M/s. Instronics Limited, Gurgaon V. ACIT, New Delhi

ITA 6338/DEL/2014

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8688 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 04-03-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 19-11-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: INDER PAL SINGH BINDRA
• Keywords: Rejection of books of accounts; Document seized; Opportunity of being heard; Principle of natural justice; Additional evidence; Question of law; Documents seized; Set aside
• Section: 69C; 143(3); 260A; 13; 132

Judgement Text

1 ITA NO. 6336-6341 & 6553-65 56/DEL/2014 (M/S. INSTRONICS LIMITED) IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: C NEW DELHI BEFORE SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER & SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER ITA NO.-6336/DEL/2014 (A.Y. 2003-04) ITA NO.-6337/DEL/2014 (A.Y. 2004-05) ITA NO.-6338/DEL/2014 (A.Y. 2005-06) ITA NO.-6339/DEL/2014 (A.Y. 2006-07) ITA NO.-6340/DEL/2014 (A.Y. 2007-08) ITA NO.-6341/DEL/2014 (A.Y. 2008-09) M/S. INSTRONICS LIMITED F-345, LADO SARAI, NEW DELHI-110030 PAN : AAACI0163R VS . ACIT CENTRAL CIRCLE-21, ROOM NO. 344, ARA CENTRE, JHANDEWALAN EXTENSION, NEW DELHI -110055 APPELLANT RESPONDENT ITA NO.-6553/DEL/2014 (A.Y. 2005-06) ITA NO.-6554/DEL/2014 (A.Y. 2006-07) ITA NO.-6555/DEL/2014 (A.Y. 2007-08) ITA NO.-6556/DEL/2014 (A.Y. 2008-09) ACIT CENTRAL CIRCLE-21, ROOM NO. 344, ARA CENTRE, JHANDEWALAN EXTENSION, NEW DELHI -110055 VS . M/S. INSTRONICS LIMITED F-345, LADO SARAI, NEW DELHI-110030 PAN : AAACI0163R APPELLANT RESPONDENT ASSESSEE BY : NONE REVENUE BY : SH. INDER PAL SINGH B INDRA, CIT-DR 2 ITA NO. 6336-6341 & 6553-65 56/DEL/2014 (M/S. INSTRONICS LIMITED) ORDER PER BENCH : (A) THE FOLLOWING GROUNDS OF APPEAL HAVE BEEN TAKEN IN THIS BATCH OF APPEALS : ITA NO.-6336/DEL/2014 (A.Y. 2003-04) 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS FAILE D TO APPRECIATE THAT THE NOTICE ISSUED U/S 153C AND ASSESSMENT ORDER PASSED BY THE LD. AO U/S. 153C/143(3) IS ILLEGAL, BAD IN LAW, WITHOUT JURISDI CTION, TIME BARRED, AND WRONG ON FACTS. THE ADDITIONS MADE ARE UNJUST, UNLAWFUL AND ARBITRARY AND ARE MADE AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD. CIT (A) HAS FAIL ED TO APPRECIATE THAT THE LD. AO WAS NOT JUSTIFIED TO IGN ORE THE SUBMISSIONS OF THE APPELLANT THAT THE ASSESSMEN T PROCEEDINGS FOR THE YEAR UNDER APPEAL WAS NOT PENDING ON THE DATE OF THE RECORDING OF SATISFACTIO N U/S. 153C AND SINCE THE SAME DIDNT ABATE, THE PROCEEDINGS U/S. 153C OF THE I.T. ACT IN THIS CASE ARE BAD IN LAW AND DESERVES TO BE QUASHED. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILE D TO APPRECIATE THAT THE ASSESSMENT FRAMED BY LD. AO IS AGAINST THE STATUTORY PROVISIONS OF THE ACT AND WIT HOUT COMPLYING THE PROCEDURES PRESCRIBED U/S. 153C OF TH E I.T. ACT AND AS SUCH THE ASSESSMENT BEING BAD IN LA W DESERVES TO BE QUASHED. 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILE D TO APPRECIATE THAT THE LD AO WAS NOT JUSTIFIED TO IGNO RE THE SUBMISSIONS OF THE APPELLANT THAT ASSESSMENT U/ S 153C OF THE INCOME TAX ACT BE RESTRICTED TO ASSESSMENT IN RESPECT OF SEIZED DOCUMENTS OF 3 ITA NO. 6336-6341 & 6553-65 56/DEL/2014 (M/S. INSTRONICS LIMITED) INCRIMINATING NATURE IN THE CASE OF THE APPELLANT F OR ONLY THE YEAR TO WHICH SAID DOCUMENTS RELATES TO, A ND IN ABSENCE OF ANY SUCH INCRIMINATING SEIZED DOCUMEN T IN THE CASE OF APPELLANT, ASSESSMENT FRAMED U/S. 153C OF THE I.T. ACT FOR THE YEAR UNDER CONSIDERATI ON, IS BAD IN LAW AND DESERVE TO BE QUASHED. 5. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS ERRED IN NOT ADMITTING THE ADDITIONAL EVIDENCES I.E. CONFIRMATIONS OF PARTIES ETC., FILED U/R. 46A ALON G WITH REQUEST FOR ITS ADMISSION, REMAND REPORT AND REJOIN DER, DURING THE APPELLATE PROCEEDINGS. THE LD CIT (A) HA S ALSO ERRED IN IGNORING THE EXPLANATIONS GIVEN, EVIDENCES AND MATERIAL PLACED AND AVAILABLE ON RECORD. 6. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN SUSTAINING OF ADDITIONS ON ACCOUNT OF DISALLOWANCES OF THE EXPENSES OF RS.6,51,666/-; AND SUSTAINING THE ADDITIONS ON ACCOUNT OF LOANS & ADVANCES OF RS. 12,99,115/- AND SUSTAINING THE ADDITIONS ON ACCOUNT OF SHARE APPLICATION MONEY RECEIVED OF RS. 18,00,000/- OF THE APPELLANT COMPAN Y ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; 7. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE CIT (A) HAS ERRE D IN IGNORING THE FACT THAT THE AO HAS ERRED BOTH ON FAC TS AND IN LAW, IN USING STATEMENT OF VARIOUS PERSONS WITHOUT GIVING A COPY OF THE SAME AND OPPORTUNITY T O CROSS EXAMINE. 8. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD. CIT (A) AND LD. AO HAS ERRED IN IGNORING THE CONCENT OF REAL INCOME AN D NOT ALLOWING TELESCOPING OF THE INCOME. 9. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE VARIOUS OBSERVATIONS AND FINDINGS OF THE LD CIT (A) AND LD AO IN THE IMPUGNED APPELLATE ORDER AND ASSESSMENT ORDER, RESPECTIVELY, IS IRRELEVANT AND VITIATED IN THE LAW. 10. THAT THE APPELLANT CRAVES THE RIGHT TO AMEND, APPEND, DELETE ANY OR ALL GROUNDS OF APPEAL. 4 ITA NO. 6336-6341 & 6553-65 56/DEL/2014 (M/S. INSTRONICS LIMITED) ITA NO.-6337/DEL/2014 (A.Y. 2004-05) 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS FAILE D TO APPRECIATE THAT THE NOTICE ISSUED U/S 153C AND ASSESSMENT ORDER PASSED BY THE LD. AO U/S. 153C/143(3) IS ILLEGAL, BAD IN LAW, WITHOUT JURISDI CTION, TIME BARRED, AND WRONG ON FACTS. THE ADDITIONS MADE ARE UNJUST, UNLAWFUL AND ARBITRARY AND ARE MADE AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD. CIT (A) HAS FAIL ED TO APPRECIATE THAT THE LD. AO WAS NOT JUSTIFIED TO IGN ORE THE SUBMISSIONS OF THE APPELLANT THAT THE ASSESSMEN T PROCEEDINGS FOR THE YEAR UNDER APPEAL WAS NOT PENDING ON THE DATE OF THE RECORDING OF SATISFACTIO N U/S. 153C AND SINCE THE SAME DIDNT ABATE, THE PROCEEDINGS U/S. 153C OF THE I.T. ACT IN THIS CASE ARE BAD IN LAW AND DESERVES TO BE QUASHED. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILE D TO APPRECIATE THAT THE ASSESSMENT FRAMED BY LD. AO IS AGAINST THE STATUTORY PROVISIONS OF THE ACT AND WIT HOUT COMPLYING THE PROCEDURES PRESCRIBED U/S. 153C OF TH E I.T. ACT AND AS SUCH THE ASSESSMENT BEING BAD IN LA W DESERVES TO BE QUASHED. 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILE D TO APPRECIATE THAT THE LD AO WAS NOT JUSTIFIED TO IGNO RE THE SUBMISSIONS OF THE APPELLANT THAT ASSESSMENT U/ S 153C OF THE INCOME TAX ACT BE RESTRICTED TO ASSESSMENT IN RESPECT OF SEIZED DOCUMENTS OF INCRIMINATING NATURE IN THE CASE OF THE APPELLANT F OR ONLY THE YEAR TO WHICH SAID DOCUMENTS RELATES TO, A ND IN ABSENCE OF ANY SUCH INCRIMINATING SEIZED DOCUMEN T IN THE CASE OF APPELLANT, ASSESSMENT FRAMED U/S. 153C OF THE I.T. ACT FOR THE YEAR UNDER CONSIDERATI ON, IS BAD IN LAW AND DESERVE TO BE QUASHED. 5. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS ERRED IN 5 ITA NO. 6336-6341 & 6553-65 56/DEL/2014 (M/S. INSTRONICS LIMITED) NOT ADMITTING THE ADDITIONAL EVIDENCES I.E. CONFIRMATIONS OF PARTIES ETC., FILED U/R. 46A ALONG WITH REQUEST FOR ITS ADMISSION, REMAND REPORT AND REJOIN DER, DURING THE APPELLATE PROCEEDINGS. THE LD CIT (A) HA S ALSO ERRED IN IGNORING THE EXPLANATIONS GIVEN, EVIDENCES AND MATERIAL PLACED AND AVAILABLE ON RECORD. 6. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN SUSTAINING OF ADDITIONS ON ACCOUNT OF DISALLOWANCES OF THE EXPENSES OF RS.4,51,989/-; AND SUSTAINING THE ADDITIONS ON ACCOUNT OF SHARE APPLICATION MONEY RECEIVED OF RS. 46,90,000/- OF TH E APPELLANT COMPANY ON MERE SUSPICION, CONJECTURES AN D SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE. N O DEFECT IS POINTED OUT IN THE BOOKS OF ACCOUNT AND T HE EVIDENCES PRODUCED, CONFIRMATIONS RECEIVED HAVE BEE N ILLEGALLY AND ARBITRARILY IGNORED. 7. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE CIT (A) HAS ERRE D IN IGNORING THE FACT THAT THE AO HAS ERRED BOTH ON FAC TS AND IN LAW, IN USING STATEMENT OF VARIOUS PERSONS WITHOUT GIVING A COPY OF THE SAME AND OPPORTUNITY T O CROSS EXAMINE. 8. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD. CIT (A) AND LD. AO HAS ERRED IN IGNORING THE CONCEPT OF REAL INCOME AN D NOT ALLOWING TELESCOPING OF THE INCOME. 9. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE VARIOUS OBSERVATIONS AND FINDINGS OF THE LD CIT (A) AND LD AO IN THE IMPUGNED APPELLATE ORDER AND ASSESSMENT ORDER, RESPECTIVELY, IS IRRELEVANT AND VITIATED IN THE LAW. 10. THAT THE APPELLANT CRAVES THE RIGHT TO AMEND, APPEND, DELETE ANY OR ALL GROUNDS OF APPEAL. ITA NO.-6338/DEL/2014 (A.Y. 2005-06) 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS FAILE D TO APPRECIATE THAT THE NOTICE ISSUED U/S 153C AND ASSESSMENT ORDER PASSED BY THE LD. AO U/S. 153C/143(3) IS ILLEGAL, BAD IN LAW, WITHOUT JURISDI CTION 6 ITA NO. 6336-6341 & 6553-65 56/DEL/2014 (M/S. INSTRONICS LIMITED) AND WRONG ON FACTS. THE ADDITIONS MADE ARE UNJUST, UNLAWFUL AND ARBITRARY AND ARE MADE AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD. CIT (A) HAS FAIL ED TO APPRECIATE THAT THE LD. AO WAS NOT JUSTIFIED TO IGN ORE THE SUBMISSIONS OF THE APPELLANT THAT THE ASSESSMEN T PROCEEDINGS FOR THE YEAR UNDER APPEAL WAS NOT PENDING ON THE DATE OF THE RECORDING OF SATISFACTIO N U/S. 153C AND SINCE THE SAME DIDNT ABATE, THE PROCEEDINGS U/S. 153C OF THE I.T. ACT IN THIS CASE ARE BAD IN LAW AND DESERVES TO BE QUASHED. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILE D TO APPRECIATE THAT THE ASSESSMENT FRAMED BY LD. AO IS AGAINST THE STATUTORY PROVISIONS OF THE ACT AND WIT HOUT COMPLYING THE PROCEDURES PRESCRIBED U/S. 153C OF TH E I.T. ACT AND AS SUCH THE ASSESSMENT BEING BAD IN LA W DESERVES TO BE QUASHED. 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILE D TO APPRECIATE THAT THE LD AO WAS NOT JUSTIFIED TO IGNO RE THE SUBMISSIONS OF THE APPELLANT THAT ASSESSMENT U/ S 153C OF THE INCOME TAX ACT BE RESTRICTED TO ASSESSMENT IN RESPECT OF SEIZED DOCUMENTS OF INCRIMINATING NATURE IN THE CASE OF THE APPELLANT F OR ONLY THE YEAR TO WHICH SAID DOCUMENTS RELATES TO, A ND IN ABSENCE OF ANY SUCH INCRIMINATING SEIZED DOCUMEN T IN THE CASE OF APPELLANT, ASSESSMENT FRAMED U/S. 153C OF THE I.T. ACT FOR THE YEAR UNDER CONSIDERATI ON, IS BAD IN LAW AND DESERVE TO BE QUASHED. 5. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS ERRED IN NOT ADMITTING THE ADDITIONAL EVIDENCES I.E. CONFIRMATIONS OF PARTIES ETC., FILED U/R. 46A ALON G WITH REQUEST FOR ITS ADMISSION, REMAND REPORT AND REJOIN DER, DURING THE APPELLATE PROCEEDINGS. THE LD CIT (A) HA S ALSO ERRED IN IGNORING THE EXPLANATIONS GIVEN, EVIDENCES AND MATERIAL PLACED AND AVAILABLE ON RECORD. 6. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD CIT (A) HAS ERRED IN 7 ITA NO. 6336-6341 & 6553-65 56/DEL/2014 (M/S. INSTRONICS LIMITED) HOLDING THE CONCLUSION THAT THE AUDITED BOOKS NOTWITHSTANDING, THE BOOK RESULTS ARE REQUIRED TO B E REJECTED, SINCE THE NARRATIONS ARE ARTIFICIAL, SHAM AND NOT REFLECTIVE OF THE ACTUAL BUSINESS / COMMERCIAL TRANSACTIONS. HOWEVER, THE LD CIT (A) STILL RELYING ON THESE BOOKS /BOOK RESULTS FOR GIVING DIRECTIONS TO THE AO FOR THE PURPOSE OF CALCULATING THE PEAK FROM THE ENTRIES IN THE CASH BOOK OF THE APPELLANT FOR THE RELEVANT YEAR. 7. A). THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE PURCHASES OF RS.6,21,52,257/- OF THE APPELLANT ON MERE SUSPICION , CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; B). THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF T HE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE 50% EXPENSES OF RS.5,68,727/- OF THE APPELLANT ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; C) THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF T HE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE LOANS AND ADVANCES PAID O F RS. 1,70,50,000/- OF THE APPELLANT ON MERE SUSPICIO N, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; D) THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF TH E CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE SHARE APPLICATION MONEY RECEIVED OF RS.3,60,000/-OF THE APPELLANT ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; 8. A) THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN WRONGLY DIRECTING THE AO TO WORK OUT THE P EAK FROM THE ENTRIES IN THE CASH BOOK AND THE BANK BOOK OF THE APPELLANT FOR THE RELEVANT YEAR AND MAKE A SINGULAR ADDITION OF THE SAID AMOUNT, AS UNEXPLAINE D INVESTMENT/EXPENDITURE, IGNORING THE FACT THAT THE SAME HAS DULY BEEN ENTERED IN THE AUDITED BOOKS OF ACCOUNTS OF THE APPELLANT FOR THE YEAR UNDER 8 ITA NO. 6336-6341 & 6553-65 56/DEL/2014 (M/S. INSTRONICS LIMITED) CONSIDERATION; B) THAT THE LD CIT (A) DID NOT GIVE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE APPELLANT COMPANY AND IGNORED THE CONCEPT OF REAL INCOME AND WRONGL Y DIRECTED THE AO TO WORK OUT THE PEAK FROM THE ENTRI ES IN THE CASH BOOK AND THE BANK BOOK OF THE APPELLANT FOR THE RELEVANT YEAR, WITHOUT GRANTING THE CREDIT OF THE PEAK OF FINANCIAL TRANSACTIONS AS PER THE CASH BOOK FOR THE PRECEDING YEARS. 9. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF TH E CASE AND THE PROVISION OF LAW, THE CIT (A) HAS ERRE D IN IGNORING THE FACT THAT THE AO HAS ERRED BOTH ON FAC TS AND IN LAW, IN USING STATEMENT OF VARIOUS PERSONS WITHOUT GIVING A COPY OF THE SAME AND OPPORTUNITY T O CROSS EXAMINE. 10. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE VARIOUS OBSERVATIONS AND FINDINGS OF THE LD CIT (A) AND LD AO IN THE IMPUGNED APPELLATE ORDER AND ASSESSMENT ORDER, RESPECTIVELY, IS IRRELEVANT AND VITIATED IN THE LAW. 11. THAT THE APPELLANT CRAVES THE RIGHT TO A MEND, APPEND, DELETE ANY OR ALL GROUNDS OF APPEAL. ITA NO.-6339/DEL/2014 (A.Y. 2006-07) 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS FAILE D TO APPRECIATE THAT THE NOTICE ISSUED U/S 153C AND ASSESSMENT ORDER PASSED BY THE LD. AO U/S. 153C/143(3) IS ILLEGAL, BAD IN LAW, WITHOUT JURISDI CTION AND WRONG ON FACTS. THE ADDITIONS MADE ARE UNJUST, UNLAWFUL AND ARBITRARY AND ARE MADE AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD. CIT (A) HAS FAILED T O APPRECIATE THAT THE LD. AO WAS NOT JUSTIFIED TO IGN ORE THE SUBMISSIONS OF THE APPELLANT THAT THE ASSESSMEN T PROCEEDINGS FOR THE YEAR UNDER APPEAL WAS NOT PENDING ON THE DATE OF THE RECORDING OF SATISFACTIO N U/S. 153C AND SINCE THE SAME DIDNT ABATE, THE PROCEEDINGS U/S. 153C OF THE I.T. ACT IN THIS CASE ARE BAD IN LAW AND DESERVES TO BE QUASHED. 9 ITA NO. 6336-6341 & 6553-65 56/DEL/2014 (M/S. INSTRONICS LIMITED) 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILED TO APPRECIATE THAT THE ASSESSMENT FRAMED BY LD. AO IS AGAINST THE STATUTORY PROVISIONS OF THE ACT AND WIT HOUT COMPLYING THE PROCEDURES PRESCRIBED U/S. 153C OF TH E I.T. ACT AND AS SUCH THE ASSESSMENT BEING BAD IN LA W DESERVES TO BE QUASHED. 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILE D TO APPRECIATE THAT THE LD AO WAS NOT JUSTIFIED TO IGNO RE THE SUBMISSIONS OF THE APPELLANT THAT ASSESSMENT U/ S 153C OF THE INCOME TAX ACT BE RESTRICTED TO ASSESSMENT IN RESPECT OF SEIZED DOCUMENTS OF INCRIMINATING NATURE IN THE CASE OF THE APPELLANT F OR ONLY THE YEAR TO WHICH SAID DOCUMENTS RELATES TO, A ND IN ABSENCE OF ANY SUCH INCRIMINATING SEIZED DOCUMEN T IN THE CASE OF APPELLANT, ASSESSMENT FRAMED U/S. 153C OF THE I.T. ACT FOR THE YEAR UNDER CONSIDERATI ON, IS BAD IN LAW AND DESERVE TO BE QUASHED. 5. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS ERRED IN NOT ADMITTING THE ADDITIONAL EVIDENCES I.E. CONFIRMATIONS OF PARTIES ETC., FILED U/R. 46A ALON G WITH REQUEST FOR ITS ADMISSION, REMAND REPORT AND REJOIN DER, DURING THE APPELLATE PROCEEDINGS. THE LD CIT (A) HA S ALSO ERRED IN IGNORING THE EXPLANATIONS GIVEN, EVIDENCES AND MATERIAL PLACED AND AVAILABLE ON RECORD. 6. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD CIT (A) HAS ERRED IN HOLDING THE CONCLUSION THAT THE AUDITED BOOKS NOTWITHSTANDING , THE BOOK RESULTS ARE REQUIRED TO BE REJECTED, SINCE THE NARRATIONS ARE ARTIFICIAL, SHAM AND NOT REFLECTIVE OF THE ACTUAL BUSINESS / COMMERCIAL TRANSACTIONS. HOWEVER, THE LD CIT (A) STILL RELYING ON THESE BOOKS /BOOK R ESULTS FOR GIVING DIRECTIONS TO THE AO FOR THE PURPOSE OF CALCULATING THE PEAK FROM THE ENTRIES IN THE CASH B OOK OF THE APPELLANT FOR THE RELEVANT YEAR. 7. A). THAT ON THE FACTS AND ON THE CIRCUMSTANCES O F THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE PURCHASES OF 10 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) RS.4,24,20,731/- OF THE APPELLANT ON MERE SUSPICION , CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; B). THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF T HE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE 50% EXPENSES OF RS.5,76,895/- OF THE APPELLANT ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; C). THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF T HE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE ADVANCES RECEIVED AGAINST ORDERS OF RS. 10,64,500/- OF THE APPELLANT ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; D). THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF T HE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE SHARE APPLICATION MONEY GIVEN OF RS. 16,00,000/- OF THE APPELLANT ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; 8. A) THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN WRONGLY DIRECTING THE AO TO WORK OUT THE P EAK FROM THE ENTRIES IN THE CASH BOOK AND THE BANK BOOK OF THE APPELLANT FOR THE RELEVANT YEAR AND MAKE A SINGULAR ADDITION OF THE SAID AMOUNT, AS UNEXPLAINE D INVESTMENT/EXPENDITURE, IGNORING THE FACT THAT THE SAME HAS DULY BEEN ENTERED IN THE AUDITED BOOKS OF ACCOUNTS OF THE APPELLANT FOR THE YEAR UNDER CONSIDERATION; B) THAT THE LD CIT (A) DID NOT GIVE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE APPELLANT COMPANY AND IGNORED THE CONCEPT OF REAL INCOME AND WRONGL Y DIRECTED THE AO TO WORK OUT THE PEAK FROM THE ENTRI ES IN THE CASH BOOK AND THE BANK BOOK OF THE APPELLANT FOR THE RELEVANT YEAR, WITHOUT GRANTING THE CREDIT OF THE PEAK OF FINANCIAL TRANSACTIONS AS PER THE CASH BOOK FOR THE PRECEDING YEARS. 9. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF T HE CASE AND THE PROVISION OF LAW, THE CIT (A) HAS ERRE D IN IGNORING THE FACT THAT THE AO HAS ERRED BOTH ON FAC TS 11 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) AND IN LAW, IN USING STATEMENT OF VARIOUS PERSONS WITHOUT GIVING A COPY OF THE SAME AND OPPORTUNITY T O CROSS EXAMINE. 10. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE VARIOUS OBSERVATIONS AND FINDINGS OF THE LD CIT (A) AND LD AO IN THE IMPUGNED APPELLATE ORDER AND ASSESSMENT ORDER, RESPECTIVELY, IS IRRELEVANT AND VITIATED IN THE LAW. 11. THAT THE APPELLANT CRAVES THE RIGHT TO AMEND, APPEND, DELETE ANY OR ALL GROUNDS OF APPEAL. ITA NO.-6340/DEL/2014 (A.Y. 2007-08) 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS FAILE D TO APPRECIATE THAT THE NOTICE ISSUED U/S 153C AND ASSESSMENT ORDER PASSED BY THE LD. AO U/S. 153C/143(3) IS ILLEGAL, BAD IN LAW, WITHOUT JURISDI CTION AND WRONG ON FACTS. THE ADDITIONS MADE ARE UNJUST, UNLAWFUL AND ARBITRARY AND ARE MADE AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD. CIT (A) HAS FAIL ED TO APPRECIATE THAT THE LD. AO WAS NOT JUSTIFIED TO IGN ORE THE SUBMISSIONS OF THE APPELLANT THAT THE ASSESSMEN T PROCEEDINGS FOR THE YEAR UNDER APPEAL WAS NOT PENDING ON THE DATE OF THE RECORDING OF SATISFACTIO N U/S. 153C AND SINCE THE SAME DIDNT ABATE, THE PROCEEDINGS U/S. 153C OF THE I.T. ACT IN THIS CASE ARE BAD IN LAW AND DESERVES TO BE QUASHED. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILED TO APPRECIATE THAT THE ASSESSMENT FRAMED BY LD. AO IS AGAINST THE STATUTORY PROVISIONS OF THE ACT AND WIT HOUT COMPLYING THE PROCEDURES PRESCRIBED U/S. 153C OF TH E I.T. ACT AND AS SUCH THE ASSESSMENT BEING BAD IN LA W DESERVES TO BE QUASHED. 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILED TO APPRECIATE THAT THE LD AO WAS NOT JUSTIFIED TO IGNO RE 12 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) THE SUBMISSIONS OF THE APPELLANT THAT ASSESSMENT U/ S 153C OF THE INCOME TAX ACT BE RESTRICTED TO ASSESSMENT IN RESPECT OF SEIZED DOCUMENTS OF INCRIMINATING NATURE IN THE CASE OF THE APPELLANT F OR ONLY THE YEAR TO WHICH SAID DOCUMENTS RELATES TO, A ND IN ABSENCE OF ANY SUCH INCRIMINATING SEIZED DOCUMEN T IN THE CASE OF APPELLANT, ASSESSMENT FRAMED U/S. 153C OF THE I.T. ACT FOR THE YEAR UNDER CONSIDERATI ON, IS BAD IN LAW AND DESERVE TO BE QUASHED. 5. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS ERRED IN NOT ADMITTING THE ADDITIONAL EVIDENCES I.E. CONFIRMATIONS OF PARTIES ETC., FILED U/R. 46A ALON G WITH REQUEST FOR ITS ADMISSION, REMAND REPORT AND REJOIN DER, DURING THE APPELLATE PROCEEDINGS. THE LD CIT (A) HA S ALSO ERRED IN IGNORING THE EXPLANATIONS GIVEN, EVIDENCES AND MATERIAL PLACED AND AVAILABLE ON RECORD. 6. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD CIT (A) HAS ERRED IN HOLDING THE CONCLUSION THAT THE AUDITED BOOKS NOTWITHSTANDING, THE BOOK RESULTS ARE REQUIRED TO B E REJECTED, SINCE THE NARRATIONS ARE ARTIFICIAL, SHAM AND NOT REFLECTIVE OF THE ACTUAL BUSINESS / COMMERCIAL TRANSACTIONS. HOWEVER, THE LD CIT (A) STILL RELYING ON THESE BOOKS /BOOK RESULTS FOR GIVING DIRECTIONS TO THE AO FOR THE PURPOSE OF CALCULATING THE PEAK FROM THE ENTRIES IN THE CASH BOOK OF THE APPELLANT FOR THE RELEVANT YEAR. 7. A). THAT ON THE FACTS AND ON THE CIRCUMSTANCES O F THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE PURCHASES OF RS. 1,00,450 /- OF THE APPELLANT ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; B) . THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE 50% EXPENSES OF RS.2,47,696/- OF THE APPELLANT ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE C) . THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE EXPENSES INCURRED FOR 13 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) INCREASE IN AUTHORIZED SHARE CAPITAL OF RS.2,89,250 /- OF THE APPELLANT ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; 8. A) THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN WRONGLY DIRECTING THE AO TO WORK OUT THE P EAK FROM THE ENTRIES IN THE CASH BOOK AND THE BANK BOOK OF THE APPELLANT FOR THE RELEVANT YEAR AND MAKE A SINGULAR ADDITION OF THE SAID AMOUNT, AS UNEXPLAINE D INVESTMENT/EXPENDITURE, IGNORING THE FACT THAT THE SAME HAS DULY BEEN ENTERED IN THE AUDITED BOOKS OF ACCOUNTS OF THE APPELLANT FOR THE YEAR UNDER CONSIDERATION; B)THAT THE LD CIT (A) DID NOT GIVE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE APPELLANT COMPANY AND IGNORED THE CONCEPT OF REAL INCOME AND WRONGL Y DIRECTED THE AO TO WORK OUT THE PEAK FROM THE ENTRI ES IN THE CASH BOOK AND THE BANK BOOK OF THE APPELLANT FOR THE RELEVANT YEAR, WITHOUT GRANTING THE CREDIT OF THE PEAK OF FINANCIAL TRANSACTIONS AS PER THE CASH BOOK FOR THE PRECEDING YEARS. 9. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF TH E CASE AND THE PROVISION OF LAW, THE CIT (A) HAS ERRE D IN IGNORING THE FACT THAT THE AO HAS ERRED BOTH ON FAC TS AND IN LAW, IN USING STATEMENT OF VARIOUS PERSONS WITHOUT GIVING A COPY OF THE SAME AND OPPORTUNITY T O CROSS EXAMINE. 10. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CAS E, THE VARIOUS OBSERVATIONS AND FINDINGS OF THE LD CIT (A) AND LD AO IN THE IMPUGNED APPELLATE ORDER AND ASSESSMENT ORDER, RESPECTIVELY, IS IRRELEVANT AND VITIATED IN THE LAW. 11. THAT THE APPELLANT CRAVES THE RIGHT TO AMEND, APPEND, DELETE ANY OR ALL GROUNDS OF APPEAL. ITA NO.-6341/DEL/2014 (A.Y. 2008-09) 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS FAILE D TO APPRECIATE THAT THE NOTICE ISSUED U/S 153C AND ASSESSMENT ORDER PASSED BY THE LD. AO U/S. 153C/143(3) IS ILLEGAL, BAD IN LAW, WITHOUT JURISDI CTION 14 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) AND WRONG ON FACTS. THE ADDITIONS MADE ARE UNJUST, UNLAWFUL AND ARBITRARY AND ARE MADE AGAINST THE PRINCIPLES OF NATURAL JUSTICE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD. CIT (A) HAS FAILED T O APPRECIATE THAT THE LD. AO WAS NOT JUSTIFIED TO IGN ORE THE SUBMISSIONS OF THE APPELLANT THAT THE ASSESSMEN T PROCEEDINGS FOR THE YEAR UNDER APPEAL WAS NOT PENDING ON THE DATE OF THE RECORDING OF SATISFACTIO N U/S. 153C AND SINCE THE SAME DIDNT ABATE, THE PROCEEDINGS U/S. 153C OF THE I.T. ACT IN THIS CASE ARE BAD IN LAW AND DESERVES TO BE QUASHED. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILE D TO APPRECIATE THAT THE ASSESSMENT FRAMED BY LD. AO IS AGAINST THE STATUTORY PROVISIONS OF THE ACT AND WIT HOUT COMPLYING THE PROCEDURES PRESCRIBED U/S. 153C OF TH E I.T. ACT AND AS SUCH THE ASSESSMENT BEING BAD IN LA W DESERVES TO BE QUASHED. 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS FAILE D TO APPRECIATE THAT THE LD AO WAS NOT JUSTIFIED TO IGNO RE THE SUBMISSIONS OF THE APPELLANT THAT ASSESSMENT U/ S 153C OF THE INCOME TAX ACT BE RESTRICTED TO ASSESSMENT IN RESPECT OF SEIZED DOCUMENTS OF INCRIMINATING NATURE IN THE CASE OF THE APPELLANT F OR ONLY THE YEAR TO WHICH SAID DOCUMENTS RELATES TO, A ND IN ABSENCE OF ANY SUCH INCRIMINATING SEIZED DOCUMEN T IN THE CASE OF APPELLANT, ASSESSMENT FRAMED U/S. 153C OF THE I.T. ACT FOR THE YEAR UNDER CONSIDERATI ON, IS BAD IN LAW AND DESERVE TO BE QUASHED. 5. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD CIT (A) HAS ERRED IN NOT ADMITTING THE ADDITIONAL EVIDENCES I.E. CONFIRMATIONS OF PARTIES ETC., FILED U/R. 46A ALON G WITH REQUEST FOR ITS ADMISSION, REMAND REPORT AND REJOIN DER, DURING THE APPELLATE PROCEEDINGS. THE LD CIT (A) HA S ALSO ERRED IN IGNORING THE EXPLANATIONS GIVEN, EVIDENCES AND MATERIAL PLACED AND AVAILABLE ON RECORD. 6. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD CIT (A) HAS ERRED IN 15 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) HOLDING THE CONCLUSION THAT THE AUDITED BOOKS NOTWITHSTANDING, THE BOOK RESULTS ARE REQUIRED TO B E REJECTED, SINCE THE NARRATIONS ARE ARTIFICIAL, SHAM AND NOT REFLECTIVE OF THE ACTUAL BUSINESS / COMMERCIAL TRANSACTIONS. HOWEVER, THE LD CIT (A) STILL RELYING ON THESE BOOKS /BOOK RESULTS FOR GIVING DIRECTIONS TO THE AO FOR THE PURPOSE OF CALCULATING THE PEAK FROM THE ENTRIES IN THE CASH BOOK OF THE APPELLANT FOR THE RELEVANT YEAR. 7. A). THAT ON THE FACTS AND ON THE CIRCUMSTANCES O F THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE PURCHASES OF RS.2,67,970/ - OF THE APPELLANT ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; B). THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF T HE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE 50% EXPENSES OF RS.11,45,939/- OF THE APPELLANT ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; C). THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF T HE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN DISREGARDING THE LOANS AND ADVANCE GIVEN O F RS.2,32,25,000/- OF THE APPELLANT COMPANY ON MERE SUSPICION, CONJECTURES AND SURMISES, EVEN WHEN NO ADVERSE MATERIAL IS THERE; 8. A) THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN WRONGLY DIRECTING THE AO TO WORK OUT THE P EAK FROM THE ENTRIES IN THE CASH BOOK AND THE BANK BOOK OF THE APPELLANT FOR THE RELEVANT YEAR AND MAKE A SINGULAR ADDITION OF THE SAID AMOUNT, AS UNEXPLAINE D INVESTMENT/EXPENDITURE, IGNORING THE FACT THAT THE SAME HAS DULY BEEN ENTERED IN THE AUDITED BOOKS OF ACCOUNTS OF THE APPELLANT FOR THE YEAR UNDER CONSIDERATION; B) THAT THE LD CIT (A) DID NOT GIVE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE APPELLANT COMPANY AND IGNORED THE CONCEPT OF REAL INCOME AND WRONGL Y DIRECTED THE AO TO WORK OUT THE PEAK FROM THE ENTRI ES IN THE CASH BOOK AND THE BANK BOOK OF THE APPELLANT FOR THE RELEVANT YEAR, WITHOUT GRANTING THE CREDIT OF THE 16 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) PEAK OF FINANCIAL TRANSACTIONS AS PER THE CASH BOOK FOR THE PRECEDING YEARS. 9. THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE CIT (A) HAS ERRE D IN IGNORING THE FACT THAT THE AO HAS ERRED BOTH ON FAC TS AND IN LAW, IN USING STATEMENT OF VARIOUS PERSONS WITHOUT GIVING A COPY OF THE SAME AND OPPORTUNITY T O CROSS EXAMINE. 10. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE VARIOUS OBSERVATIONS AND FINDINGS OF THE LD CIT (A) AND LD AO IN THE IMPUGNED APPELLATE ORDER AND ASSESSMENT ORDER, RESPECTIVELY, IS IRRELEVANT AND VITIATED IN THE LAW. 11. THAT THE APPELLANT CRAVES THE RIGHT TO AMEND, APPEND, DELETE ANY OR ALL GROUNDS OF APPEAL. ITA NO.-6553/DEL/2014 (A.Y. 2005-06) 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HA S ERRED IN LAW AND ON FACTS IN RESTRICTING THE ADDITI ON OF DISALLOWANCE OF UNVERIFIED PURCHASES AMOUNTING TO R S. 5,68,727/- BY ADOPTING THE PEAK AMOUNTS OF CASH BOOK & BANK BOOK, AFTER REDUCING THE RESPECTIVE OPENING BALANCE. 2. THE LD. COMMISSIONER OF INCOME TAX(APPEALS) HAS ERRED IN LAW AND ON FACTS IN RESTRICTING THE ADDITI ON OF DISALLOWANCE OF UNVERIFIED EXPENSES OF RS. 6,21,52,257/- BY ADOPTING PEAK AMOUNTS OF CASH BOOK & BANK BOOK, AFTER REDUCING THE RESPECTIVE OPENING BALANCE. 3. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN ADOPTING THE WORKING O F PEAK AMOUNTS SUBMITTED BY THE APPELLANT, WHEREAS THE ID. CIT(A) HAS HERSELF RECORDED REASONS FOR NOT ADMITTING ADDITIONAL EVIDENCE AND AS SUCH REJECTED THE ADDITIONAL EVIDENCE. 4. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN RELYING ON CASH BOOK A ND BANK BOOK FOR TELESCOPING, WHEREAS CIT(A)HAS HERSEL F RECORDED REASONS IN THE APPELLATE ORDER FOR CONFIRM ING 17 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) THE REJECTION OF BOOKS OF ACCOUNTS OF THE ASSESSEE. 5. (A) THE ORDER OF THE LD. CIT(APPEALS) IS ERRONEOUS AND NOT TENABLE IN LAW AND ON FACT. (B) THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AME ND ANY/ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING T HE COURSE OF THE HEARING OF THE APPEAL. ITA NO.-6554/DEL/2014 (A.Y. 2006-07) 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN RESTRICTING THE ADDITI ON OF DISALLOWANCE OF UNVERIFIED PURCHASES AMOUNTING TO R S. 4,24,20,731/- U/S 69C OF THE IT ACT, BY ADOPTING TH E PEAK AMOUNTS OF CASH BOOK & BANK BOOK, AFTER REDUCING THE RESPECTIVE OPENING BALANCE. 2. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN RESTRICTING THE ADDITION OF 50% DISALLOWANCE OF EXPENSES OF RS. 5,76,895/- CLAIMED BY THE ASSESSEE IN P & L A/C BY ADOPTING PEAK AMOUNTS OF CASH BOOK & BANK BOOK, AFTER REDUCING THE RESPECTIVE OPENING BALANCE. 3. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN ADOPTING THE WORKING O F PEAK AMOUNTS SUBMITTED BY THE APPELLANT, WHEREAS THE ID. CIT(A) HAS HERSELF RECORDED REASONS FOR NOT ADMITTING ADDITIONAL EVIDENCE AND AS SUCH REJECTED THE ADDITIONAL EVIDENCE. 4. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN RELYING ON CASH BO OK AND BANK BOOK FOR TELESCOPING, WHEREAS CIT(A) HAS HERSELF RECORDED REASONS IN THE APPELLATE ORDER FOR CONFIRMING THE REJECTION OF BOOKS OF ACCOUNTS OF TH E ASSESSEE: 5. (A) THE ORDER OF THE LD. CIT(APPEALS) IS ERRONEOUS AND NOT TENABLE IN LAW AND ON FACT. (B) THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AME ND ANY/ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING T HE COURSE OF THE HEARING OF THE APPEAL. ITA NO.-6555/DEL/2014 (A.Y. 2007-08) THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS 18 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) ERRED IN LAW AND ON FACTS IN RESTRICTING THE ADDITI ON OF DISALLOWANCE OF UNVERIFIED PURCHASES AMOUNTING TO R S. 1,00,450/- U/S 69C OF THE IT ACT, BY ADOPTING THE P EAK AMOUNTS OF CASH BOOK & BANK BOOK, AFTER REDUCING THE RESPECTIVE OPENING BALANCE. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN RESTRICTING THE ADDITION OF 50% DISALLOWANCE OF EXPENSES OF RS. 2,47,696/- CLAIMED BY THE ASSESSEE IN P & L A/C BY ADOPTING PEAK AMOUNTS OF CASH BOOK & BANK BOOK, AFTER REDUCING THE RESPECTIVE OPENING BALANCE. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN ADOPTING THE WORKI NG OF PEAK AMOUNTS SUBMITTED BY THE APPELLANT, WHEREAS THE ID. CIT(A) HAS HERSELF RECORDED REASONS FOR NOT ADMITTING ADDITIONAL EVIDENCE AND AS SUCH REJECTED THE ADDITIONAL EVIDENCE. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN RELYING ON CASH BO OK AND BANK BOOK FOR TELESCOPING, WHEREAS CIT(A) HAS HERSELF RECORDED REASONS IN THE APPELLATE ORDER FOR CONFIRMING THE REJECTION OF BOOKS OF ACCOUNTS OF TH E ASSESSEE. (A) THE ORDER OF THE LD. CIT(APPEALS) IS ERRONEOUS AND NOT TENABLE IN LAW AND ON FACT. (B) THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEND ANY/ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING T HE COURSE OF THE HEARING OF THE APPEAL. ITA NO.-6556/DEL/2014 (A.Y. 2008-09) 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN RESTRICTING THE ADDITI ON OF DISALLOWANCE OF UNVERIFIED PURCHASES AMOUNTING TO R S. 2,67,970/- U/S 69C OF THE IT ACT, BY ADOPTING THE P EAK AMOUNTS OF CASH BOOK & BANK BOOK, AFTER REDUCING THE RESPECTIVE OPENING BALANCE. 2. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN RESTRICTING THE 19 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) ADDITION OF 50% DISALLOWANCE OF EXPENSES OF RS. 11,45,939/- CLAIMED BY THE ASSESSEE IN P & L A/C BY ADOPTING PEAK AMOUNTS OF CASH BOOK & BANK BOOK, AFTER REDUCING THE RESPECTIVE OPENING BALANCE. 3. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN ADOPTING THE WORKI NG OF PEAK AMOUNTS SUBMITTED BY THE APPELLANT, WHEREAS THE ID. CIT(A) HAS HERSELF RECORDED REASONS FOR NOT ADMITTING ADDITIONAL EVIDENCE AND AS SUCH REJECTED THE ADDITIONAL EVIDENCE. 4. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN RELYING ON CASH BO OK AND BANK BOOK FOR TELESCOPING, WHEREAS CIT(A) HAS HERSELF RECORDED REASONS IN THE APPELLATE ORDER FOR CONFIRMING THE REJECTION OF BOOKS OF ACCOUNTS OF TH E ASSESSEE. 5. (A) THE ORDER OF THE LD. CIT(APPEALS) IS ERRONEOUS AND NOT TENABLE IN LAW AND ON FACT, (B) THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AME ND ANY/ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING T HE COURSE OF THE HEARING OF THE APPEAL. (B) FOR THE SAKE OF CONVENIENCE, THIS BATCH OF APPEALS IS BEING DISPOSED OFF THROUGH THIS CONSOLIDATED ORDER. THESE APPEALS WERE EARLIER DISPOSED OFF BY CO-ORDINATE BENCH OF I TAT, DELHI VIDE CONSOLIDATED ORDER DATED 13 TH MARCH, 2015 WHEREBY THE SIX APPEALS OF ASSESSEE PERTAINING TO ASSESSMENT YEARS 2003-04 TO 2008-09 WERE ALLOWED AND THE FOUR CROSS APPEALS OF REVENUE FOR ASSESSMENT YEARS 2005-06 TO 2008-09 WERE DISMISSED. VIDE THE AFORESAID CONSOLIDATED ORDER DATED 13.03.2015 CO-OR DINATE BENCH OF ITAT, DELHI HAD QUASHED THE ASSESSMENT ORDERS PA SSED BY THE ASSESSING OFFICER FOR ASSESSMENT YEARS 2003-04 TO 2 008-09. THE ASSESSMENT ORDERS WERE QUASHED BY CO-ORDINATE BENCH OF ITAT, DELHI BY AFORESAID ORDER DATED 13.03.2015 BY OBSERV ING THAT THE SATISFACTION NOTE WAS NOT RECORDED BY THE ASSESSING OFFICER OF THE 20 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) SEARCHED PERSON BEFORE INITIATING PROCEEDINGS U/S 1 53C OF INCOME TAX ACT IN THE CASE OF THE ASSESSEE. REVENUE FILED APPEALS U/S 260A OF INCOME TAX ACT BEFORE THE HONBLE DELHI HIGH COURT AGAINST THE AFORESAID CONSOLIDATED ORDER DATED 13.0 3.2015 OF CO- ORDINATE BENCH OF ITAT, DELHI. VIDE CONSOLIDATED OR DER DATED 25.05.2017, THE HONBLE DELHI HIGH COURT RESTORED T HE MATTERS TO THE FILE OF ITAT. IN THE AFORESAID CONSOLIDATED ORD ER DATED 25.05.2017 THE HONBLE DELHI HIGH COURT OBSERVED AS UNDER : 15. IN THE PRESENT CASE, THE ITAT OVERLOOKED THE F ACT THAT THE SATISFACTION NOTE WAS IN FACT RECORDED BY THE AO OF THE SEARCHED PERSON WHO ALSO HAPPENED TO BE THE AO FOR THE ASSESSEE (THE OTHER PERSON) AS WELL. THIS IS CLEAR FROM THE SENTENCE IN THE SATISFACTION NOTE WHICH READS; THE UNDERSIGNED IS THE JURISDICTIONAL AO OF THESE CASES. THE AO OF THE SEARCHED PERSON HAS RECORDED THE SATISFACTION THAT THE SEIZED DOCUMENTS BELONGED TO THE ASSESSEE. IN SIMILAR CIRCUMSTANCES IN PRINCIPAL COMMISSIONER OF INCOME TAX V. SATKAR FINC AP LTD. (SUPRA), THIS COURT HELD LIKEWISE. THE SATISFA CTION NOTE IN THE PERSENT CASE, THEREFORE, SATISFIES THE REQUIREMENT OF THE LAW. CONSEQUENTLY, THE QUESTION FRAMED IS ANSWERED IN THE NEGATIVE I.E., IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE. 16. THE LEARNED COUNSEL FOR THE PETITIONER THEN URG ED THAT THE DOCUMENTS REFERRED TO IN THE SATISFACTION NOTE WERE NOT INCRIMINATING AND, THEREFORE, ON THAT GROU ND ALSO, THE ASSUMPTION OF JURISDICTIONAL UNDER SECTIO N 153C BY THE AO WAS ERRONEOUS. 17. THE COURT FINDS THAT THERE IS NO DISCUSSION IN THE IMPUGNED ORDER OF THE ITAT ON WHETHER THE DOCUMENTS REFERRED TO IN THE SATISFACTION NOTE WERE, IN FACT, INCRIMINATING. THE ITAT INVALIDATED THE PROCEEDINGS UNDER SECTION 153 C OF THE ACT ONLY ON THE GROUND O F THERE BEING NO SATISFACTION NOTE BY THE AO OF THE SEARCHED PERSON. AS DISCUSSED EARLIER, THIS WAS FACTUALLY ERRONEOUS. THERE WAS NO OCCASION FOR THE ITAT TO EXAMINE THE OTHER GROUNDS OF CHALLENGE TO THE 21 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) ASSUMPTION OF JURISDICTION UNDER SECTION153 C OF TH E ACT. 18. CONSEQUENTLY, THE IMPUGNED ORDER DATED 13 TH MARCH, 2015 OF THE ITAT IS HEREBY SET ASIDE. THE CO URT RESTORES TO THE FILE OF THE ITAT FOR A FURTHER HEAR ING ALL THE APPEALS IN WHICH THE IMPUGNED ORDER WAS PASSED FOR CONSIDERATION OF THE FURTHER GROUNDS INCLUDING THE QUESTION WHETHER THE ASSUMPTION OF JURISDICTION BY THE AO UNDER SECTION 153C QUA THE ASSESSEE WAS JUSTIFIE D ON THE GROUND THAT THE DOCUMENTS SEIZED AND STATED TO BELONG TO THE ASSESSEE WERE NOT INCRIMINATING. (C) THE AFORESAID ORDER DATED 25.05.2017 OF HONBLE DEL HI HIGH COURT, FOR EASE OF REFERENCE, IS REPRODUCED BE LOW :- * IN THE HIGH COURT OF DELHI AT N EW DELHI ITA 613/2016 PR. COMMISSIONER OF INCOME TAX CENTRAL-3 . APPELLAN T VERSUS INSTRONICS LTD. . RESPOND ENT WITH + ITA 614/2016 PR. COMMISSIONER OF INCOME TAX CENTRAL-3 APPELLAN T VERSUS INSTRONICS LTD. RESPONDE NT WITH + ITA 615/2016 PR. COMMISSIONER OF INCOME TAX CENTRAL-3 .. APPELLAN T VERSUS INSTRONICS LTD. . RESPONDENT WITH + ITA 801/2016 PR. COMMISSIONER OF INCOME TAX .. APPELLANT VERSUS INSTRONICS LTD . RESP ONDENT WITH 22 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) ITA 805/2016 PR. COMMISSIONER OF INCOME TAX CENTRAL-3 . APPELLANT VERSUS INSTRONICS LTD. RESPONDENT WITH + ITA 809/2016 PR. COMMISSIONER OF INCOME TAX CENTRAL-3 APPELLAN T VERSUS INSTRONICS LTD. RESPONDENT WITH + ITA814/2016 PR. COMMISSIONER OF INCOME TAX CENTRAL-3 . APPELLANT VERSUS INSTRONICS LTD. .. RESPONDENT WITH + ITA840/2016 PR. COMMISSIONER OF INCOME TAX CENTRAL-3 . APPELLANT VERSUS INSTRONICS LTD. RESPONDENT WITH ITA NO. 848/2016 PR. COMMISSIONER OF INCOME TAXCENTRAL-3 .APPELLANT VERSUS INSTRONICS LTD. RESPONDENT AND + ITA 849/2016 PR. COMMISSIONER OF INCOME TAX CENTRAL-3 . APPELLANT VERSUS INSTRONICS LTD. .. RESPONDENT THROUGH: MR.ASHOK K.MANCHANDA, SR.STANDING COUNSEL WITH MR.RAGHVENDRA SINGH, MR. ANAND K.CHAUDHARI, ADVOCATES FOR THE APPELLANTS. MR. VIKAS JAIN, ADVOCATE FOR THE RESPONDENTS. CORAM: JUSTICE S. MURALIDHAR JUSTICE CHANDER SHEKHAR / 23 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) C.MS.NO. 30398/2016 & 30399/2016 (DELAY) IN ITA NO. 613/2016 C.MS.NO. 30401/2016 & 30402/2016 (DELAY) IN ITA NO. 614/2016 C.MS.NO. 30404/2016 & 30405/2016 (DELAY) IN ITA NO. 615/2016 C.MS.NO. 42538/2016 & 42539/2016 (DELAY) IN ITA NO. 801/2016 C.MS.NO. 43053/2016 & 43054/2016 (DELAY) IN ITA NO. 805/2016 C.MS.NO. 43253/2016 & 43254/2016 (DELAY) IN ITA NO. 809/2016 C.M.NO. 43265/2016 & 43266/2016 (DELAY) IN ITA NO. 814/2016 C.MS.NO. 43686/2016 & 43687/2016 (DELAY) IN ITA NO. 840/2016 C.MS.NO. 44047/2016 & 44048/2016 (DELAY) IN ITA NO. 848/2016 C.MS.NO. 44055/2016 & 44056/2016 (DELAY) IN ITA NO. 849/2016 1. FOR THE REASONS EXPLAINED IN THE APPLICATIONS, THE DELAY IN FILING AS WELL AS RE-FILING IS CONDONED. T HE APPLICATIONS ARE DISPOSED OF ITAS NOS. 613/2016, 614/2016, 615/2016, 801/2016, 805/2016, 809/2016, 814/2016, 840/2016, 848/2016, 849/2016. 2. THESE ARE TEN APPEALS BY THE REVENUE DIRECTED AGAINST THE COMMON ORDER DATED 13 TH MARCH, 2015 PASSED BY THE INCOME TAX APPELLATE TRIBUNAL (ITAT ) IN ITAS NOS. 6336, 6337, 6338, 6339, 6340 AND 6341/DEL/2014 FOR THE ASSESSMENT YEARS (AYS) 2003 - 04 TO 2008-09 AND ITAS NOS. 6553, 6554, 6555 AND 6556/DEL/2014 FOR THE AYS 2005-06 TO 2008-09. OF TH E 10 APPEALS, 6 WERE BY THE ASSESSEE AND 4 BY THE REVENUE. THE REVENUES APPEALS WERE FOR THE AYS 2005-06 TO 2008-09. 3. BY THE IMPUGNED ORDER, THE ITAT HAS PARTLY ALLOWED ALL THE APPEALS FILED BY THE ASSESSEE AND DISMISSED THE CROSS APPEALS OF THE REVENUE. 4. ADMIT. 5. THE FOLLOWING QUESTION OF LAW IS FRAMED FOR CONSIDERATION: 24 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) WHETHER THE ITAT WAS CORRECT IN HOLDING THAT IN TH E ABSENCE OF ANY SATISFACTION OF THE ASSESSING OFFICE R (AO) OF THE SEARCHED PERSON, THE ASSESSMENT FRAMED BY INVOKING THE PROVISIONS OF SECTION 153C CANNOT BE SUSTAINED? 6. IN THE PRESENT CASE, THE SEARCH TOOK PLACE IN TH E CASES OF SHRI B.K.DHINGRA, SMT. POONAM DHINGRA AND MADHUSUDAN BUILDCON PVT. LTD., ASSOCIATES OF THAPAR GROUP OF COMPANIES ON 20 TH OCTOBER, 2008. DURING THE COURSE OF THE SEARCH AT THE RESIDENTIAL PREMISES AT F- 6/5, VASANT VIHAR, NEW DELHI, CERTAIN DOCUMENTS BELONGING TO THE ASSESSEE, INSTRONICS LTD. WERE FOU ND AND SEIZED. AFTER ABOUT TWO YEARS OF THE SEARCH, TH E AO OF THE SEARCHED PERSON ON 30 TH SEPTEMBER, 2010 RECORDED A SATISFACTION THAT SOME OF THE DOCUMENTS BELONG TO THE ASSESSEE. THE SATISFACTION NOTE RECOR DED ON 30 TH SEPTEMBER, 2010 READS AS UNDER : IN THE CASE OF SH. B. K. DHINGRA, SMT. POONAM DHIN GRA, M/S MAYANK TRADERS PVT. LTD., M/S. HORIZON PVT. LTD ., SEARCH & SEIZURE TOOK PLACE U/S 132 ON 20.10.2008. THE UNDERSIGNED IS THE JURISDICTIONAL AO OF THESE CASES . DURING THE COURSE OF SEARCH & SEIZURE DOCUMENTS/PAP ERS AT PAGES 1 TO 38 OF ANNEXURE A-87, ANNEXURES, A-96, A- 97, A-98 AND A-99, ARE FOUND TO BELONG TO M/S. INST RONICS LTD., 192C, J & K POCKET, DILSHAD GARDEN, NEW DELHI . I HAVE EXAMINED THE ABOVE MENTIONED DOCUMENTS/PAPERS AND PROVISION OF SECTION 153C IS INVOKEABLE IN THIS CASE. AS THE UNDERSIGNED IS ALSO THE JURISDICTIONAL AO OF M/S. INSTRONICS LTD. 192C, J & K POCKET, DILSHAD GARDEN, NEW DELHI, THIS SATISFACTION NOTE IS RECORDED AND IS PL ACED IN THE FILE BEFORE ISSUING NOTICE U/S 153C. 7 . THEREAFTER, NOTICE UNDER SECTION 153C OF THE ACT WAS ISSUED TO THE ASSESSEE BY THE ACIT, CENTRAL CIR CLE- 17 ON L ST OCTOBER, 2010 CALLING UPON THE ASSESSEE TO FILE ITS RETURN OF INCOME FOR AYS 2003-04 TO 2008-09 WIT HIN 15 DAYS FROM THE DATE OF SERVICE OF THE NOTICE. THE CASE WAS SUBSEQUENTLY TRANSFERRED TO CENTRAL CIRCLE-21 B Y AN ORDER DATED 19 TH OCTOBER, 2010. IN RESPONSE TO THE NOTICE UNDER SECTION 153C, THE ASSESSEE FILED RETUR NS FOR THE AFOREMENTIONED AYS. 8. BY SEPARATE ASSESSMENT ORDERS DATED 31 ST 25 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) DECEMBER 2010, FOR EACH OF THE AYS 2003-04 TO 2008- 09 THE AO FINALISED THE ASSESSMENT UNDER SECTION 143(3) READ WITH SECTION 153C OF THE ACT MAKING ADDITIONS TO THE RETURNED INCOME IN EACH OF THE AYS . 9. THE APPEALS BY THE ASSESSEE WAS DISMISSED BY TH E CIT(A) BY SEPARATE ORDERS DATED 5 TH SEPTEMBER, 2014 SUSTAINING MOST OF THE ADDITIONS AND DISALLOWANCES. THE OBJECTION RAISED BY THE ASSESSEE TO THE ASSUMPT ION OF JURISDICTION UNDER SECTION 153C OF THE ACT WAS NEGATIVED BY THE CIT(A). 10. IT IS THE CASE OF THE REVENUE THAT AT THE ST AGE OF THE PROCEEDINGS BEFORE THE CIT(A), THE ASSESSEE DID NOT PLACE ON RECORD ANY REPLIES RECEIVED BY IT IN RESPO NSE TO AN APPLICATION MADE UNDER THE RIGHT TO INFORMATION ACT, 2005 (RTI ACT) DESPITE THEIR BEING AVAILABLE WITH THE ASSESSEE. 11. AGAINST THE DECISION OF THE CIT(A), BOTH THE ASSESSEE AND THE REVENUE FILED APPEALS BEFORE THE 1TAT. AT THIS STAGE, THE ASSESSEE PLACED ON RECORD THE INFORMATION GATHERED PURSUANT TO THE APPLICATION MA DE UNDER THE RTI ACT. IT WAS CONTENDED BEFORE THE ITAT BY THE ASSESSEE THAT THE SATISFACTION NOTE RECORDED ON 30 TH SEPTEMBER, 2010 WAS BY THE AO OF THE ASSESSEE AND NOT THE AO OF THE SEARCHED PERSON. ACCEPTING THIS SUBMISSION, THE ITAT BY THE IMPUGNED ORDER HELD THA T THE ASSUMPTION OF JURISDICTION AGAINST THE ASSESSEE UNDER SECTION 153C OF THE ACT WAS UNSUSTAINABLE IN LAW. 12. IT IS CONTENDED BY MR. ASHOK MANCHANDA, LEARNED SENIOR STANDING COUNSEL FOR THE REVENUE THAT THE IT AT ERRED IN OBSERVING THAT THERE IS NO SATISFACTION NO TE OF THE AO OF THE SEARCHED PERSON IN THE PRESENT CASE. IT OVERLOOKED THAT IN THE SATISFACTION NOTE ITSELF, TH E AO SPECIFICALLY NOTES THAT HE IS ALSO THE JURISDICTION AL AO FOR ALL OF THE CASES I.E., FOR THE SEARCHED PERSONS AS WELL AS THE OTHER PERSONS. THIS BASIC ERROR LED THE ITAT TO HOLD THAT THE ASSUMPTION OF JURISDICTION UNDER SECT ION 153C OF THE ACT WAS ILLEGAL. HE RELIED INTER ALIA O N THE DECISIONS OF THIS COURT IN PRINCIPAL COMMISSIONER OF INCOME TAX V. SATKAR FINCAP LTD. (ORDER DATED 16 TH 26 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) NOVEMBER, 2016 IN ITA NO. 82/2016) AND IN PRINCIPAL COMMISSIONER OF INCOME TAX V. SUPER MALLS LTD. (ORDER DATED 13 TH JANUARY, 2017 IN ITA NO. 450/2016). 13. MR. VIKAS JAIN, LEARNED COUNSEL FOR THE RESPONDENT AS'SESSEE, ON THE OTHER HAND, SOUGHT TO PLACE RELIA NCE ON THE DECISIONS OF THIS COURT IN ARN INFRASTRUCTURE INDIA LTD. V. ACIT (ORDER DATED 24 TH APRIL, 2017 IN W.P. (C) NO. 2768/2016), CIT-7 V. RRJSECURITIES LIMITED [2015] 62 TAXMANN.COM 391 (DEL), PCIT- (CENTRAL-2) V. IECS SOLUTIONS PRIVATE LIMITED (ORDER DATED 19 TH OCTOBER, 2015 IN ITA NO. 806/2015) AND PRINCIPAL COMMISSIONER OF INCOME TAX V. AAKASH AROGYA MANDIR PVT. LTD. (ORDER DATED 28 TH JULY, 2015 IN ITA NO. 509/2015). 14. TODAY BY A SEPARATE JUDGMENT IN THE BATCH OF WRIT PETITIONS, THE LEAD CASE BEING W.P.(C) 525/2015 ( GANPATI SERVICES PVT. LTD. V. COMMISSIONER OF INCOME TAX ETC), THE COURT SUMMARISED THE LEGAL POSITION IN RESPECT OF THE SATISFACTION NOTE UNDER SECTION 153 C OF THE ACT AS UNDER: '38. TO SUMMARISE THE LEGAL POSITION: (I) NO SEARCH UNDER SECTION 132 (1) OF THE ACT CAN BE INITIATED WITHOUT A SATISFACTION NOTE BEING RECORDE D BY THE AO OF SUCH SEARCHED PERSON. THIS IS FOLLOWED BY ISSUANCE OF A NOTICE TO SUCH SEARCHED PERSON UNDER SECTION 153 A OF THE ACT. AT THAT STAGE THE AO DOES NOT HAVE TO RECORD ANOTHER SATISFACTION NOTE QUA THE SEARCHED PERSON. (II) WHERE PROCEEDINGS ARE PROPOSED TO BE INITIATED UNDER SECTION 153C OF THE ACT AGAINST THE 'OTHER PERSON', IT HAS TO BE PRECEDED BY A SATISFACTION NO TE BY THE AO OF THE SEARCHED PERSON. HE WILL RECORD IN TH IS SATISFACTION NOTE THAT THE SEIZED DOCUMENT BELONGS TO THE OTHER PERSON. DEPENDING ON THE NATURE AND CONTENTS OF THE DOCUMENT HE MAY BE REQUIRED TO GIVE SOME REASONS FOR SUCH CONCLUSION. (III) WHERE THE AO OF THE SEARCHED PERSON IS DIFFERENT FROM THE AO OF THE OTHER PERSON THE AO WILL, 27 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) SIMULTANEOUS WITH TRANSMITTING THE DOCUMENTS ALONG WITH HIS SATISFACTION NOTE TO THE AO OF THE OTHER P ERSON, MAKE A NOTE IN THE FILE OF THE SEARCHED PERSON THAT HE HAS DONE SO. BUT THIS IS FOR ADMINISTRATIVE CONVENI ENCE. THE FAILURE BY THE AO OF THE SEARCHED PERSON, AFTER PREPARING AND DESPATCHING THE SATISFACTION NOTE AND DOCUMENTS TO THE AO OF THE OTHER PERSON, TO MAKE A NOTING TO THAT EFFECT IN THE FILE OF THE SEARCHED P ERSON WILL NOT VITIATE THE PROCEEDINGS UNDER SECTION 153 C AGAINST THE OTHER PERSON. (IV) WHERE THE AO OF THE SEARCHED PERSON AND THE OTHER PERSON IS THE SAME, SUCH A SATISFACTION NOTE QUA THE OTHER PERSON HAS TO BE RECORDED BY THE AO OF THE SEARCHED PERSON PRIOR TO THE INITIATION OF THE PROCEEDINGS AGAINST THE OTHER PERSON. THIS IS A SINE QUA NON FOR TRIGGERING THE PROCEEDINGS AGAINST THE OTHER PERSON UNDER SECTION 153 C OF THE ACT. (V) THERE DOES NOT HAVE TO BE TWO SEPARATE SATISFACTIO N NOTES PREPARED BY THE AO OF THE SEARCHED PERSON EVE N WHERE HE IS ALSO THE AO OF THE OTHER PERSON. IN SUC H EVENT, THE AO NEED MAKE ONLY ONE SATISFACTION NOTE. THAT SATISFACTION NOTE IS QUA THE OTHER PERSON. FURTHER IT IS SUFFICIENT THAT SUCH SATISFACTION NOTE IS PLA CED IN THE FILE OF THE OTHER PERSON BY THE AO IN HIS CAPAC ITY AS THE AO OF SUCH OTHER PERSON. (VI) IT IS ONLY IN CERTAIN CASES, WHERE THE DOCUMENT IS SUCH THAT IT MAY BELONG TO MORE THAN PERSON (INCLUD ING THE SEARCHED PERSON) THAT THE AO WILL HAVE TO INDIC ATE IN THE SATISFACTION NOTE THE REASONS WHY HE IS OF T HE OPINION THAT THE DOCUMENT BELONGS TO THE OTHER PERS ON AND NOT THE SEARCHED PERSON. (VII) WHERE THE AO OF THE SEARCHED PERSON RECORDS THAT THE SEIZED DOCUMENT IN QUESTION BELONGS TO THE OTHE R PERSON, AND WHERE NECESSARY GIVES THE REASONS THEREFOR, THE REQUIREMENT OF SECTION 153 C STANDS SATISFIED. THE FAILURE BY THE AO IN SUCH CASE TO RE CORD IN THE SATISFACTION NOTE THAT SUCH DOCUMENT DOES NO T BELONG TO THE SEARCHED PERSON WILL NOT VITIATE THE PROCEEDINGS UNDER SECTION 153 C AGAINST THE OTHER 28 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) PERSON.' 15. IN THE PRESENT CASE, THE ITAT OVERLOOKED THE FACT THAT THE SATISFACTION NOTE WAS IN FACT RECORDED BY THE AO OF THE SEARCHED PERSON WHO ALSO HAPPENED TO BE THE AO FOR THE ASSESSEE (THE OTHER PERSON) AS WELL. THIS IS CLEAR FROM THE SENTENCE IN THE SATISFACTION NOTE WHICH READS: 'THE UNDERSIGNED IS THE JURISDICTIONAL AO OF THESE CASES.' THE AO OF THE SEARCHED PERSON HAS RECORDED THE SATISFACTION THAT THE SEIZED DOCUMENTS BELONGED TO THE ASSESSEE. IN SIMILAR CIRCUMSTANCES IN PRINCIPAL COMMISSIONER OF INCOME TAX V. SATKAR FINCAP LTD. (SUPRA), THIS COURT HELD LIKEWISE. THE SATISFACTION NOTE IN THE PRESENT CASE, THEREFORE, SATISFIES THE REQUIREMENT OF THE LAW. CONSEQUENTLY, THE QUESTION FRAMED IS ANSWERED IN THE NEGATIVE I.E., I N FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE. 16. THE LEARNED COUNSEL FOR THE PETITIONER THEN URGED THAT THE DOCUMENTS REFERRED TO IN THE SATISFACTION NOTE WERE NOT INCRIMINATING AND, THEREFORE, ON THAT GROU ND ALSO, THE ASSUMPTION OF JURISDICTION UNDER SECTION 153C BY THE AO WAS ERRONEOUS. 17. THE COURT FINDS THAT THERE IS NO DISCUSSION IN THE IMPUGNED ORDER OF THE ITAT ON WHETHER THE DOCUMENTS REFERRED TO IN THE SATISFACTION NOTE WERE, IN FACT, INCRIMINATING. THE ITAT INVALIDATED THE PROCEEDINGS UNDER SECTION 153 C OF THE ACT ONLY ON THE GROUND O F THERE BEING NO SATISFACTION NOTE BY THE AO OF THE SEARCHED PERSON. AS DISCUSSED EARLIER, THIS WAS FACTUALLY ERRONEOUS. THERE WAS NO OCCASION FOR THE ITAT TO EXAMINE THE OTHER GROUNDS OF CHALLENGE TO THE ASSUMPTION OF JURISDICTION UNDER SECTION 153 C OF T HE ACT. 18. CONSEQUENTLY, THE IMPUGNED ORDER DATED 13TH MARCH 2015 OF THE ITAT IS HEREBY SET SIDE. THE COUR T RESTORES TO THE FILE OF THE ITAT FOR A FURTHER HEAR ING ALL THE APPEALS IN WHICH THE IMPUGNED ORDER WAS PASSED FOR CONSIDERATION OF THE FURTHER GROUNDS INCLUDING THE QUESTION WHETHER THE ASSUMPTION OF JURISDICTION BY THE AO UNDER SECTION 153C QUA THE ASSESSEE WAS JUSTIFIE D 29 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) ON THE GROUND THAT THE DOCUMENTS SEIZED AND STATED TO BELONG TO THE ASSESSEE WERE NOT INCRIMINATING. 19. THE AFOREMENTIONED APPEALS BE LISTED BEFORE THE ITAT ON 3 RD JULY, 2017 FOR DIRECTIONS. 20. THE PRESENT APPEALS OF THE REVENUE ARE ALLOWED IN THE ABOVE TERMS. (D) IT IS IN THIS BACKGROUND THAT THIS BATCH OF APPEALS CAME UP BEFORE ITAT ONCE AGAIN FOR FRESH HEARINGS. WHEN THE MATTERS, CAME UP FOR HEARING BEFORE US, REVENUE WAS REPRESEN TED BY SH. INDER PAL SINGH BINDRA, COMMISSIONER OF INCOME TAX (DEPARTMENTAL REPRESENTATIVE); LD. CIT-DR FOR SHO RT. HOWEVER, ASSESSEE WAS REPRESENTED BY NONE. EARLIER ALSO, WHE N THE APPEALS WERE FIXED FOR HEARING ON 14.11.2019 THE AS SESSEE WAS REPRESENTED BY NONE EVEN ON THAT DATE. THE HEARING FIXED ON 01.10.2019 WAS ALSO ADJOURNED TO 14.11.2019 ON THE REQUEST OF LD. COUNSEL FOR THE ASSESSEE. IN THE ABSENCE OF ANY REPRESENTATION FROM THE ASSESSEES SIDE ON 02.01.20 20, WHEN THE APPEALS CAME UP FOR HEARING BEFORE US, WE HEARD THE LD. CIT-DR FOR REVENUE WHO RELIED ON THE ORDERS OF THE LD. COM MISSIONER OF INCOME TAX (APPEALS) AND THE ASSESSING OFFICER. AFT ER HEARING THE LD. CIT-DR AND AFTER PERUSAL OF THE MATERIALS O N RECORD WE FIND THAT THE HONBLE DELHI HIGH COURT, VIDE AFORES AID CONSOLIDATED ORDER DATED 25.05.2017 HAS DIRECTED TH E ITAT TO CONSIDER FURTHER GROUNDS INCLUDING THE QUESTION WHE THER THE ASSUMPTION OF JURISDICTION BY THE ASSESSING OFFICER U/S 153C OF INCOME TAX ACT QUA THE ASSESSEE WAS JUSTIFIED ON TH E GROUND THAT THE DOCUMENTS SEIZED AND STATED TO BELONG TO T HE ASSESSEE WERE NOT INCRIMINATING. THE HONBLE HIGH COURT, HA S EXPRESSED THAT THE AO OF THE SEARCHED PERSON HAD RECORDED THE SATISFACTION 30 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) THAT THE SEIZED DOCUMENTS BELONGED TO THE ASSESSEE, AND FURTHER THAT THE SATISFACTION NOTE SATISFIED THE REQUIREMEN TS OF LAW. THE QUESTION, WHETHER ITAT WAS CORRECT IN HOLDING THAT IN THE ABSENCE OF ANY SATISFACTION OF ASSESSING OFFICER (A O) OF THE SEARCHED PERSON, THE ASSESSMENT FRAMED BY INVOKING THE PROVISIONS OF SECTION 153C CANNOT BE SUSTAINED ?, WAS ANSWERED BY THE HONBLE HIGH COURT IN THE NEGATIVE I.E. IN F AVOUR OF REVENUE AND AGAINST THE ASSESSEE. HOWEVER, THE HON BLE HIGH COURT FOUND THAT THERE WAS NO DISCUSSION IN THE AFO RESAID CONSOLIDATED ORDER DATED 25.05.2017 OF ITAT, ON WHE THER THE DOCUMENTS REFERRED TO IN THE SATISFACTION NOTE WERE , IN FACT, INCRIMINATING. IT WAS IN THIS BACKGROUND THAT THE H ONBLE HIGH COURT DIRECTED ITAT TO CONSIDER WHETHER THE DOCUMEN TS SEIZED AND STATED TO BELONG TO THE ASSESSEE, WERE INCRIMIN ATING OR NOT. FROM THE PERUSAL OF THE SEPARATE APPELLATE ORDERS D ATED 05.09.2014, 08.09.2014, 09.09.2014, 10.09.2014 AND 11.09.2014 PERTAINING TO ASSESSMENT YEARS 2003-04, 2004-05, 2005-06, 2006-07 AND 2007-08 PASSED BY THE LD. CIT( A); WE FIND THAT THERE IS NO DISCUSSION AS TO WHETHER THE DOCUM ENTS SEIZED FROM THE SEARCHED PERSON AND STATED TO BELONG TO TH E ASSESSEE, WERE INCRIMINATING OR NOT. THEREFORE, IN THE FITNES S OF THINGS, WE SET ASIDE THE IMPUGNED APPELLATE ORDERS OF LD. CIT( A); AND WE RESTORE ALL THE DISPUTED ISSUES TO THE FILE OF THE LD. CIT(A) FOR FRESH ORDER IN ACCORDANCE WITH LAW, AFTER DECIDING AND GIVING A CATEGORICAL FINDING ON WHETHER THE DOCUMENTS SEIZED FROM THE SEARCHED PERSON, AND STATED TO BELONG TO THE ASSESS EE WERE INCRIMINATING OR NOT. 31 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) (E) BEFORE WE PART, WE WISH TO SPECIFICALLY TAKE NOTE O F RULES 24 AND 25 OF INCOME TAX (APPELLATE TRIBUNAL) RULES 196 3. THE ASSESSEE WILL BE AT LIBERTY TO MOVE ITAT FOR SETTIN G ASIDE THIS PRESENT ORDER AND FOR RESTORATION OF THE APPEALS IF THE ASSESSEE SATISFIES THAT THERE WAS SUFFICIENT CAUSE FOR NON-A PPEARANCE WHEN THE APPEALS WERE CALLED ON FOR HEARING ON 2 ND JANUARY, 2020. ORDER PRONOUNCED IN THE OPEN COURT ON 16.01.20. SD/- SD/- (SUDHANSHU SRIVASTAVA) (ANADEE NATH MISSHRA) JUDICIAL MEMBER ACCOUNTANT MEM BER DATED: 16.01.2020 *BR* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT TRUE COPY ASSISTANT REGISTRAR ITAT NEW DELHI 32 ITA NO. 6336-6341 & 6553-6 556/DEL/2014 (M/S. INSTRONICS LIMITED) DATE OF DICTATION 03.01.2020 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 06.01.2020 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P S/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WE BSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER 19 ITA NO. 6336-6341 & 6553-6556/DEL/201 4 (M/S. INSTRONICS LIMITED) 34 ITA NO. 6336-6341 & 6553-6556/DEL/2014 (M/S. INSTRONICS LIMITED) 35 ITA NO. 6336-6341 & 6553-6556/DEL/2014 (M/S. INSTRONICS LIMITED)