Bharati Vidyapeeth Medical Foundation, Pune V. ACIT, Pune

ITA 959/PUN/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 49740 (ITAT-PUNE)
• Duration Of Justice: 9 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-04-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2000-2001
• Appeal Filed On: 29-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S U PATHAKNIKHIL PATHAK SHRI A
• Keywords: Invalid notice; Depreciation; Income from undisclosed sources; Search and seizure; Loose papers; Document seized; Charitable institution; Opportunity of being heard; Retrospective amendment; Difference of opinion; Block assessment; Documents seized; Change of opinion; Capital expenditure
• Section: 143(3); 142(1); 153A; 234B; 131; 148; 263; 132; 11; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI I.C. SUDHIR, JUDICIAL MEMBER AND SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER *** 1. ASSESSEES APPEALS ARISING OUT OF THE ORDERS PAS SED U/S 153C RWS 143(3) OF THE ACT: S.NO . ITA NO. ASST.YEAR 1. 959/PN/10 2000-01 2. 961/PN/10 2001-02 3. 963/PN/10 2002-03 4. 964/PN/10 2003-04 5. 966/PN/10 2004-05 6. 967/PN/10 2005-06 BHARATI VIDYAPEETH MEDICAL FOUNDATION, .. APPE LLANT LAL BAHADUR SHASTRI ROAD, NAVI PETH, PUNE PAN AAATB 1350Q VS. ASSTT. COMMISSIONER OF INCOME-TAX, .. RESPONDENT CIR.2(2), PUNE **** 2. ASSESSEES APPEALS ARISING OUT OF THE ORDERS PAS SED BY THE CIT U/S 263 OF THE ACT: 7. 659/PN/08 2000-01 8. 660/PN/08 2001-02 9. 661/PN/08 2002-03 10. 662/PN/08 2004-05 11. 663/PN/08 2005-06 BHARATI VIDYAPEETH MEDICAL FOUNDATION, .. APPELLAN T VS. DY.COMMISSIONER OF INCOME-TAX, .. RESPONDENT ****** 3. ASSESSEES APPEALS ARISING OUT OF THE ORDERS PAS SED U/S 263 RWS 153C RWS 143(3) OF THE ACT: 12. 958/PN/10 2000-01 13. 960/PN/10 2001-02 14. 962/PN/10 2002-03 15. 965/PN/10 2004-05 16. 968/PN/10 2005-06 BHARATI VIDYAPEETH MEDICAL FOUNDATION, .. APPELLAN T VS. DY.COMMISSIONER OF INCOME-TAX, .. RESPONDENT 4. REVENUES APPEALS ARISING OUT OF THE ORDERS PASS ED U/S 263 RWS153C RWS 143(3) OF THE ACT AND U/S 153C RWS 143(3) OF TH E ACT: 17. 1036/PN/10 2000-01 18. 1037/PN/10 2001-02 19. 1038/PN/10 2002-03 20. 1039/PN/10 2003-04 2 21. 1040/PN/10 2004-05 22 1041/PN/10 2005-06 ASSESSEE BY : S/SHRI S.U. PATHAK/NIKHIL PATHAK DEPARTMENT BY: SHRI A.S.SINGH ORDER PER BENCH: THERE ARE 22 APPEALS UNDER CONSIDERATION. SIX OF THEM ARE BY THE RE VENUE AND OTHERS ARE BY THE ASSESSEE. THE GROUNDS IN ALL THE SE APPEALS BY THE ASSESSEE AND THE REVENUE ARE EITHER COMMON OR INTERLINKED OR OVERLA PPING ON THE ISSUES. THEREFORE, THEY ARE CLUBBED AND DISPOSED OF IN THIS CO NSIDERED ORDER. OTHERWISE, THERE ARE THREE CATEGORIES OF APPEALS IN THIS GROUP OF 2 2 APPEALS. FOR THE FIRST CATEGORY APPEALS NUMBERING SEVEN (INCLUDING ONE BY THE REVENU E FOR THE AY 2003-4), THE IMPUGNED ORDERS ARE PASSED U/S 153C RWS 14 3(3) OF THE ACT IN RESPECT OF THE AYS 2000-01 TO 2005-06. FOR THE SECOND CATEGORY OF THE APPEALS, THE REVIEW ORDER OF THE CIT PASSED U/S 263 OF THE ACT SETTING ASIDE THE ABOVE REFERRED ORDERS OF THE AO/CIT(A) IS THE IMPUGNED O RDER. THE ASSESSEE IS IN APPEAL AGAINST ORDER OF THE CIT IN RESPECT OF THE AYS 2000-01 TO 2005-06 WITH THE EXCEPTION FOR THE AY 2003-04. THUS, THERE ARE 5 APPEALS IN THIS REGARD. THIRD CATEGORY OF THE APPEALS ARE THE 10 CROSS APPEALS OF THE ASSESSEE AND THE REVENUE AGAINST THE FRESH ASSESSMENT ORDERS PASSED BY THE AO U/S 153C RWS 143(3) RWS 263 OF THE ACT. 2. TO START WITH, WE SHALL TAKE UP THE FIRST CATEGORY. ON FINDING THAT THE GROUNDS IN ALL THESE 7 APPEALS ARE EITHER COMMON OR IN TERLINKED OR OVERLAPPING ON THE ISSUES, WE PROCEED TO ADJUDICATE ALL OF THEM IN A CONSOLIDATED MANNER. FOR THE SAKE REFERENCE, WE CONSIDER THE IMPUGNED ORDERS F OR THE AY 2000-01 AND THE RELEVANT GROUNDS FOR THE SAID AY 2000-01 ARE REPRODU CED AS UNDER. 3. THE FOLLOWING GROUNDS INCLUDING THE ADDITIONAL GROUND ARE TAKEN BY THE ASSESSEE FOR THE AY 2000-01 AND THEY ARE WITHOUT PREJUDICE TO EACH OTHER ON FACTS AND IN LAW, 1. THE LD CIT(A) ERRED IN NOT APPRECIATING THAT THE NOTICE ISSUED U/S 153C WAS NOT VALID AND THEREFORE, THE ASSESSMENT MADE U/S 153C R.W.S. 153A WAS NULL AND VOID. 2. THE LD CIT(A) ERRED IN HOLDING THAT THE ACTIVITIES OF TH E ASSESSEE TRUST WERE COVERED U/S 10(23C) AND THEREFORE, THE CLAIM OF EXEMP TION OF THE ASSESSEE COULD BE EXAMINED ONLY U/S 10(23C) AND NOT U/S 11 13. 3. THE LD CIT(A) ERRED IN HOLDING THAT THE APPELLANT TRUST WAS NOT ENTITLED TO THE EXEMPTION U/S 11 AS IT HAD VIOLATED THE PROVISIONS OF SE CTIONS 13(1)(D) R.W.S. 11(5). 3 4. THE LD CIT(A) ERRED IN CONFIRMING THE ADDITION IN RESPECT OF DONATION RECEIVED THROUGH ISSUE OF COUPONS OF RS 31,25,000/- WITHOUT AP PRECIATING THAT THE SAID DONATIONS WERE RECEIVED TOWARDS THE CORPUS OF THE TRU ST AND HENCE, EXEMPT U/S 11(1)(D) OF THE ACT. 5. THE LD CIT(A) ERRED IN CONFIRMING AN ADDITION OF RS 97,50 ,000/- BEING DONATIONS RECEIVED BY THE TRUST TOWARDS HOSPITAL EQUIPMENT FUND O N THE GROUND THAT THE SAID DONATIONS RECEIVED WERE NOT TOWARDS THE CORPUS O F THE TRUST. 6. THE LD CIT(A) ERRED IN HOLDING THAT THE ASSESSEE TRUST WAS NOT ENTITLED TO CLAIM EXEMPTION U/S 11 ON THE GROUND THAT THE FORM NO 10 W AS NOT FILED BY THE ASSESSEE ALONG WITH THE RETURN OF INCOME. 7. THE LD CIT(A) ERRED IN NOT ALLOWING THE DEDUCTION OF RS 7,47,475/- BEING THE AMOUNT PAID TOWARDS THE REPAYMENT OF LIABILITY OF THE TRU ST. 8. THE LD CIT(A) ERRED IN NOT GRANTING BENEFIT OF 25% OF T HE INCOME WHICH IS ALLOWABLE AS PER LAW TO BE SET APART AND ACCORDINGLY, THE INCOME COMPUTED SHOULD HAVE BEEN REDUCED BY 25%. 9. THE LD CIT(A) ERRED IN NOT ALLOWING THE APPLICATION OF INC OME OF RS 16,67,410/- BEING EXPENDITURE OF CAPITAL NATURE WHILE COMPUTING THE INC OME OF THE ASSESSEE TRUST. 10. THE LD CIT(A) ERRED IN NOT GRANTING DEPRECIATION TO THE ASSESSEE AS PER LAW. 11. THE LD CIT(A) ERRED IN DENYING THE EXEMPTION U/S 11 TO THE APPELLANT. 12. THE LD CIT(A) ERRED IN DENYING THE DEDUCTION U/S 80L TO THE APPELLANT. 13. THE LD CIT(A) ERRED IN NOT APPRECIATING THAT NO INTERES T WAS CHARGEABLE U/S 234B AS PER LAW. THE ABOVE ABRIDGED GROUNDS ARE MANY IN NUMBER AND THEY ARE BOTH LEGAL AND MERIT RELATED ONES IN NATURE. THE GROUND AT SL NO 1 IE THE LD CIT(A) ERRED IN NOT APPRECIATING THAT THE NOTICE ISSUED U/S 153C WAS NO T VALID AND THEREFORE, THE ASSESSMENT MADE U/S 153C R.W.S. 153A WAS NULL AND V OID IS A COMMON GROUND AND THE DECISION ON THIS GROUND DETERMINES THE VALIDI TY OF OTHER APPEALS OF THE ASSESSEE FOR THE AY 2001-02 TO 2005-06 TOO. FURTHER, T HE DECISION OF ALL SIX CROSS APPEALS OF THE REVENUE IS ALSO DEPENDENT ON THE SAME . THEREFORE, WE PROCEED TO TAKE UP THIS CRUCIAL AND LEGAL GROUND IN THE VERY BEG INNING OF THIS ORDER. 4. RELEVANT FACTS OF THE CASE IN GENERAL AND THE SAI D LEGAL GROUND NO 1 IN PARTICULAR ARE THAT A SEARCH AND SEIZURE ACTION WAS COND UCED ON 20.7.2005 IN THE CASE OF SHRI RAMCHANDRA DADA SHINDE AT HIS OFFICE PREM ISES AT BHARATI VIDYA BHAVAN AS WELL AS AT HIS RESIDENCE AT ASHIRWAD BHAR ATI NAGAR, PAUD ROAD, KOTHRUD. SHRI RAMCHANDRA DADA SHINDE IS THE TRUSTED EMP LOYEE OF BHARATI VIDYAPEETH, PUNE AND HE WORKED AS AN ACCOUNTS OFFICE R LOOKING AFTER THE ACCOUNTS OF VARIOUS TRUSTS OF BHARATI GROUP INCLUDING THE ASSESSEE-TRUST. DURING THE COURSE OF SEARCH ACTION, NUMBER OF DOCUMENTS RELATI NG TO ASSESSEE WERE SEIZED FROM SHRI R D SHINDE VIDE PANCHANAMA DT 22.7.2 005.THE SAID SEIZER ALSO INCLUDES BUNDLE NO 10 WHICH IS THE LEDGER OF THE ASSESSEE TRUST FOR THE F.Y 2003-04. THE CASE WAS ASSIGNED TO THIS CHARGE VIDE C IT (CENTRAL) PUNES ORDER NO PN/CIT(C)/ ASSIGN.JURIS/2006-07/15 DT 26.4.2006. ON THE BASIS OF DOCUMENTS SEIZED/ IMPOUNDED FROM SRI R D SHINDE AND ALSO ON THE BASIS OF CERTAIN FACTS REVEALED DURING THE COURSE OF POST SEARCH ENQUIRIES THE THEN AO AFTER SATISFYING 4 HIMSELF ABOUT THE INVOCATIONS OF PROVISIONS OF SECTI ON 153C IN THE CASE OF ASSESSEE ISSUED A NOTICE U/S 153C ON 30.3.2007. AS NO RETURNS WERE FILED IN RESPONSE TO THIS NOTICE A FURTHER NOTICE U/S 142(1) CA LLING THE RETURNS AND THE FINAL NOTICE WAS ISSUED TO ASSESSEE ON 2.8.2007 WHI CH WAS SERVED ON THE ASSESSEE ON 3.8.2007. AS THERE WAS NO RESPONSE TO THI S NOTICE ALSO A SUMMONS U/S 131 REQUIRING THE ASSESSEE TRUST TO FILE THE RETURN S WAS ISSUED TO MANAGING TRUSTEE ON 16.8.2007. IN THE INTERVENING PERIOD THE AS SESSEE HAD HOWEVER DRAWN MY ATTENTION TO THEIR LETTER DT 28.8.2006 WHERE T HEY ASKED FOR REASONS FOR ISSUING NOTICE U/S 153C , THE SAME WERE FURNISHED TO THE ASSESSEE VIDE LETTER DT 10.0.2007. IN THE MEANTIME, THE ASSESSEE F ILED THE RETURNS ON 18.9.2007 DECLARING NIL INCOME. THE RETURN FILED BY THE ASSESSEE THOUGH ACCOMPANIED BY INCOME AND EXPENDITURE ACCOUNT AND BALANCE SHEET NO AUDIT REPORT HAS BEEN FURNISHED ALONG WITH RETURN OF INCOME. THE SAID RETURN ALSO IS NOT ACCOMPANIED BY FORM NO 10 READ WITH RULE 17 OF THE IT RULES.IN TH E MEANTIME TO FACILITATE THE COMPLETION OF ASSESSMENT A NOTICE U/S 142(1) AL ONG WITH A DETAILED QUESTIONNAIRE WAS ISSUED TO THE ASSESSEE ON 7.9.2007 REQUIRING THE ASSESSEE TO FILE THEIR REPLIES. THE ASSESSEE TRUST IS MANAGED BY A BOARD OF TRUSTEES CONSISTING OF FOLLOWING SIX MEMBERS. THEY ARE: DR PAT ANGRAO SHRIPATRAO KADAM; 2.SMT VIJAYMALA PATANGRAO KADAM 3. DR SHIVAJIRAO SHRIPA TRAO KADAM ; 4.DR ASMITA RAJENDRA JAGTAP 5. SRI VILASRAO B MHETRE 6. S HRI DATTATRAY SHANKAR KULKARNI AND 7.DR E.K. BARUCHA. FURTHER, THERE ARE SEVERAL OTHER TRUSTS HAVING THEIR REGISTERED OFFICE AT THE SAME ADDRESS AS THAT OF THE ASSESSEE TRUST. THESE TRUSTS ARE: 1. BHARATI KALA ACADEMY; 2. PATANGRAO KADAM PRATISHTAN; 3.ABHIJIT KADAM MEMORIAL TRUST; 4. BHARATI KRIDA PRATISHTAN; 5. B HARATI VIDYAPITH EDUCATION TRUST; AND 6. SONHIRA FOUNDATION FOR RURAL DEVELOPMENT. 5. AO COMPLETED THE ASSESSMENT AFTER MAKING ADDITION S AND THE ASSESSED INCOME FOR THE AY 2000-01 WAS RS 2.45 CRORES AGAINST T HE NIL INCOME RETURNED BY THE ASSESSEE. ADMITTEDLY, THE ASSESSEE DID NOT RAISE THIS LEGAL ISSUE RELATING TO ISSUE OF INVALID NOTICE U/S 153C OF THE ACT AND THE RE IS NO DISCUSSION IN RESPECT OF VALIDITY OF THE SAID NOTICE S. 153C, MAKING IT CLEA R THAT THE SAME WAS NOT RAISED BEFORE THE AO. HOWEVER, THE ISSUE CAME UP SUBSTANTIAL LY BEFORE THE FIRST APPELLATE AUTHORITY. THUS, IT IS A LEGAL ISSUE IN NA TURE AND IT WAS RAISED BEFORE THE OTHER REVENUE AUTHORITIES AND THEREFORE, IT CAN BE RAISE D BEFORE US AND HAS TO BE ENTERTAINED AND ADDRESSED BY US IN THIS APPEAL. IN P ARTICULAR, VALIDITY OF THE NOTICE U/S 153C WAS RAISED BEFORE THE CIT(A) WHO DISM ISSED THE SAID GROUND DURING THE FIRST APPELLATE PROCEEDINGS. PARA 5 OF THE IMPUGNED ORDER CONTAINS THE RELEVANT FACTS AND THE DISCUSSION ON THE ISSUE. WE P ROCEED TO THE SAME IN THE 5 PRECEDING PARAGRAPHS. IT IS REQUIRED TO CLARIFY HERE THA THE IMPUGNED ORDER IS A COMMON ORDER PASSED BY THE AO ATTENDING TO THE GROUNDS RAISED ON THE ISSUES ARISING OUT OF THE SEARCH ASSESSMENT ORDER PASSED UNDER SECTION 153C R W S 143(3) AND ALSO THE FRESH ASSESSMENT ORDER PASSED U/S 153C R W S 143(3) R W S 263 OF THE ACT. DURING THE FIRST APPELLATE PROCEEDIN GS THE ASSESSEE MADE VARIOUS WRITTEN SUBMISSION ON THIS ISSUE RELATING TO T HE VALIDITY OF THE NOTICE U/S 153C OF THE ACT ISSUED TO THE ASSESSEE IN RESPECT OF THE SIX AYS UNDER CONSIDERATION IE 2000-01 TO 20005-06. AFTER CONSIDERI NG THE SAME, THE FIRST APPELLATE AUTHORITY DISMISSED THE GROUND OF THE ASSES SEE AND UPHELD THE VALIDITY OF THE NOTICE. IT IS THE CONSISTENT VIEW OF THE REVE NUE THAT THE VIDE THE SECTION 153C OF THE ACT R W THE FIRST PROVISO TO SECTION 153A OF THE ACT, THE AO CAN ASSUME JURISDICTION AUTOMATICALLY IN RESPECT OF SIX A YS PRIOR TO THE SEARCH IRRESPECTIVE OF THE FACT WHETHER THERE EXIST ANY INCRIMI NATING MATERIAL OR OTHERWISE AS THE EXPRESSION INCRIMINATING IS NOT BO RNE OUT OF THE ACT. FOR THE SAKE OF COMPLETENESS, WE PROCEED TO REPRODUCE THE SAID PARAGRAPH 5 FROM THE IMPUGNED ORDER AND THE SAME READ AS UNDER. 5. GROUNDS NO. 1 ASSESSMENT IS NULL AND VOID: 5.1 THE APPELLANT HAS RAISED THE ABOVE GROUND VIDE GROUNDS NO 1 AND 1.1 AND THE SAME ARE QUOTED BELOW FOR READY REFERENCE: 1) THE ASSESSMENT ORDER U/S 153C R.W.S.263 IS NULL AND VOID AS THE BASIC ORDER U/S 263 ITSELF WAS NOT JUSTIFIED IN LAW AND ON FACT S. 1.1) THE ASSTT. ORDER U/S 153C R.W.S. 263 IS ALSO B AD IN LAW AS IT HAS BEEN ASSED WITHOUT GIVING A SUFFICIENT OPPORTUNITY OF HEARING TO THE APPELLANT. 5.2 IT CAN BE SEEN FROM THE PERUSAL OF THE ABOVE TW O GROUNDS THAT THE APPELLANT HAS CONTENDED THAT THE ASSESSMENT MADE U/ S 153C R.W.S. 263 IS NULL AND VOID AS (A) THE BASIC ORDER U/S 263 ITSELF WAS NOT JUSTIFIED IN LAW AND ON FACTS AND(B) SUFFICIENT OPPORTUNITY OF BEING HEARD WAS NOT GIVEN. PERUSAL OF THE ASSESSMENT ORDER REVEALS THAT THE AO HAS DISCUS SED THE FACTS BASED ON WHICH THE LD CIT (CENTRAL) PASSED ORDER U/S 263 ALO NG WITH DIRECTIONS GIVEN TO THE AO. THERE IS NO DISCUSSION IN RESPECT OF VALIDI TY OF S. 153C, MAKING IT CLEAR THAT THE SAME WAS NOT RAISED BEFORE THE AO. EVEN TH E GROUNDS REFERRED TO ABOVE, DO NOT CHALLENGE THE VALIDITY OF NOTICE ISSU ED U/S 153C. 5.3 THE APPELLANT HAS MADE THEIR SUBMISSIONS VIDE T HEIR LETTER DT 9.10.2009 AND THE SAME WAS ALSO CONSIDERED. RELEVANT PORTION OF THE SUBMISSIONS ARE QUOTED BELOW:- 3. ON VALIDITY OF NOTICES U/S 153C 3.1 IN THIS CASE, THE LD AO HAD ISSUED NOTICE U/S 153C IN PURSUANCE OF THE SEARCH ON SHRI R.D. SHINDE. THE LD AO HAS GIVEN US THE SATISFACTION NOTE WHEREIN HE HAS REFERRED TO THE DOCUMENTS RELAT ING TO THE ASSESSEE FOUND WITH SHRI R D SHINDE. THE LD AO HAS STATED TH AT THE NOTICE U/S 153C WAS ISSUED ON ACCOUNT OF CERTAIN DOCUMENTS SEIZED F ROM SHRI SHINDE. THE NOTICE WAS ISSUED ON 30.3.2007.ACCORDINGLY, THE LD AO IS OF THE OPINION THAT SINCE VARIOUS DOCUMENTS SEIZED FROM SHRI R D SH INDE PERTAIN TO THE 6 ASSESSEE, THE NOTICE U/S 153C IS VALID. THE ASSESSE E SUBMITS THAT THERE IS NO JUSTIFICATION FOR ISSUE OF NOTICE U/S 153C. SECT ION153C STATES THAT WHERE ANY MONEY, BULLION, JEWELLERY OR VALUABLE ART ICLE OR THING OR BOOKS OF ACCOUNTS OR DOCUMENTS SEIZED BELONG TO A PERSON OTHER THAN THE PERSON REFERRED TO SECTION IN 153A, THEN NOTICE U/S 153C CAN BE ISSUED TO THE PERSON WHOSE BOOKS OF ACC OUNTS, ETC. ARE SEIZED. THE ASSESSEE SUBMITS THAT THE DOCUMENTS FOUND WITH SHRI SHINDE WHICH ARE MENTIONED IN THE SATISFACTION NOTE RECORDED BY THE LD AO ARE NOT INCRIMINATING DOCUMENTS BUT THEY ARE THE DOCUMENTS FOR THE TRANSACTIONS WHICH ARE DULY ACCOU NTED BY THE ASSESSEE TRUST IN ITS BOOKS AND THEREFORE, THERE WAS NO REASON TO ISSUE NOTICE TO THE ASSESSEE U/S 153C. THE ASSESSEE CONTE NDS THAT WHERE REGULAR DOCUMENTS WHICH ARE ACCOUNTED AND CAN BE VE RIFIED ARE SEIZED, THEN NO NOTICE U/S 153C CAN BE ISSUED. IT IS SUBMIT TED THAT THE LEDGER ACCOUNTS FOR F Y 2003-04 WERE FOUND WITH SHRI SHIND E. IT IS SUBMITTED THAT ALL THESE ACCOUNTS WERE DULY ACCOUNTED AND NO INCRI MINATING MATERIAL WAS FOUND PERTAINING TO THE ASSESSEE DURING THE SEARCH ON SHRI SHINDE. HENCE, WE SUBMIT THAT THE NOTICE ISSUE D U/S 153C IS NOT VALID AT ALL SINCE NO INCRIMINATING EVIDENCE HAS BEEN FOU ND PERTAINING TO THE ASSESSEE. ACCORDINGLY, WE SUBMIT THAT THE NOTICE U/ S 153C IS NOT VALID AND THEREFORE, THE ASST. MADE BY THE LD AO IN PURSUANCE OF THE SAID NOTICE IS ALSO INVALID. 3.2 WITHOUT PREJUDICE TO THE ABOVE SUBMISSIONS, THE ASSESSEE SUBMITS THAT THE NOTICE ISSUED U/S 153C WAS ON 30.3.2007. N OW, AS PER THE PROVISO TO SECTION 153C, THE DATE OF RECKONING THE DATE OF INITIATION OF ASST. PROCEEDINGS FOR EARLIER YEARS IS THE DATE OF HANDING OVER THE DOCUMENTS BY THE AO. NOW, IN THIS CASE, THE SEARCH ON SHRI R D SHINDE TOOK PLACE ON 20.7.2005. ON THE BASIS OF THIS DATE, THE NOTICES ARE ISSUED FOR IMMEDIATELY SIX PRECEDING YEARS I.E. F.YS 1999- 2000 TO 2004-05. HOWEVER, THE NOTICE U/S 153C WAS ISSUED ON 30.3.200 7 AND THEREFORE, THE SIX PRECEDING YEARS ARE F.YS 2000-01 TO 2005-06. AC CORDINGLY, IN VIEW OF THE PROVISO TO SECTION 153C, THE ASST. FOR A.Y 2000-01 COULD NOT BE COMPLETED U/S 153C. IN THIS CONTEXT, RELIANCE IS PLACED ON AHMEDABAD ITAT DECISION IN THE CASE OF VIJAY M VIMAWAL (25 DT R 363) WHEREIN HONBLE ITAT HAS UPHELD THIS PRINCIPLE. IN VIEW OF THE ABOVE SUBMISSIONS, THE ASSESSEE SUBMITS THAT THE ASST. U/S 153C R.W.S. 153A COMPLETED FOR A.Y 2000-01IS NULL AND VOID. 5.4. I HAVE CAREFULLY CONSIDERED THE GROUNDS OF TH E APPELLANT MENTIONED AT PARA 5.1 AND THE RIVAL SUBMISSIONS AND FIND THAT THE GROUND NO. 1 IS BASED ON THE ORDER OF THE CIT PASSED U/S 263 OF THE I.T. ACT. THIS GROUND IS INADMISSIBLE AT THIS FORUM AS THE APPEAL AGAINST TH E ORDER PASSED U/S 263 CAN ONLY BE FILED BEFORE THE HONBLE ITAT AND THEREFORE, THE ABOVE GROUND IS DISMISSED. THE APPELLANT HAS ALREADY FILE D AN APPEAL BEFORE THE HONBLE ITAT, PUNE BENCH, PUNE. .. IN VIEW OF TH E ABOVE, BOTH THE ABOVE GROUNDS RAISED BY THE APPELLANT ARE TREATED AS DISM ISSED. 5.5 WITHOUT PREJUDICE TO THE DISCUSSIONS MADE IN TH E ABOVE PARA, IT IS OBSERVED THAT THE SUBMISSIONS OF THE APPELLANT ARE ON THE VALIDITY OF PROCEEDING INITIATED U/S 153C, WHICH IS NOT THE SUB JECT MATTER OF APPEAL BUT ARE BEING DISCUSSED HEREUNDER WITHOUT ADMITTING SUC H ISSUES AS A MATTER OF APPEAL. IT IS CLEAR THAT NO OBJECTION WAS TAKEN Y T HE APPELLANT DURING THE PROCEEDING INITIATED BY THE AO U/S 153C R.W.S. 143( 3) OF THE I.T ACT SUBSEQUENT TO THE SEARCH. IN VIEW OF THE ABOVE, THE SAME CANNOT BE CHALLENGED TO BE INVALID BECAUSE OF PROVISIONS CONTAINED U/S 292B AND 292BB OF THE I.T. ACT. THE GROUNDS ARE ALSO INADMISSIBLE UNDER RLE 46A OF 7 THE I.T. RULES. ON MERIT ALSO S. 153C R.W.S. 153A REFERS TO MATERIALS SEIZED DURING SEARCH, WHICH MAY OR MAY NOT BE INCRI MINATING. THE WORD INCRIMINATING IS MISSING IN THESE SECTIONS AND THEREFORE, ITS EXISTENCE CANNOT BE PRESUMED. ASSUMPTION OF JURISDI CTION U/S 153C IS A PRE- REQUISITE FOR THE AO TO ENABLE HIM TO VERIFY THE DO CUMENTS OR MATERIALS SEIZED WHETHER THE SAME IS INCRIMINATING OR NOT. ON THE SU BMISSION OF THE APPELLANT THAT THE ASSESSMENT YEAR 2000-01 IS BEYOND THE PURVIEW OF SE CTION 153C ON THE BASIS OF THE JUDGMENT GIVEN BY HONBLE ITAT AHMEDABAD IN VIJAY M VIMAWAL, IT IS SEEN THE ABOVE ARGUMENT IS B ASED ON THE INTERPRETATION OF AMENDMENT BROUGHT IN PROVISO TO S. 153C BY FINAN CE ACT, 2005 WITH RETROSPECTIVE EFFECT FROM 1.6.2003. HOWEVER, IN THA T PROCESS, THE APPELLANT SEEM TO BE IGNORING OTHER AMENDMENTS BROUGHT IN SIM ULTANEOUSLY THROUGH THE SAME FINANCE ACT IN OTHER RELATED SECTIONS FOR BRIN GING IN HARMONY IN THE ENTIRE PROCESS OF ASSESSMENT AND RE-ASSESSMENT REQU IRED TO BE DONE AFTER SEARCHES. THE PROVISO TO SUB-SECTION 1 OF S. 153C W AS INSERTED ALONG WITH SECOND PROVISO TO SUB-SECTION 1 OF S. 153A AND PROV ISO TO SUB-SECTION 1 O S. 153B. ALONG WITH THE SAME, CERTAIN OTHER AMENDMENTS WERE MADE IN THOSE RELEVANT SECTIONS. IF ALL SUCH AMENDMENTS ARE CONSID ERED TOGETHER, IT IS NOT DIFFICULT TO UNDERSTAND THAT BY THESE AMENDMENTS IT WAS NEVER MEANT THAT SIX YEARS ARE TO BE COUNTED FROM THE ASSESSMENT YEA R IN WHICH CASH/DOCUMENTS ARE RECEIVED IN CASE OF PERSONS REFE RRED IN S. 153C. ON THE CONTRARY, THE SAME WAS TO PROVIDE THE AO TIM E PERIOD OF ATLEAST ONE YEAR FOR COMPLETING THE ASSESSMENT AFTER RECEIVING THE SEIZED MATERIALS. THIS ASPECT HAS BEEN VERY CLEARLY EXPLAINED BY THE CBDT IN PARA 3.26 OF THE CIRCULAR NO. 3 OF 2006 DT 27.2.2006. THIS CIRCULAR HAS BEEN ISSUED TO EXPLAIN ALL THESE AMENDMENTS BROUGHT IN BY FINANCE ACT, 2005 AN D IN PARA 3.26 THE SAME HAS BEEN REFERRED AS RATIONALIZATION OF THE PROVISI ONS RELATING TO ASSESSMENT OF INCOME IN SEARCH AND SEIZURE CASES. THEREFORE, IF T HERE IS ANY CONFUSION IN THE INTERPRETATION OF LAW, THE MOST RELEVANT SOURCE FOR SEEKING CLARIFICATION HAS TO BE THE ABOVE CIRCULAR AND NOT SOMETHING ELSE. EVEN OTHERWISE, IF THE APPELLANTS ARGUMENT IS ACCEPTED, IT WILL LEAD TO A SITUATION IN WHICH S. 153C WILL BECOME SUBSTANTIALLY IN-OPERATIONAL. SUCH INTE RPRETATION WILL LEAD TO ABSURDITY. IT HAS TO BE UNDERSTOOD AND REALIZED THA T THE MATERIAL GATHERED DURING SEARCH HAS TO BE NECESSARILY RELATING TO YEA RS PRIOR TO THE DATE OF THE SEARCH. LAW HAS PROVIDED THE AUTHORITY TO THE AO TO EXAMINE ITS RELEVANCE FOR ASSESSMENT/REASSESSMENT FOR SIX ASSESSMENT YEARS PR IOR TO THE YEAR IN WHICH SEARCH TAKES PLACE. THERE IS NO AMBIGUITY ON THIS C ONCEPT SO FAR PROVISIONS CONTAINED IN S. 153A ARE CONCERNED. HOWEVER, IF THE DATE OF RECKONING FOR COUNTING SIX YEARS IS ADVANCED TO THE DATE OF HANDI NG OVER OF MATERIAL TO THE AO OF PERSONS OTHER THAN THOSE SEAR CHED AS ARGUED BY APPELLANT IN S.153C, SEARCH MATERIALS BEING OF R ELEVANCE TO THE PERIOD PRIOR TO THE DATE OF SEARCH CANNOT HAVE ANY RELEVANT FOR YEARS WHICH GET ADVANCED DUE TO TIME LAG IN HANDING OVER SUCH MATERIALS. THEREFORE, MAY SUCH ASSESSMENT YEARS FOR WHICH ACTI ON U/S 153C GETS INITIATED AS PER THE APPELLANT WILL HAVE NO RE LEVANT SEIZED MATERIALS AND MANY OF THE SEIZED MATERIALS WILL REM AIN UNUTILIZED. THEREFORE, WITHOUT ADMITTING THE ISSUES RAISED IN S UBMISSIONS, IT IS HELD THAT EVEN ON MERIT, THEY ARE NOT LIABLE TO BE ACCEPTED. 6. WE FIND FROM THE ABOVE THAT THE CIT(A) DISMISSED THE SAID LEGAL GROUND OF THE ASSESSEE ON VARIOUS REASONING AND THEY ARE: (I) IS SUE OF VALIDITY OF THE NOTICE WAS NOT RAISED BEFORE THE AO; (II) THE SAID ISSUE WAS PENDING BEFORE THE ITAT AT THE RELEVANT POINT OF TIME AND THEREFORE, CIT(A) DID NOT WANT TO INTERFERE BY GIVING HIS DECISION ON THE ISSUE; (III) HOWEVER, THE CIT (A) OPINED THAT THE 8 EXPRESSION INCRIMINATING IS NOT BORNE OUT OF THE STA TUTE AND IT OUR WORDS IT IS NOT CASE OF CAUCUS EMMICUS ; (IV) CIT(A) IS OF THE VIEW THAT THE PROVISIONS CON TAINED U/S 292B AND 292BB OF THE I.T. ACT HAS A CURE FOR SUC H DEFICIENCIES IF ANY. ACCORDINGLY, CIT(A) DISMISSED THE SUBMISSIONS OF THE ASSESSEE AND DISMISSED THE RELEVANT LEGAL GROUNDS. WITH REGARD TO THE VALIDITY OF THE NOTICE U/S 153C FOR THE AY 2000-01, THE CIT(A) MENTIONED THAT THE SUBMISSIO NS OF THE GETS ANSWERED BY THE DEPARTMENTAL CIRCULAR AND FINALLY, HE HELD THAT TH E NOTICE ISSUED FOR AY 2000- 01 IS ALSO VALID. OTHERWISE, FOR THE AY, THE ASSESSE E SUBMITTED THAT THE SEARCH ON SHRI R D SHINDE TOOK PLACE ON 20.7.2005 AND NOTIC E ISSUED U/S 153C WAS ON 30.3.2007. AS PER THE PROVISO TO SECTION 153C, THE DA TE OF RECKONING THE DATE OF INITIATION OF ASST. PROCEEDINGS FOR EARLIER YEARS IS THE DATE OF HANDING OVER THE DOCUMENTS BY THE AO. BUT THE AO WRONGLY CONSIDERED THE DATE OF SEARCH AND ACCORIDNGLY, THE NOTICES WEERE ISSUED FOR IMMEDIATE SI X PRECEDING YEARS I.E. F.YS 1999-2000 TO 2004-05 INSTEAD OF THE SIX PRECEDING YE ARS ARE F.YS 2000-01 TO 2005-06 CONSIDERING THE DATE OF TRANSFER OF THE DOCUME NTS. ACCORDINGLY, IN VIEW OF THE PROVISO TO SECTION 153C, THE ASST. FOR A.Y 2000-01 COULD NOT BE COMPLETED U/S 153C. IN THIS CONTEXT, RELIANCE WAS PLACED ON THE ITATS DECISION IN THE CASE OF VIJAY M VIMAWAL (25 DTR 363 )(AHD) WHEREIN HONBLE ITAT HAS UPHELD THIS PRINCIPLE. CIT(A) REJECTED THE SAID SUBMISSION AND DISHONORED THE SAID PRINCIPLE IN EXISTENCE. IN THE BA CK GROUND OF THE ABOVE, THE ASSESSEE FILED THE APPEALS UNDER CONSIDERATION FOR ALL THE SIX YEARS. REVENUE ALSO FILED CROSS APPEALS FOR ALL THE SIX YEARS ON OTHER ISSU ES. WE SHALL TAKE UP THE ASSESSEES APPEALS FOR ALL THE SIX YEARS IN GENERAL AN D THE AY 2000-01 IN SPECIFIC. 7. DURING THE PROCEEDINGS, SRI SUNIL PATHAK, LD COUNSE L FOR ASSESSEE FILED HUGE AMOUNT OF THE PAPER BOOKS AND THE WRITTEN SUBMIS SIONS. SOMETIMES THE SUBMISSIONS ARE COMMON TO THE APPEAL FILED IN CONNEC TION WITH THE APPEALS IN THE BHARATI GROUP CASES IN GENERAL AND THAT OF BHARATI VIDYAPEET IN PARTICULAR FOR THE SAME AYS IN CONNECTION WITH SAME GROUND RELATING TO THE ISSUE OF VALIDITY OF THE NOTICE U/S 153C OF THE ACT. GIST OF THE ARGUMENT S OF SRI PATHAK RELATING TO THE LEGAL OF ISSUE OF VALIDITY IS DESCRIBED IN THE FOLLO WING PARAGRAPHS. (I) LEDGER ACCOUNTED ONE OR NOT- IF IT RELATES TO AY 2003-04 O R AY 2004-05: FROM THE SATISFACTION NOTE, IT IS NOTED THAT THE NOTICE U/S 153C WAS ISSUED BECAUSE ONE LEDGER ACCOUNT PERTAINING TO THE ASSESSEE WAS FOUND WITH S HRI R D SHINDE. IT IS SUBMITTED THAT THE LEDGER ACCOUNT IS DULY ACCOUNTED AND NOT AN INCRIMINATING DOCUMENT. THE AO STATED ERRONEOUSLY THAT THE LEDGER PERTAINING TO AY 2003-04 WAS FOUND DURING THE COURSE OF SEARCH ON SHRI R D SHINDE. THE COPY OF THE SAID LEDGER IS GIVEN ON PAGES 571-597 OF THE PAPER BOOK AND IT 9 RELATES TO THE AY 2004-05 . THE RELEVANT SUBMISSION MADE BY THE ASSESSEE BEFORE CIT(A) IS GIVEN ON PAGES 598 612 OF THE PAP ER BOOK. IN THIS REGARD, DURING THE COURSE OF THE PROCEEDINGS BEFORE US, SRI PAT HAK, CROSS TALLIED CERTAIN ENTRIES IN THE LEDGER BOOK VIS--VIS THE AMOUNTS RECORD ED IN THE BALANCE SHEET OF THE ASSESSEE. THUS, IT WAS DEMONSTRATED THAT THE LEDGER BOOK IS ACCOUNTED LEDGER BOOK . IT WAS ALSO CLARIFIED THAT APART FROM THE SAID LEDG ER, NO OTHER DOCUMENT PERTAINING TO THE ASSESSEE TRUST FOR THE SAID AYS UND ER CONSIDERATION WAS FOUND WITH SHRI SHINDE AND TRANSFERRE D TO THE AO OF THE ASSESSEE. (II) ON INCRIMINATING MATERIAL: IT IS SUBMITTED THAT FOR THE PURPOSE OF INVOKING THE PROVISIONS OF SECTION 153C, THERE HAS TO BE SOME INCRIMINATING EVIDENCE FOUND PERTAINING TO THE ASSESSEE WITH THE THIRD PARTY . IN THE ABSENCE OF ANY INCRIMINATING EVIDENCE, THE PROCEEDINGS U/S 15 3C CANNOT BE INITIATED. SECONDLY THE LEDGER BOOK IS DULY ACCOUNTED AND NOT A N INCRIMINATING DOCUMENT. (III) PURPOSE OF 153C - UNFETTERED POWERS: IT IS SUBMITTED THAT THE STAND OF THE DEPARTMENT IS GROSSLY INCORRECT IN LAW AS THE PURPOS E BEHIND THE INTRODUCTION THE SPECIAL PROVISION OF SECTION 153C IS THE SAME AS THAT BEHIND THE PROVISIONS OF SECTION 158BD. THAT IS, IN SHORT, TO ENABLE THE DEPA RTMENT TO PROCEED AGAINST A THIRD PERSON FOR BRINGING TO TAX ANY INCOME OF SUCH THI RD PERSON, IN SEARCH ACTION, THE DIARY, LOOSE PAPERS, ASSETS ETC HAVE TO BE FOUND UNACCOUNTED AND INCRIMINATING IN NATURE OR NOT DISCLOSED FOUND TO BE B ELONGING TO A THIRD PERSON. THEN ONLY THE AO GETS THE JURISDICTION TO ASSESS SUC H THIRD PERSON U/S 153C OF THE ACT. THE INTENTION BEHIND THE PROVISIONS OF SECT ION 153C IS NOT TO GIVE UNFETTERED POWERS TO THE AO TO PROCEED AGAINST ANY SUCH THIRD PERSON I F ANY DOCUMENT IS FOUND PERTAINING TO HIM. IF THE DEPARTMEN TAL STAND IS ACCEPTED IT WOULD LEAD TO A SITUATION WHEREIN FOR GENUINE AND FUL LY ACCOUNTED TRANSACTIONS, THE ITO MAY GET POWERS TO PROCEED AGAINST ANY OTHER PE RSON. TO GIVE AN EXAMPLE, IF A CLOTH DEALER IS SEARCHED HE HAS PURCHASED CLOTH FROM VARIOUS REPUTED COMPANIES AND THE PURCHASE BILLS ARE FOUND WI TH HIM. NOW, BECAUSE THE BILLS ARE ISSUED BY THE MANUFACTURER COMPANIES, WILL B E JUSTIFIED ON THE PART OF THE AO TO PROCEED AGAINST SUCH COMPANIES U/S 153C O F THE ACT. SIMILARLY, IF A DEALER OF A AUTOMOBILE MANUFACTURING COMPANY IS SEARCHED AND IN HIS PLACE, THE BILLS ISSUED BY THE AUTOMOBILE COMPANY ARE BOUND TO BE FOUND, IN THAT CASE, WILL IT BE JUSTIFIED FOR THE AO TO PROCEED AGAINST SU CH COMPANY. THERE CAN BE MAY SUCH EXAMPLE IN DAY TO DAY LIFE. A PERSON IS GOI NG OUT OF STATION FOR A LONG PERIOD OF ABOUT 1 MONTH OR SO AND HE KEEPS HIS CAR WITH A FRIEND . SUCH FRIEND IS SEARCHED, WILL IT BE JUSTIFIED TO TROUBLE THE OTHE R PERSON BY PROCEEDING U/S 153C OF THE ACT. (IV) SUMMARY OF THE ARGUMENTS: THE PROVISIONS OF SECTION 153C FOR AYS 2000-01 TO 2005-06 ARE WRONGLY INVOKED BY THE REVENUE. OUT OF 10 THESE SIX YEARS, NO EVIDENCE AT ALL WAS FOUND FOR AYS 2000-01 TO 2003-04 & 2005-06. THE LEDGER BOOK WAS FOUND FOR AY 2004-05 BUT AS CLARIFIED ABOVE, IT IS NOT AN INCRIMINATING DOCUMENT. ACCORDINGLY, IN VIEW O F THE ITAT, PUNE DECISION IN THE CASE OF SINHGAD TECHNICAL EDUCATION SOCIETY V A CIT ITA NOS 114 TO 117/PN/10, THE ASSESSEE SUBMITS THAT THE NOTICE ISS UED U/S 153C IS BAD IN LAW AND THE ASSESSMENTS COMPLETED FOR THE ABOVE SIX YEARS MAY KINDLY BE DECLARED NULL AND VOID. 8. PER CONTRA, SRI A S SINGH, DR FOR THE REVENUE ASSERTED V EHEMENTLY THAT FOR THE PURPOSES OF INVOKING THE PROVISIONS OF SECTION 153C OF THE ACT, IT IS NOT NECESSARY THAT THE DOCUMENTS FOUND PERTAINING TO THE THIRD PARTY SHOULD BE INCRIMINATING IN NATURE. THE STRESS OF THE DEPARTMENT I S ON THE WORDING OF SECTION 153C OF THE ACT WHEREIN IT I MENTIONED THAT IF ANY A SSETS OR DOCUMENTS OR BOOKS BELONGING TO THE THIRD PARTY ARE FOUND WITH THE PERSON SEARCH, THE AO WILL PROCEED AGAINST SUCH THIRD PARTY. SRI SINGH RELIED ON CE RTAIN DECISIONS FOR THE PROPOSITIONS THAT NO INCRIMINATING EVIDENCE IS NECESS ARY FOR INITIATING THE PROCEEDINGS U/S 153C OF THE ACT AND THEY ARE: VIJAYB HAI N CHANDRANI (231 CTR 474 (GUJ); PANCHURAM DESHMUKH & ORS 133 TTJ 53 (BILA SPUR) AND SHYAM LATA KAUSHIK 114 ITD 305 (DEL). 9. DURING THE REBUTTAL TIME ALSO SRI PATHAK STATED THA T THE DOCUMENTS BELONGING TO THE PARTY IS INCRIMINATING OR THE ASSET F OUND BELONGING TO THE THIRD PARTY OR UNDISCLOSED, THEN ONLY, THE PROCEEDINGS U/S 1 53C OF THE ACT WOULD BE JUSTIFIED. ON THE OTHER HAND, IF THE AO IS AUTHORIZED TO PROCEED AGAINST ANY THIRD PARTY JUST BECAUSE SOME DOCUMENT, WHETHER ACCOUNTED A ND NOT INCRIMINATING, OF THE THIRD PART IS FOUND DURING SEARCH, IT WOULD LEAD TO THE CASES MENTIONED IN ABOVE WHEREIN GENUINE PARTIES FOR THE FULLY ACCOUNTED DOCUMENTS OR ASSETS WILL BE SUBJECTED TO THE HARASSMENT OF UNDERGOING THE BLOCK ASSESSMENTS ORDEAL TO MILLION OF CITIZENS AS A CONSEQUENCE OF WRONG INVOKI NG OF THE PROVISIONS OF U/S 153C OF THE ACT. IN SHORT, AS THE DEPARTMENTAL STAND WILL LEAD TO A HARASSMENT FOR THE ASSESSEES IN GENERAL AND AN ARBITRARY AUTHORITY FOR THE OFFICERS, SUCH INTERPRETATION HAS TO BE AVOIDED. IN THIS CONTEXT, TH E ASSESSEE RELIES UPON THE FOLLOWING DECISIONS WHEREIN THE COURTS HAVE HELD THAT WHEN NO INCRIMINATING EVIDENCE IS FOUND, NO ADDITION CAN BE MADE IN THE A SSESSMENT U/S 153A/153C A. ANIL KUMAR BHATIA & ORS (2010) 1 ITR (TRIB) 484 (DE L): IN THIS CASE, IT HAS BEEN HELD THAT IN RESPECT OF AN ASSESSMENT UNDER S. 153A, WHERE PROCESSING RETURNS U/S 143(1)(A) STOOD COMPLETED IN RESPECT OF RET URNS FILED IN DUE COURSE BEFORE SEARCH AND NO MATERIAL IS FOUND IN SEARCH THEREAF TER, NO ADDITION CAN BE MADE. B. LMJ INTERNATIONAL LTD. (2008) 119 TTJ 214 (KOL): IN THIS CASE, IT 11 HAS BEEN HELD HAT WHERE NOTHING INCRIMINATING IS FOUN D IN THE COURSE OF SEARCH RELATING TO ANY ASSESSMENT YEARS, THE ASSESSMENTS FOR SUCH YEARS CANNOT BE DISTURBED; ITEMS OF REGULAR ASSESSMENT CANNOT BE ADDED BACK IN THE PROCEEDINGS U/S 153C WHEN NO INCRIMINATING DOCUMENTS WERE FOUND I N RESPECT OF THE DISALLOWED AMOUNTS IN THE SEARCH PROCEEDINGS. 10. CASES RELIED UPON BY THE CIT-DR: SRI PATHAK SUBMITTED THE FOLLOWING IN CONNECTION WITH THE ARGUMENTS OF SRI AS SINGH, L D DR FOR REVENUE. OTHERWISE, SRI SINGH RELIED ON CERTAIN DECISIONS FOR T HE PROPOSITIONS THAT NO INCRIMINATING EVIDENCE IS NECESSARY FOR INITIATING THE PROCEEDINGS U/S 153COF THE ACT THEY ARE: VIJAYBHAI N CHANDRANI (231 CTR 474 (GUJ ); PANCHURAM DESHMUKH & ORS 133 TTJ 53 (BILASPUR) AND SHYAM LATA KAUSHIK 11 4 ITD 305 (DEL). IN THIS REGARD, IT IS SUBMITTED THAT IN THE VARIOUS DECISION O F THE TRIBUNAL WHEREIN THE VIEW IS TAKEN IN FAVOUR OF THE DEPARTMENT, THE ABOV E ARGUMENT IS NOT TAKEN AND SECONDLY, IN ALL THESE CASES, PRIMA FACIE, THE DOCUMENTS WERE INCRIMINATING IN NATURE WHILE IN INSTANT CASE, IT IS NOT SO AT ALL . HENCE, THE NOTICES U/S 153C ARE INVALID. IN FACT, IN THE CASE BEFORE THE HONBLE GUJ ARAT H.C., THE ISSUE WAS THAT SOME LOOSE PAPERS WERE FOUND AT THE PREMISES OF ONE HO USING SOCIETY IN THE COURSE OF SEARCH AND ON THE BASIS OF THE SAID DOCUMEN T, NOTICED U/S 153C WAS ISSUED TO THE ASSESSEE. HONBLE H.C HELD THAT THE D OCUMENTS FOUND DID NOT PERTAIN TO THE ASSESSEE AND HENCE, NOTICE ISSUED U/S 153C WAS INVALID. ACCORDINGLY, THE ISSUE BEFORE HONBLE H.C WAS TOTALLY DIFFERENT. FURTHER, IN THE CASE BEFORE ITAT, BILASPUR IN THE CASE OF PANCHURAM DE SHMUKH & ORS 133 TTJ 53 (BILASPUR) SOME DOCUMENTS WERE FOUND PERTAINING TO THE ASSESSEE WHICH INDICATED SOME PRIMA FACIE BENAMI TRANSACTIONS. THUS, ITAT HELD THAT THE NOTICE ISSUED IS VALID. AS REGARDS THE ISSUE IN THE CASE BEF ORE ITAT DELHI IN THE CASE OF SHYAM LATA KAUSHIK 114 ITD 305 (DEL), THE ASSESSMEN T IN THAT CASE WAS COMPLETED U/S 153A AND NOT U/S 153C. THUS, THE FAC TS ARE DISTINGUISHABLE. WHERE A PERSON IS SEARCHED, HIS ASSESSMENT IS TO BE C OMPLETED U/S 153A AND IN THAT CONTEXT, HONBLE ITAT HELD THAT NO INCRIMINATIN G EVIDENCE IS NECESSARY TO COMPLETE THE ASSESSMENT U/S 153A. 11. ACCORDINGLY, IT IS SUBMITTED THAT THE DECISIONS CITED BY THE LD DR ARE DISTINGUISHABLE AND NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. IT IS SUBMITTED THAT SINCE NO INCRIMINATING EVIDENCE IS FO UND DURING THE COURSE OF SEARCH ON SHRI R D SINDE PERTAINING TO THE ASSESSEE, T HE NOTICE ISSUED U/S 153C FOR THE AYS 2000-01 TO 2005-06 MAY BE DECLARED NULL A ND VOID. WITHOUT PREJUDICE, ONLY ONE DOCUMENT IS FOUND FOR THE AY 200 5-06 I.E. THE INWARD REGISTER. HENCE, FOR OTHER FIVE YEARS SINCE NO DOCUMENT HAS BEEN FOUND AND 12 THEREFORE, IN VIEW OF THE DECISION OF ITAT, PUNE IN T HE CASE OF SINHGAD TECHNICAL EDUCATION SOCIETY V ACIT (ITA NOS 114 TO 117/PN/10) AND M/S KUMAR & CO. VIDE ITA NO 463/PN/08 FOR THE AY 2000-01, IT IS SUBMITTED THAT THE ASSESSMENT COMPLETED FOR THESE 5 YEARS BE DECLARED NULL AND VOID. 12. FURTHER, THE AO IN THE SATISFACTION NOTE REFERRED T O THE STATEMENT OF SHRI R D SHINDE RECORDED DURING THE COURSE OF SEARCH U/S 132( 4). ACCORDING TO HIM, SHRI SHINDE HAD STATED THAT THE AMOUNT COLLECTED FROM THE STUDENTS HAS BEEN DEPOSITED IN THE BUILDING AND EQUIPMENT FUND OF THE VARIOUS TRUSTS OF BHARATI VIDYAPEETH GROUP. HENCE, THIS STATEMENT OF SHRI SHIND E HAS ALSO BEEN CONSIDERED WHILE RECORDING THE SATISFACTION NOTE U/S 153C. IT IS SUBMITTED THAT AS PER SECTION 153C, WHERE ANY MONEY BULLION, JEWELLERY OR OTHER VALUABLE ARTICLES OR THING OR BOOKS OF ACCOUNT OR DOCUMENTS BELONG TO A PERSON OTHER THAN A PERSON WHO IS SEARCHED, THEN NOTICE U/S 153C CAN BE I SSUED AGAINST THE OTHER PERSON. HENCE, AS PER SECTION 153C WHERE ANY MONEY, BU LLION, JEWELLERY OR OTHER VALUABLE ARTICLES OR THING OR BOOKS OF ACCOUNT OR DOCUM ENTS THEN ACTION CAN BE TAKEN. NOW, THE LD AO HAS REFERRED TO THE STATEMENT O F SHRI R D SHINDE FOR RECORDING THE SATISFACTION. HOWEVER, THE SECTION DOES NOT PERMIT ISSUE OF NOTICE U/S 153C ON THE BASIS OF A STATEMENT RECORDED OF THE PERSON SEARCHED. IT IS SUBMITTED THAT STATEMENT CANNOT BE EQUATED WITH DOC UMENT OR VALUABLE ARTICLE OF THING. IN THIS CONTEXT, RELIANCE IS PLACED THE DECIS ION OF DELHI H.C IN THE CASE OF LATE RAJ PAL BHYATIA 237 CTR 1. IN THIS CASE, THE N OTICE U/S 158BD WAS ISSUED AGAINST THE ASSESSEE ON THE BASIS OF THE STATEMENT RECORDED OF THE PERSON SEARCHED. HONBLE H.C HELD THAT NOTICE U/S 158BD COU LD NOT BE ISSUED ON THE BASIS OF THE STATEMENT RECORDED OF THE PERSON SEARCHED AND THE STATEMENT OF SEARCHED PERSON CANNOT BE THE BASIS. IT IS SUBMITTED THAT THE WORDING OF SECTION 158BD IS SIMILAR TO THAT OF SECTION 153C AND HENCE, IN VIEW OF THE SAID DECISION, IT IS SUBMITTED THAT THE LD.AO HAS ERRED IN PLACING RE LIANCE ON THE STATEMENT OF SHRI SHINDE FOR INVOKING THE PROVISIONS OF SECTION 153 C. 13. FURTHER, WE FIND IT IS NECESSARY TO HIGHLIGHT THE STAND OF THE REVENUE AND THE SAID STAND OF THE REVENUE IS COMMUNICATED TO US BY WAY OF WRITTEN SUBMISSIONS AND FOR THE SAKE OF COMPLETENESS OF THE ORDER, THE SAME IS EXTRACTED WHICH IS AS UNDER. IN THE ADDITIONAL GROUND THE ASSESSEE HAS CONTENDED TH AT THE ORDER PASSED U/S 263 IS NULL AND VOID, AS THE ASSESSMENT ORDER PASSED U/ S 153A R.W.S. 153C IS ITSELF NULL AND VOID. IT IS FURTHER CONTENDED THAT PROCEEDINGS U /S 153C ARE BAD IN LAW FOR THE REASONS THAT THERE WAS NO INCRIMINATING MATERIAL FOUND D URING THE SEARCH CONDUCTED IN THE CASE OF SHRI R D SHINDE, PERTAINING TO ASSESSEE TRU ST FOR THE CONCERNED YEARS. 13 THE ASSESSEES CONTENTION THAT NO INCRIMINATING MATERIA L WAS FOUND DURING THE SEARCH ON SRI R D SHINDE, PERTAINING TO ASSESSEE, IS NOT CORRECT. THIS IS CLEAR FROM THE SATISFACTION NOTE RECORDED PRIOR TO ISSUE OF NOTICE U/ 1 53C, A COPY OF WHICH IS ENCLOSED HEREWITH. THE ASSESSEE HAS NOT CONTESTED THE FACT TH AT THE DOCUMENTS REFERRED TO IN THE SATISFACTION NOTE WERE SEIZED DURING THE SEARCH ON SHRI R D SHINDE AND THAT THEY BELONG TO THE ASSESSEE. THE CONDITIONS PRECEDENT FOR INITIATIO N OF THE PROCEEDINGS U/S 153C ARE THEREFORE SATISFIED AND THE PROCEEDINGS ARE THEREFORE VALID. IF IT IS THE ASSESSEES CONTENTION THAT THE BOOKS OF ACCOUNTS OR DOCUMENTS SEIZED DURING THE SEARCH SHOULD BE SPECIFIC TO PARTICULAR A.Y AND THAT THESE SHOULD CONTAIN INCRIMINATING MATERIAL, THESE CONTENTIONS DESERVE TO BE RE JECTED. IN THIS CONTENTION YOUR HONOURS KIND ATTENTION IS INVITE D TO THE PROVISIONS OF SECTION 153C OF THE I.T. ACT. IT MAY KINDLY BE SEEN TH AT AS PER THE PROVISIONS OF SECTION 153C, THE SATISFACTION REQUIRED TO BE ARRIVED AT BY THE AO FOR ISSUE OF NOTICE U/S 153C IS THAT ANY MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNTS OR DOCUMENTS SEIZED OR REQUISITIONED BELONGS O R BELONG TO A PERSON OTHER THAN THE PERSON REFERRED TO IN SECTION 153A IF THIS SATISFACTION IS ARRIVED AT, THE AO IS ENTITLED TO ISSUE NOTICE TO THE PERSON IN ACCORDANCE WITH THE PROVISIONS OF SECTION 153A. THE PROVISIONS OF SECTION U/S 153A PROVIDE FOR THE ASS ESSMENTS OR RE- ASSESSMENTS OF THE INCOME OF SIX ASSESSMENT YEARS IMME DIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH THE SEARCH IS CONDUCTED OR REQUISITION IS MADE. IT MAY KINDLY BE APPRECIATED THAT THE PROVISIONS IN SECTION 153A TO SECTION 153D ARE SPECIAL PROVISIONS ENACTED FOR DOING ASS ESSMENTS IN THE CASES OF PERSONS WHO HAVE BEEN SUBJECTED TO SEARCH OR WHOSE DOCUMENTS HAVE BEEN FOUND DURING THE SEARCH. IT MAY ALSO KINDLY BE APPRECIATED THA T THE PROVISIONS IN SECTION 153A AND SECTION 153C ARE NOTWITHSTANDING ANYTHING CONTAINED IN THE NORMAL PROVISIONS RELATING TO ASSESSMENTS LIKE SECTIONS 139, 147,148, 149, 151, 153 ETC. THE ASSESSMENTS IN SEARCH CASES SHOULD, THEREFORE, BE STRICTLY IN ACCORD ANCE THE PROVISIONS CONTAINED IN SECTIONS 153A TO SECTION 153D. AS ALREADY NOTED, THE ONLY REQUIREMENT FOR ISSUE OF NO TICE U/S 153C IS THAT THE BOOKS OF ACCOUNTS OR DOCUMENTS SEIZED BELONGS OR BELON G TO THE OTHER PERSON. THE LANGUAGE OF SECTION 153C IS VERY CLEAR. THERE IS NO REQU IREMENT THAT THE BOOKS ACCOUNTS OR DOCUMENTS SHOULD CONTAIN INCRIMINATING EVIDENCE. WHETHE R THE INFORMATION CONTAINED IN THE BOOKS OR DOCUMENTS IS INCRIMINATING IS AN ISSUE THAT WILL HAVE TO BE DECIDED DURING THE ASSESSMENT PROCEEDINGS. THERE IS ALSO NO REQUIREMEN T THAT BOOKS OR DOCUMENTS RELATING TO EACH OF THE SIX YEARS SHOULD HAVE BEEN FOU ND DURING THE SEARCH. IT MAY ALSO KINDLY BE ALLOWED TO POINT OUT THAT IF INCRIMINA TING EVIDENCE RELATING TO A PARTICULAR ASSESSMENT YEAR IS FOUND DURING THE SEA RCH, ACTION COULD BE TAKEN FOR RE- ASSESSMENT OF INCOME OF THAT YEAR UNDER THE NORMAL PR OVISIONS CONTAINED IN SECTION 148 OF THE INCOME-TAX ACT. THE INSISTENCE THAT INCRIMINATING DOCUMENTS RELATING TO EACH OF THE ASSESSMENT YEARS WHICH ARE SOUGHT TO BE COVERED U/S 153C SHOULD BE SEIZED IN ORDER TO BESTOW JURISDICTION ON THE AO FOR ACTION U/S 1 53C WILL BE A THROWBACK TO THE PROVISIONS OF SECTION 148, NEGATING THE VERY PURPOSE OF INTRODUCTION OF THE SPECIAL PROVISIONS CONTAINED IN SECTIONS 153A TO SECTION 153D. IT IS, THEREFORE, MY HUMBLE SUBMISSION THAT BEFORE TAKING ACTION 153C, THE AO IS NOT REQUIRED TO ARRIVE A SATISFACTION REGARDING INCRIMINATING NATURE OF THE DOCUMENTS AND IT IS NOT NECESSARY THAT DOCUMENTS PERTAINING TO EACH OF THE SIX ASSESSMENT YEARS SHOULD H AVE BEEN SEIZED. 14. AS PER THE ABOVE NOTE, STAND OF THE REVENUE IS CL EAR THAT THE AO AT THE TIME OF HANDING OVER OF THE DOCUMENTS TO THE AO OF T HE ASSESSEE IS NOT REQUIRED TO ARRIVE AT THE SATISFACTION REGARDING INCRIMINATING NATURE OF THE DOCUMENTS 14 AND FURTHER, AS PER THE EXPRESS PROVISIONS, IT IS NOT NECESSARY THAT DOCUMENTS PERTAINING TO EACH OF THE SIX ASSESSMENT YEARS SHOULD HAVE BEEN SEIZED AND HANDED OVER TO THE AO OF THE ASSESSEE. 16. WE HAVE HEARD THE PARTIES AND PERUSED THE VOLUMINO US PAPERS FILED BEFORE US INVOLVING ALL THE SIX AYS INCLUDING THE WRI TTEN SUBMISSIONS OF THE PARTIES.AS STATED IN THE PRECEDING PARAGRAPHS, WE PROCE ED THE ADJUDICATE THE ISSUE RELATING TO THE VALIDITY OF THE NOTICE ISSUED U/S 153C OF THE ACT FOR THE SIX YEARS IN QUESTION. FOR THIS PURPOSE WE EXAMINE SATI SFACTION NOTE RECORDED BY THE HANDING OVER-AO; SATI SFACTION NOTE: SATISFACTION NOTE FOR PROCEEDINGS U/S 153C OF THE I. T. ACT, 1961 IN THE CASE OF BHARATI VIDYAPEETH MREDICAL FOUNDATION,BHARATI VIDYA BHA VAN, PUNE 411030. THE SEARCH ACTION U/S 132 OF THE IT ACT WAS CARRIED IN THE CASE OF SHRI RAMCHANDRA DADA SHINDE, ON 22.7.2005. THE ASSESSEE W AS WORKING AS ACCOUNTS OFFICER IN THE BHARATI VIDYAPEETH GROUP OF TRUSTS. DURING THE S EARCH ACTION THE OFFICE CABIN OF THE ASSESSEE SITUATED AT BHARATI VIDYA BHAVAN NEAR ALK A TALKIES, PUNE-30 WAS SEARCHED ALONGWITH HIS RESIDENTIAL PREMISES. DURING THE SEARCH ACTION BOOKS OF ACCOUNTS, DOCUMENT S & CASH WERE FOUND AND SEIZED. TOTAL 3 BUNDLES OF LOOSE PAPER WERE SEIZED VIDE A NNEXURE A-1 OF PANCHNAMA DT 21.7.2005 AND 18 LOOSE PAPER BUNDLES WERE SEIZED VIDE A NNEXURE A-1 OF THE PANCHNAMA DT 22.7.2005. THE DETAILS OF SEIZED DOCUMENTS AS PER ANNEXURE A OF PANCHNAMA DT 22.7.2005 BELONGING TO THE ASSESSEE FIRM ARE AS FOLLOWS- 1. BUNDLE NO. 10 THIS IS LEDGER OF BHARATI VIDYAP EETH MEDICAL FOUNDATION FOR A.Y 2003-04 THE PROVISIONS OF SECTION 153C OF THE IT ACT 1961 REA DS AS WHERE THE AO IS SATISFIED THAT ANY MONEY, BULLION, JEWELLERY OR OTHER VALUA BLE ARTICLE OR THING OR BOOKS OF ACCOUNTS OR DOCUMENTS SEIZED OR REQUISITIONED BELONGS OR BELONGS TO PERSON OTHER THAN THE PERSON REFERRED TO IN SECTION 153A THEN. AO SHALL PROCEED AGAINST EACH SUCH OTHER PERSON & ISSUE SUCH OTHER NOTICE AND ASSESS OR REASSE SS INCOME OF SUCH OTHER PERSON IN ACCORDANCE WITH THE PROVISIONS OF SECTION 153A SINCE IN THIS CASE, THE BOOKS OF ACCOUNTS BELONGING TO ASSESSEE TRUST HAS BEEN SEIZED, I AM SATISFIED THAT NOTICE U/S 153C OF THE IT ACT SHOULD BE ISSUED. FURTHER SHRI D SHINDE IN HIS STATEMENT RECORDED U/S 13 2(4) ON 22.7.2005 STATED THAT THE AMOUNT RECEIVED OF RS 2,00,00,000/- ON ACCO UNT OF CONSULTANCY FROM THE STUDENTS HAVE BEEN DEPOSITED IN THE PAST TO THE BUILDING FUND AND EQUIPMENT FUND OF THE VARIOUS TRUSTS OF THE BHARATI VIDYAPEETH GROUP. IN THE CASE OF ASSESSEE TRUST, THERE IS CREDIT IN TRU ST FUND A/C AND DEVELOPMENT FUND A/C FROM F Y 99-2000 TO 05-06 IS RS 1,34,91,141 /- EXAMINATION OF SEIZED BOOKS OF ACCOUNTS OF THE ASSESS EE TRUST SHOWS THAT THE AMOUNT CREDITED IN VARIOUS DATES IN THE LEDGER A/C OF DE V FUND AND TRUST FUND CLAIMED TO BE RECEIPTS TOWARDS THE CORPUS OF THE TRUSTS HAS BEE N RECEIVED ENTIRELY IN CASH, AND THE DONORS HAS NOT BEEN MENTIONED IN THE BOOKS OF A/C. IN VIEW OF THE ABOVE FACTS, I AM SATISFIED THAT, THE RECEIPTS ON ACCOUNT OF DEV. FUND A ND TRUST FUND CREDITED IN THE BOOKS ARE NOT GENUINE. SINCE THE RECEIPT CREDITED N THE BOOKS OF A/C NOT FROM THE GENUINE SOURCE FOR THE CHARITABLE PURPOSE OF THE TRUST, APPAR ENTLY THE INCOME OF ASSESSEE TRUSTS IS NOT LIABLE FOR EXEMPTION U/S 11,12,13 OF THE IT ACT 1 961. THEREFORE NOTICES U /S 153C IS HEREBY ISSUED FOR THE FOLLOWING A. YRS. 15 A.Y 2000-2001 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 SD/- DATE: 30 MARCH 2007 ASSESSING OFFICER. 16. FROM THE ABOVE, IT IS CLEAR THAT THERE IS SEIZURE O F LEDGER INVOLVING THE ASSESSEE BY WAY OF BUNDLE NO. 10 THIS IS LEDGER OF BHARATI VIDYAPEETH MEDICAL FOUNDATION AND WE FIND IT RELATES TO AY 2004-05 AND NOT FOR A.Y 2003-04 AS MENTIONED BY THE AO IN THE ABOVE EXTRACTED SATISFAC TION NOTE. IT IS ALSO A FACT THAT THERE IS NO OTHER SEIZED DOCUMENTS/OTHER LISTED O NES PERTAINING TO OTHER AYS UNDER CONSIDERATION AND BELONGING TO THE ASSESSEE. FU RTHER, IT IS THE INESCAPABLE OBSERVATION THAT REST OF THE DOCUMENTS RELATE TO THE A Y 2006-07, WHICH IS NOT THE SUBJECT MATTER OF THIS ORDER. AS STATED ABOVE, THE CIT(A) DISMISSED THE SAID LEGAL GROUND OF THE ASSESSEE ON THE REASONING THAT TH E (I) ISSUE OF VALIDITY OF THE NOTICE WAS NOT RAISED BEFORE THE AO; (II) THE SAID IS SUE WAS PENDING BEFORE THE ITAT AT THE RELEVANT POINT OF TIME AND THEREFORE, CIT (A) DID NOT WANT TO INTERFERE BY GIVING HIS DECISION ON THE ISSUE; (III) HOWEVER, THE CIT (A) OPINED THAT THE EXPRESSION INCRIMINATING IS NOT BORNE OUT O F THE STATUTE AND IN OUR WORDS, IT IS NOT A CASE OF CASUS OMISUS AND THERE IS NO NEED TO SUPPLY THE WORDS IN THE LEGISLATION ; (IV) CIT(A) IS OF THE VIEW THAT THE PROVISIONS CON TAINED U/S 292B AND 292BB OF THE I.T. ACT HAS A CURE FOR SUC H DEFICIENCIES IF ANY. FURTHER, THE ABOVE EXTRACTED WRITTEN SUBMISSIONS ALSO ADD TO THE ABOVE LIST OF THE ARGUMENTS OF THE REVENUE. WE HAVE EXAMINED THE STAND OF THE ASSESSEE WHICH WAS ALREADY DISCUSSED IN THE PRECEDING PARAGRAPHS AND DESIST TO REPEAT THE SAME TO AVOID THE DUPLICATION. CONSIDERING THE ABOVE RIVAL STANDS OF THE PARTIES, WE HAVE EXAMINED THE SCOPE OF THE PROVISIONS OF SECTION 153C OF THE ACT AND LEGAL PRONOUNCEMENTS VIS A VIS (I) THE INCRIMINATION OF THE SEIZED DOCUMENTS AND (II) THE REQUIREMENT OF THE SEIZURE AND HANDING OVER OF THE DOCUMENTS BELONGING TO THE THIRD PARTY. 17. SCOPE: WE HAVE EXAMINED THE PROVISIONS OF SECTION 153C, REL EVANT PROVISIONS OF SECTION 153A OF THE ACT. WE HAVE ALSO EXAMINED THE COPIES OF THE DECISIONS IN THE CASES OF KUMAR AND COMPANY (SUPRA) A ND THE SINHGAD TECHNICAL EDUCATION SOCIETY (SUPRA) RELIED UPON BY THE LD COUNS EL FOR THE ASSESSEE. IN THESE ORDERS, THE HONBLE TRIBUNAL OF THIS BENCH HA S COME TO THE CONCLUSIONS THAT THE AO SHALL NOT POSSESS UNFETTERE D POWERS OF SUMMARILY OPINING OR REOPENING THE CONCLUDED ASSESS MENTS OF ALL THE SIX ASSESSMENT YEARS IN RESPECT OF THE THIRD PARTY MENTIONED IN SECTION 16 153C OF THE ACT WITHOUT HAVING IN POSSESSION THE AY -SPECIFIC INCRIMINATING DOCUMENTS/OTHER LISTED ITEMS. THE SAI D DECISION WAS TAKEN BY THIS BENCH RELYING ON THE KOLKATA BENCH DE CISION OF THE TRIBUNAL IN THE CASE OF LMJ INTERNATIONAL (SUPRA). IT IS A FACT THAT THE PROVISIONS OF SECTION 153C DOES NOT HAVE THE EXPRES SIONS SUCH AS INCRIMINATING OR UNDISCLOSED INCOME. HOWEVER, C ONSIDERING THE SEARCH SEIZURE PROVISIONS, WHERE THERE IS NO SCOPE FOR ESTIMATIONS AND SURMISES, HOBLE TRIBUNAL TOOK THE VIEW THAT THERE IS NEED FOR SEIZURE OF THE DOCUMENTS AND THOSE DOCUMENTS HANDED OVER TO TH E AO OF THE THIRD PARTY COVERED U/S 153C OF THE ACT MUST BE BEL ONGING TO THE SAID PARTY AND SHOULD BE INCRIMINATING TOO. SETTLED AS SESSMENTS MUST NOT BE DISTURBED MERELY BASED ON THE DUMB DOCUMENTS GAT HERED AND SEIZED BY THE REVENUE. IT IS ALSO THE FINDING OF TH E TRIBUNAL THAT THE SUCH INCRIMINATING DOCUMENTS MUST BE ASSESSMENT YEA R SPECIFIC AND IT IS THE FINDING OF THE TRIBUNAL THAT AO HAS NO POWER TO ISSUE NOTICE US/ 153C OF THE ACT IN RESPECT OF AN AY WHERE THERE IS NO ASST YEAR SPECIFIC INCRIMINATING SEIZURE OF THE DOCUMENTS OR OTHER LIS TED ITEMS. AO CANNOT ISSUE NOTICE IN RESPECT OF AN AY, WHEN THE INCRIMINAT ING MATERIAL BELONGING TO THE ASSESSEE PERTAINS TO SOME OTHER AY. WE PROCEED TO IMPO RT RELEVANT PORTIONS OF AN UNREPORTED DECISION OF THE TRIBUNAL OF THIS BENCH I N THE CASE OF SINHGAD TECHNICAL EDUCATION SOCIETY VIDE ITA NO 114 TO 117/ PN/10. THIS EXTRACT CONSISTS OF THE RELEVANT PORTIONS AGAIN IMPORTED FROM THE ORDER OF THE TRIBUNAL IN THE CASE OF THE KUMAR AND COMPANY VIDE ITA NO. 463/PN/08 FOR T HE SAME A.Y 2000-01. 18. EXTRACTION OF PARAGRAPHS 8 TO 15 FROM THE ORDER OF THE SINHGAD TECHNICAL EDUCATION SOCIETY VIDE ITA NO 114 TO 117/PN/10. 8. ADDITIONAL GROUND: INVALID NOTICES U/S 153C: IN THIS REGARD, WE HAVE PERUSED THE REASONS RECORDED BY THE AO OF THE ASSESSEE. WE FIND THAT THERE EXISTS THE REASONS FOR ISSUE OF NOTICE U/S 153C OF THE ACT AND IT IS AN UNDISPUTED FACT. WE ALSO FIND THAT THEY ARE COMMON REASONS FOR ALL SIX AYS INCLUDING THE FOUR AYS UNDER CONSIDERATION. THE COUNSEL FOR THE ASSESSE E ARGUED VEHEMENTLY THAT AO ISSUED NOTICES U/S 153C SIMPLY RELYING ON THE CONTENTS OF SECTION 153A(1)(B) OF THE ACT AND ALSO ITS FIRST PROVISO IGNORING VARIOUS SETTLED LEGA L PROPOSITIONS IE THE CONCLUDED ASSESSMENTS, WHICH FALL IN THE BUNCH OF SIX AY, SHOULD NOT DISTURBED UNLESS THERE EXISTS INCRIMINATING MATERIAL RELEVANT FOR THE SAID AYS OR CONCLUDED ASSESSMENTS AND SUCH INCRIMINATING MATERIAL SHOULD BE OF T HAT NATURE IT SHOULD NOT BE A DUMB DOCUMENTS. IN THIS REGARD, THE STAND OF TH E REVENUE IS THAT THE EXPRESS PROVISIONS ARE CLEAR ON THE PROPOSITION THAT THE AO IS E MPOWERED UNDER THE STATUTE TO ASSESS OR REASSESS THE TOTAL INCOME OF SIX ASSESSM ENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH SUCH SEARCH IS CONDUCTED.. (FIRST PROVISO). CONSIDERING THE CONTRARY STANDS OF THE PARTIES, WITHOUT GOING INTO THE MERITS OF THE ADDITIONS, WE HAVE DECIDED T O ADJUDICATE THE LEGAL ISSUE IE ADDITIONAL GROUND AND IT INVOLVES THE STUDY THE DETAILS O F THE REASONS RECORDED BY 17 THE AO BASED ON WHICH THE AO ISSUED THE IMPUGNED NOTICE S U/S 153C OF THE ACT FOR THE IMPUGNED FOUR AYS. FOR THIS PURPOSE, WE HAVE EXTR ACTED THE RELEVANT PORTION OF THE REASONS AND THE SAME READ AS FOLLOWS. 9. SATISFACTION NOTE FOR PROCEEDINGS U/S 153C OF THE I T ACT, 1961 IN THE CASE OF M/S SINHGAD TECHNICAL EDUCATIONAL SOCIETY (STES), PUNE 1) PAGE 11 THIS IS VOUCHER OF SINHGAD TECHNICAL EDUC ATION SOCIETY (STES) DT. 17-01- 2004 FOR CHEQUE PAYMENT OF RS. 2.80 LACS TO AMIR MOIDDIN SHAIKH. 2) PAGE 12 THIS IS VOUCHER OF STES DT. NIL FOR CHE QUE PAYMENT OF RS. 1 LACS TO AMIR MOIDDIN SHAIKH. 3) PAGE NO. 13- THIS IS VOUCHER OF STES DT. 30.01.20 05 FOR CHEQUE PAYMENT OF RS. 2 LACS TO SHAIKH AMIR SHAIKH. 4) PAGE NO. 14- THIS IS VOUCHER OF STES DT. 27.09.20 04 FOR CASH PAYMENT OF RS. 1 LACS TO SHAKI AMIR SHAIKH 5) PAGE NO. 15- THIS IS VOUCHER OF STES DT. NIL FOR CHEQUE PAYMENT OF RS. 50,000/- TO SHAIKH AMIR SHAIKH. 6) PAHE NO. 45- THIS IS AN OFFICE COPY OF LETTER DT. 2 3.06.2007 WRITTEN TO DIRECTOR OF DTE, MUMBAI BY SINHGAD COLLEGE OF PHARMACY, OWNED BY STES. BUNDLE NO. A-2 7) PAGE NO. 35- THERE ARE THE BALANCES AVAILABLE TO VA RIOUS INSTITUTE OF STES ON OR BEFORE 25.06.2005. BUNDLE NO. A-4 8) PAGE NO. 50 & 54 THESE PAGES CONTAINS THE DETA ILS OF STAFF ARRANGEMENTS MADE BY THE STES COLLEGE OF ENGINEERING FO R ADMISSION PROCESS FOR F.Y. 2003-04. 9) PAGE NO. 58 TO 60- THESE PAGES CONTAIN THE DETAILS OF EXPENSES INCURRED BY STES. 10. FROM THE ABOVE, IT IS DEMONSTRATED BY THE LD COU NSEL THAT THE ITEMS AT SL NO 1 TO 5 ABOVE BELONGS TO THE AY 2004-05 OR THEREAF TER. REFERRING TO THE REST OF THE ITEMS AT SL 6 TO 9 ABOVE, THE COUNSEL MENTIONED THE SAID DOCUMENTS SEIZED ARE EITHER RECORDED IN THE BOOKS OF ACCOUNT OR INVOLVES CH EQUE TRANSACTIONS. THUS, HE SUMMED UP STATING THAT THE DOCUMENTS IN QUESTION ARE NEITHER THE INCRIMINATING ONES NOR UNACCOUNTED TRANSACTIONS OF THE ASSESSEE AN D NOR THEY RELATE TO THE IMPUGNED FOUR AYS. IN SUCH CIRCUMSTANCES, THE AO NOT ONLY ASSUMED JURISDICTION INVALIDLY BUT ALSO ERRED IN DISTURBING THE SETTLED AND COMPLE TED ASSESSMENTS. ACCORDINGLY, AO SHOULD NOT ASSUME JURISDICTION IN RESPECT OF SUCH AYS IN THE ABSENCE OF ANY INCRIMINATING INFORMATION OR TRANSACTIONS SPECIFIC TO ANY OF THE IMPUGNED FOUR AYS IE 2000-01 TO 2003-04. THE CONTRARY ARGUMENT FROM THE SIDE OF THE REVENUE IS THAT THE OVERALL APPROACH IN MATTERS OF CONCEALMENT BY THE GROUP ASSESSES AND ALL THE DISCOVERIES OF THE SEARCH ON MR NA VALE AND IT CONCERNS, HAVE TO BE TAKEN INTO ACCOUNT WHILE FORMING THE SATISFACTION WITHIN THE MEANING OF SECTION 153C OF THE ACT. CONSIDERING THE DIVERGENT VIEWS OF THE PARTIES, WE HAVE EXAMINED THE SAID SATISFACTION NOTE VERY CLOSELY AND FOUND THAT T HE IMPUGNED REASONS MENTIONED BY THE AO ARE SILENT IN SO FAR AS ANY AY-SPEC IFIC-INCRIMINATING- INFORMATION (ASII) OR OTHERS IE UNACCOUNTED OR UNDISCLO SED OR HIDDEN INFORMATION TO THE REVENUE BY THE ASSESSEE. IN OUR OPINION, THE IMPUG NED SATISFACTION NOTE IS VERY GENERAL ONE FOR SIX YEARS. IT IS SURPRISING TO NOTE THAT THE AO HAS NARRATED SOME INFORMATION AGAINST THE MR NAVALE HUF, WHICH IS NOT RELEVA NT FOR THE PRESENT ASSESSEE. IN THE PROCESS, THE AO TOTALLY MISSED THE RE QUIREMENTS OF THE LAW IE ONLY THE AY WITH THE PENDING ASSESSMENTS AND THE AY WITH TH E AY SPECIFIC INCRIMINATING DOCUMENTS/ TRANSACTIONS OR SEIZED ASSET SHOULD ONLY BE REOPENED UNDER THE PROVISIONS OF THE FIRST PROVISO TO SECTION 153A OF THE A CT AND NOT OTHERWISE. 11. IN THIS REGARD, WE HAVE PERUSED VARIOUS LEGAL PROPO SITIONS. FIRST, WE HAVE PERUSED THE DECISION OF THIS TRIBUNAL IN THE CASE OF KUMA R COMPANY FOR THE AY 18 2000-01 (SUPRA) AND PARA 26 OF THE M/S. KUMAR AND COMPANY VIDE ITA NO. 463/PN/08 FOR THE A.Y 2000-01 AND THE SAME READS AS FOLLOWS:- 25. THUS, WE FIND THAT THE SEIZED DOCUMENTS BELONG TO THE ASSESSEE BY WAY OF LIMITED OWNERSHIP AND THEY ARE NOT DUMB DOCUMENTS AS ADVOCATED BY THE LD COUNSEL FOR THE REASON MENTIONED ABOVE. HOWEVER, THEY ARE NOT FOUND TO BE INCRIMINATING DOCUMENTS FOR THE AY 2000-01. THE DOCUMENT MAY NOT BE A DUMB DOCUMENT AND THEREFO RE A SPEAKING ONE, BUT THEY MUST BE THE DOCUMENT WITH PRIMA FACIE INC RIMINATING INFORMATION TOO. SUCH INCRIMINATING NATURE OF THE SEIZED DOCUMENT IS AN ESSENTIAL FACTOR FOR SWITCHING ON THE PROCEEDING U/S 153C. IN OTHER WORDS, THE DOCUMENT SEIZED MUST NOT ONLY BE A SPEAKING ONE BUT ALSO BE PRIMA FACIE INCRIMINATING ONE FOR IGNITING THE PROCEEDINGS U/S153C. UNLIKE OTHER AYS, T HERE IS NOTHING MADE OUT BY THE AO WHAT IS CALLED INCRIMINATING FOR THE CU RRENT AY UNDER CONSIDERATION. WHEN THE IMPUGNED DOCUMENTS MERELY CONTA INS THE NOTINGS OF ENTRIES, WHICH ARE ALREADY FOUND PLACE IN THE BOOKS OF A CCOUNTS OR SUBJECTED TO SCRUTINY OF THE AO IN THE PAST IN REGULAR ASSESSMENT U/ S 143(3) OF THE ACT, SUCH DOCUMENT CANNOT BE SAID TO BE CONTAINING THE INCRIMINATIN G INFORMATION. WHAT IS THE POINT IN DISTURBING THE SETTLED ASSESSMENT WHEN THE REVENUE DOES NOT HAVE INCRIMINATING INFORMATION FOR AN AY AND THE INFORMATION WHA T IS AVAILABLE IS ONLY ROUTINE ONE AND WHEN THE AO MERELY MAKES AN ADDITION IN THE ASSESSMENT U/S 153C BASED ON CHANGE OF OPINION AND WHEN SUCH ADDITIONS ARE LIKELY TO BE DELETED IN VIEW OF THE SETTLED NATURE OF THE ISSUES? INC OME TAX PROVISIONS ARE NOT MERELY FOR THE ISSUE OF NOTICE U/S 153C BUT IT IS ES SENTIALLY FOR TAXING THE INCOME OF THE PERSON. WHAT IS POINT IN ISSUING NOTICE U/S 153C ON FLIMSY GROUNDS AND FINALLY TAX NOTHING? SUCH PROCEEDINGS ONLY CREATES AV OIDABLE NUISANCE BOTH TO THE OVER-BURDENED TAXMAN AND THE MUCH HAZZLED TAX PAYERS. IN THE INSTANT CASE, PROVISIONS OF SECTION 153C ARE INVOKED MERELY TO A PPLY THE PROVISIONS OF SECTION 45(4) IN THIS YEAR, THE ISSUE WHICH WAS ALREADY EXAMINED AND CONCLUDED AS INAPPLICABLE TO THE FACTS OF THE CASE. SUCH ISSUE OF NOTICE IS UNWARRANTED AND SUCH REOPENING OF THE ASSESSMENT FOR THE AY 2000-01 IS UNCALLED FOR. 26. THEREFORE, THE PROCEEDINGS INITIATED U/S 153C IS NO T VALID IN VIEW OF THE DECISION IN THE CASE OF LMJ INTERNATIONAL (SUPRA). UNDER THESE CIRCUMSTANCES, WE ARE OF THE OPINION, THE AO HAS INVALIDLY ISSUED THE NOTICE U/S 153C FOR THE AY 2000-01 ON THE WRONG PRESUMPTION THAT AO CAN ASSUME JURISDI CTIONAL IN RESPECT ALL THE SIX AYS AUTOMATICALLY EVEN WITH OUT ANY INCRIMINATING DOCUMENTS IN RESPECT OF THE CONCLUDED ISSUES TOO . ACCORDINGLY, THE RELEVANT GROUNDS OF THE ASSESSEE ARE ALLOWED. 12. FROM THE ABOVE, IT IS OUR FINDING THAT THE REASONS RECORDED BY THE AO AS EXTRACTED ABOVE DO NOT CONTAIN ANYTHING INCRIMINATING FOR THE AYS UPTO 2003-04. IT IS THE SETTLED POSITION OF THE LAW BASED ON THE DECISION O F THE TRIBUNAL IN THE CASE OF LMJ INTERNATIONAL (SUPRA) THAT THE ISSUE OF NOTICE UNDE R THE PROVISIONS OF THE FIRST PROVISO TO SECTION 153A(1) OF THE ACT IS NOT AUTOMATIC AND THERE IS NEED FOR AY- SPECIFIC INCRIMINATING INFORMATION (ASII) IN THE POSSESSION OF THE AO TO BE THE FOUNTAIN HEAD FOR SPRINGING SATISFACTION TO HIM THAT THER E EXISTS SOME INCOME OR ASSET TO BE ASSESSED IN THE HANDS OF ANY OTHER PERSO N, WHO ARE REFERRED TO IN SECTION 153C OF THE ACT. REASON FOR THIS KIND OF INTERP RETATION WAS ALREADY GIVEN IN PARA 25 AND 26 OF OUR ORDER IN THE CASE OF KUMAR COM PANY FOR THE AY 2000-01. IN THIS REGARD, WE POSED QUESTION TO OURSELVES IF IT IS FAIR TO REOPEN THE ASSESSMENT WHICH IS ALREADY CONCLUDED WITHOUT ANY REASON OR LOGIC THE REBY ENCROACH ON THE RIGHTS OF THE TAX PAYERS? SHOULD THE AO BE GIVEN UNFET TERED OR ARBITRARY POWERS TO ISSUE NOTICE FOR THE SIX AYS SPECIFIED IN THE FIRST PROVIS O TO SECTION 153A(1) OF THE 19 ACT WHEN THE IMPUGNED ASSESSMENTS FOR THE SAID SIX AYS ARE OTHERWISE REACHED FINALITY AFTER DUE PROCESS OF LAW. IN OUR OPINION, THE AN SWER IS NEGATIVE AND IT IS IN FAVOUR OF THE ASSESSEE. IN ANY CASE, DR HAS NOT BRO UGHT ANYTHING ON RECORD TO DEMONSTRATE THAT THE DECISIONS GIVEN BY THE TRIBUNAL IN T HE CASE OF LMJ INTERNATIONAL (SUPRA) AND M/S KUMAR COMPANY (SUPRA) A RE NOT TO BE FOLLOWED IN THIS CASE. OUR PERUSAL OF ANOTHER ORDER OF THE TRIBUNAL IN T HE CASE OF M/S KUMAR COMPANY FOR THE AY 2201 TO 2003-04 VIDE ITA NO 1020, 1250,1021,1251,1022 & 1252/PN/2008, RELIED UPON BY THE LD DR IS FOUND DISTINGU ISHABLE IN SO FAR AS THE EXISTENCE OF THE INCRIMINATING DOCUMENT FOR THE RELEVANT AY IS CONCERNED. WHEREAS, IN THE INSTANT CASE, FIRST OF ALL, THERE IS NO M ENTION OF ANY DOCUMENT IN THE SAID REASONS RELATABLE TO THE IMPUGNED FOUR YEARS AND T HE INCRIMINATING NATURE OF THE SAME IS OUT OF QUESTION. THEREFORE, RELIANCE OF THE DR ON THE SAID CASE IS MISPLACED. 13. FURTHER, WE HAVE EXAMINED VARIOUS OTHER JUDICIAL PR OPOSITIONS MENTIONED BY THE LD COUNSEL AND SOME OF THEM ARE REPRODUCED AS UNDER. 1) ANIL KUMAR BHATIA & ORS. (2010) 1 ITR (TRIB) 48 4 (DEL) CONCLUSION:- IN RESPECT OF AN ASSESSMENT UNDER S. 153A, WHERE P ROCESSING RETURNS UNDER S. 143(1)(A) STOOD COMPLETED IN RESPECT OF RETURNS FILED IN DUE COURSE BEFORE SEARCH AND NO MATERIAL IS FOUND IN SEARCH THEREAFTER, NO ADDITION CAN BE MADE. 2) SUNCITY ALLOYS (P) LTD. (2009) 124 TTJ (JD) 67 4 CONCLUSION:- ASSESSMENTS OR REASSESSMENTS MADE PURSUANT TO NOTIC E UNDER S. 153A ARE NOT DE NOVO ASSESSMENT AND THEREFORE NO NE W CLAIM OF DEDUCTION OR ALLOWANCE CAN BE MADE BY ASSESSEE WHERE ADMITTEDLY THE REGULAR ASSESSMENTS ARE SHOWN AS COMPLETED ASSESSMENTS ON THE DATE OF INIT IATION OF ACTION UNDER S. 132. 3) MEGHMANI ORGANICS LTD. (2010) 129 TTJ (AHD) 255 CONCLUSION:- RECORD MAINTAINED BY A PERSON FOR HIS OWN PURPOSE THO UGH REFERABLE TO THE ASSESSEE CANNOT BE SAID TO BE BELONGIN G TO THE ASSESSEE WITHIN THE MEANING OF S. 153C. FURTHER, WHERE NONE OF THE ASSESSMENTS ARE PENDING ON THE DATE OF ACTION UNDER S. 153C, SUCH A SSESSMENTS DO NOT ABATE . 4) LMJ INTERNATIONAL LTD. (2008) 119 TTJ (KOL) 214 CONCLUSION:- WHERE NOTHING INCRIMINATING IS FOUND IN THE COURSE OF SEARCH RELATING TO ANY ASSESSMENT YEARS, THE ASSESS MENTS FOR SUCH YEARS CANNOT BE DISTRIBUTED; ITEMS OF REGULAR ASSESSMENT CANNOT BE ADDED BACK IN THE PROCEEDINGS UNDER S. 153C WHEN NO INCRIMINAT ING DOCUMENTS WERE FOUND IN RESPECT OF THE DISALLOWED AMOUNTS IN THE SEARC H PROCEEDINGS. 5) KAILASH AUTO FINANCE LTD. (2009) 32 SOT 80 (LUCK ) CONCLUSION:- A NOTICE UNDER S. 148(1) CAN BE ISSUED EVEN WHERE NO TICE UNDER S. 143(2) HAS BEEN PENDING AND NOT CLOSED. BY PROCESS ING THE RETURN AND BY ISSUING ACKNOWLEDGMENT AS TOKEN OF ACCEPTING THE RETURN , THE PROCEEDINGS INITIATED BY FILING THE RETURN ARE TERMINATED AND NO PROCE EDINGS, THEREFORE, REMAIN PENDING. 6) R.M.L. MEHROTRA (2010) 320 ITR 403 CONCLUSION:- UNDISCLOSED INCOME OF THE BLOCK PERIOD HAS TO BE DETERM INED ON THE BASIS OF EVIDENCE FOUND AS A RESULT OF SEARCH OR R EQUISITION OF BOOKS OF ACCOUNT OR OTHER DOCUMENTS AND SUCH OTHER MATERIALS O R INFORMATION AS ARE AVAILABLE WITH THE A.O AND RELATABLE TO SUCH EVIDENCE; AO CANNOT COMPUTE THE INCOME ON THE BASIS OF BEST JUDGEMENT. 20 14. FROM THE ABOVE, IT IS EVIDENT THAT THE WHERE NOTHIN G AY AND ASSESSEE SPECIFIC INCRIMINATING MONEY, JEWELLERY OR OTHER VALUABLE AR TICLE OR THING OR BOOKS OF ACCOUNT OR DOCUMENTS, THE ASSESSMENTS FOR ASSESSEE YEARS CANNOT BE DISTRIBUTED. FURTHER, THE CONCLUDED ASSESSMENTS SHOULD NOT BE DISTU RBED MERELY FOR MAKING ROUTINE ADDITIONS, WHICH COULD HAVE BEEN OTHERWISE DONE IN THE REGULAR ASSESSMENT AND OF COURSE, THE PENDING ASSESSMENTS FALL UNDER EXCE PTIONS. AS STATED BY THE LD COUNSEL POINT NO 9 OF HIS NOTE REPRODUCED ABOVE, NOT HING IS SEIZED PERTAINING TO A.Y 2000-01 TO 2003-04 OBVIOUSLY THERE IS NO QUESTION OF RECORDING SATISFACTION NOTE. ON THIS REASONING ITSELF, WE FIND THAT THE ASSESSE E HAS TO SUCCEED. THEREFORE, WE DO NOT EXAMINE THE OTHER ARGUMENTS OF THE COUNSEL. OTHERWISE, THE COUNSEL ARGUED THAT THE REOPENING OF THE ASSESSMENT FOR THE AY 2000-01 TO 2001-02 IS IMPERMISSIBLE IN VIEW OF THE JUDGMENT OF ALLAHABAD BENCH IN THE CASE OF VIJAY VIMAWAL VS. ACIT 124 TTJ 508. FURTHER, HE ALSO ARGUED THAT THE ASSESSMENT OF A.Y 2003-04 WAS ACTUALLY COMPLETED U/S. 143(3) ON 30/03/20 06 IE PRIOR TO RECEIPT OF THE IMPUGNED DOCUMENTS BY THE ASSESSING OFFICER ON 18/04/2 007, THIS ASSESSMENT WAS NOT PENDING. ATTENDING TO THESE ARGUMENTS OF THE COUN SEL IS SUPERFLUOUS AND MERELY AN ACADEMIC EXERCISE AS WE HAVE UPHELD THE APPLICABILITY OF THE DECISION OF THE TRIBUNAL IN THE CASE OF LMJ INTERNATIONAL LTD (SUPRA) FO R THE PROPOSITION THAT THE WHERE NOTHING INCRIMINATING IS FOUND IN THE COURSE OF SEA RCH RELATING TO ANY ASSESSMENT YEARS, THE ASSESSMENTS FOR SUCH YEARS CA NNOT BE DISTRIBUTED AND OTHER LOCAL DECISION CITED ABOVE. ACCORDINGLY, THE ADDITIONAL GROU ND RAISED BY THE ASSESSEE FOR ALL THE 4 APPEALS UNDER CONSIDERATION ARE A LLOWED AND IN FAVOUR OF ASSESSEE. 15. AS THE ADDITIONAL GROUND FOR ALL THE FOUR YEARS ARE ALLOWED IN FAVOUR OF THE ASSESSEE, WE ARE OF THE CONSIDERED OPINION THE ADJUDICA TION OF THE GROUNDS RELATING TO THE MERITS OF THE ADDITIONS IS MERELY AN ACADEMIC EXER CISE. THEREFORE, THE RELEVANT GROUNDS IN ALL THE FOUR APPEALS ARE DISMISSED AS ACADEMIC. 18. WE HAVE DISCUSSED THE EXISTING LEGAL PROPOSITION ON THE ISSUE OF VALIDITY OF THE NOTICE IN THE LIGHT OF THE PROVISIONS OF SECTION 153C R W S `153A OF THE ACT. FROM THE ABOVE, IT IS THE DECISION OF THIS BENCH OF THE TRIBUNAL, TAKEN RELYING ON THE DECISIONS OF THE OTHER BENCHES OF THE TRIBUNAL IE IN THE CASE OF LMJ INTERNATIONAL LTD (SUPRA) THAT WHERE NOTHING INCRIMINATING IS FOUND IN THE COURSE OF SEARCH RELATING TO ANY ASSESSMENT YEAR, T HE ASSESSMENTS FOR SUCH YEARS CANNOT BE DISTRIBUTED . THUS, THE ASSESSMENTS MADE BY THE AO U/S 153C OF THE ACT WITHOUT THE EXISTENCE OF AY-SPECIFIC INCRIMI NATING DOCUMENTS ARE INVALID . 19 . APPLICATION OF THE ABOVE SCOPE TO THE FACTS OF TH IS CASE: NOW WE SHALL TAKE UP THE CONTENTS OF THE SATISFACTION NOTE AND EXAMINE IF THERE ARE ANY DOCUMENTS SEIZED INVOLVING THE ASSESSEE AND IF THEY ARE INCRIMINATING WITH REFERENCE EACH OF THE SIX AYS OF THE ASSESSEE. 20. IN THE INSTANT CASE AS EXPRESSIVELY MENTIONED BY THE REVENUE AUTHORITIES THAT THE AO ISSUED NOTICES U/S 153C OF THE ACT SIMP LY RELYING ON THE CONTENTS OF SECTION 153A(1)(B) OF THE ACT AND ALSO ITS FIRST PROV ISO. IT IS THE STAND OF THE DEPARTMENT AS DISCUSSED IN THE PRECEDING PARAGRAPHS OF THIS ORDER THAT THERE IS NO NEED FOR THE AY-SPECIFIC SEIZURE AND HANDING OVER OF THE DOCUMENT TO THE AO OF THE ASSESSEE AS THE PROVISIONS OF SECTION 153C OF THE ACT. AO RELIED ON THE PLAIN READING OF THE RELEVANT PROVISIONS OF THE SAID S ECTIONS. IN THE PROCESS, 21 REVENUE IGNORED VARIOUS SETTLED LEGAL PROPOSITIONS ON THE SUBJECT. THE SAID PROPOSITIONS ARE THAT THE CONCLUDED ASSESSMENTS, WHIC H FALL IN THE BUNCH OF SIX AY SHOULD NOT BE DISTURBED UNLESS THERE EXISTS AY SP ECIFIC INCRIMINATING MATERIAL RELEVANT FOR EACH OF THE SAID AYS OR CONCLUDED ASSESSM ENTS AND IT SHOULD NOT BE A CASE OF DUMB DOCUMENTS. PROBABLY, FROM THE REVENUES POINT OF VIEW, THE SAID PROPOSITIONS ARE DILUTION OF THE EXPRESS PROVISIONS WHI CH READS THAT AO MAY ASSESS OR REASSESS THE TOTAL INCOME OF SIX ASSESSME NT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVI OUS YEAR IN WHICH SUCH SEARCH IS CONDUCTED .. (FIRST PROVISO). IT IS ALSO FACT THAT THE DECISIO N IN THE CASE OF LMJ INTERNATIONAL LTD. (2008) 119 TTJ (KOL) 214 I S UNDISTURBED AS ON DATE AND IT IS RELEVANT FOR THE PROPOSITION THAT WHERE NOTHING INCRIMINATING IS FOUND IN THE COURSE OF SEARCH RELATING TO ANY ASSESSMENT YEARS, THE ASSESSMENTS FOR SUCH YEARS CANNOT BE DISTRIBUTED; ITEMS OF REGULAR ASSES SMENT CANNOT BE ADDED BACK IN THE PROCEEDINGS UNDER S. 153C WHEN NO INCRIMINAT ING DOCUMENTS WERE FOUND IN RESPECT OF THE DISALLOWED AMOUNTS IN THE SEARCH PROCEEDINGS. NOTHING IS BROUGHT TO OUR NOTICE BY THE REVENUE CONTRARY TO THE AB OVE AND THE DECISIONS RELIED ON BY THE DR ARE OTHERWISE DISTINGUISHABLE ON FACTS. 21. IN THE PRESENT CASE OF THE ASSESSEE AND IN THE A PPEALS ARISING FROM THE ORDER OF THE AO UNDER SECTION 153C RWS 143(3) OF THE A CT FOR THE AY AYS 2000- 01 TO 2005-06 , THERE ARE SIX AYS. BASED ON THE EXISTENCE OF THE SE IZED DOCUMENTS, THESE SIX AYS CAN CATEGORIZED INTO TWO CA TEGORIES. (I) THE AYS WITHOUT SEIZURE OF ANY DOCUMENTS OR ANY OTHER SEIZURES AS REFERRED TO IN THE PROVISIONS OF SECTION 153C OF THE ACT; AND (II) THE AY WITH THE SEIZURE OF SOME DOCUMENTS AS REFERRED TO IN THE PROVISIONS OF SECTION 1 53C OF THE ACT. 22. APPEALS BY THE ASSESSEE - AYS 2000-01 TO 2003-0 4 & 2005-06: IN CONNECTION WITH THE AYS AT SL NO (I) ABOVE IE AY S 2000-01 TO 2004-05, ADMITTEDLY, THERE IS NO SEIZURE OF THE DOCUMENTS AS E VIDENT FROM THE SATISFACTION NOTE AND THE TABLES EXPLAINED BY THE ASSESSEE. CONS IDERING THE ABOVE SCOPE OF THE PROVISIONS AND LEGAL PROPOSITIONS ALREADY ADOPTED BY THIS BENCH IN THE CASE OF SINHGAD TECHNICAL EDUCATION SOCIETY (SUPRA), WE A RE OF THE OPINION THAT THE ISSUANCE OF NOTICES U/S 153C FOR THE AYS 2000-01 TO 2003-04 & 2005-06 , WHERE THERE ARE NO SEIZED DOCUMENTS, IS INVALID . 23. IN SO FAR AS THE LONE APPEAL FOR THE REVENUE IN RESPECT OF THE APPEAL ITA 1039/PN/10 FOR AY 2003-04 IS CONCERNED, THE SAME HAS TO BE DISMISSED WITHOUT GOING IN TO THE MERITS OF THE GROUND AS WE QU ASHED THE ASSESSMENT PROCEEDINGS IN VIEW OF THE INVALID NOTICE. 22 24. APPEALS BY THE ASSESSEE - AY 2004-05: IN CONNECTION WITH THE AYS AT SL NO (II) ABOVE IE AYS 2004-05, ADMITTEDLY, THE RE IS SOME SEIZURE OF THE DOCUMENTS AS EVIDENT FROM THE SATISFACTION NOTE. WE ARE CONVINCED THAT THE SAID LEDGER IS AN ACCOUNTED ONE. FURTHER, THE REASONIN G GIVEN BY US IN THE ORDER IN THE CASE OF SINHGAD TECHNICAL EDUCATION SOCIETY (SUPRA) APPLY TO THE ISSUE IN THESE APPEALS MUTATIS MUTANDIS. IN OTHER WORDS, THE VIEWS APPROVED BY THIS BENCH IN THE CASE OF SINHGAD TECHNICAL EDUCATION SOCIETY (SUPRA) AND KUMAR COMPANY (SUPRA) ARE AFFIRMED BY THE SAID JUDGMENT OF THE GUJA RAT HIGH COURT IN THE CASE OF VIJAYBHAI N CHANDANI 231CTR 474 (GUJ) A ND MERE APPEARANCE OF NAMES DOES NOT MEAN ANYTHING AS SECTION 153C OF THE ACT IS INTENDED FOR TAXING THE UNDISCLOSED INCOME OF THE THIRD PARTY BASE D ON THE MATERIAL/OTHERS SEIZED DURING THE SEARCH ACTION. AS SUCH, ONLY THE UN ACCOUNTED AND INCRIMINATING MATERIAL OR OTHERS LISTED IN THE SAID SECTION ARE ONLY SEIZED DURING THE SEARCH AND THE ACCOUNTED DOCUMENTS SHOULD NOT BE SEIZED. SEIZU RE OF THE DOCUMENTS IS AIMED AT THE UNEARTHING OF THE UNACCOUNTED INCOME OF THE ASSESSEE ASSESSABLE U/S 153A OR THE OTHER THIRD PARTIES SUBJECTED ASSESSME NT U/S 153C OF THE ACT. WHEN THE DOCUMENTS DO NOT INDICATE ANY UNDISCLOSED INCOME, THE LEDGER IN THE INSTANT CASE, WHAT IS THE RELEVANCE OF SUCH DOCUMENT ? SUCH LEDGER CONSTITUTES MERELY AN ACCOUNTED ONE WITH NO FINANCIAL IMPLICATIO NS. THUS, THE DOCUMENTS, THE LEDGER IN THE INSTANT CASE RELEVANT FOR THE AY 2004-05, WITH NO FINANCIAL IMPLICATIONS CAN NEITHER BE CONSIDERED IN CRIMINATING NOR BE CONSIDERED CAPABLE OF SPRINGING SATISFACTION TO ANY AO THAT THERE IS SCOPE OF UNDISCLOSED INCOME IN RESPECT OF THE THIRD PARTY ASSASABLE U/S 153C OF THE ACT. ACCORDINGLY, THE LEGAL GROUNDS RAISED IN ALL THESE APPEALS OF THE ASSESSEE RELATING TO THE VALIDITY OF THE NOTICE U/S 153C OF THE ACT ARE ALLOWED IN FAVOUR OF THE ASSESSEE IN RESPECT OF ALL THE AYS UNDER CONSIDERATION. FURTHER, WE ARE OF THE CONSIDERED OPINION THAT THE ADJUDICATIO N OF THE OTHER GROUNDS RELATING TO THE OTHER LEGAL AND MERIT ORIENTED ISSUES IS MERELY AN ACADEMIC EXERCISE. THEREFORE, THE RELEVANT GROUNDS IN ALL THE FOU R APPEALS ARE DISMISSED AS ACADEMIC. 25. IN THE RESULT ALL THE SIX APPEALS OF THE ASSESSE E ARE ALLOWED AND CONSEQUENTLY, THE CROSS APPEAL BY THE REVENUE VIDE ITA 1039/PN/10 FOR AY 2003- 04 IS DISMISSED. SECOND CATEGORY OF THE APPEALS (FIVE APPEALS OF ASSESSEE AGAINST THE ORDER OF THE CIT U/S 263 OF ACT) 26. THESE ARE THE ASSESSEES APPEALS ARISING OUT OF T HE ORDERS PASSED BY THE CIT U/S 263 OF THE ACT. THE ITA NUMBERS UNDER CONSIDE RATION HERE ARE AS 23 UNDER.659/PN/08 FOR THE AY 2000-01, 660/PN/08 FOR THE AY 2001-02, 661/PN/08FOR THE AY 2002-03, 662/PN/08 FOR THE AY 200 4-05 AND 663/PN/08 FOR THE AY 2005-06. AS PER SRI SUNIL PATHAK, LD COUNSEL, ALL THESE APPEALS HAVE TO BE QUASHED IN CASE THE NOTICES ISSUED BY THE AO U/S 153C IN RESPECT OF ALL THE AYS UNDER CONSIDERATION ARE HELD NULL AND VOID. LD DR RELIED ON THE ORDERS OF THE REVENUE. WE HEARD THE PARTIES AND CONSIDERED THE ARGUME NTS OF THE PARTIES AND THE DOCUMENTS FILED BEFORE US. WE FIND THAT THE LEGA L GROUND RAISED BY THE ASSESSEE QUESTIONS THE VALIDITY OF THE REVIEW ORDER OF THE CIT PASSED U/S 263 OF THE ACT. FROM THE ABOVE PARAGRAPHS OF THIS ORDER, IT IS EVIDENT THAT WE HAVE UPHELD THE INVALIDITY OF THE NOTICES ISSUED U/S 153C OF THE ACT AND IN F AVOUR OF THE ASSESSEE AND IN EFFECT, WE HOLD THAT THE ORDERS P ASSED U/S 153C R W S 143(3) BY THE AO FOR THE AYS UNDER CONSIDERATION ARE HELD TO B E NULL AND VOID . CONSEQUENTLY, THE ASSESSMENT ORDERS REVIEWED BY THE C IT U/S 263 OF THE ACT ARE NULL AND VOID AND THEREFORE, THE REVIEW ORDER OF THE CIT ALSO BECOMES NULL AND VOID. ACCORDINGLY AND CONSEQUENTLY, THESE SECON D CATEGORY OF APPEALS NUMBERING 5 FOR THE SAID AY HAVE ALSO TO BE DECIDED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. THUS, THE SAID LEGAL GROUND RELATING TO THE INVALIDITY OF THE NOTICE U/S 153C & THE INVALIDITY OF THE REVIEW O RDER RAISED BY THE ASSESSEE IN RESPECT OF THE FIVE AYS UNDER CONSIDERATION IS ALLOWED . THE ADJUDICATION OF THE OTHER GROUNDS FOR ALL THE AYS UNDER CONSIDERATION ARE TO BE DISMISSED AS ACADEMIC. 27. IN THE RESULT, THE FIVE APPEALS OF THE ASSESSEE ARE ALLOWED. THIRD CATEGORY OF THE APPEALS (TEN CROSS APPEALS OF THE ASSESSEE AND REVENUE AGAI NST THE FRESH ASSESSMENT ORDERS PASSED BY AO U/S 263 RWS 153C RWS 143(3) OF ACT) 28. THESE ARE THE TEN CROSS APPEALS ARISING OUT OF THE FRESH ASSESSMENT ORDERS PASSED BY THE AO U/S 263 RWS 153C RWS 143(3) OF THE A CT. AS PER SRI SUNIL PATHAK, LD COUNSEL, ALL THESE APPEALS HAVE ALSO TO BE QUASHED IN CASE THE NOTICES ISSUED BY THE AO U/S 153C IN RESPECT OF ALL THE AYS UNDER CONSIDERATION ARE HELD NULL AND VOID AND IN CASE THE REVIEW ORDERS OF THE CI T ARE HELD NULL AND VOID TOO. LD DR RELIED ON THE ORDERS OF THE REVENUE. WE HEARD THE PARTIES AND CONSIDERED THE ARGUMENTS OF THE PARTIES AND THE DOCUMENTS FILED BEFORE US. WE FIND THAT THE LEGAL GROUND RAISED BY THE ASSESSEE QUESTIONS THE VAL IDITY OF THE REVIEW ORDER OF THE CIT PASSED U/S 263 OF THE ACT. FROM THE ABOVE PA RAGRAPHS OF THIS ORDER, IT IS EVIDENT THAT WE HAVE UPHELD THE INVALIDITY OF THE NOTICES ISSUED U/S 153C OF THE 24 ACT AND IN FAVOUR OF THE ASSESSEE AND IN EFFECT, WE HOLD THAT THE ORDERS PASSED U/S 153C R W S 143(3) BY THE AO FOR THE AYS UNDER CONS IDERATION AND THE REVIEW ORDERS OF THE CIT PASSED U/S 263 ARE HELD TO BE NULL AND VOID . CONSEQUENTLY, THE ASSESSMENT ORDERS REVIEWED BY THE CIT U/S 263 OF THE ACT ARE NULL AND VOID AND THEREFORE, THE REVIEW ORDER OF THE CIT ALSO BECOMES NULL AND VOID. ACCORDINGLY AND CONSEQUENTLY, THESE SECOND CATEGORY OF APPEALS N UMBERING 10 FOR THE SAID AY HAVE ALSO TO BE DECIDED NULL AND VOID IN VIEW OF THE FACT THESE APPEALS REVOLVE AROUND THE FRESH ASSESSMENT ORDERS ARISING OUT O F THE REVIEW ORDERS WHICH ARE HELD INVALID. THUS, THE SAID LEGAL GROUNDS RELATING TO THE INVALIDITY OF THE NOTICE U/S 153C & THE INVALIDITY OF THE REVIEW O RDER AND THE FRESH ASSESSMENT ORDERS RAISED BY THE ASSESSEE IN RESPECT OF THE FIVE A YS UNDER CONSIDERATION ARE ALLOWED AND IN FAVOUR OF THE ASSESSEE. THE ADJUDICAT ION OF THE OTHER GROUNDS FOR ALL THE AYS UNDER CONSIDERATION ARE TO BE DISMISSED AS ACADEMIC. 29. IN THE RESULT, THE FIVE APPEALS OF THE ASSESSEE ARE ALLOWED AND FIVE APPEALS OF THE REVENUE ARE DISMISSED ON TECHNICALITIES. ORDER PRONOUNCED IN OPEN COURT ON 28 TH APRIL, 2011 SD/- SD/- (I.C. SUDHIR) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE DATED THE 28 TH APRIL, 2011 B COPY OF THE ORDER IS FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A)- IV, PUNE 4. THE CIT, CEN., PUNE 5. THE D.R. ITAT B BENCH 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL PUNE