Dr. Rajat Kumar Ray, Sundargarh V. ACIT, Central Circle, Sambalpur

ITSSA 149/CTK/2018

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 5961 (ITAT-CUTTACK)
• Duration Of Justice: 3 year(s) 21 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 20-12-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 29-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Gift; Depreciation; Income from undisclosed sources; Search and seizure; Document seized; Documents seized; TDS
• Section: 131; 132; 143(3); 153A; 72; 158BD; 153C

Judgement Text

आयकर अपीऱीय अधिकरण, कटक न्यायपीठ, कटक IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH, CUTTACK BEFORE SHRI C.M. GARG, JM & SHRI MANISH BORAD, AM आयकर अपीऱ सं./ITA No.148 to 150/CTK/2018 (नििाारण वषा / Assessment Years :2011-2012 to 2013-2014) Dr. Rajat Kumar Ray, At: Shop No.1, Block No.10, Janata Bipani Market, STI Square, Rourkela-769004 Vs ACIT, Sambalpur PAN No. : ABMPR 7260 E (अऩीलाथी /Appellant) .. (प्रत्यथी / Respondent) ननधाारिती की ओर से /Assessee by : Shri P.K.Mishra, AR िाजस्व की ओर से /Revenue by : Shri M.K.Gautam, CIT DR स ु नवाई की तािीख / Date of Hearing : 20/10/2021 घोषणा की तािीख/Date of Pronouncement : 21/12/2021 आदेश / O R D E R Per Bench: The above captioned appeals filed at the instance of assessee pertaining to A.Ys. 2011-2012, 2012-13 & 2013-2014, respectively are directed against the separate orders of Ld. Commissioner of Income Tax(Appeals)-2, Bhubaneswar, (in short 'CIT(A)'), all dated 24.07.2018, which are arising out of the separate assessment order u/s 143(3) of the Income Tax Act 1961(hereinafter called as the 'Act') all framed on 31.12.2016 by ACIT, Central Circle, Sambalpur. 2. Since the grounds raised in all the three appeals are similar, except different in figures, therefore, for the sake of convenience, we shall take into consideration the grounds raised in the appeal of the assessee for A.Y.2011-2012 in IT(SS)A No.148/CTK/2018, which read as under :- 1. For that, the impugned order passed by the learned C.LT.(A) is not just and proper under the facts and in the circumstances IT(SS)A No.148-150/CTK/2018 2 of the case and hence is liable to be quashed in the interest of justice. 2. For that, the impugned order of Assessment completed U/S.153C read with section 143(3) of the Act is without jurisdiction and without the Authority of law as such the same is liable to be quashed in the interest of justice. 3. For that the learned C.LT(A) should have quashed the impugned Assessment order passed U/S.153C of the Act, when the learned A.O himself has observed that there is no document found to justify any undisclosed income received from the searched party and the addition is made on estimation basis. 4. For that the learned C.LT.CA) should not have confirmed the addition of Rs.7,73,470.00, rather should have deleted it, when there is no incriminating material was found during the search and the impugned addition was made on estimation basis. 5. For that, the Appellant craves leave of this Hon'ble Tribunal to urge other grounds of Appeal, if any, at the time of hearing. 3. Brief facts as culled out from the records are that a search and seizure operation u/s.132 of the I.T.Act, 1961 was conducted on 11.03.2014 in the business and residential premises of Dr. Monu Pattanayak, Prop. Shanti Memorial Hospital and Group of cases, Rourkela. During such search and seizure operations, books of account and other relevant documents/materials were found and seized. On the basis of the seized documents/materials and/or books of account, the assessment proceeding u/s.153Cr.w.s.143(3) of the Act was initiated in the case of the assessee and framed the assessment making additions of Rs.7,73,470/- on account of difference of professional receipt, Rs.21,032/- on account of non-genuine claim made under Chapter-VI-A and Rs.1,41,229/- on account of depreciation claimed on car and computer. Accordingly, the AO assessed the total income of the assessee at Rs.18,45,890/-. IT(SS)A No.148-150/CTK/2018 3 4. Against the order of Ld. AO, assessee preferred an appeal before the Ld. CIT(A) and the CIT(A) allowed the depreciation claimed on car and computer of Rs.1,41,229/- by the assessee and restore the issue of addition of Rs.21,032/- to the file of AO to verify the evidence. Further the CIT(A) confirmed the addition made on account of Rs.7,73,470/- made on the basis of difference of professional receipt. 5. Now, the assessee is in further appeal before the Tribunal. 6. Ld. AR of the assessee argued on the legal grounds being ground Nos.1 to 3 as well as on merits of the case as raised in ground No.4. Ground No.5 is general in nature, which requires no separate adjudication. 7. With regard to legal grounds ld. AR submitted that during the course of assessment proceedings the AO could not found any document to justify any undisclosed income received from the searched party. It was also submitted by the ld. AR that there no incriminating material was found during the search. It was also contended by the ld. AR that the AO has committed mistake in treating the assessee as if he was owner of Shanti Memorial Hospital and as if he receives professional charges directly from the patients. As per the assessee, the payments were collected from the patients by the hospital and there is no evidence that he has received professional fees over and above the disclosed receipts from the hospital. It was further submitted by the ld. AR of the assessee that there are other doctors and it is not possible that all the patients were treated by the assessee and even if the patients are admitted under him, IT(SS)A No.148-150/CTK/2018 4 ultimately the patients may be treated by a different doctor. Moreover, it is submitted by the ld. AR that the AO has confused with the figures in as much as the number of patients as per SMH-69 is sometimes taken as 146 and at other times taken as 116.To support his contentions, ld. AR relied on the following case laws :- i) Pepsico India Holdings (P) Ltd. -vs- ACIT & Another reported in 1[2015] 370 ITR 295 (Delhi). ii) Pepsi Foods (P) Ltd. -vs- ACIT reported in f20141 367 ITR 112. iii) CIT vs- Meghmani Organics Ltd. reported in [2013] 40 taxmann.com 31 (Guiarat). iv) CIT vs- Renu Constructions (P) Ltd. reported in [2018] 99 taxmann.com 426 (Delhi). v) Anil Kumar Gopikishan Agrawal -vs- ACIT, Circle-3(2), reported in [2019] 106· taxmann.com 137 (Guiarat). vi) Super Malls (P) Ltd. -vs- Pr. CIT, 8 New Delhi reported in [2020] 115 taxmann.com 105 (SC). vii) CIT-III (Pune) -vs- Sing had Technical Education Society reported in 397 ITR 344 (SC). 8. Per Contra, Ld. DR filed a consolidated written submission for the three assessment years under consideration, which read as under :- In these appeals, the appellant has challenged the action of the Id. CIT(A)-2, Bhubaneswar in confirming the action of the A.O. in regard to suppression of receipts and other disallowances while framing the orders u/s.153C r.w.s.143(3) of the Act on the ground that seized documents were not incriminating in nature and documents so seized did not belong to the appellant. In this regard, the following facts are pertinent: a) In the general grounds of appeal, the appellant has not challenged the validity of satisfaction note recorded by the A.O. of the searched person. There is no specific ground of appeal relating to the fact that the seized documents in question did not belong to the appellant. Hence these arguments are liable to be ignored and the paper book consisting of 125 pages filed on 16.11.2020 need not be taken into account by the Hon'ble Bench. b) Without prejudice to the above fact, it is submitted that Section 153C which is similarly worded to section 158BD of the Act, provides that where the Assessing Officer is satisfied that any money, bullion, jewellery or other valuable article or thing or books of account or documents seized or requisitioned belongs or belong to a person other than the person referred to in Section 153A, he shall proceed against each such other person and issue such other IT(SS)A No.148-150/CTK/2018 5 person notice and assess or reassess income of such other person. However, there is a distinction between the two provisions inasmuch as under section 153C notice can be issued only where the money, bullion, jewellery or other valuable article or thing or books of account or documents seized or requisitioned belong to such other person, whereas under Section 158BD if the Assessing Officer is satisfied that any undisclosed income belongs to any person, other than the person with respect to whom search was made under section 132 or whose books of account or other documents or assets were requisitioned under section 132A, he shall proceed against such other person under section 158BC. From the comparison of language of Sections 153C and 158BD, it is clear that the condition for recording satisfaction by the Assessing Officer of the person searched is present in both the cases. In Section 158BD, the Assessing Officer of the person searched is to be satisfied that any undisclosed income belong to any person other than the person searched, while, in the case of Section 153C, the Assessing Officer of the person searched is to be satisfied that any money, bullion, jewellery or other valuable article/thing or books of account/documents belong to a person other than the person searched. Thereafter, the subsequent procedure in both Sections 158BD and 153C is the same. c) As regards the incriminating nature of seized documents, the Patients Admission Register (SMH-40) is being produced in the original during the course of hearing for the perusal of Hon'ble Members .. Extract copies of seized material SMH-69 (5 pages) showing payments of professional charges to Dr. Rajat Ray are being submitted. These have to be examined with reference to page-63 of SMH-15. It should be appreciated that Patient Admission Register (SMH-40) is the basic source information register giving information such as Registration No., Date & Time, Bed No., Name of the Patient, Residential Address, Age, Sex, Mobile Number, Diagnosis, Consultant, signature of attending Sister and Remarks (Discharge Date). This Patients Admission Register (SMH-40) is further corroborated by the page-63 of SMH-15. It can be seen that one Smt. Meena Kumari Paramanik was admitted on 08.05.2010 and discharged on 15.05.2010. She had paid an amount of Rs.12,740/-. These details are also found at Serial No.312 of SMH-40. Hence the genuineness of SMH-40 can't be doubted. On perusal of SMH- 40 (FY 2010-11), it is seen that Dr. Rajat Ray was the consulting doctor of 361 patients. As per seized material SMH-69, data for payment of professional charges was maintained in Cisco.tel database. As per SMH-69, Dr. Rajat Ray was the consulting doctor of 146 patients and had been paid professional charges of Rs.3,77,470/-. On comparison of seized register SMH-40 and Ciscotel Database SMH-69, it is seen that out of 361 patients,116 were common to both the databases. Since the details of professional charges paid in respect of 245 patients were not known, the A.O. had to estimate the professional charges IT(SS)A No.148-150/CTK/2018 6 @Rs.1000/- & Rs.5000/- per patient as per statement of Dr. Rajat Ray recorded on 11.06.2014 before the DDIT (Investigation). Thus abovementioned seized documents were incriminating in nature. The Id. AR of the appellant has relied upon the judgement of Hon'ble Delhi High Court in the case of Pepsico India Holding P. Ltd. vs. ACIT (370 ITR 295) but the facts and circumstances therein are found to be distinguishable. In that case, a search had been carried out in the case of Iaipuria Group and notice U/s.153C was issued to Pepsico India Holding P. Ltd. On analysis of seized documents, the Hon'ble Delhi High Court observed as under; i.) The photocopies of preference shares belonged to Iaipuria Group and not to Pepsico India Holding P. Ltd. ii.) Unsigned cheques were found in the cheque-books of Iaipuria Group and had not been handed over to Pepsico India Holding P. Ltd. iii.) In respect of supply and loan agreement, only a photocopy had been found from the premises of Ialpuria Group. The original of supply and loan agreement was available with Pepsico India Holding P. Ltd. On the basis of above facts, the Hon'ble High court that the seized documents did not belong to Pepsico India Holding P. Ltd. Similarly in the case of Pepsi Foods P. Ltd. vs. ACIT (367 ITR 112), the Hon'ble Delhi High Court held that apart from saying that the documents belonged to the assessee and that the A.O. was satisfied that it was a fit case of issue of notice u/s.153C, there was nothing in the satisfaction note that presumptions which were to be normally raised, had been rebutted by the A.O. In fact, the Hon'ble High Court held that satisfaction note itself must display the reasons or basis for the conclusion that the A.O. was satisfied that seized documents belonged to the other person. In the present case, the A.O. of the searched person has given elaborate reasoning that how the documents seized from the premises of Dr. Monu Pattanayak, Proprietor of Shanti Memorial Hospital belonged to Dr. Rajat Kumar Ray along with working of suppressed receipts in his hands. In the case of CIT vs. Meghmani Organics Ltd. (40 taxmann.com 31), there was a clear cut finding by the Hon'ble Gujarat High Court that in the impugned order, the Tribunal held and observed that "the Assessing Officer in the assessment order has categorically held that pages 87 to 91 of Annexure A-4 seized from Lalit K Patel are his own hand written estimate for the proposed work of the assessee". It was further held that it had certain references to the IT(SS)A No.148-150/CTK/2018 7 estimations and expenditure etc. of the properties belonging to the assessee. Thus facts are totally different in the cited case. The other judgements namely Renu Constructions (P.) Ltd. (399 ITR 262), Anil Kumar Gopikishan Agarwal (418 ITR 25) etc. relied upon by the Id. AR of the appellant are with reference to the amendment brought in section 153C w.e.f', 01.06.2015 whereby the word "belongs" had been replaced by "pertains to". These have no relevance here. The Hon'ble Delhi High Court in the case of SSP A viations Ltd. vs. DCIT (346 ITR 177) held in para-IS that in view of provisions of section 153(, satisfaction that is required to be reached by A.O. having jurisdiction over searched person is that valuable article or books of account or documents seized during search should belong to a person other than a searched person. However, there is no requirement in section 153((1) that Assessing Officer should also be satisfied that such valuable articles or books of account or documents belonging to other person must conclusively reflect or disclose any undisclosed income. The Hon'ble Gujarat High Court in the case of Kamleshbhai Dharamshibhai Patel vs. CIT (31 taxmann.com 50) (para-22 & 23) also held the similar view. In the cited case, the assessee sold certain land to Sanghvi group. Subsequently, Sanghvi group was subjected to search during which sale deeds of land and agreements entered into by and between tenants of said property and assessee on various dates regarding eviction of tenants were seized. Relying upon said documents, action under section 153C was initiated against assessee. Since documents in question could be said to be belonging to assessee, the action initiated by the A.O. under section 153C was held to be justified in spite of the fact that only registered sale deeds and eviction agreements had been seized which could not be said to be incriminating. d) There is no requirement that the A.O. of the searched person at the time of recording of satisfaction note should conclusively prove the quantum of undisclosed income that is likely to be raised in the case of "other person". iv.) In the present case, the A.O. of the searched person and "other person" are same (Shri Shisbir Kumar Dash). Therefore satisfaction note is not required to be prepared in the case of "other person" (Dr. Rajat Kumar Ray). Ltd.). Reliance in this regard is placed on the decision of Hon'ble Supreme Court in the case of Super Malls (P.) Ltd. vs. PCIT [2020] 115 taxmann.com 105 wherein it was held that there can be one satisfaction note prepared by the same At), if he records the satisfaction, on the basis of material evidence on IT(SS)A No.148-150/CTK/2018 8 record, such as statement of the "person searched" that documents found from the premises of "person searched" belonged to the "other person", that documents were seized from the "person searched" and that documents contained transactions, say of cash receipts on sale of shops! offices, which belonged to "other person". This will fulfill the mandatory requirement of section 153C. The Hon'ble Apex Court in para-6.1 has held as under: "In case, where the Assessing Officer of the searched person and the other person is the same, there can be one satisfaction note prepared by the Assessing Officer, as he himself is the Assessing Officer of the searched person and also the Assessing Officer of the other person. However, as observed hereinabove, he must be conscious and satisfied that the documents seized/recovered from the searched person belonged to the other person. In such a situation, the satisfaction note would be qua the other person. The second requirement of transmitting the documents so seized from the searched person would not be there as he himself will be the Assessing Officer of the searched person and the other person and therefore there is no question of transmitting such seized documents to himself". In the case of Ganpati Fincap Services (P.) Ltd. vs. CIT (82 taxmann.com 408), the Hon'ble Delhi High Court held that where Assessing Officer of searched person recorded that documents seized during search belonged to assessee, merely because he had not categorically stated that documents mentioned therein did not belong to searched person would not invalidate assumption of jurisdiction under section 153C in respect of assessee. Where proceeding under section 153C was initiated against assessee on basis of seized documents which could not be said to be non- incriminating on bare perusal and despite of being given several opportunities no submission on merits of case was made by assessee, assessment order passed under said section to make additions was justified. In the case of Rajesh Sunderdas Vaswani vs. ACIT (76 taxmann.com 311), the Hon'ble Gujarat High Court held that where Assessing Officer of search person recorded that document found during search was copy of a ledger of books of account of assessee company which evidenced certain cheque payments as well as cash payments to a company by assessee, there was prima facie material to suggest that satisfaction as per section 153C was duly recorded and thus, notice issued to file return to assessee was justified . In view of above judicial precedents and facts, these grounds of appeal are required to be dismissed. Apart from the above, ld. DR drew our attention to para 4 of the appellate order and submitted that the name of the assessee is mentioned against the patients who were admitted under him, therefore, the claim of the IT(SS)A No.148-150/CTK/2018 9 assessee that the information does not pertain to him is absolutely incorrect. Accordingly, the ld. DR submitted that the orders passed by both the authorities below deserve to be upheld. 9. Now, first we shall decide the legal ground raised by the assessee as to whether the Assessing Officer is having valid jurisdiction and authority to complete the assessment u/s.153C of the Act by making impugned additions for the assessment years under consideration even in the absence of any incriminating material deemed to be found during the search conducted u/s.132 of the Act. The contention of the assessee is that the additions can be made only on the basis of incriminating material found during the course of search and seizure proceedings. The search and seizure operation was conducted u/s.132 of the I. T. Act, 11.03.2014 in the case of Dr. Monu Pattnayak and Group of cases. The assessee was working as a visiting Doctor in the Hospital run by Dr. Monu Pattanayak in his proprietary status namely M/s Shanti Memorial Hospital. The AO in the assessment order at page 3 has mentioned the seized material i.e. SMH-40 which is the patient admission register and SMH-69 is the Payment of Professional charges register to different doctors of the said Hospital and SMH-15 is the Discharge Register. Meaning thereby, that these documents does not belong to the assessee, rather belong to Dr. Monu Pattnaik (searched person) proprietor of M/s Shanti Memorial Hospital. On comparison of information in Ciscotel data and the information available in seized register i.e. SMH-40, the AO found that out of 361 patients figuring in the patient admission register, 116 are common IT(SS)A No.148-150/CTK/2018 10 to both the databases i.e. Ciscotel database as well as seized register SMH-40. On being asked by the AO, the assessee explained that the information is not related to the assessee. Ld. AR of the assessee produced copy of statement of the assessee which reads as under :- Statement of Dr. Rajat Kumar Ray, s/o Sri Nrusingha Charan Ray, aged 50 years, recorded u/s 131 at the office of the Deputy Director of Income Tax ( Investigation), F- 7,Old Siemens Building Sector-2, Rourkela on 11/06/2014. I do swear in the name of God that I shall speak the truth, the whole truth & nothing but truth. Sd/- Sd/- Oath Administered by Oath administered on Q.1: Please identify yourself? Ans. I am Dr. Rajat Kumar Ray, S/o. Sri Nrusingha Charan Ray, aged 50 years resident of M-44, Phase-I, Chhend, Rourkela. Q.2: What is your educational qualifications & occupation? Ans: I have completed M.D. in 0 & G and profession in medical practice. Q.3 Are you assessed to Income-Tax. If so, please give details of PAN, Income Tax Particulars regarding filing of return of income. Ans: Yes, I am assessed to tax. My PAN is ABMPR7260E and I am assessed at ITO, Ward-I. I am furnishing Income Tax particulars for the A.Ys.2010- 11 to 2013-14. Q.4 Please state details of family tree? Ans.:The family trees are as under: i) Sri Nrusingha Charan Ray, father aged 75 years ex- SALE employee ii) Smt. Laxmipriya Ray, mother aged 72 years housewife iii) Self iv) Dr. Sunita Samal, spouse age 42 OG specialist RGH v) Gunjan Ray, daughter age -16 years DPS School, Class-X complete vi) Harshit Ray, Son age - 10 years DPS School, Class - V Q.5. Please state details of bank accounts maintained in your name & in the name of your concern, if any and in the name of family members. A- Details of bank accounts I have shown in my balance sheet which is produced. Besides this, I am maintaining one bank account at HDFC Bank, sn chowk. My son has one bank account at Bank of India, Civil Township. Q.6. Are you associated with Shanti Memorial Hospital/Dr. Monupatnaik. If so, since when IT(SS)A No.148-150/CTK/2018 11 Ans. I was associated with Dr. Monupattnaik from 1999 to 2007 on salary basis. After that I had attended the nursing home Shanti Memorial Hospital as a consultant. Q.7 Please state in details how you are associated with Shanti Memorial Hospital/Dr. Monu Pattanayak, whether part-time or full-time basis. Ans. As stated above in reply to Que No. 6 Q.8. Please state have you engaged in treatment of indoorsj outdoor patients at Shanti Memorial Hospital. Please state the modus of charging towards patients. Ans: I had attended the indoor patient only my reference patients which I was initially made treatment at my clinic at STI Chowk. My charging towards indoor patients ranges from Rs.1,000 to 5,000 dependent on patient to patient (normal delivery Rs.1,000 approximately and caesarian Rs.3000 - 5000 or uterus removal after 2007. Before that I was engaged on salary basis of Rs.8,000 p.m. Other charges like O.T. Bed charges, nursing charges etc. were received by Shanti Memorial Hospital. Q.9 Please state 'how much of salary /professional charges you beve received from Shanti Memorial Hospital during preceding six financial years and current financial year. Please also state receipt of salary/professional charges attract TDS provision or not with documentary support. Ans. After 2008, I was receiving consultant charges from Shanti Memorial Hospital on patient basis. Q.10 Please state the basis of receipt of salary/professional fees. i.e. your receipt from Shanti Memorial Hospital is at fixed rate or patientwise. Ans: Professional charges received from patients initially paid to Shanti Memorial hospital who after calculating total charges, paid the amount directly to me on day to day basis in cash. Professional charges depend on patient to patient. Q.11. Please state yearwise details of patients you have attended for operation/consultation during last six years. Ans. I do not maintain any accounts in details in respect of number of indoor patients I had attended during last six years. So, it is not possible to give the details. Q.12 Please state do you maintain any accounts regarding receipt of fees for attending of patient at Shanti Memorial Hospital. Ans: No, I do not maintain any accounts regarding receipt of fees for attending of patients at Shanti Memorial Hospital. Q.13. Please state details of mode of receipt from Shanti Memorial Hospital. Ans: Cash on daily basis. Q.14. Please state do you receive any amount from Shanti Memorial Hospital otherwise than cheque, if so, furnish the details. Ans: Yes, I receive in cash. IT(SS)A No.148-150/CTK/2018 12 Q.15. Please state besides engage in Shanti Memorial Hospital, do you have your own hospital/clinic, if so, give the details of functioning. Ans: I have own clinic in the name & style as Ray Infertility Clinic, sn Chowk (OPD) and Ray Hospital Test Tube Baby Centre, Civil Township, Rourkela (Indoor clinic). Both are proprietorship concern. Q.16. If reply to Que. No.LS is affirmative, what are the books of account you maintain and what is the fees/receipt from the aforesaid hospital/clinic. Please state what is the total investment in both OPD & nursing home. Ans: For outdoor patients, we maintain one register mentioning only name of the patient with date, no amount is mentioned against the patient. For indoor patients, we maintain register like admission register, O.T. register, birth report register, for ultrasound also we maintain one register, cash book, ledger etc. For OPD, initial consultant RS.200 and subsequent consultation RS.100. As regards to receipts from OPD and Nursing Home, it has duly reflected in the audit report for F.Y.2012-13 , which is furnished. OPD at STI has been allotted by RDI on rent basis of RS.7000 per month. Nursing home we have taken on rental basis of Rs.70,000 per month from 2012 from Mr. Bhawan Singh. Investment in OPD is around Rs.18 lacs and Nursingh Home at about Rs.50,00,000/-. Q.17. Please also state besides the above, are you attending any other nursing home/clinic run by other organizations. If so, please furnish details, of receipt from said hospital/organization. Ans: Yes, I am attending honorary Associate Professor at Hitech Medical College. Earlier, I was received salary from Hitech Medical College and now on honorary basis. Q.18. Please state do you or your family members have acquired any moveable and immovable assets during the proceeding six years. If so, please state how accounted for in the Income Tax purpose. Ans: Yes, I have acquired one plot at Civil township bearing plot No.C-4/10 for a consideration of Rs.56,00,000/- during October, 2013 and it will be shown in the balance sheet for the current year. The vehicle stands in my name has been shown in my balance sheet. Q.19. Please state do you receive any commission from medicine companies. If so, please give the details and state do you account for. Ans: NO. Q.20. During the course of search & seizure operation at Shanti Memorial Hospital, books of account/registers were IT(SS)A No.148-150/CTK/2018 13 seized from which it is revealed that you have carried out operation/indoor treatment at Shanti Memorial Hospital, yearwise details for last three years are as under: F.Y. No. of Patients F.Y.2010-11 359 F.Y.2011-12 238 F.Y.2012-13 8 Also please go through the seized register where entry of patient has been made against your name as consulting/operating doctor. Can you furnish your accounts where entry has been made in respect of patients as per register. Please also state how much fees you have received from them along with details of proof. Ans. I have not remembered the exact no. of patients as per the register as I do not maintain details of accounts patientwise attended at Shanti Memorial Hospital. However, I may clarify that whatever I have received professional charges! TDS has been made by Shanti Memorial Hospital. On the basis of the TDS certificate, the receipt as per TDS certificate has been shown in my return of income. Q.21 Do you want to say any more or reverse the statement given above? Ans: No. Whatever is stated above is correct to the best of my knowledge and belief. I shall stand by it. The above statement is recorded without any coercion, threat, fear, undue influence. I signed the statement after going through it. 10. From the above, it is clear that where the Assessing Officer is satisfied that, any money, bullion, jewellery or other valuable article or thing or books of accounts or documents seized or requisitioned belongs or belong to a person other than the person referred to in section 153A, he shall proceed against each such other person and issue such other person notice and Assess or Reassess income of such other person. Thus, the condition precedent for issuing notice U/s.153C and assessing IT(SS)A No.148-150/CTK/2018 14 or reassessing income of such other person, is that, the money, bullion, jewellery or other valuable article or thing or books of account or document seized or requisitioned should belong to such other person. Mere reference of the name of the assessee (third party) as attending Doctor in said documents does not contemplate that, said documents belong to the assessee. If, the said requirement is not satisfied, resort cannot be had to the provisions of section 153C of the Act. Ld. AR of the assessee drew our attention to the decision of the Hon’ble Delhi High Court in the case of Pepsico India Holdings Pvt. Ltd. [2015] 370 ITR 295 (Delhi), wherein the Hon’ble High Court has held as under :- Held, that in the satisfaction note there was nothing to indicate that the seized documents did not belong to the J group. This was even apart from the fact that there was no disclaimer on the part of the group in so far as the documents were concerned. Secondly, the finding of photocopies in the possession of a person in respect of whom search was conducted does not necessarily mean and imply that they "belong" to the person who holds the originals. Possession of documents and possession of photocopies of documents are two separate things. While the group might be the owner of the photocopies of the documents it was quite possible that the originals might be owned by some other person. Unless it was established that the documents in question, whether they be photocopies or originals did not belong to the person in respect of whom search was conducted, the question of invoking section 153C would not arise. None of the three sets of documents-copies of preference shares, unsigned leaves of cheque books and the copy of the supply and loan agreement-could be said to "belong to" the assessee. The notice under section 153C was not valid. 11. Further the Hon’ble Gujarat High Court in the case of CIT Vs. Meghmani Organics Ltd. [2013] 40 taxmann.com 31 (Gujarat), wherein the Hon’ble High Court has held that where the documents on basis of which AO initiated proceedings under section 153C did not belong to assessee, the assessment framed u/s.153C of the Act to be cancelled. IT(SS)A No.148-150/CTK/2018 15 12. Reliance was also placed by the ld. AR of the assessee on the decision of coordinate bench of the Tribunal in the case of Smt. Sunita Bhagchandka, ITA No.3447/Del/2016, order dated 19.08.2019, wherein the Tribunal following the judgments of Hon’ble Delhi High Court has held as under :- 15. Now the second question that arises that present Assessment Year involved in this appeal is assessment year 2006 - 07. The search took place on 24/1/2007. The notice u/s 153C read with section 153A was issued to the assessee on 1/12/2008. The assessee filed a return of income for the impugned assessment year on 11/07/2006. The due date for issue of any notice u/s 143 (2) of the income tax act was up to 30/9/2007. Admittedly, no notice u/s 143 (2) of the act was issued to the assessee however on 28/11/2008, learned assessing officer recorded the satisfaction u/s 153C of the act. Based on this on 01/12/2008, notice u/s 153C was issued. On the above chronology of events, it is apparent that the assessment as on that date is concluded. Such concluded assessment, can only be disturbed, if there is any incriminating material unearthed during the course of search. The only material unearthed during the course of search was a certificate issued by the bank to the assessee. Such bank account was already disclosed by the assessee in her form number 2D filed for assessment year 2006 - 07 in column number 13. According to that column, the assessee is required to disclosed the details of bank account stating the name of the bank, MICR code, address of the bank branch, type of account and account number. The assessee has disclosed that she is holding an account with which the bank having MICR code of 110029002 at address of Ansari Road, darya Ganj, New Delhi in the form of savings account with account number 7601. In the computation of total income the assessee has also shown the interest income of INR 1 5522/- under the head income from other sources. Therefore, it is apparent that whatever information, unearthed during the course of search, already existed on the record of the revenue disclosed by the assessee herself in her return of income. Therefore it is apparent that the existence of the bank account cannot be said to be a new information that is undisclosed, unearthed by the revenue. 16. Now we come to the bank certificate issued by the bank. In impugned bank certificate there is no information about the undisclosed income of the assessee. If the documents unearthed during the course of search do not indicate existence of any unaccounted income, they are not incriminating in nature. It is important that documents found during the course of search must give some indication about the undisclosed income of the assessee. The impugned certificate did not give any indication IT(SS)A No.148-150/CTK/2018 16 about the fact of gift of the shares, which are alleged to be undisclosed income of the assessee. As held by the honourable Delhi High Court in CIT vs. Kabul Chawla (2016) 380 ITR 573 (Del), principal Commissioner of income tax vs. Meeta Gutgutia (2017) 395 ITR 526 (Del), Principal Commissioner Of Income Tax Vs Best Infrastructure (India) Private Ltd in ITA number 11/22/2017 dated 1/8/2017, that the concluded assessment can only be disturbed on the basis of the undisclosed income contained in the incriminating documents found during the course of search. The revenue could not show us any evidence that how the bank certificate found during the course of search at the premises of 3rd party belonging to the assessee can be said to be an incriminating document and what is the undisclosed income of the assessee contained in those documents. Apparently, that bank account clearly shows only the bank balance of that bank account. It is not the case of the revenue that such bank account is not disclosed by the assessee to the income tax department. Is the contention of the revenue is upheld, then it would imply that any document found during the course of search on other person belonging to the 3rd person, whether it contains any details of unaccounted income of 3rd person or not, the concluded assessment of the 3rd person will be disturbed and any addition can be made in the hands of 3rd person even if, in the seized document no reference of unaccounted income is found. Thus, such a view, will render the distinction between concluded assessment and abetted assessment meaningless. Thus, we cannot uphold the view of the revenue. In view of this, we do not have any hesitation in holding that the impugned bank certificate is not an incriminating document based on which the concluded assessment in the case of the assessee can be disturbed. In view of this according to us , we hold that no addition can be made in the hands of the assessee in absence of any incriminating evidence leading to any unaccounted income unearthed during the course of search. Accordingly, ground number 1 - 3 of the appeal of the assessee is allowed. 13. To support our view, reliance can be placed on the decision of Indore Bench of the Tribunal in the case of Kalani Bros & Ors ITA(SS) No.71/Ind/2014 dated 06.11.2015, wherein the Tribunal has observed as follows:- "We have heard both the sides. We have also gone through the case laws relied upon by both the sides. We have also considered various relevant facts of the case. It is a settled legal position that once a search and seizure action has taken place u/ s 132 of the Act or a requisition has been made u/ s 132A, the provisions of section 153A trigged and Assessing Officer is bound to issue notice u/ s 153A of the Act. Once notices are issued u/ s 153A of, the Act then assessee is legally obliged to file return of income for six IT(SS)A No.148-150/CTK/2018 17 years. The assessment and reassessment for six years shall be finalised by the Assessing Officer. It is also held by various Courts that once notice u/ s 153A of the Act issued, then assessment for six years shall be at large both for Assessing Officer and assessee have no warrant of law. It has been also held that in the assessment years where assessments have been abated in terms of second proviso to section 153A then Assessing Officer acts under original jurisdiction and one assessment is made for total income Sanjay Agrawal including the addition made on the basis of seized material. But where there is no abatement of assessments and assessments were completed on the date of search then addition can be made only on the basis of incriminating documents or undisclosed assets, etc. In these cases there was no incriminating document found and seized. No assessment proceedings were abated in these assessees. Thus assessments for these assessment years were completed on the date of search. The assessments were completed u/s 143(3) of the Act read with section 153A/ 153C of the Act after the search. There was no abatement of any proceedings in these cases for these assessment years in terms of second proviso to section 153A of the Act. There is no seized material belonging to the assessee which was found and seized in relation to additions made. In. a recent decision, Hon'ble Delhi High Court in the case of CIT vs. Kabul Chawla (supra) has held that completed assessments can be interfered with by the Assessing Officer while making assessment u/ s 153A of the Act, only on the basis of some incriminating material unearthed during the course of search or requisition of documents or undisclosed income or property discovered in the course of search which was not produced or not already disclosed or made known in the course of original assessment. In. all these cases no assessments were pending on the date of search for these assessment years. No assessments were abated in terms of second proviso to section 153A of the Act. Hon'ble Delhi High / Court in the case of CIT vs. Kabul Chawla (supra) has considered various High Court decisions relied upon by the learned DR. The Hon'ble Delhi High Court has considered the cases of Canara Housing Development Co.vs. DCIT; Madugula vs. DCIT; CIT vs. Chetandas Laxmandas and CIT vs. Anil Kumar Bhatia (supra). The only decision of the Hon'ble Allahabad High Court in the case of CIT vs. Raj Kumar Arora; 367 ITR 517 relied on by the learned DR was not considered by Hon'ble Delhi High Court while deciding the issue in the case of Kabul Chawla. The Hon'ble Allahabad High Court has reversed the order of the Tribunal and remanded the issue to the Tribunal to consider the appeal of the department on merits. It is a settled legal position that when two views are possible on a particulars issue then the view favourable to the assessee should be followed as held by the Hon'ble Apex Court in the case of CIT vs. Vegetable Products; 88 ITR 192. Respectively following the decision of the Hon'ble Apex Court, we dismiss the ground of appeals of the Revenue. Departmental appeals are disposed accordingly." IT(SS)A No.148-150/CTK/2018 18 14. The aforesaid principle and ratio are clearly applicable on the facts of the present case also, as admittedly in the assessment years under consideration, while framing the assessment, the AO has not referred to any incriminating material belonging to the assessee was found during the course of search and seizure operation. Had some incriminating material during the course of search been found then the AO must have taken into cognizance while framing the assessment order but he did not refer to any incriminating document. The ld. DR has also not controverted the above facts before us by bringing any cogent material fact. In view of the aforesaid statutory scheme and clear position of law, it is clear that since the alleged documents SMH-15, SMH-40, and SMH-69 do not belong to the assessee, assessment U/s.153C of the Act cannot be framed in the case of the assessee.Therefore, considering the above facts of the case and also the observations of both the lower authorities and respectfully following the decisions referred above, we are of the considered view that in the absence of any incriminating materials belonging to the assessee, the orders passed by both the authorities below are not sustainable and the same are hereby quashed. 15. Since, we have already quashed the assessment framed by the AO u/s.153C/143(3) of the Act allowing the appeals of the assessee on legal issue, the other grounds on merit need not to be adjudicated upon. Thus, the appeal of the assessee for A.Y.2011-2012 in IT(SS)A No.148/CTK/2018 is allowed on legal ground. IT(SS)A No.148-150/CTK/2018 19 16. As the grounds raised in all the three appeals of the assessee are identical, except different in figures and we have quashed the orders passed by both the authorities below, therefore, our observations made in the appeal of the assessee for A.Y.2011-2012 shall apply mutatis mutandis. Thus, IT(SS)A Nos.149&150/CTK/2018 are also allowed on legal grounds. 17. In the result, all the three appeals of the assessee are allowed. Order pronounced in the open court on 21/12/ 2021. Sd/- (सी.एम.गगा) (C.M.GARG) Sd/- (मिीष बोरड़) (MANISH BORAD) न्यानयक सदस्य / JUDICIAL MEMBER ऱेखा सदस्य / ACCOUNTANT MEMBER कटक Cuttack; ददनाांक Dated 21/12/2021 Prakash Kumar Mishra, Sr.P.S. आदेश की प्रनिलऱपप अग्रेपषि/Copy of the Order forwarded to : आदेशाि ु सार/ BY ORDER, (Senior Private Secretary) आयकर अपीऱीय अधिकरण, कटक/ITAT, Cuttack 1. अऩीलाथी / The Appellant- Dr. Rajat Kumar Ray, At: Shop No.1, Block No.10, Janata Bipani Market, STI Square, Rourkela-769004 2. प्रत्यथी / The Respondent- ACIT, Sambalpur 3. आयकि आय ु क्त(अऩील) / The CIT(A), 4. आयकि आय ु क्त / CIT 5. ववभागीय प्रनतननधध, आयकि अऩीलीय अधधकिण, कटक / DR, ITAT, Cuttack 6. गार्ा पाईल / Guard file. सत्यावऩत प्रनत //True Copy//