PASSED UNDER SECTION 263 OF TH E ACT. THE LD. CIT(APPEALS), AFTER CONSIDERING THE SUBMISS IONS OF THE ASSESSEE OBSERVED THAT THE PRINCIPLES OF NAT URAL JUSTICE WERE VIOLATED WHILE FRAMING THE FRESH ASSES SMENT. EVEN NO NOTICE WAS ISSUED TO THE ASSESSEE BY THE ASSESSING OFFICER WHILE FRAMING THE SAID ASSESSMENT . HE, 4 THEREFORE, HELD THAT THE ORDER PASSED BY THE ASSESS ING OFFICER WAS NOT IN CONFORMITY WITH THE LAW; HE, ACCORDINGLY, QUASHED THE SAID ASSESSMENT ORDER DATE D 22.02.2012. THE REVENUE HAS COME IN APPEAL AGAINS T THE SAID ORDER OF THE LD. CIT (APPEALS). ITA NO. 401/2012 (ASSESSEE'S APPEAL ) 4. NOW COMING TO THE ASSESSEE'S APPEAL RELATING TO THE VALIDITY OF THE ORDER PASSED UNDER SECTION 263 OF T HE ACT, THE ASSESSEE HAS NOT ONLY CONTESTED THE VALIDITY OF THE IMPUGNED ORDER PASSED UNDER SECTION 263 OF THE ACT BUT ALSO THE VERY VALIDITY OF THE ASSESSMENT ORDER PASS ED UNDER SECTION 153C OF THE ACT IN RELATION TO WHICH THE IMPUGNED ORDER U/S 263 HAS BEEN PASSED BY THE CIT. APART FROM THAT, THE ASSESSEE HAS ALSO CONTESTED TH E DIRECTIONS OF THE CIT FOR MAKING ADDITIONS INTO THE INCOME OF THE ASSESSEE ON ACCOUNT OF CAPITAL GAINS AND DEEMED DIVIDEND, AS DISCUSSED ABOVE. 5. BOTH THE LD. REPRESENTATIVES OF THE PARTIES HAVE SUBMITTED THAT THE LEGAL ISSUE REGARDING THE VALID ITY OF INVOKING OF REVISION JURISDICTION BY THE CIT UNDER SECTION 263 OF THE ACT BE HEARD AND DECIDED FIRST BEFORE PROCEEDING TO DECIDE THE MERIT OF THE ADDITIONS SO DIRECTED BY THE CIT TO BE MADE INTO THE INCOME OF T HE ASSESSEE. HENCE, WE PROCEED TO DECIDE THE LEGAL IS SUE REGARDING THE VALIDITY OF THE INVOCATION OF JURISDI CTION BY LD. CIT UNDER SECTION 263 OF THE ACT. 5 6. THE LD. COUNSEL FOR THE ASSESSEE IN THIS RESPECT HAS STATED THAT THE LD. CIT HAS INVOKED THE JURISDICTIO N UNDER SECTION 263 OF THE ACT IN RESPECT OF ORDER PASSED B Y THE ASSESSING OFFICER UNDER SECTION 153C OF THE ACT PURSUANCE TO THE SEARCH ACTION IN THE CASE OF CERTA IN OTHER PERSONS NAMELY M/S S.L. ARORA GROUP OF CASES, LD. COUNSEL HAS CONTENDED THAT AS REQUIRED UNDER THE PROVISIONS OF SECTION 153C OF THE ACT, THE ASSESSIN G OFFICER OF THE ASSESSEE COULD NOT HAVE ASSUMED THE JURISDICTION UNDER SECTION 153C OF THE ACT WITHOUT RECORDING A SATISFACTION IN THE CASE OF SEARCHED PE RSON. HE, IN THIS RESPECT HAS RELIED UPON THE LETTER DATE D 28.07.2016 OF THE DY. CIT WHICH IS A REPLY TO THE APPLICATION DATED 29.06.2016 MOVED BY THE ASSESSEE UNDER RIGHT TO INFORMATION ACT, 2005. IN HIS APPLI CATION DATED 29.06.2016, THE ASSESSEE HAD REQUESTED TO PRO VIDE THE INFORMATION AS TO WHETHER A SATISFACTION NOTE W AS RECORDED IN THE CASE OF THE SEARCHED PERSON I.E. M/ S S.L. ARORA GROUP BEFORE INITIATING PROCEEDINGS UNDER SEC TION 153C OF THE ACT IN THE CASE OF THE ASSESSEE. THE S AID QUERY WAS REPLIED BE THE DY. CIT VIDE LETTER DATED 28.07.2016, THE CONTENTS OF WHICH FOR THE PURPOSE O F READY REFERENCE ARE HEREBY REPRODUCED AS UNDER: 3. THE APPLICATION OF THE APPLICANT HAS BEEN CONSIDERED. IN VIEW OF THIS POINTWISE REPLY IS AS UNDER:- (I) IT IS TO CONVEY THAT THE SATISFACTION NOTE RECORDED BEFORE INITIATING PROCEEDINGS U/S 153C HAVE ALREADY BEEN PROVIDED TO YOU VIDE ORDER DATED 16.6.2016. ON EXAMINATION OF 6 SATISFACTION NOTE IT IS CLEAR THAT THE DOCUMENTS REFERRED IN SATISFACTION NOTE WERE SEIZED FROM THE RESIDENTIAL PREMISES OF SH. S.L. ARORA RESIDENT OF #123, PHASE-3B1, MOHALI AND H. NO. 4918 PANCHNAMA SOCIETY, SECTOR 68, MOHALI. FURTHER IT IS ALSO CLEAR THAT SHRI S.L. ARORA IS ALSO ONE OF THE MAJOR DIRECTOR / SHARE HOLDER IN ASSESSEE COMPANY M/S VISION LAND PROMOTER & BUILDERS PVT LTD. (II) FURTHER IT IS CONVEY THAT THE ASSESSING OFFICER OF SHRI S.L. ARORA AND M/S VISION LAND PROMOTERS & BUILDERS PVT LTD WERE THE SAME AND SHRI S.L. ARORA IS ONE OF THE DIRECTOR OF ASSESSEE COMPANY. THERE WAS NO NEED TO TRANSFER THE DOCUMENTS TO ANY OTHER OFFICER AND TO RECORD A SEPARATE A SATSIFCITON NOTE IN THE CASE OF SHRI S.L. ARORA. 7. A PERUSAL OF THE ABOVE REPRODUCED LETTER REVEALS THAT NO SEPARATE SATISFACTION NOTE WAS RECORDED IN THE C ASE OF SEARCHED PERSON THAT THE SEIZED DOCUMENTS BELONGED TO THE ASSESSEE AND THAT THE SAME WILL HAVE A BEARING ON THE DETERMINATION OF THE TOTAL INCOME OF THE ASSESSEE. HOWEVER, IT HAS BEEN FURTHER POINTED OUT THAT A SATISFACTION NOTE WAS RECORDED IN THE CASE OF THE ASSESSEE, COPY OF WHICH HAS ALREADY BEEN PROVIDED T O THE ASSESSEE. FURTHER, THAT SINCE THE ASSESSING OFFICE R OF THE SEARCHED PERSON M/S S.L. ARORA GROUP OF CASES AND OF THE ASSESSEE WERE THE SAME, HENCE, THERE WAS NO NEE D TO TRANSFER THE DOCUMENTS TO ANY OTHER OFFICER OF SEAR CHED PERSON. THE LD. COUNSEL AT THIS STAGE HAS RELIED U PON THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE O F CIT VS M/S CALCUTTA KNITWEARS (2014) 362 ITR 673 (S.C) WHEREIN THE HON'BLE SUPREME COURT HAS HELD THAT BEF ORE INITIATING PROCEEDINGS UNDER SECTION 158BD OF THE A CT, 7 THE ASSESSING OFFICER WHO HAS INITIATED PROCEEDINGS FOR COMPLETION OF THE ASSESSMENT UNDER SECTION 158BC OF THE ACT, SHOULD BE SATISFIED THAT THERE IS AN UNDISCLOS ED INCOME WHICH HAS BEEN TRACED OUT WHEN A PERSON WAS SEARCHED UNDER SECTION 132 OF THE ACT OR THE BOOKS OF ACCOUNT WERE REQUISITIONED UNDER SECTION 132A OF TH E ACT WITH SECTION 158BD, EXISTENCE OF COGENT AND DEMONSTRATIVE MATERIAL IS GERMANE TO THE ASSESSING OFFICERS SATISFACTION IN CONCLUDING THAT THE SEIZE D DOCUMENTS BELONGED TO A PERSON OTHER THAN THE SEARC HED PERSON IS NECESSARY FOR INITIATION OF ACTION UNDER SECTION 158BD OF THE ACT. 8. THE LD. COUNSEL HAS FURTHER RELIED UPON THE FOLLOWING DECISIONS WHEREIN IT HAS BEEN HELD BY VAR IOUS HIGH COURTS THAT THE PROVISIONS OF SECTION 153C OF THE ACT ARE SUBSTANTIALLY SIMILAR/PARI-MATERIA TO THE PROVISIONS OF SECTION 158BD AND THEREFORE, THE PROPOSITION OF LAW LAID DOWN BY THE HON'BLE SUPREME COURT IN RELATION TO THE PROVISIONS OF SECTION 158B D READ WITH SECTION 158BC SHALL ALSO APPLY TO THE PROCEEDI NGS UNDER SECTION 153C OF THE ACT FOR THE PURPOSE OF ASSESSMENT OF INCOME OF A PERSON OTHER THAN THE SEARCHED PERSON : 1. CLT VS M/S MECHMEN 11-C (2016) 380 ITR 591 (MP HC) 2. CIT VS M/S RRJ SECURITIES LTD (2016) 380 ITR 612 (DEL HC) 8 3. P.R.CIT-CENTRAL II VS. AAKASH AROGYA MANDIR P.LTD ITA 509/2015 DATED 28.07.2015 (DEL HC) 9. THE LD. COUNSEL HAS FURTHER RELIED UPON CIRCULAR NO. 24 OF 2015 DATED 31.12.2015 OF CBDT WHICH READS AS UNDER: CIRCULAR NO. 24/2015 F.NO.279/MISC./140 /2015/ITJ GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE CENTRAL BOARD OF DIRECT TAXES NEW DELHI, 31ST DECEMBER, 2015 SUBJECT: RECORDING OF SATISFACTION NOTE UNDER SECTI ON 158BD/153C OF THE ACT - REG.- THE ISSUE OF RECORDING OF SATISFACTION FOR THE PURP OSES OF SECTION 158BD/153C HAS BEEN SUBJECT MATTER OF LITIGATION. 2. THE HON'BLE SUPREME COURT IN THE CASE OF M/S CAL CUTTA KNITWEARS IN ITS DETAILED JUDGMENT IN CIVIL APPEAL NO.3958 OF 2014 DATED 12.3.2014(AVAILA BLE IN NJRS AT 2014-LL-0312-51) HAS LAID DOWN THAT FOR THE PURPOSE OF SECTION 158BD OF THE A CT, RECORDING OF A SATISFACTION NOTE IS A PREREQUISITE AND THE SATISFACTION NOTE MUST BE PREP ARED BY THE AO BEFORE HE TRANSMITS THE RECORD TO THE OTHER AO WHO HAS JURISDICTION OVER SUCH OTHE R PERSON U/S 158BD. THE HON'BLE COURT HELD THAT 'THE SATISFACTION NOTE COULD BE PREPARED AT AN Y OF THE FOLLOWING STAGES: (A) AT THE TIME OF OR ALONG WITH THE INITIATION OF PROCEEDINGS AGAINST THE SEARCHED PERSON UNDER SECTION 158BC OF THE ACT; OR (B) IN THE COURSE OF T HE ASSESSMENT PROCEEDINGS UNDER SECTION 158BC OF THE ACT; OR (C) IMMEDIATELY AFTER THE ASSE SSMENT PROCEEDINGS ARE COMPLETED UNDER SECTION 158BC OF THE ACT OF THE SEARCHED PERSON.' 3. SEVERAL HIGH COURTS HAVE HELD THAT THE PROVISION S OF SECTION 153C OF THE ACT ARE SUBSTANTIALLY SIMILAR/PARI-MATERIA TO THE PROVISIONS OF SECTION 1 58BD OF THE ACT AND THEREFORE, THE ABOVE GUIDELINES OF THE HON'BLE SC, APPLY TO PROCEEDINGS U/S 153C OF THE IT ACT, FOR THE PURPOSES OF ASSESSMENT OF INCOME OF OTHER THAN THE SEARCHED PER SON. THIS VIEW HAS BEEN ACCEPTED BY CBDT. 4. THE GUIDELINES OF THE HON'BLE SUPREME COURT AS R EFERRED TO IN PARA 2 ABOVE, WITH REGARD TO RECORDING OF SATISFACTION NOTE, MAY BE BROUGHT TO T HE NOTICE OF ALL FOR STRICT COMPLIANCE. IT IS FURTHER CLARIFIED THAT EVEN IF THE AO OF THE SEARCH ED PERSON AND THE 'OTHER PERSON' IS ONE AND THE SAME, THEN ALSO HE IS REQUIRED TO RECORD HIS SATISF ACTION AS HAS BEEN HELD BY THE COURTS. 5. IN VIEW OF THE ABOVE, FILING OF APPEALS ON THE I SSUE OF RECORDING OF SATISFACTION NOTE SHOULD ALSO BE DECIDED IN THE LIGHT OF THE ABOVE JUDGEMENT . ACCORDINGLY, THE BOARD HEREBY DIRECTS THAT PENDING LITIGATION WITH REGARD TO RECORDING OF SATI SFACTION NOTE UNDER SECTION 158BD /153C SHOULD BE WITHDRAWN/NOT PRESSED IF IT DOES NOT MEET THE GUIDELINES LAID DOWN BY THE APEX COURT. (RAMANJIT KAUR SETHI) DCIT (OSD) (ITJ), CBDT, NEW DELHI. 9 10. THE LD. COUNSEL, THEREAFTER HAS STRESSED THAT T HE CIRCULARS ISSUED BY CBDT ARE BINDING ON THE ASSESSI NG OFFICER. THAT SINCE NO SATISFACTION NOTE WAS RECORD ED IN THE CASE OF SEARCHED PERSON, THEREFORE, IN THE LIGH T OF THE PROPOSITION OF LAW LAID DOWN BY HON'BLE SUPREME COU RT IN THE CASE OF CALCUTTA KNITWEARS (SUPRA) AND AS LAID DOWN BY VARIOUS HIGH COURTS AND ALSO AS PER THE CBDT CIRCULAR(SUPRA), THE VERY INITIATION OF ASSESSMENT PROCEEDINGS UNDER SECTION 153C OF THE ACT IN THE CA SE OF THE ASSESSEE WERE INVALID AND THE ASSESSMENT ORDER PASSED UNDER SECTION 153C OF THE ACT IN THE CASE OF THE ASSESSEE WAS ILLEGAL AND NULLITY IN THE EYES OF LAW . HE, THEREAFTER, HAS CONTENDED THAT ANY SUBSEQUENT ORDER PASSED IN CONTEXT OR IN RELATION TO OR MODIFYING TH E SAID NULL AND VOID ORDER WOULD ALSO BE ILLEGAL AND VOID AND FURTHER THAT THE JURISDICTION OR THE LEGALITY OF TH E PRIMARY / BASE PROCEEDINGS CAN ALSO BE CHALLENGED IN THE SUBSEQUENT/COLLATERAL PROCEEDINGS ALSO. HE, ACCORDI NGLY, HAS CONTENDED THAT THE SUBSEQUENT ORDER PASSED UNDE R SECTION 263 OF THE ACT BY THE LD. CIT MODIFYING OR DIRECTING TO PASS A FRESH ORDER UNDER SECTION 153C MAKING CERTAIN ADDITIONS WAS ALSO NULL AND VOID. HE, IN THIS RESPECT HAS RELIED UPON THE FOLLOWING CASE LAW S : I) M/S WESTLIFE DEVELOPMENT LTD VS PR.CIT (201 6) 49 ITR 406 (MUM TRIB) II) VALIANT GLASS WORKS VS. ACIT ITA 1612/MUM/2013 DATED 27.07.2016 III) STEEL STRIPS LTD VS ACIT (1995) 53 ITR 553 (CHD TRI B) IV) P V DOSHI VS CIT (1978) 113 ITR 0022 (GUJ HC) 10 V) CIT VS INCOME TAX APPELLATE TRIBUNAL & ORS (2012) 7 8 DTR 113 (DEL HC) VI) MAVANY BROTHERS VS CIT TAX APPEAL NO. 8 OF 2007 DAT ED 17.04.2015 11. THE LD. DR, ON THE OTHER HAND, HAS RELIED UPON THE FINDINGS OF THE LD. CIT AND HAS SUBMITTED THAT THE LD. CIT HAS RIGHTLY INVOKED THE REVISION JURISDICTION U /S 263 OF THE ACT. 12. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HA VE ALSO GONE THROUGH THE RECORD. SO FAR AS THE QUESTION AS TO WHETHER THE LEGALITY OR VALIDLY TO THE ORIGINAL ORD ER PASSED U/S 153C OF THE ACT CAN BE CHALLENGED BY THE ASSESS EE IN THIS APPEAL CONTESTING THE EXERCISE OF REVISION JURISDIC TION U/S 263 OF THE ACT IS CONCERNED, THE ISSUE IS NO MORE R ES INTEGRA IN THE LIGHT OF THE VARIOUS CASE LAWS RELIED UPON B Y THE LD. COUNSEL OF THE ASSESSEE AS MENTIONED IN PARA 10 ABO VE. NOW COMING TO THE QUESTION OF VALIDITY OF ORIGINAL PROC EEDINGS CARRIED OUT U/S 153 OF THE ACT, ADMITTEDLY, IN THIS CASE THE SEARCH ACTION WAS CARRIED OUT UNDER SECTION 132 OF THE ACT IN THE CASE OF M/S S.L. ARORA GROUP. AS PER THE LAW, LAID DOWN BY HON'BLE SUPREME COURT IN THE CASE OF M/S CALCUTT A KNITWEARS (SUPRA), THE ASSESSING OFFICER OF THE SEA RCHED PERSON IS REQUIRED TO RECORD SATISFACTION; THE RELE VANT PART OF THE ORDER IS REPRODUCED AS UNDER: WE WOULD CERTAINLY SAY THAT BEFORE INITIATING PROC EEDINGS UNDER SECTION 158BD OF THE ACT, THE ASSESSING OFFICER WHO HAS INITIATED PROCEEDINGS FOR COMPLETION OF THE ASSESSMENTS UNDER SECTION 158BC OF 11 THE ACT SHOULD BE SATISFIED THAT THERE IS AN UNDISC LOSED INCOME WHICH HAS BEEN TRACED OUT WHEN A PERSON WAS SEARCHED UNDER SE CTION 132 OR THE BOOKS OF ACCOUNTS WERE REQUISITIONED UNDER SECTION 132A OF THE ACT. THIS IS IN CONTRAST TO THE PROVISIONS OF SECTION 14 8 OF THE ACT WHERE RECORDING OF REASONS IN WRITING ARE A SINE QUA NON. UNDER SECTION 158BD THE EXISTENCE OF COGENT AND DEMONSTRATIVE MAT ERIAL IS GERMANE TO THE ASSESSING OFFICERS' SATISFACTION IN CONCLUDI NG THAT THE SEIZED DOCUMENTS BELONG TO A PERSON OTHER THAN THE SEARCHE D PERSON IS (T) NECESSARY FOR INITIATION OF ACTION UNDER SECTION 15 8BD. 13. FURTHER, VARIOUS HIGH COURTS, AS DISCUSSED ABOVE, HAVE HELD THAT THE PROVISIONS OF SECTION 153 C ARE IDENTICAL AND ARE IN PARI-MATERIA TO THAT OF SECTIO N 158BD OF THE ACT AND THAT THE PROPOSITION OF LAW LA ID DOWN BY HON'BLE SUPREME COURT REGARDING SATISFACTIO N NOTE AS PER THE PROVISIONS OF SECTION 158BD WOULD A LSO APPLY TO THE PROVISIONS OF SECTION 153C OF THE ACT. RELIANCE IN THIS RESPECT CAN ALSO BE PLACED ON THE DECISION OF THE MADHYA PRADESH HIGH COURT IN THE CA SE OF CIT VS M/S MECHMEN (SUPRA). FURTHER, IT IS ALSO NO W SETTLED PROPOSITION OF LAW THAT IN A CASE WHERE THE ASSESSING OFFICER OF THE SEARCHED PERSON AS WELL AS THAT OTHER PERSON, IN CASE OF WHOM THE ASSESSMENT U/S 15 3C IS CONTEMPLATED, IS ONE AND THE SAME, THE SATISFACT ION WOULD HAVE TO BE RECORDED SEPARATELY QUA THE SEARCH ED PERSON. EVEN ASSUMING THAT NO HANDING OVER OF DOCUMENTS IS REQUIRED, RECORDING OF SATISFACTION IS A MUST, AS, THAT IS THE FOUNDATION, UPON WHICH SUBSEQ UENT PROCEEDINGS AGAINST OTHER PERSON ARE INITIATED. THE HANDING OVER OF DOCUMENTS ETC. IN SUCH A CASE MAY O R MAY NOT BE OF MUCH RELEVANCE BUT THE RECORDING OF 12 SATISFACTION IS STILL REQUIRED AND IN FACT IS MANDA TORY. IT HAS ALSO BEEN CATEGORICALLY HELD SO IN THE CBDT CIR CULAR NO. 24/2015 (SUPRA.) EVEN THE CBDT HAS DIRECTED THE CONCERNED OFFICERS THAT PENDING LITIGATION WITH REG ARD TO RECORDING OF SATISFACTION NOTE UNDER SECTION 158BD/UNDER SECTION 153C SHOULD BE WITHDRAWN/NOT PRESSED, IF IT DOES NOT MEET THE GUIDELINES LAID DO WN BY THE APEX COURT. THE CIRCULAR OF THE BOARD, THOUGH I S NOT BINDING ON THIS TRIBUNAL BUT SAME IS BINDING ON THE DEPARTMENT. 14. IN VIEW OF THE PROPOSITION OF LAW AS LAID DOWN BY HON'BLE SUPREME COURT AND VARIOUS HIGH COURTS AS DISCUSSED ABOVE, AND ALSO IN VIEW OF THE CBDT CIRCU LAR NO. 24 OF 2015 (SUPRA), WE HAVE NO HESITATION TO HO LD THAT BECAUSE OF THE LEGAL PROPOSITION LAID DOWN BY THE VARIOUS COURTS AND IN THE LIGHT OF CBDT CIRCULAR, T HE VERY ASSUMING OF JURISDICTION AND INITIATION OF ASSESSME NT PROCEEDINGS IN THE CASE OF THE ASSESSEE UNDER SECTI ON 153C OF THE ACT WAS BAD IN LAW AND SUBSEQUENT ASSESSMENT ORDER PASSED UNDER SECTION 153C OF THE A CT IS NULL AND VOID AND IS TO BE TREATED AS NONEST IN THE EYES OF LAW. SINCE THE BASE ORDER PASSED U/S 153C OF THE ACT HAS BEEN HELD TO BE NULL AND VOID, THE SUBSEQUENT REVISION ORDER PASSED BY THE CIT U/S 263 OF THE ACT IS ALSO ACCORDINGLY HELD TO BE VOID. THE ASSESSEE, THE REFORE, SUCCEEDS ON THE LEGAL ISSUE. 13 15. NOW COMING TO THE APPEAL OF THE REVENUE IN ITA NO. 483/CHD/2013 RELATING TO ASSESSMENT YEAR 2007-08. THE SAME IS THE OFFSHOOT OF THE ASSESSMENT PROCEEDI NGS CARRIED OUT BY THE ASSESSING OFFICER WHILE GIVING E FFECT TO THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX U/S 263 OF THE ACT. SINCE WE HAVE ALREADY QUASHED THE ORDER OF THE CIT U/S 263 OF THE ACT, HENCE, THE SUBSEQUENT PROCEEDINGS CARRIED OUT IN COMPLIANCE OF THE SAID O RDER HAVE NO LEGS TO STAND AND ACCORDINGLY THE SAME ARE HEREBY QUASHED. THE APPEAL OF THE REVENUE, THUS, HA VING BECOME INFRUCTUOUS, IS HEREBY DISMISSED. 16. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS HE REBY ALLOWED AND THAT OF THE REVENUE IS HEREBY DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT 28.09.2017. SD/- SD/- (DR. B.R.R. KUMAR) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 28 SEPT, 2017. RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. THE CIT 5. THE DR ASSISTANT REGISTRAR, ITAT/CHD