M/S TAJ GRIH NIRMAN SOCIETY, Bhopal V. THE ACIT 3(1), Bhopal

ITSSA 128/IND/2016

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 9133 (ITAT-INDORE)
• Duration Of Justice: 4 year(s) 6 month(s) 7 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 08-01-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 02-11-2020
• Assessment Year: 2007-2008
• Appeal Filed On: 01-07-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ASHIMA GUPTA
• Assessee Lawyers: GIRISH AGRAWAL; NISHA LAHOTI A RS
• Keywords: Rectification of order; Search and seizure; Document seized; Opportunity of being heard; Additional evidence; Documents seized; Reassessment proceedings; TDS; Set aside
• Section: 271(1)(c); 143(3); 142(1); 133A; 153A; 251; 143(2); 113; 13; 153; 22; 153C; 68; 27; 132; 154

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER IT(SS)A NOS.126 & 127 & 128/IND/2016 ASSESSMENT YEARS:2005-06, 2006-07 & 2007-08 TAJ GRIH NIRMAN SOCIETY SHAFIQUE VILLA, BUNGLOW NO.7, AHMEDABAD PALACE ROAD, BHOPAL / VS. AC IT - 3(1) BHOPAL ( APPELLANT ) ( REVENUE ) P.A. NO. AABAT7162Q APPELLANT BY SHRI GIRISH AGRAWAL & MISS NISHA LAHOTI , A RS REVENUE BY SMT. ASHIMA GU PTA, CIT - DR DATE OF HEARING: 02.11.2020 DATE OF PRONOUNCEMENT: 08.01.2021 / O R D E R PER KUL BHARAT, J.M: THESE THREE APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST THE DIFFERENT ORDERS OF LD. COMMISSIONER OF INCOME TAX (APPEAL)IN SHORT LD. CIT(A)-2, BHOPAL ALL DATED 21.03.2016 PERTAINING TO ASSESSMENT YEARS 2005-06, TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 2 2006-07 & 2007-08. ALL THESE APPEALS WERE TAKEN UP TOGETHER AND ARE BEING DISPOSED OF BY WAY OF CONSOLID ATED ORDER AS THE GROUNDS ARE IDENTICAL EXCEPT THE CHANGE IN TO FIGURES. 2. WE TAKE THE ASSESSEE APPEAL IN ITANO.126/IND/2016 FO R A.Y. 2005-06 AS A LEAD CASE. IN THIS APPEAL THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) WAS NOT JUSTIFIED IN UPHOLDING THAT THE ADDI TION OF RS.20,00,000/- BY TREATING THE DEPOSITS MADE BY THE MEMBERS OF THE SOCIETY AS UNEXPLAINABLE AS DONE BY THE ASSESSING OFFICER. 3. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE THIS TRIBUNAL THE ASSESSEE ALSO RAISED FOLLOWING ADDITIONAL GROUNDS OF APPEAL: 1.ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, LD. ASSESSING OFFICER ERRED IN MAKING THE ADDITION OF RS.20,00,000/- AND PASSING THE IMPUGNED ASSESSMENT ORDER UNDER SECTION 153C RWS 143(3) WITHOUT REFERENCE TO ANY INCRIMINATING MATERIAL FOUND AND SEIZED FROM THE SE ARCHED PERSONS DURING THE CONDUCT OF THEIR SEARCH. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, LD. ASSESSING OFFICER ERRED IN MAKING THE ADDITION OF RS.20,00,000/- AND PASSING THE IMPUGNED ASSESSMENT ORDER UNDER SECTION 153C RWS 143(3) WITHOUT REFERENCE TO SATISFACTION RECORDED BY THE ASSESSING OFFICER OF THE SEARCHED P ERSONS AND WITHOUT SUPPLYING A COPY OF THE SAID SATISFACTION T O THE APPELLANT FROM THE FILE OF SEARCHED PERSONS IN WHOS E CASE TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 3 ASSESSMENTS WERE COMPLETED UNDER SECTION 153A. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, LD. ASSESSING OFFICER ERRED IN MAKING THE ADDITION OF RS.20,00,000/- AND PASSING THE IMPUGNED ASSESSMENT ORDER UNDER SECTION 153C RWS 143(3) MORE PARTICULARLY WHE N PROVISIONS OF SECTION 292C APPLIES ON PERSON FROM W HOM THE SEIZED MATERIAL IS FOUND IN THE POSSESSION OR CONTR OL OF, IN THE COURSE OF A SEARCH UNDER SECTION 132 OR SURVEY UNDE R SECTION 133A AND NOT THE OTHER PERSON. 4. THE FACTS GIVING RISE TO THE PRESENT APPEAL ARE THAT A SEARCH AND SEIZURE OPERATION U/S 132(1) OF THE INCOME TAX ACT 1961(HEREINAFTER REFERRED AS THE ACT) WAS CARRIED O UT IN THE CASE OF MOHD. SHAFIQUE GROUP CASES ON 21.09.2006. DURING THE SEARCH AND SEIZURE OPERATION U/S 132(1), DOCUMENTS RELATING TO THE ASSESSEE NAMELY TAJ GRIH NIRMAN SOCIETY WERE ALSO FOUND. THEREAFTER, HAVING RECORDED THE REASONS A NOTICE U/S 153C WAS ISSUED ON 19.05.2008. AGAIN, NOTICE U/S 142(1) R.W.S. 153C OF THE ACT WAS ISSUED ON 20.06.2008 CALLING THE ASSESSEE TO ATTEND HEARING ON 06.06.2008. IN RESPONSE THERETO, A RETUR N OF INCOME FOR A.Y. 2005-06 WAS FILED ON 30.09.2008 DEC LARING INCOME OF RS.2,290/-. 5. THEREAFTER, THE ASSESSING OFFICER MADE ASSESSMENT U/ S 153 R.W.S. 143(3) ON 31.12.2008 AND ASSESSED THE INCO ME AT RS.20,02,290/- HENCE MAKING AN ADDITION OF TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 4 RS.20,00,000/-. THE MATTER TRAVELLED UP TO THE TRIBUN AL AND IMPUGNED ORDER THEREIN WAS SET ASIDE AND ASSESSMENT WAS RESTORED BACK TO THE FILE OF ASSESSING OFFICER VID E ORDER DATED 03.09.2012. IN PURSUANCE OF THE TRIBUNAL ORDER T HE ASSESSING OFFICER ISSUED A NOTICE U/S 143(2) DATED 30.01.2014, NO ONE APPEARED BEFORE THE ASSESSING OFFIC ER ON THE DATES SO FIXED. THEREAFTER, AGAIN A NOTICE WAS IS SUED, IN RESPONSE THERETO, THE AUTHORIZED REPRESENTATIVE ( AR) OF THE ASSESSEE, SHRI ROHIT PATHAK, ADVOCATE ATTENDED THE HEARING AND FILED WRITTEN SUBMISSION WHICH WERE PLACED ON RECORD. THE ASSESSING OFFICER RECORDED THAT THE ASSES SEE FAILED TO GIVE ANY DOCUMENTARY EVIDENCES IN SUPPORT O F ITS CLAIM. THEREFORE, HE MADE AN ADDITION OF RS.20,00,000/- . 6. AGGRIEVED AGAINST THIS THE ASSESSEE PREFERRED AN APPE AL BEFORE THE LD. CIT(A) WHO AFTER CONSIDERING THE SUBM ISSIONS DISMISSED THE APPEAL. IT IS ALSO NOTED THAT BEFORE THE LD. CIT(A) THE ASSESSEE HAD FURNISHED CERTAIN EVIDENCES. THOSE EVIDENCES WERE NOT FOUND TO BE SUFFICIENT, HENCE, LD. CIT(A) SUSTAINED THE ADDITION. NOW THE ASSESSEE IS IN APPEAL BEFORE THIS TRIBUNAL. DURING THE COURSE OF HEARING TH E ASSESSEE FILED ADDITIONAL GROUNDS OF APPEAL. FIRST WE WOULD TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 5 DECIDE THE ISSUE OF ADMISSIBILITY OF ADDITIONAL GROUN DS TAKEN BY THE ASSESSEE. 7. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ADDITIONAL GROUNDS ARE LEGAL IN NATURE. THEY CAN BE RAISED AT ANY STAGE. HE VEHEMENTLY ARGUED THAT IN THE LIGHT OF THE JUDGMENTS RELIED BY THE ASSESSEE THESE GROUNDS DESER VE TO BE ADMITTED AND ALLOWED. LD. COUNSEL FURTHER REITERATED THE SUBMISSION AS MADE IN THE SYNOPSIS. THE SUBMISSIONS OF THE ASSESSEE ARE REPRODUCED AS UNDER: A. ADDITIONAL GROUNDS OF APPEAL FOR ALL THE THREE YEARS UNDER APPEAL I.E. A.Y. 2005 -06 TO 2007- 08, ASSESSEE HAS FILED ADDITIONAL GROUNDS OF APPEAL THROUGH A SEPARATE APPLICATION DATED 07.09.2018 WHICH ARE LEG AL GROUNDS ON FUNDAMENTAL ISSUE OF JURISDICTION GOING TO THE R OOT OF THE MATTER. ASSESSEE PRAYS THAT THESE GROUNDS OF APPEAL MAY PLEASE BE ADMITTED IN THE INTEREST OF NATURAL JUSTI CE AND APPROPRIATE ADJUDICATION OF THE MATTER. 1. INSTANT PROCEEDINGS ARE THE SECOND ROUND OF APPEAL BEFORE THE HONBLE ITAT BENCH OF INDORE AFTER THE MATTER W AS SET ASIDE BY THE HONBLE BENCH TO THE FILE OF AO VIDE ORDER P RONOUNCED ON 03.09.2012 IN APPEAL NOS. IT(SS)A 300 TO 302/IND/20 12.[REFER PB 209 214] THE MATTER WAS SET ASIDE BY THE HONBLE BENCH OWING TO ADDITIONAL EVIDENCES FILED BY THE ASSESSEE WHICH WE RE NOT CONSIDERED BY THE AUTHORITIES BELOW.[REFER PB 174] WHILE SETTING ASIDE THE MATTER TO THE FILE OF LD. A O, HONBLE ITAT NOTED THE FOLLOWING FACTS IN ITS ORDER AT INTERNAL PAGE 5[PB 211] ON THE ISSUE AS TO WHY THESE DOCUMENTS COULD NOT B E FILED BEFORE THE LEARNED ASSESSING OFFICER, IT WAS EXPLAI NED BY THE TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 6 LEARNED COUNSEL THAT THE SEARCH TOOK PLACE ON 21.09 .2006 AND NOTICE U/S 153C WAS ISSUED ON 16.09.2008 APPROXIMAT ELY AFTER TWO YEARS OF THE SEARCH. THE RETURN WAS CLAIMED TO BE FILED ON 16.09.2008. IT WAS ALSO POINTED THAT THE QUESTIONNA IRE WAS ISSUED ON 11.10.2008, THEREFORE, THE ASSESSMENT WAS TO BE COMPLETED BY 31.12.2008.[EMPHASIS SUPPLIED] 2. SEARCH WAS CONDUCTED IN THE CASE OF MOHD. SHAFIQUE, MOHD. ATIQUE AND M/S. EKTA TRANSPORT CO. FOR WHOM ASSESSMENTS WERE COMPLETED U/S 153A RWS 143(3). CAS ES OF MOHD. SHAFIQUE AND MOHD. ATIQUE ARE IN APPEAL BEFOR E YOUR HONORS ALONG WITH THE INSTANT CASE. 3. IN THE INSTANT CASE, THE MATTER RELATES TO FUNDAMEN TAL ISSUE OF JURISDICTION AS THE IMPUGNED ASSESSMENTS F OR THE ASSESSEE SOCIETY WERE COMPLETED U/S 153C RWS 143(3) . RECORDING OF SATISFACTION IN THE FILE OF SEARCHED P ERSON IS OF VITAL IMPORTANCE. IT IS ONLY ON THE BASIS OF SATISFACTION RECORDED IN THE CASE OF SEARCHED PERSONS THAT PROCEEDINGS U/S 153C COULD HAVE BEEN INITIATED IN THE CASE OF ASSESSEE. 4. ASSESSEE FILED A REMINDER APPLICATION FOR THE SUPPL Y OF CERTIFIED TRUE COPY OF SATISFACTION RECORDED IN THE CASE OF SEARCHED PERSONS TO THE OFFICE OF LD. CIT(A) 2, B HOPAL AS WELL AS TO THE OFFICE OF LD. ACIT 3(1), BHOPAL ON 02-0 3 AUGUST 2018 WHICH WAS IN CONTINUATION TO THE ERSTWHILE PENDING APPLICATION DATED 16.08.2012.[PB 194] ANOTHER REMINDER DATED 25.08.2018 WAS FILED BEFORE THE ACIT 3(1), BHOPAL FOR SUPPLY OF REQUIRED SATISFACTION RE CORDED IN THE CASE OF SEARCHED PERSONS. TILL DATE,COPIES OF THE R EQUIRED SATISFACTION NOTE RECORDED IN THE CASES OF SEARCHED PERSONS HAVE NOT BEEN PROVIDED TO THE ASSESSEE.[COPY ANNEXE D TO THIS SUBMISSION] ASSESSEE ALSO FILED AN APPLICATION UNDER THE RIGHT TO INFORMATION ACT, 2005 (RTI)ON 17.09.2018 REQUESTING TO PROVIDE THE STATUS OF ABOVE REFERRED PENDING APPLICATIONS A ND ALSO TO MAKE AVAILABLE CERTIFIED TRUE COPY OF THE SATISFACT ION NOTE RECORDED IN THE CASE OF SEARCHED PERSONS,VIZ.MOHD. ATIQUE, MOHD. SHAFIQUE AND M/S. EKTA TRANSPORT COMPANY. [CO PY ANNEXED TO THIS SUBMISSION] TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 7 5. AS PER THE LAW ENSHRINED IN SECTION 153C WHICH RELA TES TO ASSESSMENT OF INCOME OF ANY OTHER PERSON, IT IS THE 'SATISFACTION' OF THE ASSESSING OFFICER OF THE PERSON SEARCHED WHI CH IS SINE QUA NON FOR ACQUIRING THE JURISDICTION U/S 153C. ON LY WHEN 'SATISFACTION' HAS BEEN RECORDED BY THE ASSESSING O FFICER OF THE PERSON SEARCHED WHO ALONE IS REQUIRED UNDER THE LAW TO RECORD SUCH SATISFACTION, EVEN THOUGH 'SATISFACTION' HAS B EEN RECORDED BY THE LD. ASSESSING OFFICER OF THE ASSESSEE AND TH EREFORE, IN TERMS OF LAW ENSHRINED IN SECTION 153C SUCH A RECOR DING OF SATISFACTION DOES NOT CLOTHE THE ASSESSING OFFICER WITH THE JURISDICTION TO INITIATE PROCEEDINGS U/S 153C AND C ONSEQUENTLY TO FRAME ANY ASSESSMENT U/S 153C RWS 143(3). IN THE INSTANT CASE, LD. ASSESSING OFFICER OF THE ASSESSEE ISSUED NOTICE U/S 153C FOR THE IMPUGNED ASSESSMENT YEARS ON 16.09.200 8. IN OTHER WORDS, AT THE FIRST STAGE, THE AO OF THE P ERSON WHO HAS BEEN SEARCHED MUST ARRIVE AT A SATISFACTION THAT TH E ASSETS OR DOCUMENTS SEIZED DOES NOT BELONG TO THE SEARCHED PE RSON BUT TO SOME 'OTHER PERSON'; IN THE SECOND STAGE, THAT IS, AFTER SUCH SATISFACTION IS ARRIVED BY THE AO OF PERSON SEARCHE D, THEN HE IS REQUIRED TO TRANSFER OR HAND OVER THE ASSETS OR DOC UMENTS TO THE AO HAVING JURISDICTION OVER THE 'OTHER PERSON'; AND LASTLY, THE AO OF 'OTHER PERSON' SHALL COMMENCE THE PROCEEDINGS UN DER SECTION 153C AND CONSEQUENTLY PASS ASSESSMENT /REASSESSMENT ORDER IN THE MANNER PROVIDE U/S 153A. IF SUCH A PROCEDURE IS NOT FOLLOWED THEN NEEDLESS TO SAY THAT JURISDICTION TO PROCEED U/S 153C CANNOT BE ACQUIRED BY THE AO OF 'OTHER PERSON' , I.E., OTHER THAN THE PERSON SEARCHED. 6. RELIANCE IS PLACED ON FOLLOWING JUDICIAL PRECEDENCE OF THE HONBLE JURISDICTIONAL HIGH COURT OF MADHYA PRADESH IN THE CASE OF MECHMEN [2015] 60 TAXMANN.COM 484(MP) PARA 15 [CLPB - XX] 7. THESE ADDITIONAL GROUNDS GO TO THE ROOT OF MATTER A ND ARE VITAL TO THE DISPOSAL OF SAID APPEALS. THEIR ADMITT ANCE SHALL HELP THE ASSESSEE IN GETTING JUSTICE. RELIANCE IS PLACED ON THE FOLLOWING DECISIONS FOR ADMITTANCE OF LEGAL GROUNDS IN THE INSTANT APPEALS A. HONBLE APEX COURT IN THE CASE OF NATIONAL THERMAL POWER CO. LTD [1998] 229 ITR 383 [CLPB - XX] TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 8 B. HONBLE ITAT BENCH OF CHENNAI (TM) IN THE CASE OF H EMAL KNITTING INDUSTRIES [2010] 127 ITD 160 [CLPB - XX] 8. ASSESSEE PRAYS THAT THE ADDITIONAL GROUNDS OF APPEA L BEING LEGAL GROUNDS ON FUNDAMENTAL ISSUE OF JURISDI CTION AND GO THE ROOT OF MATTER AND HENCE PLEASE BE ADMITTED FOR ADJUDICATION OF MATTER. IN THE COURSE OF HEARING HELD ON 06.02.2019, HONBL E BENCH WAS KIND IN GIVING AN OPPORTUNITY TO THE LD. CIT(DR ) TO MAKE HER SUBMISSION ON THE CASE LAWS RELATING TO THE ADD ITIONAL GROUNDS FILED BY THE ASSESSEE. 2. A WRITTEN SUBMISSION ON THE ADDITIONAL GROUNDS ALON G WITH RELEVANT JUDICIAL DECISIONS IS ALREADY ON RECORD. T HIS FURTHER SUBMISSION MAY PLEASE BE CONSIDERED IN CONTINUATION TO THE EARLIER SUBMISSION ALREADY ON RECORD WHICH SPECIFIC ALLY DEALS WITH ADMISSION OF ADDITIONAL GROUND CHALLENGING THE LEGAL AND JURISDICTIONAL ISSUE FOR THE FIRST TIME IN THE SECO ND ROUND OF APPELLATE PROCEEDINGS BEFORE THE TRIBUNAL. 3. ASSESSEE VIDE APPLICATION DATED 04.09.2018 FILED ON 07.09.2018 RAISED ADDITIONAL GROUNDS OF APPEAL. THE SE ADDITIONAL GROUNDS OF APPEAL GO THE ROOT OF THE MAT TER AND ARE VITAL TO THE DISPOSAL OF THE SAID APPEALS. THEIR AD MITTANCE SHALL HELP APPELLANT IN GETTING JUSTICE. 4. RULE 11 OF THE INCOME TAX (APPELLATE TRIBUNAL) RULE S, 1963 READS THE APPELLANT SHALL NOT, EXCEPT BY LEAVE OF THE TR IBUNAL, URGE OR BE HEARD IN SUPPORT OF ANY GROUND NOT SET FORTH IN THE MEMORANDUM OF APPEAL, BUT THE TRIBUNAL, IN DECIDING THE APPEAL, SHALL NOT BE CONFINED TO THE GROUNDS SET FO RTH IN THE MEMORANDUM OF APPEAL OR TAKEN BY LEAVE OF THE TRIBU NAL UNDER THIS RULE : PROVIDED THAT THE TRIBUNAL SHALL NOT REST ITS DECIS ION ON ANY OTHER GROUND UNLESS THE PARTY WHO MAY BE AFFECTED T HEREBY HAS HAD A SUFFICIENT OPPORTUNITY OF BEING HEARD ON THAT GROUND. TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 9 TRIBUNAL IS UNDER STATUTORY OBLIGATION NOT ONLY TO ENTERTAIN PLEA BUT ALSO TO DECIDE THE SAME AFTER PROVIDING SUFFICI ENT OPPORTUNITY OF BEING HEARD TO THE OTHER SIDE. 5. THERE ARE DIRECT DECISIONS WHICH DEAL WITH THE SUBJ ECT MATTER OF THIS SUBMISSION RELATING TO ADMISSION OF ADDITIONAL GROUND IN THE SECOND ROUND OF APPELLATE PROCEEDINGS BEFORE THE HONBLE TRIBUNAL. THESE ARE IN ADDITION TO AND IN C ONTINUATION OF THE CASE LAW PAPER BOOK ALREADY ON RECORD. A CASE L AW PAPER BOOK VOLUME 2 HAS BEEN FURNISHED WITH THE SIMILAR SUBMISSION MADE IN THE APPEALS OF MOHD. ATIQUE. A) HONBLE BOMBAY HIGH COURT IN THE CASE OF INVENTORS INDUSTRIAL CORPN. LTD [1992] 194 ITR 548 HEAD N OTE SECTION 251 OF THE INCOME-TAX ACT, 1961 COMMISSI ONER (APPEALS) POWERS OF ASSESSMENT YEAR 1958-59 W HETHER A GROUND BY WHICH JURISDICTION TO MAKE ASSESSMENT ITS ELF IS CHALLENGED CAN BE URGED BEFORE ANY AUTHORITY FOR FI RST TIME HELD, YES WHETHER, THEREFORE, ASSESSEE WAS ENTITL ED TO CHALLENGE JURISDICTION OF INCOME-TAX OFFICER TO INI TIATE REASSESSMENT PROCEEDINGS BEFORE APPELLATE ASSISTANT COMMISSIONER IN SECOND ROUND OF PROCEEDINGS EVEN TH OUGH HE HAD NOT RAISED IT EARLIER BEFORE INCOME-TAX OFFICER OR IN EARLIER APPEAL BEFORE AAC HELD, YES [EMPHASIS SUPPLIED] B) HONBLE ITAT BENCH OF KOLKATA A IN THE CASE OF PE ERLESS GEN. FIN. & INV. CO. LTD. [2008] 21 SOT 440 HEA D NOTE - SECTION 253 OF THE INCOME-TAX ACT, 1961 - APPELLATE TRIBUNAL - APPEALS TO - ASSESSMENT YEAR 1994-95 - WHETHER JURI SDICTIONAL PROVISION, WHICH IS MANDATORY, CAN BE TAKEN UP IN S ECOND ROUND OF LITIGATION AND AN ASSESSEE CAN RAISE ISSUE RELAT ING TO VALIDITY OF ORDER IN SECOND ROUND OF LITIGATION EVEN IF SAME WAS NOT RAISED IN FIRST ROUND - HELD, YES [EMPHASIS SUPPLI ED] C) HONBLE BOMBAY HIGH COURT (FULL BENCH) IN THE CASE OF AHMEDABAD ELECTRICITY CO. LTD. [1993] 6 TAXMAN 27 HEAD NOTE SECTION 254 OF THE INCOME-TAX ACT, 1961 - A PPELLATE TRIBUNAL - POWERS OF - ASSESSMENT YEARS 1962-63 TO 1971-72 - DURING ASSESSMENT ASSESSEE DID NOT CLAIM DEDUCTION OF AMOUNTS TRANSFERRED TO 'RESERVE' AS PER ELECTRIC SU PPLY ACT, 1948, EITHER BEFORE ITO OR AAC - LATER, ON BASIS OF A HIGH COURT DECISION HOLDING SUCH AMOUNTS AS DEDUCTIBLE ON REVE NUE TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 10 ACCOUNT ASSESSEE CLAIMED DEDUCTION OF SAME BEFORE T RIBUNAL BY WAY OF ADDITIONAL GROUND WHILE APPEAL WAS PENDING B EFORE TRIBUNAL - TRIBUNAL REFUSED TO PERMIT ASSESSEE TO R AISE SUCH ADDITIONAL GROUND - WHETHER PHRASE 'PASS SUCH ORDER THEREON' OCCURRING IN SECTION 254(1) CONFERS WIDEST POSSIBLE JURISDICTION ON TRIBUNAL INCLUDING JURISDICTION TO PERMIT ANY AD DITIONAL GROUND OF APPEAL IF IN ITS DISCRETION AND FOR GOOD REASONS IT THINKS IT NECESSARY AND PERMISSIBLE TO DO SO - HELD , YES - WHETHER TRIBUNAL HAD JURISDICTION TO PERMIT ADDITIO NAL GROUNDS TO BE RAISED BEFORE IT EVEN THOUGH THESE MIGHT NOT HAVE ARISEN FROM AAC'S ORDER, SO LONG AS THESE GROUNDS WERE IN RESPECT OF SUBJECT-MATTER OF ENTIRE TAX PROCEEDINGS - HELD, YE S [EMPHASIS SUPPLIED] D) HONBLE GUJARAT HIGH COURT IN THE CASE OF P.V. DOSH I [1978] 113 ITR 22 HELD ...............AS THE T RIBUNAL HAD FAILED TO NOTICE THIS MATERIAL DISTINCTION BETWEEN A MERE PROCEDURAL PROVISION WHICH COULD BE WAIVED AND SUCH JURISDICTIONAL PROVISION OR A MANDATORY PROVISION E NACTED IN PUBLIC INTEREST WHICH COULD NOT BE WAIVED, BECAUSE BY CONSENT NO JURISDICTION COULD BE CONFERRED ON THE AUTHORITY UNLESS THE CONDITIONS PRECEDENT WERE FIRST FULFILLED. THE TRIB UNAL'S VIEW WAS CLEARLY ERRONEOUS THAT THE MATTER BECAME FINAL WHEN THE TRIBUNAL PASSED THE EARLIER REMAND ORDER SO THAT TH IS POINT OF JURISDICTION GOT FINALLY SETTLED, WHICH COULD NOT B E AGITATED UNLESS THE ASSESSEE HAD COME IN THE REFERENCE TO TH E HIGH COURT AT THIS STAGE. THE TRIBUNALS VIEW WAS ALSO INCORRE CT THAT IN RESTORING THE CASE TO THE FILE OF THE ITO BY THE EA RLIER ORDER, THE ONLY POINT LEFT OPEN WAS IN RESPECT OF ADDITION ON MERITS AND THAT THE LEGAL OR JURISDICTIONAL ASPECT WHETHER THE RE-ASSESSMENT PROCEEDINGS WERE LEGALLY INITIATED WAS NOT KEPT OPE N. EVEN THE TRIBUALS VIEW WAS ERRONEOUS THAT EVEN THOUGH THIS POINT WENT TO THE ROOT OF THE JURISDICTION AND WAS A PURE QUES TION OF LAW, MERELY BECAUSE THE POINT WAS INITIALLY RAISED AND N OT PRESSED WHEN THE MATTER WAS TAKEN UP BEFORE THE AAC, IT COU LD BE WAIVED AND IT COULD NOT BE REAGITATED. [EMPHASIS S UPPLIED] E) HONBLE APEX COURT IN THE CASE OF S. NELLIAPPAN [ 1967] 66 ITR 722 HEAD NOTE SECTION 254 OF THE INCOME-TA X ACT, 1961 [CORRESPONDING TO SECTION 33(4) OF THE INCOME- TAX ACT, 1922] - APPELLATE TRIBUNAL - POWER OF - WHETHER IN HEARING AN TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 11 APPEAL TRIBUNAL MAY GIVE LEAVE TO ASSESSEE TO URGE GROUNDS NOT SET FORTH IN MEMORANDUM OF APPEAL, AND IN DECIDING APPEAL TRIBUNAL IS NOT RESTRICTED TO GROUNDS SET FORTH IN MEMORANDUM OF APPEAL OR TAKEN BY LEAVE OF TRIBUNAL - HELD, YES [ EMPHASIS SUPPLIED] F) THE LEGAL AND JURISDICTIONAL ISSUE RAISED IN THE IN STANT ADDITIONAL GROUNDS BY THE APPELLANT WAS DEALT BY TH E HONBLE DELHI HIGH COURT IN THE CASE OF KABUL CHAWLA [201 6] 380 ITR 573 - PARA 2 THE ISSUE THAT THE COURT PROPOSES T O ADDRESS IN THESE APPEALS IS THE SAME THAT WAS CONSIDERED BY TH E ITAT VIZ., WHETHER THE ADDITIONS MADE TO THE INCOME OF THE RE SPONDENT ASSESSEE FOR THE SAID AYS UNDER SECTION 2(22)E OF T HE INCOME TAX ACT, 1961 (ACT) WERE NOT SUSTAINABLE BECAUSE NO INCRIMINATING MATERIAL CONCERNING SUCH ADDITIONS WE RE FOUND DURING THE COURSE OF SEARCH AND FURTHER NO ASSESSME NTS FOR SUCH YEARS WERE PENDING ON THE DATE OF SEARCH? [EM PHASIS SUPPLIED] 6. THE ABOVE JUDICIAL PRECEDENTS ADEQUATELY FORTIFY TH E CASE OF THE APPELLANT. ADDITION MADE IN ABSENCE OF INCRI MINATING MATERIAL RELATING TO SUCH ADDITION FOUND AND SEIZED DURING THE COURSE OF SEARCH OF MOHD. ATIQUE AND MOHD. SHAFIQUE , ASSESSEE BEING OTHER PERSON AND ASSESSED UNDER SECTION 153 C, OUGHT TO BE DELETED. THE ABOVE ISSUE OF ADMITTANCE OF ADDITIONAL LEGAL G ROUND RAISED FOR THE FIRST TIME BEFORE HONBLE TRIBUNAL IN SECON D ROUND OF APPELLATE PROCEEDINGS IS ALSO RAISED IN THE CASE OF SEARCHED PERSONS NAMELY, MOHD. ATIQUE AND MOHD. SHAFIQUE. TH E RATIO OF SUBMISSION MADE IN THE CASE OF SEARCHED PERSONS APP LIES WITH EQUAL FORCE IN THE INSTANT CASE ALSO, WITHOUT PREJU DICE TO THE OTHER LEGAL GROUNDS OF APPEAL. 8. LD. CIT-DR OPPOSED THESE SUBMISSIONS AND SUBMITT ED THAT AT THIS BELATED STAGE THESE ADDITIONAL GROUNDS AS RAISED SHOULD NOT BE ADMITTED. LD. CIT-DR FURTHER SUBMITTED THAT THE CASE LAWS RELIED BY THE LD. COUNSE L FOR TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 12 THE ASSESSEE ARE DISTINGUISHABLE. THE LD. CIT-DR FUR THER SUBMITTED THAT THE ASSESSEE OUGHT TO HAVE BEEN VIGILANT AND SHOULD NOT BE ALLOWED TO RAISE THE STALE ISSUE AT S UCH BELATED STAGE. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORDS. THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT THE ISSUE SO RAISED GOES TO TH E ROOT OF THE JURISDICTION. LD. COUNSEL FOR THE ASSESSEE HAS DR AWN OUR ATTENTION TO THE JUDGMENT OF THE HON'BLE JURISDI CTIONAL HIGH COURT IN THE CASE OF NANDLAL SACHDEVA VS. CIT (2012) 19 ITJ 361 . THE HON'BLE COURT HAS DECIDED THIS ISSUE AS UNDER: 10. THE ISSUE WITH REGARD TO LEGALITY OF PROCEEDIN GS UNDERTAKEN U/S 154 AFTER ISSUE OF NOTICE U/S 143(2) IS A PURELY LEGAL ISSUE CAN BE RAISED AT ANY STAGE. THIS ISSUE WAS NOT RAISED BY THE ASSESSEE IN THE FIRST ROUND OF AP PEAL EITHER BEFORE THE CIT(A) OR BEFORE THE TRIBUNAL. ON THE GR OUND OF NOTICE U/S 143(2) HAVING NOT BEEN ISSUED, THE LD. C IT(A) IN THE FIRST ROUND OF APPEAL HAS ANNULLED THE ASSESSME NT, HOWEVER, IN FURTHER APPEAL FILED BY THE REVENUE BEF ORE THE TRIBUNAL, IT WAS HELD BY THE TRIBUNAL, VIDE ORDER D ATED 3.6.2008 THAT NOTICE WAS ISSUED U/S 143(2) WITHIN T HE SPECIFIED TIME, HOWEVER, SINCE ISSUE RAISED ON MERI T WERE NOT CONSIDERED BY THE LD. CIT(A), THE MATTER WAS RESTOR ED TO HIM FOR DECIDING THE ISSUE ON MERIT. TO GIVE EFFECT TO THE ORDER OF THE TRIBUNAL, THE ID. CIT(A) ISSUED NOTICE ON 1.08. 2008 DURING WHICH A LEGAL ISSUE WAS ALSO RAISED BEFORE HIM, BUT THE LD. CIT(A) DID NOT ENTERTAIN THE SAME. NOW THE ASSESSEE HAS PLEADED BEFORE US THAT THE LD. CIT(A) WAS NOT JUSTI FIED IN TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 13 ENTERTAINING THE LEGAL ISSUE RAISED BEFORE HIM AND ALSO CONTENDED THAT IN VIEW OF VARIOUS DECISIONS CITED B Y HIM AS DISCUSSED ABOVE, THE PROCEEDINGS INITIATED U/S 154 AFTER THE ISSUE OF NOTICE U/S 143(2) WAS NOT SUSTAINABLE IN L AW. WE FOUND SUBSTANCE IN THE CONTENTION OF THE LD. AR THE GROUND OF LEGALITY OF PROCEEDINGS U/S 154 AFTER ISSUE OF NOTI CE U/S 143(2) IS A PURELY LEGAL ISSUE, WHICH DESERVES TO B E ACCEPTED IN VIEW OF THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF NATIONAL THERMAL POWER CORPORATION (SUPRA). WE ALSO FOUND THAT ALL THE FACTS WITH REGARD TO ISSUE OF NOTICE U /S 143(2) AND RECTIFICATION OF ORDER PASSED U/S 154 THEREAFTER, I S ALREADY ON RECORD. AS ALL THE FACTS WITH REGARD TO THE LEGAL I SSUE ARE ALREADY ON RECORD, THERE IS NO MERIT IN THE ACTION OF THE LD. CIT(A) FOR DECLINING TO ENTERTAIN THE LEGAL ISSUE, EVEN THOUGH RAISED FOR THE FIRST TIME BEFORE HIM. IN THE INTERE ST OF JUSTICE AND FAIR PLAY, WE RESTORED THIS LEGAL ISSUE TO THE FILE OF CIT(A) AND DIRECT HIM TO DECIDE THE SAME AS PER LAW KEEPIN G IN VIEW VARIOUS DECISIONS DISCUSSED HEREIN ABOVE. THE TRIBUNAL ALLOWED THE CONTENTION OF THE ASSESSEE FOR RAISING THE LEGAL ISSUE, BUT REMANDED THE MATTER TO THE CIT(A) TO CONSIDER THE AFORESAID LEGAL ISSUE. IN THIS APPEAL THE SOLE CONTENTION OF THE APPELLANT BEFORE THIS COURT IS THAT IN PLACE OF REMAND THE TRIBUNAL ITSEL F OUGHT TO HAVE ADVERTED ITSELF TO THE LEGAL ISSUE AND REMAND IN THE MATTER WAS NOT REQUIRED. WHILE THE LEARNED COUNSEL FOR REVENUE SUPPORTED THE REMAND ORDER. IN THIS CASE, A S PER THE FINDING RECORDED BY THE TRIBUNAL IN PARA 10 OF THE ORDER, WE FIND THAT ALL THE FACTS WERE BEFORE THE TRIBUNAL AN D THE TRIBUNAL IN THIS PARA SPECIFICALLY HAVE RECORDED TH IS FACT. WHEN ALL THE FACTS FOR DECIDING THE LEGAL ISSUE WER E ALREADY ON RECORD, IN THE AFORESAID CIRCUMSTANCES, WHETHER THE TRIBUNAL COULD HAVE REMANDED THE MATTER OR OUGHT TO HAVE DECIDED THE MATTER ITSELF IT TO BE SEEN. THE POWERS OF THE TRIBUNAL ARE VESTED UNDER SECTION 254 OF THE INCOME TAX ACT. SECTION 254(1) OF THE INCOME TAX ACT, 1961 PROVIDES THUS, TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 14 254(1) THE APPEAL TRIBUNAL MAY, AFTER GIVING BOTH THE PARTIES TO THE APPEAL AN OPPORTUNITY OF BEING HEARD , PASS SUCH ORDERS THEREON AS IT THINKS FIT. THE APPELLATE TRIBUNAL AFTER EXTENDING BOTH THE PAR TIES AN OPPORTUNITY OF BEING HEARD, CAN PASS SUCH ORDERS TH EREON AS IT THINK FIT. MEANING THEREBY THE TRIBUNAL IS EMPOW ERED TO DECIDE THE LEGAL ISSUE AND ALSO OTHER ISSUES BASED ON FACTS. THE POWERS OF THE TRIBUNAL ARE VERY WIDE. THE LEGIS LATION HAS GIVEN WIDE POWERS TO THE TRIBUNAL UNDER SECTION 25 4(1). A SIMILAR QUESTION WAS CONSIDERED BY THE GUJARAT HI GH COURT IN SAURASHTRA PACKAGING PVT. LTD. CIT (1993) 204 IT R 443)(GUJ) IN WHICH THE DIVISION BENCH OF GUJARAT HI GH COURT HELD THUS: . IN OUR OPINION, THE CONTENTIONS RAISED ON BEHALF OF THE ASSESSEE DESERVE TO BE ACCEPTED. THOUGH RELIANCE WA S PLACED BY THE ASSESSEE ON THE DISSOLUTION DEED BEFO RE THE ITO FOR A DIFFERENT PURPOSE, THE FACT REMAINS THAT A COPY OF THE DISSOLUTION DEED WAS ON THE RECORD OF THE CASE. AS POINTED OUT BY THE LEARNED ADVOCATE FOR THE ASSESSE E, THE SAID DISSOLUTION DEED HAS PROVIDED FOR RIGHTS AND L IABILITIES OF THE ASSESSEE WHICH TOOK OVER THE RUNNING BUSINESS O F THE PARTNERSHIP FIRM. IN VIEW OF THIS MATERIAL, THE TRI BUNAL COULD HAVE EASILY LOOKED INTO THE RELEVANT PROVISIONS OF THE GUJARAT SALES-TAX ACT AND THE GUJARAT SALES-TAX RULES IF TH AT WAS FOUND NECESSARY AND DECIDED THE APPEALS. THUS, THER E WAS NO JUSTIFICATION FOR SETTING ASIDE THE ORDERS PASSE D BY THE CIT(A) AND SENDING THE MATTERS BACK TO HIM FOR A FR ESH DECISION. THE TRIBUNAL, THEREFORE, CAN BE SAID TO H AVE ERRED IN HOLDING THAT IT WAS UNABLE TO DECIDE THE POINT IN C ONTROVERSY FINALLY IN THE ABSENCE OF RELEVANT MATERIAL. IN ORD ER TO SAVE TIME AND AVOID MULTIPLICITY OF PROCEEDINGS, WE ARE OF THE OPINION THAT INSTEAD OF DIRECTING THE TRIBUNAL TO S TATE THE CASE AND REFER TO THIS COURT THE QUESTIONS RAISED BY THE ASSESSEE, THE TRIBUNAL BE DIRECTED TO CONSIDER THE DISSOLUTIO N DEED ITSELF AND DISPOSE OF THE MATTER FINALLY. IT WOULD BE OPEN TO THE PARTIES TO PRODUCE WHATEVER MATERIAL THEY DEEM FIT AND TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 15 NECESSARY FOR THE PURPOSE OF DECIDING THE POINT IN ISSUE. THIS APPLICATION IS DISPOSED OF ACCORDINGLY. NO ORDER AS TO COSTS. A SIMILAR ISSUE CAME BEFORE THE MADRAS HIGH COURT I N REMGOSRI CONSTRUCTION (P) LTD. VS. INCOME TAX OFFIC ER (209) 308 ITR 290 (MAD), IN WHICH THE DIVISION BENCH HELD IN PARA 8 OF THE JUDGMENTS WHICH READS THUS: 8.THE TRIBUNAL HAS NOT SET ASIDE THE FINDING OF TH E APPELLATE AUTHORITY AND REMITTED THE ENTIRE ISSUE T O THE FILE OF THE AO. THE TRIBUNAL HAD MERELY CONTENDED ITSELF BY SAYING THAT NEITHER THE AO NOR THE APPELLATE AUTHOR ITY HAD EXAMINED THE RELEVANT DETAILS AND THAT IT IS NOT CL EAR WHETHER THE RECORDS WERE BEFORE THE AO. BUT, IT DOE S NOT APPEAR TO BE CORRECT SINCE THERE WERE MATERIALS BEF ORE THE AO AS WELL AS THE APPELLATE AUTHORITY FOR THEM TO D RAW THE RESPECTIVE CONCLUSIONS. THEREFORE, WE REMIT THE MAT TER BACK TO THE TRIBUNAL TO DECIDE THE MATTER AFRESH AS EXPEDITIOUSLY AS POSSIBLE ON THE BASIS OF THE AVAIL ABLE MATERIALS. IN THE AFORESAID BOTH THE JUDGMENTS, IT HAS BEEN HE LD THAT WHEN THE ENTIRE MATERIAL IS BEFORE THE TRIBUNAL, TH E TRIBUNAL IN PLACE OF REMAND OUGHT TO HAVE DECIDED T HE MATTER ON ITS OWN MERITS. IN THIS CASE A PURE LEGAL ISSUE WAS BEFORE THE TRIB UNAL AND THE TRIBUNAL ITSELF HAS RECORDED THAT ALL THE FACTS ARE ALREADY ON RECORD, THEN IN THE AFORESAID CIRCUMSTAN CES THE TRIBUNAL ITSELF OUGHT TO HAVE DECIDED THE MATTER IT SELF. APART FROM THIS, THE MATTER RELATES TO THE ASSESSME NT YEAR 2000-01. EARLIER THE MATTER WAS REMANDED BY THE TRI BUNAL VIDE ANNEXURE A-4 ON 3.6.2008 AND A SUFFICIENT PERI OD HAS ELAPSED IN THE PROCEEDINGS AND AT THIS JUNCTURE IF THE MATTER IS REMANDED TO DECIDE THE AFORESAID LEGAL IS SUE, THEN IT WILL BE THE ANOTHER ROUND OF LITIGATION. TO SAVE TIME, MONEY AND ENERGY, IT WOULD BE APPROPRIATE IF THE TR IBUNAL IS DIRECTED TO DECIDE ON THE AFORESAID LEGAL ISSUE. TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 16 IN VIEW OF THE AFORESAID WE FIND THAT THE TRIBUNAL ERRED IN REMANDING THE MATTER TO THE CIT(A) AND ACCORDINGLY THE AFORESAID PART OF THE ORDER IS HEREBY SET ASIDE AND THE MATTER IS REMANDED BACK TO THE TRIBUNAL TO DECIDE I T AFRESH, IN ACCORDANCE WITH LAW. HOWEVER, WHILE SETT ING ASIDE THE AFORESAID ORDER, WE OBSERVE THAT IN CASE AFTER HEARING BOTH THE PARTIES, THE TRIBUNAL STILL RECORD S AN OPINION THAT THE MATTER DESERVES TO BE REMANDED BAC K TO DECIDE THE ISSUES. THE TRIBUNAL SHALL BE FREED TO P ASS SUCH ORDER, AFTER GIVING ITS REASONS IN THIS REGARD. 10. FURTHER, RELIANCE HAS BEEN PLACED ON THE JUDGMENTS OF HON'BLE M.P. HIGH COURT RENDERED IN THE CASE OF DCIT VS. TORQUOISE INVESTMENT & FINANCE LTD. (2006) 154 TAXMAN 80 (MP) WHEREIN THE HON'BLE COURT HAS DECIDED THIS ISSUE AS UNDER: 15. COMING TO THE QUESTION NOS. 3 AND 4, WHETHER TH E ISSUE COULD BE RAISED BY THE ASSESSEE BEFORE THE TRIBUNAL FOR THE FIRST TIME AND HAVING DISMISSED THE CROSS-OBJECTION, THE TRIBUNAL COULD PROCEED TO GIVE A FINDING ON THE SAME, THE LE ARNED COUNSEL FOR THE ASSESSEE HAS INVITED OUR ATTENTION TO THE D ECISION OF THE CIT(A) EX./C IN IT APPEAL NO. 112 OF 2003 IN WHICH REFERENCE HAS BEEN MADE TO THE DECISION OF THE HON'BLE MADRAS HIGH COURT IN CIT V. VR. S.R.M. FIRM (SUPRA), BUT HE HAS ERRONEOUSLY STATED THAT IT WAS HELD IN THE SAID DECISION THAT T HE SAID DIVIDEND IS TAXABLE IN INDIA UNDER SECTIONS 8 AND 9 OF THE IT ACT, 1961, THOUGH THE DECISION HOLDS TO THE CONTRAR Y. LEARNED COUNSEL, THEREFORE, CONTENDS THAT THE FACT THAT THE SAID DECISION WAS CITED BEARS TESTIMONY TO THE FACT THAT CONTENTI ON WAS RAISED WITH REGARD TO THE NON-TAXABILITY OF THE DIVIDEND E ARNED IN MALAYSIA IN INDIA UNDER THE AGREEMENT IN QUESTION. LEARNED COUNSEL HAS FURTHER SUBMITTED THAT IN THE APPEALS F ILED BY THE RESPONDENTS, THEY HAVE CLEARLY RAISED THE QUESTIONS THAT THE TRIBUNAL WAS NOT JUSTIFIED IN DISMISSING THE CROSS- OBJECTION FILED BY THE ASSESSEE ON THE GROUND OF LIMITATION SPECIAL LY WHEN IT TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 17 TOOK THE VIEW THAT THE DIVIDEND INCOME WAS NOT TAXA BLE IN INDIA. ATTENTION HAS ALSO BEEN INVITED TO RULE 27 OF THE I TAT RULES, 1963. THE SAID RULE READS AS UNDER: 27. THE RESPONDENT, THOUGH HE MAY NOT HAVE APPEALED , MAY SUPPORT THE ORDER APPEALED AGAINST ON ANY OF THE GR OUNDS DECIDED AGAINST HIM. 16. REFERENCE HAS ALSO BEEN MADE TO THE DECISION OF THE APEX COURT IN NATIONAL THERMAL POWER CO. LTD. V. CIT IN WHICH THEIR LORDSHIPS HAVE OBSERVED THAT THE POWER OF THE TRIBU NAL IN DEALING WITH APPEALS IS EXPRESSED IN WIDEST POSSIBL E TERMS. THE PURPOSE OF ASSESSMENT PROCEEDINGS BEFORE THE TAXING AUTHORITIES IS TO ASSESS CORRECTLY THE TAX LIABILITY OF AN ASSE SSEE IN ACCORDANCE WITH LAW. IF, FOR EXAMPLE, AS A RESULT O F JUDICIAL DECISION GIVEN WHILE THE APPEAL IS PENDING BEFORE T HE TRIBUNAL, IT IS FOUND THAT A NON-TAXABLE ITEM IS TAXED OR A P ERMISSIBLE DEDUCTION IS DENIED, THERE IS NO REASON WHY THE ASS ESSEE SHOULD BE PREVENTED FROM RAISING THAT QUESTION BEFO RE THE TRIBUNAL FOR THE FIRST TIME, SO LONG AS THE RELEVAN T FACTS ARE ON RECORD IN RESPECT OF THE ITEM. FROM THE ABOVE POSIT ION IT IS CLEAR, THAT IF THE MATERIAL IS ON RECORD ON THE BASIS WHER EOF OBJECTION CAN BE RAISED, THE PARTIES TO THE APPEAL CANNOT BE PRECLUDED FROM RAISING SUCH CONTENTION, ESPECIALLY THE RESPON DENT, IN VIEW OF RULE 27 OF THE ITAT RULES, 1963, QUOTED ABOVE. W E ARE, THEREFORE, OF THE CONSIDERED VIEW THAT BOTH QUESTIO NS NO. 3 AND NO. 4 IN THE DEPARTMENT'S APPEAL DESERVE TO BE ANSW ERED AGAINST THE DEPARTMENT. IN VIEW OF THE WIDE POWERS THAT THE TRIBUNAL IS INVESTED WITH, AS CLEARLY REFERRED TO A ND SPELT OUT BY THEIR LORDSHIPS IN THEIR DECISION IN NATIONAL THERM AL POWER CO. LTD. (SUPRA), THE TRIBUNAL CANNOT BE PRECLUDED FROM CONSIDERING THE QUESTIONS OF LAW ARISING IN AN ASSESSMENT PROCE EDING NOT RAISED EARLIER, AND RESTRICTED TO ISSUES ARISING OU T OF APPEAL BEFORE THE CIT(A). THE ASSESSEES HAVE ALSO FILED AP PEAL FROM ITEM NOS. 14 TO 26 CAPTIONED ABOVE. THOUGH A LARGE NUMBER OF QUESTIONS HAVE BEEN RAISED BY THE ASSESSEES, THE AP PEALS HAVE BEEN ADMITTED ON THE FOLLOWING QUESTIONS, AS FORMUL ATED IN IT APPEAL NO. 112 OF 2003. TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 18 (I) WHETHER THE TRIBUNAL WAS JUSTIFIED IN DISMISSIN G THE CROSS- OBJECTION FILED BY THE APPELLANT (ASSESSEE) ON THE GROUND OF LIMITATION AND IF SO, WHETHER SUCH FINDING IS SUSTA INABLE IN LAW ? (II) HAVING CONSIDERED THE CASE OF THE ASSESSEE ON MERITS AND RECORDED A CATEGORICAL FINDING ON THE MERITS OF THE CASE TO THE EFFECT THAT DIVIDEND INCOME RECEIVED FROM PAN MALAY SIA CANNOT BE TAXED IN INDIA, DID IT NOT RESULT IN ALLOWING TH E CROSS-OBJECTION SO SUBMITTED BY THE APPELLANT/ASSESSEE ? (III) HAVING HELD IN FAVOUR OF THE ASSESSEE THAT TH E DIVIDEND INCOME IN QUESTION IS NOT TAXABLE IN THE HANDS OF A SSESSEE, WAS IT NOT NECESSARY FOR THE TRIBUNAL TO HAVE FURTHER R ECORDED THE FINDING THAT ISSUE RELATING TO GRANT OF CREDIT SOUG HT BY THE ASSESSEE HAS BECOME REDUNDANT AND HENCE NEED NOT BE GONE INTO ? (IV). HAVING DECIDED THE ISSUE IN FAVOUR OF THE ASS ESSEE, WHETHER THE TRIBUNAL WAS JUSTIFIED IN THEN ALLOWING THE APPEAL FILED BY THE DEPARTMENT OR THE TRIBUNAL SHOULD HAVE THEN EITHER DISMISSED THE APPEAL FILED BY THE REVENUE OR SHOULD HAVE HELD IT TO HAVE RENDERED INFRUCTUOUS IN THE LIGHT OF A C ATEGORICAL FINDING RECORDED IN FAVOUR OF THE ASSESSEE ? 17. THOUGH IN VIEW OF OUR ANSWER TO THE QUESTIONS F ORMULATED IN THE REVENUE APPEALS, IT IS NOT NECESSARY TO DECIDE THE QUESTIONS FORMULATED IN THE APPEALS FILED BY THE ASSESSEES, W E MAY OBSERVE THAT SINCE WE HAVE HELD THAT THE DIVIDEND I NCOME IS NOT CHARGEABLE UNDER THE ACT IN VIEW OF THE AGREEMENT, THE QUESTION WITH REGARD TO THE GRANT OF CREDIT FOR THE TDS IN R ELATION THEREWITH, IS RENDERED REDUNDANT. 11. IN THE LIGHT OF THE ABOVE JUDGMENTS OF THE HON'B LE JURISDICTIONAL HIGH COURT ADDITIONAL GROUND RAISED BY THE ASSESSEE ARE ADMITTED FOR ADJUDICATION. TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 19 12. ADDITIONAL GROUND NO.1 IS QUA THE ADDITION MADE WITHOUT REFERENCE TO ANY SEIZED DOCUMENTS. LD. COUN SEL FOR THE ASSESSEE CONTENDED THAT THE IMPUGNED ADDITION DESERVES TO BE DELETED ON THE SOLE GROUND THAT THERE IS NO REFERENCE TO THE SEIZED MATERIAL. THE ADDITION HAS BE EN MADE PURELY ON THE BASIS OF MATERIAL ALREADY AVAILABLE WITH THE REVENUE. SUCH CONDUCT OF THE ASSESSING OFFICER IS NOT JUSTIFIABLE AND IS CONTRARY TO THE JUDICIAL PRONOUNCEME NTS. TO BUTTRESS THIS CONTENTION LD. COUNSEL FOR THE ASSE SSEE HAS RELIED UPON THE DECISION OF TRIBUNAL RENDERED IN THE CASE OF SHRI KAMAL KISHORE KOTWANI IT(SS) A NO.186 TO 190/IND/2016 DATED 04.07.2018, KANTA PRASAD DWIVEDI IT (SS)A NO.182 TO 185/IND/2016 DATED 19.09.2018 AND DECISION OF THE DELHI TRIBUNAL RENDERED IN THE CASE O F JAY DEE SECURITIES & FINANCE LTD (2017) 88 TAXMANN.COM 62 6. LD. COUNSEL SUBMITTED THAT THE ASSESSEE IS A COOPERATIV E SOCIETY VIDE REGISTRATION NO.D978 DATED 29.4.2004 WIT H MAIN OBJECT TO COLLECT AMOUNT FROM MEMBERS TO PURCHASE LAND. THE LAND SO PURCHASED IS THEN DEVELOPED AND DIVI DED UNITS ARE ALLOTTED TO THE MEMBERS OF THE SOCIETY. 13. LD. DEPARTMENTAL REPRESENTATIVE OPPOSED THE SUBMISSION AND SUPPORTED THE ORDERS OF LOWER AUTHORI TIES. TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 20 LD. DR SUBMITTED THAT THERE IS A CATEGORICAL REFERENCE TO THE INCRIMINATING MATERIAL RELATED TO THE SOCIETY. 14. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE REFERENCE IS RELATED TO THE OBJECTIVES OF THE SOCIET Y WHICH CANNOT BE TERMED AS INCRIMINATING MATERIAL. AS SUCH NO EVIDENCE HAS BEEN GATHERED DURING THE COURSE OF SEARCH . 15. WE HAVE HEARD RIVAL CONTENTION AND PERUSED THE RECORDS PLACED BEFORE US. WE FIND THAT THE A.O HAS MA DE ADDITION BY OBSERVING AS UNDER; 7. IT IS NOTICED HAT IN THIS EASE ASSESSEE HAS NOT S UBMITTED EVEN A SINGLE PAPER AS ADDITIONAL EVIDENCES. THE SUBMISSIONS MADE BY THE A SSESSEE WERE ALREADY CONSIDERED BY THE THEN ASSESSING OFFICER AND AFTER EXAMINATION OF THE SAME, HE HAS GIVEN THE FOLLOWING FINDINGS IN HIS ASSESSMENT ORDER:- IN THE YEAR UNDER CONSIDERATION, ASSESSEE HAS SHOWN CURRENT LIABILITY OF RS.20,00,000/- IN THE ORDER SHEET ENTR Y DATED 11.10.2008, ASSESSEE WAS ASKED TO FURNISH. DETAILS OF CURRENT LIA BILITY VIZ. NAME, ADDRESS AND AMOUNT. ON WHICH ASSESSEE IS NOT ABLE TO S UBMIT ANY DETAILS EXCEPT COPY OF ACCOUNT OF ADVANCE FOR PLOT. FURTHER, IN THE ORDER SHEET ENTRY DATED 15.10.2008, ASSESSEE WAS ASK ED TO F URNISH BANK STATEMENT AND RETURN OF INCOME. BU: ASSESSEE I S NOT ABLE TO SUBMIT ANY DETAILS IN THIS REGARD. EVEN THE NAME AND ADDRE SS OF THE MEMBERS OF THE SOCIETY HAS NOT BEEN PRODUCED. IN THE LIGHT OF ABOVE DISCUSSION, ASSESSEE IS NOT ABLE TO PROVE, IDENTITY, CREDITWORTHINESS ARID GENUINENESS OF ADVA NCES RECEIVED. THEREFORE, ADVANCE OF RS.20,OO,OOO/- WILL BE DEEMED TO BE TREATED AS INCOME OF THE ASSESSEE.' THE SAID FINDINGS OF THE ASSESSING OFFICER WAS ALSO CONFIRMED BY THE CIT(A)-II, BHOPAL. DURING THE SET ASIDE PROC EEDINGS ALSO THE TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 21 ASSESSEE HAS FAILED TO GIVE ANY DOCUMENTARY EVIDENCE IN SUPPORT OF CASH CREDIT AVAILABLE WITH HIM. THEREFORE, THE ASSE SSEE HAS FAILED TO PROVE IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE ADVANCES RECEIVED. THEREFORE, AN AMOUNT OF RS.20,OO,OOO/- IS HEREBY ADDED TO THE TOTAL INCOME OF THE ASSESSEE UNDER SECTION 68 O F THE ACT. I AM ALSO SATISFIED THAT THE ASSESSEE HAS CONCEALED HIS IN COME AND ALSO FURNISHED INACCURATE PARTICULARS OF INCOME WITHIN TH E MEANING OF THE SECTION 271 (1) (C) OF THE INCOME TAX ACT 1961. HEN CE, PENALTY PROCEEDINGS U/S. 271(1)(C) ARE BEING INITIATED SEPA RATELY. 16. FROM THE ABOVE OBSERVATION OF THE A.O IT IS EVIDE NT THAT THE A.O HAS NOT MADE ANY SPECIFIC REFERENCE TO TH E INCRIMINATING MATERIAL FOUND DURING THE SEARCH. UNDER THESE FACTS NON REFERENCE TO THE INCRIMINATING MATERIAL BY THE A.O IS CONTRARY TO THE SETTLED POSITION OF LAW. WE HOLD ACCORDINGLY. THIS GROUND OF ASSESSEES APPEAL IS ALLOWED . 17. GROUND NO.2 OF THE ADDITIONAL GROUND IS AGAINST NO N RECORDING OF SATISFACTION BY THE A.O OF THE SEARCHED PERSON. LD. COUNSEL FOR THE ASSESSEE REITERATED THE AVERMENTS MADE IN THE WRITTEN SUBMISSIONS. HE CONTENDED THAT DURING THE COURSE OF HEARING THE REVENUE WAS DIRECTED TO FURNISH THE SATISFACTION RECORDED BY THE ASSESSING OFFICER OF THE SEARCHED PERSON. HOWEVER, THE REVENUE HAS GROSSLY FAIL ED TO FURNISH THE SATISFACTION NOTE RECORDED BY THE ASSESSIN G OFFICER OF THE SEARCHED PERSON. HE SUBMITTED THAT THE LAW IS CLEAR ON THIS ISSUE AS PER SECTION 153C. THE ASSESSING OFFICER OF THE SEARCHED PERSON IS REQUIRED TO RECORD A TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 22 SATISFACTION NOTE IN CASE THE MATERIAL FOUND DURING THE COURSE OF SEARCH DOES NOT RELATE TO THE SEARCHED PERS ON. THE ASSESSING OFFICER OF THE SEARCHED PERSON IS REQUIR ED RECORD A SATISFACTION IN THIS REGARD AND TRANSMITS THE RECORD TO THE ASSESSING OFFICER OF THE OTHER PERSON. LD. COUNSEL SUBMITTED THAT THE ISSUE IS SQUARELY COVERED B Y THE JUDGMENT OF JURISDICTIONAL HIGH COURT RENDERED IN TH E CASE OF CIT VS. MECHMEN (2015) 60 TAXMANN.COM 484 (MP). 18. ON THE CONTRARY, LD. CIT-DR OPPOSED THESE SUBMISSIONS AND SUPPORTED THE ORDERS OF THE AUTHORIT IES BELOW. HE PLACED RELIANCE ON THE JUDGMENT OF HON'BLE DELHI HIGH COURT RENDERED IN THE CASE OF GANPATI FINCAP SERVICES PRIVATE LIMITED (2017) 82 TAXMANN.COM 408. IN REJOINDER LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT IN FACT TH E JUDGMENT RELIED BY THE REVENUE HELPS THE ASSESSEE. H E DREW OUR ATTENTION TO PARAGRAPH NO.26 & 27 OF THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT. 19. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE MATERIALS AVAILABLE ON RECORDS AND GONE THROUGH THE ORDER S OF THE AUTHORITIES BELOW. IN THIS CASE UNDISPUTED FAC TS ARE THAT THE REVENUE HAS PLACED ON RECORD VIDE LETTER DATED 22.07.2019 A SATISFACTION NOTE BY THE ACIT-3(1), BHOP AL TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 23 WHICH IS RELATED TO THE ASSESSEE HEREIN. IT IS STATED IN THE LATER THAT THE ASSESSING OFFICER OF THE SEARCHED PERSO N AND THE ASSESSEE ARE THE SAME, THEREFORE, THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT RENDERED IN THE CASE OF GANPATI FINCAP SERVICES PRIVATE LIMITED(SUPRA) & INSTRONICS LIMITED (2017 82 TAXMANN.COM 357 (DELHI) HELP THE REVENUE. WE FIND THAT THE HON'BLE DELHI HIGH COURT IN THE CASE OF GANPATI FINCAP SERVICES PRIVATE LIMITED(SUPRA) PARA 26 TO 28 HELD AS UNDER: 26. THE COURT IS OF THE VIEW THAT A PLAIN READING OF SECTION 153C DOES NOT REQUIRE THE AO OF THE SEARCHED PERSON (A) TO PREPARE TWO SATISFACTION NOTES. ONLY AS FAR AS THE OTHER PERSON' B IS CONCERNED THE AO IS EXPECTED TO PREPARE A SATISFACTION NOTE STATING THAT THE 2 DOCUMENTS BELONG TO B. THE FAILURE BY THE AO TO ADD IN THE SAID SATISFACTION NOTE THAT THE 2 DOCUMENTS DO NOT BELONG TO A WILL NOT VITIATE THE ENTIRE PROCEED INGS AGAINST B UNDER SECTION 153C OF THE ACT FOR THE SIMPLE REASON THAT THERE IS NO SUCH REQUIREMENT. 27. WHAT THE SETTLED LEGAL POSITION AS EXPLAINED IN SEVERAL CASES, WHICH WILL BE DISCUSSED SHORTLY, IS THAT THE RECORDING BY THE AO OF THE SEARCHED PERSON THAT SOME DOCUMENTS S EIZED DURING THE SEARCH 'BELONG TO' THE OTHER PERSON IS M ANDATORY IN ORDER TO ASSUME JURISDICTION QUA THE OTHER PERSON U NDER SECTION 153C OF THE ACT. THIS IS MANDATORY EVEN WHERE THE AO OF THE SEARCHED PERSON AND THE OTHER PERSON IS THE SAME. T HIS IS ALSO WHAT THE CBDT CIRCULAR NOW CLARIFIES. IN A PARTICUL AR CASE, GIVEN THE NATURE OF THE DOCUMENT, IT MAY BECOME NECESSARY FOR THE AO TO INDICATE THE BASIS OF HIS SATISFACTION THAT THE DOCUMENT BELONGS ONLY TO B AND NOT TO A. BUT THEN THAT IS DI CTATED BY THE NATURE OF THE DOCUMENT. WHAT HE HAS TO BE SURE ABOU T, AND THE TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 24 NOTE SHOULD REFLECT THIS, IS THAT IT DOES BELONG TO B. ONCE THE NOTE SAYS THAT THEN THE REQUIREMENT OF SECTION 153C IS FULFILLED. 28. THEREFORE, THE COURT DOES NOT AGREE WITH MR. SA BHARWAL THAT THERE HAVE TO BE TWO SEPARATE SATISFACTION NOTES PR EPARED BY THE AO OF THE SEARCHED PERSON EVEN WHERE HE IS ALSO THE AO OF THE OTHER PERSON. IN SUCH EVENT, THE AO NEED MAKE O NLY ONE SATISFACTION NOTE. THAT SATISFACTION NOTE IS QUA TH E OTHER PERSON. FURTHER IT IS SUFFICIENT THAT SUCH SATISFACTION NOT E IS PLACED IN THE FILE OF THE OTHER PERSON BY THE AO IN HIS CAPACITY AS THE AO OF SUCH OTHER PERSON. 20. FOR THE SAKE OF CLARITY SECTION 153C OF THE ACT IS REPRODUCED AS UNDER: IN SECTION 153C OF THE INCOME-TAX ACT, IN SUB-SECTI ON (1), WITH EFFECT FROM THE 1ST DAY OF JUNE, 2015 FOR THE PORTI ON BEGINNING WITH THE WORDS AND FIGURES 'NOTWITHSTANDING ANYTHING CONTAINED IN SECTION 139' AND ENDING WITH THE WORDS ' THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTH ER PERSON', THE WORDS, FIGURES, BRACKETS AND LETTERS 'NOTWITHSTA NDING ANYTHING CONTAINED IN SECTION 139, SECTION 147, SECT ION 148, SECTION 149, SECTION 151 AND SECTION 153, WHERE THE ASSESSING OFFICER IS SATISFIED THAT, (A) ANY MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING, SEIZED OR REQUISITIONED, BELONGS TO; OR (B) ANY BOOKS OF ACCOUNT OR DOCUMENTS, SEIZED OR REQUISITIONED, PERTAINS OR PERTAIN TO, OR ANY INFORMATION CONTAINED THEREIN, RELATES TO, A PERSON OTHER THAN THE PERSON REFERRED TO IN SECTIO N 153A, THEN, THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS, SEIZED OR REQUISITIONED, SHALL BE HANDED OVER TO THE ASSESSING O FFICER HAVING JURISDICTION OVER SUCH OTHER PERSON AND THAT ASSESSING OFFICER SHALL PROCEED AGAINST EACH SUCH OTHER PERSON AND ISSUE NOTICE AND ASSESS OR REASSESS THE INCOME OF THE OTHE R PERSON IN ACCORDANCE WITH THE PROVISIONS OF SECTION 153A, IF THAT ASSESSING OFFICER IS SATISFIED THAT THE BOOKS OF ACC OUNT OR TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 25 DOCUMENTS OR ASSETS, SEIZED OR REQUISITIONED, HAVE A B EARING ON THE DETERMINATION OF THE TOTAL INCOME OF SUCH OTHER PERSON FOR THE RELEVANT ASSESSMENT YEAR OR YEARS REFERRED TO IN SUB-SECTION (1) OF SECTION 153A. PROVIDED THAT IN CASE OF SUCH OTHER PERSON, THE REFE RENCE TO THE DATE OF INITIATION OF THE SEARCH UNDER SECTION 132 OR MAKING OF RE4QUISITION UNDER SECTION 132A IN THE SECOND PROVIS O TO {SUB- SECTION (1) OF ] SECTION 153A SHALL BE CONSTRUED AS REFERENCE TO THE DATE OF RECEIVING THE BOOKS OF ACCOUNT OR DOCUM ENTS OR ASSETS SEIZED OR REQUISITIONED BY THE ASSESSING OFFI CER HAVING JURISDICTION OVER SUCH OTHER PERSON:] PROVIDED FURTHER THAT THE CENTRAL GOVERNMENT MAY BY RULES MADE BY IT AND PUBLISHED IN THE OFFICIAL GAZETTE, SP ECIFY THE CLASS OR CLASSES OF CASES IN RESPECT OF SUCH OTHER PERSON, IN WHICH THE ASSESSING OFFICER SHALL NOT BE REQUIRED T O ISSUE NOTICE FOR ASSESSING OR REASSESSING THE TOTAL INCOME FOR S IX ASSESSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR REL EVANT TO THE PREVIOUS YEAR IN WHICH SEARCH IS CONDUCTED OR REQ UISITION IS MADE EXCEPT IN CASES WHERE ANY ASSESSMENT OR REASSE SSMENT HAS ABATED.'. (2) WHERE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SE IZED OR REQUISITIONED AS REFERRED TO IN SUB-SECTION (1) HAS O R HAVE BEEN RECEIVED BY THE ASSESSING OFFICER HAVING JURISDICTIO N OVER SUCH OTHER PERSON AFTER THE DUE DATE FOR FURNISHING THE R ETURN OF INCOME FOR THE ASSESSMENT YEAR RELEVANT TO THE PREV IOUS YEAR IN WHICH SEARCH IS CONDUCTED UNDER SECTION 132 OR REQUIS ITION IS MADE UNDER SECTION 132A AND IN RESPECT OF SUCH ASSES SMENT YEAR (A) NO RETURN OF INCOME HAS BEEN FURNISHED BY SUCH OTHER PERSON AND NO NOTICE UNDER SUBSECTION (1) OF SECTION 142 HAS BEEN ISSUED TO HIM, OR (B) A RETURN OF INCOME HAS BEEN FURNISHED BY SUCH OT HER PERSON BUT NO NOTICE UNDER SUBSECTION (2) OF SECTION 143 H AS BEEN SERVED AND LIMITATION OF SERVING THE NOTICE UNDER SUB -SECTION (2) OF SECTION 143 HAS EXPIRED, OR (C) ASSESSMENT OR REASSESSMENT, IF ANY, HAS BEEN MA DE, BEFORE THE DATE OF RECEIVING THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED BY THE ASSESSING O FFICER HAVING JURISDICTION OVER SUCH OTHER PERSON, SUCH AS SESSING OFFICER SHALL ISSUE THE NOTICE AND ASSESS OR REASSES S TOTAL TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 26 INCOME OF SUCH OTHER PERSON OF SUCH ASSESSMENT YEAR IN THE MANNER PROVIDED IN SECTION 153A. 21. UNDISPUTEDLY, THE REVENUE HAS NOT PLACED ON RECOR D SATISFACTION NOTE BY THE ASSESSING OFFICER OF THE SEAR CHED PERSON RECORDING THAT THE DOCUMENTS BELONG TO THE OT HER PERSON IN THIS CASE ASSESSEE HEREIN. IN THE ABSENCE OF SUCH RECORDING THE ASSESSMENT SO FRAMED IS CONTRARY TO PROVISION OF LAW AND THE BINDING PRECEDENCE. WE, THE REFORE, HOLD THAT THE ASSUMPTION OF JURISDICTION BY THE ASSESS ING OFFICER U/S 153C OF THE ACT IS NOT IN ACCORDANCE WITH LAW. HENCE, THE ASSESSMENT SO FRAMED U/S 153C OF THE ACT I S BAD IN LAW DESERVES TO BE QUASHED. THIS GROUND OF THE ASSESSEES APPEAL IS ALLOWED. 22. SINCE WE HAVE HELD THAT THE ASSUMPTION OF JURISDIC TION BY THE ASSESSING OFFICER FOR FRAMING ASSESSMENT IS NOT IN ACCORDANCE WITH LAW AND QUASHED THE ASSESSMENT ON THIS GROUND, THE OTHER GROUNDS ON MERIT HAVE BECOME ACADEMI C IN NATURE. THEREFORE, WE ARE NOT ADJUDICATING THE SAME. 23. AS A RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED . NOW WE TAKE UP IT(SS)ANO.127 & 128/IND/2016 FOR A.Y S. 2006-07 & 2007-08 TAJ GRIH NIRMAN SOCIETY /IT(SS)ANOS.126 TO 128/IND /2016 27 24. THE FACTS ARE IDENTICAL AS WERE IN THE IT(SS)ANO.126/IND/2019 IN ASSESSEES OWN CASE FOR A.Y.2005-06. THE LD. COUNSEL FOR THE ASSESSEE ADVANCED THE SAME ARGUMENTS AND LD. DR ALSO ADOPTED THE SAME ARGUMENTS. ACCORDINGLY, FOR THE SAME REASONING RECORDE D IN IT(SS)ANO.126/IND/2019 AS ABOVE, THE ASSESSMENTS SO FRAMED ARE HELD TO BE BAD IN LAW. CONSEQUENTLY, GROUNDS RAISED IN THESE APPEALS ARE ALSO PARTLY ALLOWED. 25. IN RESULT, THESE APPEALS FILED BY THE ASSESSEE ARE PARTLY ALLOWED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 08.01.20 21. SD/- (MANISH BORAD) SD/- (KUL BHARAT) A CCOUNTANT MEMBER JUDICIAL ME MBER INDORE; DATED : 08 /01/2021 PATEL/PS COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR, INDORE