Smt. Sarladevi Sarawagi, Surat V. The ACIt.,Cent.Circle-4, Surat

ITSSA 209/AHD/2012

• Counselvise Citation: [2015] 122 COUNSELVISE.COM (IT) 0781 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 month(s) 8 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 05-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 29-05-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 27-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: O P VAISHNAV
• Assessee Lawyers: MEHUL R SHAH
• Keywords: Search and seizure; Documents seized
• Section: 143(3); 153A

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI KUL BHARAT, JUDICIAL MEMBER IT(SS)A NO. 209/AHD/2012 / ASSESSMENT YEAR: 2008-09 SMT. SARLADEVI SARAWAGI V-2131, SURAT TEXTILE MARKET, RING ROAD, SURAT PAN : ACIPS 3334 H V/S. ACIT, CENTRAL CIRLCE-4, SURAT / // / (APPELLANT) / // / (RESPONDENT) ASSESSEE(S) BY : SHRI MEHUL R. SHAH, AR REVENUE BY : SHRI O.P. VAISHNAV, CIT-DR ! '#$/ // / DATE OF HEARING : 29/05/2015 %& ! '#$ / // / DATE OF PRONOUNCEMENT: 05/06/2015 '( '( '( '(/ // / O R D E R PER G.D. AGRAWAL, VICE PRESIDENT: THIS IS AN APPEAL FILED BY THE ASSESSEE AND IS DIRE CTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME-TAX(APPEALS )-II, AHMEDABAD DATED 30.01.2012, PERTAINING TO ASSESSMENT YEAR 200 8-09. 2. THE FIRST GROUND OF THE ASSESSEES APPEAL READS AS UNDER:- ON THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS LAW ON THE SUBJECT, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAS ER RED IN CONFIRMING THE ACTION OF ASSESSING OFFICER IN FRAMING ASSESSMENT U /S 143(3) R.W.S. 153C OF THE ACT. 3. AT THE TIME OF HEARING BEFORE US, IT IS SUBMITTE D BY THE LD. COUNSEL THAT ON 20.01.2009 A SEARCH TOOK PLACE AT THE LAXMI PATI GROUP. HOWEVER, THERE WAS NO SEARCH WARRANT IN THE NAME OF THE ASSE SSEE AND THEREFORE, THERE WAS NO SEARCH AND SEIZURE OPERATION SO FAR AS THE A SSESSEE IS CONCERNED. THAT IT(SS)A NO. 209/AHD/2012 SMT SARLADEVI SARAWAGI VS. ACIT FOR AY 2008-09 2 THE ASSESSING OFFICER TOOK ACTION U/S 153C IN THE C ASE OF THE ASSESSEE. THE CIT(A) UPHELD THE VALIDITY OF THE ISSUE OF NOTICE U /S 153C ON THE GROUND THAT PART OF THE JEWELLERY FOUND AT THE TIME OF SEA RCH WAS BELONGING TO THE ASSESSEE AND THEREFORE, IT IS A CLEAR CASE WHERE TH E VALUABLES OF THE ASSESSEE WERE FOUND AND SEIZED AT THE TIME OF SEARCH OF THIR D PARTY. HE STATED THAT THE ASSESSING OFFICER OF THE SEARCHED PARTY HAS NOT REC ORDED ANY SATISFACTION AND HAS NOT COMMUNICATED ANY SUCH SATISFACTION TO T HE ASSESSING OFFICER OF THE ASSESSEE. THAT THE ASSESSING OFFICER ISSUED NOT ICE U/S 153C MERELY BECAUSE THE CASE WAS CENTRALIZED U/S 127(2) OF THE INCOME-TAX ACT. HE FURTHER STATED THAT NO JEWELLERY BELONGING TO THE A SSESSEE WAS FOUND AT THE TIME OF SEARCH AND MOREOVER, EVEN IF ANY JEWELLERY WAS FOUND, THE SAME WOULD BE CONSIDERED FOR ASSESSMENT YEAR 2009-10 BEC AUSE THE DATE OF SEARCH IS 20.01.2009. HE, THEREFORE, SUBMITTED THA T EVIDENTLY FOR THE YEAR UNDER CONSIDERATION NO DOCUMENTS OR VALUABLES WERE FOUND SO AS TO INITIATE THE PROCEEDINGS U/S 153C IN THE CASE OF THE ASSESSE E. 4. THE LD. DEPARTMENTAL REPRESENTATIVE, ON THE OTHE R HAND, RELIED UPON THE ORDER OF THE CIT(A), ESPECIALLY PARAGRAPH 2.1, AND POINTED OUT THAT THE CIT(A) HAS CONSIDERED IN DETAIL THE FACTS OF THE CA SE, PROVISIONS OF SECTION 153C AND HAS RIGHTLY SUSTAINED THE VALIDITY OF INIT IATION OF PROCEEDINGS U/S 153C IN THE CASE OF THE ASSESSEE. HE, THEREFORE, RE QUESTED THAT THE ORDER OF THE CIT(A) SHOULD BE SUSTAINED. 5. WE HAVE CAREFULLY CONSIDERED THE ARGUMENTS OF BO TH THE SIDES AND PERUSED THE MATERIAL PLACED BEFORE US. SECTION 153 C(1) READS AS UNDER:- 153C. [(1)] NOTWITHSTANDING ANYTHING CONTAINED IN S ECTION 139, SECTION 147, SECTION 148, SECTION 149, SECTION 151 AND SECT ION 153, WHERE THE ASSESSING OFFICER IS SATISFIED THAT ANY MONEY, BULL ION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNT OR DO CUMENTS SEIZED OR REQUISITIONED BELONGS OR BELONG TO A PERSON OTHER T HAN THE PERSON REFERRED TO IN SECTION 153A, THEN THE BOOKS OF ACCOUNT OR DOCUM ENTS OR ASSETS SEIZED OR IT(SS)A NO. 209/AHD/2012 SMT SARLADEVI SARAWAGI VS. ACIT FOR AY 2008-09 3 REQUISITIONED SHALL BE HANDED OVER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON [AND THAT ASSE SSING OFFICER SHALL PROCEED AGAINST EACH SUCH OTHER PERSON AND ISSUE NOTICE AND ASSESS OR REASSESS THE INCOME OF THE OTHER PERSON IN ACCORDANCE WITH THE P ROVISIONS OF SECTION 153A, IF, THAT ASSESSING OFFICER IS SATISFIED THAT THE BO OKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED HAVE A BEARING 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] :] 6. FROM THE ABOVE, IT IS EVIDENT THAT WHERE THE ASS ESSING OFFICER IS SATISFIED THAT ANY VALUABLES OR BOOKS OR DOCUMENTS SEIZED BELONG TO A PERSON OTHER THAN THE PERSON SEARCHED, THEN THE BOO KS OF ACCOUNTS OR THE DOCUMENTS OR THE ASSETS SEIZED ARE TO BE HANDED OVE R TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH PERSON AND TH EN THE ASSESSING OFFICER OF SUCH OTHER PERSON HAS TO INITIATE THE PROCEEDING S AGAINST SUCH OTHER PERSON. HOWEVER, IN THE CASE UNDER CONSIDERATION B EFORE US, THE REVENUE HAS NOT PLACED ON RECORD ANY SUCH SATISFACTION HAVI NG BEEN RECORDED BY THE ASSESSING OFFICER OF PERSON SEARCHED. THERE IS NO F INDING EITHER IN THE ORDER OF THE ASSESSING OFFICER OR IN THE ORDER OF THE CIT (A) WITH REGARD TO ANY SUCH SATISFACTION HAVING BEEN RECORDED BY THE ASSES SING OFFICER OF PERSON SEARCHED. THE RELEVANT FINDING OF THE ASSESSING OFF ICER IN PARAGRAPH 1 OF THE ASSESSMENT ORDER READS AS UNDER:- A SEARCH ACTION WAS CARRIED OUT AT THE RESIDENTIAL PREMISES OF THE ASSESSEE IN CONNECTION WITH JARI & TEXTILE GROUP (SUB-GROUP-LAX MIPATI GROUP) ON 20.01.2009. THEREAFTER, THE CASE WAS CENTRALIZED VI DE ORDER U/S 127(2) OF THE I.T. ACT AND CONSEQUENTLY, NOTICE U/S 153C OF THE I NCOME TAX ACT, WAS ISSUED ON 25.08.2009, WHICH WAS DULY SERVED UPON TH E ASSESSEE. AS PER THE PROVISION OF SECTION 153C, THE ASSESSEE WAS REQUEST ED TO FILE THE RETURN OF INCOME FOR THE INSTANT A.Y., BEING ONE OUT OF THE S IX ASSESSMENT YEARS (I.E. A.Y. 2003-04 TO 2008-09) WITHIN FIFTEEN DAYS FROM T HE SERVICE OF REFERRED NOTICE. 7. FROM THE ABOVE OBSERVATION OF THE ASSESSING OFFI CER, IT IS EVIDENT THAT HE ISSUED NOTICE U/S 153C OF THE INCOME-TAX ACT, BE CAUSE THE GROUP CASES OF IT(SS)A NO. 209/AHD/2012 SMT SARLADEVI SARAWAGI VS. ACIT FOR AY 2008-09 4 THE PERSON SEARCHED WERE CENTRALIZED WITH HIM. IN OUR OPINION, MERELY BECAUSE OF THE GROUP CASES OF THE PERSONS SEARCHED AND THEIR RELATIVES ARE CENTRALIZED WITH ONE ASSESSING OFFICER DOES NOT GIV E THE POWER TO THE ASSESSING OFFICER TO ISSUE NOTICE U/S 153C IN THE C ASE OF PERSON OTHER THAN THE PERSON SEARCHED. THE CIT(A) UPHELD THE VALIDIT Y OF THE NOTICE U/S 153C WITH THE FOLLOWING FINDINGS:- 2.1 I HAVE CAREFULLY CONSIDERED THE ASSESSING ORD ER AND THE SUBMISSION FILED BY THE APPELLANT. THE COPY OF PANCHNAMA IN TH E CASE OF GOVIND PRASAD SARAWAGI AND OTHERS ALONGWITH ANNEXURE WERE PRODUCE D BY THE APPELLANT AND IT WAS FOUND THAT AS PER INVENTORY OF JEWELLERY FOUND AND SEIZED AS ANNEXURE JS PAGE 2 DATED 20.01.2009, GOLD ORNAMENTS AND JEWELLERY OF RS.5,25,975/- WERE SEIZED FROM THE RESIDENTIAL PREM ISES OF GOVIND PRASAD G. SARAWAGI AND OTHERS WHICH WERE CLAIMED TO BE BELONG ING TO SMT. SARALA DEVI SARAWAGI. THE GOLD ORNAMENTS AND JEWELLERY WERE SEI ZED FROM THE TOTAL INVENTORY PREPARED IN ANNEXURE JF 1, WHEREIN TOTAL JEWELLERY WORTH RS.93,57,452/- WAS INVENTORISED. THE APPELLANT HAS WRONGLY CLAIMED THAT NO MONEY BULLION JEWELLERY OR VALUABLE ARTICLES WERE S EIZED FROM THE POSSESSION OF OTHER PERSONS REFERRED TO IN SECTION 153A OF THE ACT. THE ASSESSING OFFICER OF SHRI GOVIND PRASAD SARAWAGI AND OTHERS AND THE A PPELLANT IS SAME TO WHOM ALL CASES WERE ASSIGNED AS PER ORDER UNDER SEC TION 127(2) OF THE I.T. ACT, AND THEREFORE, THE ASSESSING OFFICER, AFTER TH E SATISFACTION ISSUED NOTICE UNDER SECTION 153C TO THE APPELLANT. 8. FROM THE ABOVE, IT IS EVIDENT THAT THE CIT(A) WA S OF THE OPINION THAT THE GOLD JEWELLERY I.E. VALUABLES BELONGING TO THE ASSESSEE WAS FOUND AND SEIZED FROM THE RESIDENTIAL PREMISES OF THE PERSONS SEARCHED. THOUGH THE ASSESSEE HAS DENIED THE SAME, BUT WITHOUT GOING INT O THE CONTROVERSY WHETHER THE JEWELLERY SEIZED FROM THE PERSON SEARCH ED BELONGED TO THE ASSESSEE OR NOT, ADMITTEDLY THE SEARCH TOOK PLACE O N 20.01.2009. THEREFORE, ANY JEWELLERY FOUND AND SEIZED AT THE TIME OF SEARC H IS TO BE CONSIDERED IN ASSESSMENT YEAR 2009-10 AND NOT IN ASSESSMENT YEAR 2008-09. THERE IS NO CLAIM BY THE REVENUE THAT THESE JEWELLERIES WERE AC QUIRED IN ASSESSMENT YEAR 2008-09 BY THE ASSESSEE. IN FACT, IN THE WHOLE ASSESSMENT ORDER THERE IS NO DISCUSSION ABOUT THE JEWELLERY. IN VIEW OF THE TOTALITY OF THE ABOVE FACTS, IT(SS)A NO. 209/AHD/2012 SMT SARLADEVI SARAWAGI VS. ACIT FOR AY 2008-09 5 WE ARE CLEARLY OF THE OPINION THAT THE CONDITION LA ID DOWN FOR INITIATION OF THE PROCEEDINGS U/S 153C IN THE CASE OF PERSON OTHE R THAN THE PERSONS SEARCHED HAS NOT BEEN SATISFIED IN THE CASE OF THE ASSESSEE FOR ASSESSMENT YEAR 2008-09. WE, THEREFORE, QUASH THE NOTICE ISSU ED U/S 153C AND CONSEQUENTLY, THE ASSESSMENT ORDER COMPLETED IN PUR SUANCE TO SUCH NOTICE IS ALSO QUASHED. 9. SINCE WE HAVE ALREADY QUASHED THE ASSESSMENT ORD ER WHILE ADJUDICATING GROUND NO.1 OF THE ASSESSEES APPEAL, THE OTHER GROUNDS WHEREIN THE ASSESSEE HAS CHALLENGED THE VARIOUS ADD ITIONS SUSTAINED BY THE CIT(A) DO NOT SURVIVE FOR ADJUDICATION. 10. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED . ORDER PRONOUNCED IN THE COURT ON 5 TH JUNE, 2015 AT AHMEDABAD. SD/- SD/- (KUL BHARAT) JUDICIAL MEMBER (G.D. AGRAWAL) VICE-PRESIDENT AHMEDABAD; DATED 05/06/2015 BIJU T., PS '( ! ') *')' '( ! ') *')' '( ! ') *')' '( ! ') *')'/ COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ++ ' , / CONCERNED CIT 4. , ( ) / THE CIT(A) 5. )/0 ' , , / DR, ITAT, AHMEDABAD 6. 02 3 / GUARD FILE . '( '( '( '( / BY ORDER, TRUE COPY 4 44 4/ // / +5 +5 +5 +5 ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD