DCIT, New Delhi V. Sh. Anupam Naglia, Gurgaon

ITSSA 36/DEL/2010

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 3803 (ITAT-DELHI)
• Duration Of Justice: 7 year(s) 9 month(s) 15 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 19-06-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 24-07-2017
• Assessment Year: misc
• Appeal Filed On: 03-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: APARNA KARAN CITD R SHR
• Keywords: Unexplained investment; Income from undisclosed sources; Search and seizure; Document seized; Assessment record; Block assessment; Documents seized
• Section: 142(1); 147; 27; 148; 132; 15

Judgement Text

//FIT FOR PUBLICATION// SD/- SD/- A.M. J.M. IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES A : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER I.T(S.S)A.NO.36/DEL./2010 BLOCK PERIOD 01.04.1997 TO 08.05.2003 THE DCIT, CIRCLE-20, ROOM NO.333, E-2, ARA CENTRE, JHANDEWALAN EXTN., NEW DELHI. VS SHRI ANUPAM NAGALIA, EG-3/18, GARDEN ESTATE, GURGAON. PAN AAFPN8953Q (APPELLANT) (RESPONDENT) FOR REVENUE : SMT. APARNA KARAN, CIT-D.R. FOR ASSESSEE : SHRI C.S. AGGARWAL, SR. ADVOCATE AND SHRI D.B. JAIN, C.A. DATE OF HEARING : 21.05.2018 DATE OF PRONOUNCEMENT : 19.06.2018 ORDER PER BHAVNESH SAINI, J.M. THIS APPEAL BY REVENUE HAS BEEN DIRECTED AGAINST TH E ORDER OF THE LD. CIT(A)-1, NEW DELHI, DATED 14.06.2 010 FOR THE ABOVE BLOCK PERIOD ON THE FOLLOWING GROUNDS : 2 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. 1. THE ORDER OF THE LD. CIT(APPEALS) IS NOT CORRECT I N LAW AND FACTS. 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN QUASHING THE BLOCK ASSESSMENT COMPLETED UNDER SECTION 158BC READ WITH SECTION 158BD OF INCOME TAX ACT, 1961 WHEREAS NEITH ER OBJECTION WAS RAISED AGAINST LEGAL VALIDITY OF PROC EEDINGS BEFORE THE A.O. NOR ANY REMEDY WAS SOUGHT AT ANY OT HER LEVEL. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT SEARCH AND SEIZURE OPERATIONS WERE CONDUCTED AT THE RESIDENCE OF THE ASSESSEE ON 08.05.2003 IN CONNECTION WITH THE SEARC H IN VATIKA GROUP OF COMPANIES. A SATISFACTION NOTE WAS RECORDE D BY THE ASSESSING OFFICER HAVING JURISDICTION OVER THE VATI KA GROUP OF CASES. ACCORDINGLY A NOTICE UNDER SECTION 158BD WAS ISSUED ON 31.05.2005 AND THE ASSESSEE FILED ITS RETURN OF INC OME DECLARING NIL UNDISCLOSED INCOME. THE A.O, HOWEVER, COMPUTED THE 3 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. UNDISCLOSED INCOME OF THE ASSESSEE AT RS.1,89,53,90 0/- IN THE ORDER PASSED UNDER SECTION 158BD DATED 21.05.2007. 2.1. THE ASSESSEE CHALLENGED THE ORDER OF THE A.O. BEFORE LD. CIT(A) ON SEVERAL GROUNDS IN WHICH THE ASSESSEE , INTER ALIA, CHALLENGED THE VALIDITY OF THE PROCEEDINGS INITIATE D UNDER SECTION 158BD OF THE I.T. ACT AS WELL AS ADDITIONS ON MERIT. THE ASSESSEE IN THE WRITTEN SUBMISSIONS CONTENDED THAT, SATISFACTION NOTE WAS RECORDED IN THE CASE OF ASSES SEE AND, NO SATISFACTION NOTE WAS RECORDED BY THE ASSESSING OFF ICER IN THE CASE OF VATIKA GROUP OF COMPANIES. THEREFORE, ACCOR DING TO THE ASSESSEE, NO NOTE OF SATISFACTION WAS RECORDED BY T HE ASSESSING OFFICER HAVING JURISDICTION OVER THE ASSESSEE WHO H AS BEEN SEARCHED ALTHOUGH IN THE ASSESSMENT ORDER IT IS STA TED THAT, A SATISFACTION NOTE WAS RECORDED BY THE ASSESSING OFF ICER HAVING JURISDICTION OVER THE VATIKA GROUP OF COMPANIES. TH E ASSESSEE STATED THAT, THE ASSESSING OFFICER IN THE FIRST PAR A OF THE ASSESSMENT ORDER NOTED THAT, A SATISFACTION NOTE WAS RECORDED BY THE ASSESSING OFFICER HAVING JURISDICTION OVER T HE VATIKA GROUP 4 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. OF CASES . HOWEVER, IN SECOND PARA OF THE ORDER, IT IS STATE D THAT A COPY OF SATISFACTION NOTE WAS DULY PROVIDED TO TH E ASSESSEE AND THE ASSESSEE FILED ITS LETTER DATED 10.05.2006. THE ASSESSEE DISPUTED THE OBSERVATION OF THE A.O. THAT THE SATIS FACTION NOTE WAS RECORDED IN THE CASE OF VATIKA GROUP OF CASES. THE A.O. DID NOT DEAL THE AFORESAID OBJECTIONS OF THE ASSESSEE S O RAISED BEFORE COMPLETION OF THE ASSESSMENT PROCEEDINGS. IT WAS SU BMITTED THAT COPY OF THE SAID SATISFACTION NOTE HAD BEEN SE RVED UPON THE ASSESSEE ON 27.01.2006 WHEREAS THE SATISFACTION NOT E WAS RECORDED ON 31.05.2005 AND NO REASON HAVE BEEN EXPL AINED FOR THE DELAY OF OVER 7 MONTHS FOR PROVIDING SUCH SATIS FACTION NOTE TO THE ASSESSEE. THE SATISFACTION NOTE SERVED UPON THE ASSESSEE CLEARLY SHOWS THAT IT WAS RECORDED IN THE CASE OF S HRI. ANUPAM NAGALIA (ASSESSEE). IT WAS, THEREFORE, SUBMITTED TH AT NO SATISFACTION NOTE WAS RECORDED IN THE CASE OF THE P ERSON SEARCHED I.E., M/S. VATIKA GROUP OF COMPANIES. THE ASSESSEE RELIED UPON THE DECISIONS OF HONBLE SUPREME COURT IN THE CASE OF MANISH MAHESHWARI VS. ACIT 289 ITR 341 AND OTHER S. ON THE BASIS OF THESE DECISIONS, THE ASSESSEE HAS OBJECTED TO THE 5 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. INITIATION OF THE PROCEEDINGS UNDER SECTION 158BD, SINCE NO SATISFACTION NOTE WHATSOEVER WAS RECORDED BY THE A. O. HAVING JURISDICTION OVER THE PERSON SEARCHED. 2.2. IT WAS FURTHER CONTENDED THAT, THE ADDITIONS HAVE BEEN MADE IN THE HANDS OF THE ASSESSEE ON THE BASIS OF THE DOCUMENTS SEIZED FROM ASSESSEES PREMISES ALLEGEDLY PERTAINING TO THE ASSESSEE AND NOT ON THE BASIS OF EVEN A SING LE PAPER SEIZED FROM THE PREMISES OF VATIKA GROUP OF COMPANI ES. EVEN IN THE NOTE OF SATISFACTION THERE IS NO MENTION OF ANY INCRIMINATING DOCUMENT SEIZED FROM THE RESIDENTIAL PREMISES OF TH E ASSESSEE. THE ASSESSEE, THEREFORE, OBJECTED TO THE OBSERVATIO NS OF THE ASSESSING OFFICER THAT A NOTE OF SATISFACTION WAS R ECORDED IN THE CASE OF VATIKA GROUP OF COMPANIES. IN FACT, THERE C ANNOT BE ANY OCCASION TO RECORD ANY NOTE OF SATISFACTION FOR THE PAPERS SEIZED DURING SEARCH ON THE ASSESSEE NOT PERTAINING TO VAT IKA GROUP OF COMPANIES. A.O. HAS WRONGLY ASSUMED JURISDICTION UN DER SECTION 158BD OF THE I.T. ACT. IT WAS SUBMITTED THA T SINCE ASSESSEE WAS SUBJECTED TO SEARCH, THEREFORE, ASSESS MENT SHOULD 6 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. HAVE BEEN FRAMED IN THE CASE OF ASSESSEE UNDER SECT ION 158BC OF THE I.T. ACT. THEREFORE, ASSESSMENT SO FRAMED IS TIME BARRED. THE ASSUMPTION OF JURISDICTION BY INVOKING THE PROV ISIONS OF SECTION 158 BD OF THE ACT, IS WITHOUT JURISDICTION, AS NO VALID NOTICE COULD HAVE BEEN ISSUED BEYOND A PERIOD OF TW O YEARS FROM THE END OF THE MONTH IN WHICH SEARCH TOOK PLACE AT ASSESSEES PREMISES. 2.3. THE LD. CIT(A) CALLED FOR THE REMAND REPORT F ROM THE A.O. IN WHICH THE A.O. REPORTED THAT IT IS AN UNDIS PUTED FACT THAT SEARCH WAS CONDUCTED UNDER SECTION 132 OF THE I.T. ACT IN THE CASE OF ASSESSEE AND ON THE COMPANY M/S. VATIKA LANDBASE PRIVATE LIMITED IN WHICH HE WAS DIRECTOR ON 08.05.2 003. NOTICE UNDER SECTION 158BD OF INCOME TAX ACT, 1961 WAS ISS UED ON 31.05.2005 AFTER RECORDING SATISFACTION NOTE WHICH IS WITHIN TIME. THE A.O. THEREAFTER, FRAMED THE BLOCK ASSESSM ENT UNDER SECTION 158BD ON 21.05.2001. DURING THE COURSE OF B LOCK ASSESSMENT PROCEEDINGS, THE ASSESSEE DID NOT RAISE THE ISSUE OF BLOCK ASSESSMENT UNDER SECTION I58BC BUT OBJECTED T O THE 7 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. INITIATION OF PROCEEDINGS UNDER SECTION 158BD ON ME RITS OF SATISFACTION NOTE. THE COMMENTS OF THE ASSESSEE ON REMAND REPORT WERE ALSO CALLED FOR AND COMMENTS OF THE ASS ESSEE ARE REPRODUCED IN THE APPELLATE ORDER. 2.4. THE LD. CIT(A) CONSIDERING THE SUBMISSIONS OF BOTH THE PARTIES AND MATERIAL ON RECORD HELD THAT PROCEE DINGS INITIATED UNDER SECTION 158BD OF THE ACT ARE NOT LE GAL, VALID AND ACCORDINGLY, QUASHED. THE FINDINGS OF THE LD. CIT(A ) IN PARAS 4 TO 4.9 OF THE ORDER ARE REPRODUCED AS UNDER : 4. I HAVE GONE THROUGH THE FACTS OF THE CIRCUMSTAN CES OF THE ISSUE AS WELL AS JUDICIAL PRONOUNCEMENTS RELIED UPON BY THE APPELLANT. SECTION 158BD OF THE ACT PROVIDES AS UNDER: 'WHERE THE ASSESSING OFFICER IS SATISFIED THAT ANY UNDISCLOSED INCOME BELONGS TO ANY PERSON, OTHER THAN THE PERSON WITH R ESPECT TO WHOM SEARCH WAS MADE UNDER SECTION 132 OR WHOSE BOOKS OF ACCOUN T OR OTHER DOCUMENTS OR ANY ASSETS WERE REQUISITIONED UNDER SE CTION 132 A. THEN, THE BOOKS OF ACCOUNT, OTHER DOCUMENTS OR ASSETS SEI ZED OR REQUISITIONED SHALL BE HANDED OVER TO THE ASSESSING OFFICER HAVIN G JURISDICTION OVER SUCH OTHER PERSON AND THAT ASSESSING OFFICER SHALL PROCEED AGAINST SUCH OTHER PERSON AND THE PROVISIONS OF THIS CHAPTER SHA LL APPLY ACCORDINGLY.' 4.1. ON PLAIN READING OF THE AFORESAID STATUTORY PR OVISIONS CONTAINED IN SECTION 158BD OF THE ACT, IT WILL BE SEEN THAT, IT HAS BEEN PROVIDED 8 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. THAT, WHERE THE ASSESSING OFFICER OF THE SEARCHED P ERSON IS SATISFIED THAT, ANY UNDISCLOSED INCOME BELONGS TO ANY PERSON, OTHER THAN THE PERSON WITH RESPECT TO WHOM SEARCH WAS MADE UNDER SECTION 132 OF THE ACT, THEN, THE BOOKS OF ACCOUNT, OTHER DOCUMENTS OR ASSE TS SEIZED OR REQUISITIONED SHALL BE HANDED OVER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON AND, THEREAFTER THE ASSESSING OFFICER OF SUCH OTHER PERSON SHALL PROCEED AGAINST SUCH OTH ER PERSON. THE, APEX COURT IN THE CASE OF MANISH MAHESHWARI 289 ITR 341 HAS HELD THAT, UNLESS THERE IS A VALID SATISFACTION NOTE RECORDED BY THE ASSESSING OFFICER OF THE SEARCHED PERSON, AFTER GOING THROUGH THE SEI ZED DOCUMENTS TO THE EFFECT THAT INITIATION OF PROCEEDINGS U/S 158BD IS CALLED FOR, THERE IS NO JUSTIFICATION, TO INITIATE PROCEEDINGS U/S 158BD OF THE I.T. ACT. IT CONCLUDED THEREIN AS UNDER: THE CONDITION PRECEDENT FOR INVOKING A BLOCK ASSES SMENT IS THAT A SEARCH HAS BEEN CONDUCTED UNDER SECTION 132, OR DOCUMENTS OR ASSETS HAVE BEEN REQUISITIONED UNDER SECTION 132A. THE SAID PROVISIO N WOULD APPLY IN THE CASE OF ANY PERSON IN RESPECT OF WHOM SEARCH HAS BE EN CARRIED OUT UNDER SECTION 132A OR DOCUMENTS OR ASSETS HAVE BEEN REQUI SITIONED UNDER SECTION 132A. SECTION 158BD, HOWEVER, PROVIDES FOR TAKING RECOURSE TO A BLOCK ASSESSMENT IN TERMS OF SECTION 158BC IN RES PECT OF ANY OTHER PERSON, THE CONDITIONS PRECEDENT WHEREOF ARE: (I) S ATISFACTION MUST BE RECORDED BY THE ASSESSING OFFICER THAT ANY UNDISCLO SED INCOME BELONGS TO ANY PERSON, OTHER THAN THE PERSON WITH RESPECT O F WHOM SEARCH WAS MADE UNDER SECTION 132 OF THE ACT; (II) THE BOOKS O F ACCOUNT OR OTHER DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED HAD BEE N HANDED OVER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTH ER PERSON; AND (III) THE ASSESSING OFFICER HAS PROCEEDED UNDER SECTION 1 58BC AGAINST SUCH OTHER PERSON. 9 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. THE CONDITIONS PRECEDENT FOR INVOKING THE PROVISION S OF SECTION 158BD, THUS, ARE REQUIRED TO BE SATISFIED BEFORE THE PROVI SIONS OF THE SAID CHAPTER ARE APPLIED IN RELATION TO ANY PERSON OTHER THAN TH E PERSON WHOSE PREMISES HAD BEEN SEARCHED OR WHOSE DOCUMENTS AND O THER ASSETS HAD BEEN REQUISITIONED UNDER SECTION 132A OF THE ACT. THE ONLY QUESTION WHICH ARISES FOR OUR CONSIDERATIO N IS AS TO WHETHER THE NOTICE DATED FEBRUARY 6, 1996, SATISFIES THE REQUIR EMENTS OF SECTION 158BD OF THE ACT. THE SAID NOTICE DOES NOT RECORD A NY SATISFACTION ON THE PART OF THE ASSESSING OFFICE, DOCUMENTS AND OTH ER ASSETS RECOVERED DURING SEARCH HAD NOT BEEN HANDED OVER TO THE ASSES SING OFFICER HAVING JURISDICTION IN THE MATTER. A LARGE NUMBER OF DECISIONS OF VARIOUS HIGH COURTS HAVE BEEN CITED AT THE BAR. WE WOULD, AT THE OUTSET, REFER TO A DECISI ON OF THE GUJARAT HIGH COURT IN KHANDUBHAI VASANTJI DESAI V. DEPUTY CIT [1 999] 236 ITR 73. THEREIN, IT WAS CLEARLY HELD (PAGE 85) THIS PROVISION INDICATES THAT WHERE THE ASSESSING OFFICER WHO IS SEIZED OF THE MATTER AND HAS JURISDICTION OVER THE PERSON OTHER THAN THE PERSON WITH RESPECT TO WHOM SEARCH WAS MADE UNDER SECTION 132 OR WHOSE BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR ANY ASSETS WERE RE QUISITIONED UNDER SECTION 132A, HE SHALL PROCEED AGAINST SUCH OTHER P ERSON AS PER THE PROVISIONS OF CHAPTER XIV-B WHICH WOULD MEAN THAT O N SUCH SATISFACTION BEING REACHED THAT ANY UNDISCLOSED INCOME BELONGS T O SUCH OTHER PERSON, HE MUST PROCEED TO SERVE A NOTICE TO SUCH OTHER PER SON AS PER THE PROVISIONS OF SECTION 158BC OF THE ACT. IF THE ASSE SSING OFFICER WHO IS SEIZED OF THE MATTER AGAINST THE RAIDED PERSON REAC HES SUCH SATISFACTION THAT ANY UNDISCLOSED INCOME BELONGS TO SUCH OTHER P ERSON OVER WHOM HE 10 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. HAS NOT JURISDICTION, THEN, IN THAT EVENT, HE HAS T O TRANSMIT THE MATERIAL TO THE ASSESSING OFFICER HAVING JURISDICTION OVER S UCH OTHER PERSON AND IN SUCH CASES THE ASSESSING OFFICER WHO HAS JURISDI CTION WILL PROCEED AGAINST SUCH OTHER PERSON BY ISSUING THE REQUISITE NOTICE CONTEMPLATED BY SECTION 158BC OF THE ACT. 4.2. ALSO, HON'BLE DELHI HIGH COURT IN THE CASE OF JANKI EXPORTS INTERNATIONAL V UOI REPORTED IN 278 ITR 296 HAS FUR THER HELD AS UNDER : 'WE FIND THAT SECTION 158BD IS SOMEWHAT ANALOGOUS T O SECTION 147 IN SO FAR AS THE PROCEDURE THAT IS REQUIRED TO BE FOLLOWE D. SECTION 147 CONTEMPLATES THAT IF THE ASSESSING OFFICER HAS REAS ONS TO BELIEVE THAT THERE IS ESCAPEMENT OF INCOME, THEN NOTICE CAN BE I SSUED UNDER SECTION 148 OF THE ACT. SO FAR AS SECTION 158BD OF THE ACT IS CONCERNED, THE ASSESSING OFFICER HAS TO BE SATISFIED THAT THERE IS UNDISCLOSED INCOME. UPON SUCH SATISFACTION, THE ASSESSING OFFICER IS RE QUIRED TO FORWARD THE RELEVANT DOCUMENTS, PAPERS, ETC.. TO THE ASSESSING OFFICER WHO IS REQUIRED TO ASSESS THE PERSON IN RESPECT OF WHOM TH E UNDISCLOSED INCOME HAS BEEN DISCOVERED. ONCE THIS IS DONE, WE FEEL THA T THE PERSON WHO IS TO BE PROCEEDED AGAINST UNDER SECTION 158BD AND THEN S ECTION 158BC, MUST BE INFORMED ABOUT THE SATISFACTION OF THE ASSESSING OFFICER WHICH HAS BEEN RECORDED AND HE MUST BE GIVEN A REASONABLE OPP ORTUNITY TO OBJECT TO THE SAME. SATISFACTION CAN BE ARRIVED ON SOME MATERIAL. THAT MATERIAL WOULD PROVIDE THE REASONABLE SATISFACTION. 4.3. THE HON'BLE TRIBUNAL IN THE EASE OF MANOJ AGGA RWAL VS. DCIT REPORTED IN 113 ITD DCIT (SB) DEL.) IN PARA 123 TO 124 HAS HELD AS UNDER : 11 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. '123. HARING HELD THAT RECORDING OF SATISFACTION IS IMPERATIVE BEFORE ASSUMPTION OF JURISDICTION U/S 158BD. WE MAY NOW TU RN TO EXAMINE THE MEANING OF THE EXPRESSION ''WHERE THE ASSESSING OFFICER IS SATISFIED' APPEARING AT THE BEGINNING OF SECTION 15 8BD FOR THE MEANING SO ASCERTAINED GIVES US A CLUE AS TO THE NA TURE OF THE NOTE OF SATISFACTION THAT IS ENVISAGED IN THE SAID, SECTION 1 24 ............ ONTHE OTHER HAND, THE TERM 'SATISFA CTION' IN SECTION 158BD CONNOTES THAT THERE EXISTS UNDISCLOSED INCOME AND THAT SUCH UNDISCLOSED INCOME IS THAT OF THE PERSON NOT SEARCH ED. THE USE OF THE EXPRESSION 'SATISFIED' IN SECTION 158BD CANNOT BE R EAD IN ISOLATION AND IT HAS TO BE UNDERSTOOD IN THE CONTEXT IN WHICH THE SAID TERM APPEARS IN THE SAID SECTION. IT WILL BE SEEN THAT SECTION 158B D STARTS WITH THE EXPRESSION 'WHERE THE ASSESSING OFFICER IS SATISFIED THAT ANY UNDISCLOSED INCOME BELONGS TO ANY PERSON OTHER THAN THE PERSON WITH RE SPECT TO WHOM SEARCH WAS MADE. IT IS SIGNIFICANT THAT THE TERM 'SATIS FIED* IS NOT USED IN A VACUUM BUT ALONG WITH THE WORDS 'THAT ANY UNDISCLOS ED INCOME BELONGS TO OTHER THAN THE PERSON WITH RESPECT TO WHOM SEARC H WAS MADE....', AND THE WORDS IN THE CONTEXT ARE UNDISCLOSED INCOM E' AND 'BELONGS TO' WHICH CLEARLY INDICATE THAT AT THAT POINT OF TIME W HEN SATISFACTION IS RECORDED BY THE ASSESSING OFFICER THE UNDISCLOSED I NCOME IS TO BE IDENTIFIED. FURTHER, THE SAID EXPRESSION DOES NOT S TOP THERE. IT FURTHER 12 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. USES THE EXPRESSION 'BELONGS TO ANY PERSON, OTHER THAN THE PERSON WITH RESPECT TO WHOM SEARCH WAS MADE' WHICH INDICAT ES THAT THE UNDISCLOSED INCOME IDENTIFIED BY THE ASSESSING OFFI CER IS FOUND TO BE BELONGING TO THE OTHER PERSON. IT WOULD THUS MEAN T HAT AT THE STAGE OF RECORDING, THE ASSESSING OFFICER HAS REACHED A FIND ING THAT UNDISCLOSED INCOME HAS BEEN DETECTED AS A RESULT OF SEARCH AND ALSO FURTHER THAT SUCH INCOME BELONGS TO THE PERSON NOT SEARCHED. ALL THESE CONST ITUTE FINDINGS AND NOT A MORE BELIEF HELD BY THE ASSESSING OFFICER ON THE EXAMINA TION OF THE SEIZED MATERIAL AND HENCE THE SATISFACTION CONTEMPLATED IN SECTION 158BD IS TOTALLY DIFFERENT THAN CONTEMPLATED IN SECTION 147. IT IS FUNDAMENTAL THAT THE ASSESSING OFFICER FINDS OUT WHETHER THERE IS UNDISCLOSED INCOME. IF H E FINDS THAT THERE EXISTS UNDISCLOSED INCOME, THEN HE HAS TO GIVE A FINDING A S TO WHOM THE SAID INCOME BELONGS. IN THE ABSENCE OF SUCH A FINDING, IT IS NO T POSSIBLE TO CONCLUDE A BLOCK ASSESSMENT UNDER SECTION 158BC. ONLY THEREUPON, THE SECTION 158BD PROCEEDINGS IN RESPECT OF THE OTHER PERSON FOR MAKI NG A SIMILAR BLOCK ASSESSMENT OF SUCH UNDISCLOSED INCOME WOULD COMMENCE. HENCE, I N OUR CONSIDERED VIEW 7 , THE NOTE OF SATISFACTION MUST CONTAIN A POSITIVE FI NDING BY THE ASSESSING OFFICER MAKING THE ASSESSMENT UNDER SECTION 158BD INDICATIN G THEREIN THE UNDISCLOSED INCOME FOUND AS A RESULT OF HIS EXAMINATION OF THE SEIZED MATERIAL, THE PERSON TO WHOM SUCH INCOME BELONGS AND PROCEED ACCORDINGLY AS PROVIDED FOR IN THE SAID SECTION. THE CIRCUMSTANCES ENVISAGED AND THE CONTEX T IN SECTIONS 147 AND 13 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. 15SBD ARC ENTIRELY DIFFERENT DECISION IN THE CASE C ITED (SUPRA) INTO THE SECTION 158BD PROCEEDING FOR THE REASONS DETAILED HEREIN.' 4.4. IN OTHER WORDS, THE BASIC STATUT ORY PRE-CONDITION FOR INVOKING SECTION 158BD OF THE ACT IS THE SATISFACTI ON OF THE AO OF THE SEARCHED PERSON AND, SUCH SATISFACTION IS TO BE RECORDED IN WRITING ON THE BASIS OF MATERIAL FOUND AS A RESULT OF SEARCH ON THE SEARCHE D PERSON. 4.5. APPLYING THE FOREGOING PRINCIPLE S TO THE FACTS OF THE INSTANT CASE, IT WILL BE SEEN THAT IN THE INSTANT CASE, THE BASIS ADOPTED FOR INITIATION OF PROCEEDINGS UNDER SECTION 158BD OF THE ACT IN THE C ASE OF THE APPELLANT IS THAT, THERE HAS BEEN A SEARCH CONDUCTED AT THE PREMISES O F VATIKA GROUP OF COMPANIES (HEREIN AFTER ALTERNATIVELY REFERRED TO AS 'SEARCHE D PERSON) AND AS A RESULT OF SEARCH, SATISFACTION NOTE WAS RECORDED BY THE LEARN ED OFFICER HAVING JURISDICTION OVER VATIKA GROUP OF CASES. THE SATISFACTION NOTE, AS RECORDED BY THE ASSESSING OFFICER HAVING JURISDICTION OVER VATIKA GROUP OF CA SES READS AS UNDER : 'REASONS U/S 158BC READ WITH 158BD IN THE CASE OF S HRI ANUPAM NAGALIA WARRANT WAS ISSUED IN THE NAME OF VATIKA GROUP OF C OMPANIES TO SEARCH RESIDENCE OF SH. ANUPAM NAGALIA ON 8.5.2003, WHO WAS DIRECTOR OF SOME OF THE COMPANIES OF VATIKA GROUP A ND ALSO A CHARTERED ACCOUNTANT. SCRUTINY OF SEIZED DOCUMENTS REVEALS THAT ASSESSEE HAD UNACCOUNTED INCOME UNDER THE FOLLOWING HEADS :- 14 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. I REMUNERATION- ANNEXURE A-11. PAGES 33, 34, 37 AND 3 8 REVEALS RECEIPT OF UNACCOUNTED REMUNERATION BY SH. ANUPAM N AGALIA. II PROFIT IN DANISCO DEAL - ANNEXURE A-L REVEALS RECEI PT OF UNACCOUNTED PROFIT FROM BUSINESS DEAL WITH M/S DANI SCO INGREDIENTS (INDIA) PVT. LTD. III INVESTMENT IN ASSETS- ANNEXURE A-L. PAGE 65 REVEALS UNACCOUNTED INVESTMENT IN LAND AT RAJPUR ROAD. DEHRADUN AMOUNTING TO RS. 55 LACS, AT VILLAGE BHONDSI (MANANA) AMOUNTING TO RS.18 LACS AND IMMOVABLE PROPERTIES COMPRISING LOANS AND ADVANCES, INVESTMENT IN SHARES AND DEPOSITS, JEWELLERY ETC. AMOUNTING TO RS. 48 LACS. IV UNACCOUNTED LOAN ANNEXURE A-2, PAGE 1,2,3,5,6,8,1 0,13,15 AND 21 REVEALS TRANSACTIONS ON ACCOUNT OF LOANS NOT DISCLOSED FOR THE PURPOSE OF INCOME TAX. IN VIEW OF THE FACTS STATED ABOVE AND MATERIAL AVAILABLE IN THE FORM OF SEIZED DOCUMENTS, I AM SATISFIED THAT SH. ANUPAM NAGALIA HAD UNDISCLOSED INCOME FOR THE BLOCK PERIOD 01.04.1997 TO 08.05.2003 WHICH WAS NOT DISCLOSED IN THE REGULAR RETURN OF IN COME. THEREFORE, NOTICE U/S 158BC READ WITH SECTION 158BD IS ISSUED. SD/- (P.K.SINGH) ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-20, NEW DELHI. 15 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. 4.6. THE AFORESAID SATISFACTION NOTE WOULD SHOW THAT TH E LEARNED ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCL E 20, NEW DELHI HAS REFERRED TO THE FOLLOWING MATERIAL FOR CONCLUDI NG THAT THERE IS UNDISCLOSED INCOME OF THE APPELLANT: (A) PAGES 33. 34. 37 AND38 OF ANNEXURE A-11 (B) ANNEXURE A-11 (C) PAGE 65 OF ANNEXURE A-L (D) PAGES 1, 2, 3, 5, 6, 8, 10, 13. 15 AND 21 OF ANNEXU RE A-2. 4.7. IT IS ADMITTED POSITION THAT, EACH OF THE AFORESAID PAPERS HAVE BEEN FOUND AS A RESULT OF SEARCH ON THE APPELLANT A ND, NOT FROM THE PREMISES OF M/S. VATIKA GROUP OF COMPANIES, I.E., S EARCHED PERSON CONSIDERED BY THE ASSESSING OFFICER FOR ASSUMING JU RISDICTION U/S 158BD OF THE ACT. THUS, SINCE SATISFACTION NOTE IS NOT BA SED ON ANY SEIZED MATERIAL FOUND FROM THE SEARCHED PERSON I.E. VATIKA GROUP OF CASES, THE BASIC STATUTORY PRECONDITION FOR INVOKING PROVISIONS CONTAINED IN S ECTION 158BD OF THE ACT IS LACKING IN THE INSTANT CASE. THE BURDEN WAS ON THE ASSESSING OFFICER TO ESTABLISH THAT, A VALID SATISFACTION NOTE HAD BEEN RECORDED O N THE BASIS OF MATERIAL FOUND AS A RESULT OF THE SEARCHED PERSONA IN THE INSTANT CASE, THE PERUSAL OF SATISFACTION NOTE WOULD CLEARLY SHOW THAT, SINCE THERE IS NO MAT ERIAL FOUND AS A RESULT OF THE SEARCH ON THE SEARCHED PERSON, NO SATISFACTION COULD HAVE BEEN RECORDED UNDER SECTION 15SBD OF TINE ACT IN THE CASE OF THE SEARCHED PERSON. ON THE CONTRARY, IT IS A CASE WHERE PROCEEDINGS HAVE BEEN INITIATED ON THE BASIS OF MATERIAL FOUND AS A RESULT OF SEARCH CONDUCTED ON T HE APPELLANT AND. NOT ON THE SEARCHED PERSON I.E. VATIKA GROUP OF CASES. IN THESE CIRCUMSTANCES, IT IS EVIDENT THAT, STATUTORY PRECONDITION FOR INVO KING PROVISIONS CONTAINED IN SECTION 158BD OF THE ACT IS NOT SATISFIED AND TH EREFORE, NOTICE UNDER SECTION 158BD OF THE ACT IS WITHOUT JURISDICTION. I AM ALSO SUPPORTED HERE BY THE 16 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. ORDER OF THE HON'BLE TRIBUNAL IN THE CASE OF ACIT V S. M/S. COZY ENTERPRISES LTD. IN IT(SS)A.NO. 249/DEL/2005 WHEREIN IT HAS BE EN HELD AS UNDER : '6.2. COMING TO THE FACTS OF THIS CASE, A DIARY WA S SEIZED FROM SHRI S.K. JAIN, WHICH CONTAINED THE TRANSACTIONS OF THE ASSES SEE. NO ASSET OR MATERIAL WAS SEIZED FROM SHRI PRAVEEN MITTAL. IN TE RMS OF THE DECISION IN THE CASE OF MANISH MAHESHWARI (SUPRA), THE A.O. OF SHRI S.K. JAIN HAD TO RECORD HIS SATISFACTION THAT UNDISCLOSED INCOME IN RESPECT OF TRANSACTIONS WITH THE ASSESSEE WAS THAT OF THE ASSE SSEE AND HANDOVER THE RELEVANT PART OF THE SEIZED MATERIAL TO THE A.O. HA VING JURISDICTION OVER THE MATTER, NAMELY, THE SECOND MENTIONED A.O. IT AP PEARS TO US THAT SUCH NOTE AND MATERIAL WERE TRANSMITTED TO THE FIRST MEN TIONED A.O. WHO ISSUED A NOTICE UNDER SECTION 158BC READ WITH 158BD TO THE ASSESSEE. HOWEVER, NOTHING WAS FOUND IN THE CASE OF SHRI PRAV EEN MITTAL WHOSE A.O. RECORDED THE SATISFACTION NOTE ON THE BASIS OF SUBMISSIONS MADE IN HIS CASE BEFORE HIM. AS NOTHING WAS SEIZED FROM HIM . NOTHING WAS TRANSMITTED BY THE A.O. OF SHRI PRAVEEN MITTAL TO T HE SECOND MENTIONED A.O., WHO HAPPENS TO BE THE SAME OFFICER. THUS, IN VIEW OF THE DECISION IN THE CASE OF MANISH MAHESHWAR (SUPRA), IT IS HELD THAT PRE-CONDITIONS REQUIRED TO BE SATISFIED BEFORE ASSUMING JURISDICTI ON UNDER SECTION 158BD IN THE CASE OF THE ASSESSEE WERE NOT SATISFIE D. LEARNED DR HAS NOT BEEN ABLE TO SHOW OR REFER TO ANY MATERIAL WHICH WA S SEIZED IN THE CASE OF SHRI PRAVEEN MITTAL SO AS TO AUTHORIZE HIS A.O. TO RECORD SATISFACTION IN THE CASE OF THE ASSESSEE. THUS, WE ARE IN THE AG REEMENT WITH THE LEARNED COUNSEL, ALBEIT FOR SOMEWHAT DIFFERENT REASONS, ON THE ISSUE THAT THE SECOND MENTIONED A.O. DID NOT HAVE THE JURISDICTION TO ISSUE NOTICE UNDER SECTION 158BC READ WITH SECTION 158 BD ON 15.07.200 2. THEREFORE, THE ORDER PASSED ON THE BASIS OF THIS NOTICE IS INVALID IN THE EYE OF LAW .' 17 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. 4.8. THE ASSESSING OFFICER IN THE REMAND REPORT, HA S CONTENDED THAT SINCE THIS OBJECTION WAS NOT RAISED IN THE COURSE OF ASSE SSMENT PROCEEDINGS, THEREFORE, THIS OBJECTION MAY NOT BE ENTERTAINED IN VIEW OF SECTION 292BB OF THE ACT. FIRSTLY, THE CONTENTION IS FACTUALLY IN CORRECT AS THE CONTENTION REGARDING VALIDITY OF PROCEEDINGS WAS RAISED BY THE APPELLANT IN THE COURSE OF ASSESSMENT PROCEEDINGS VIDE HIS REPLY DATED 14.5 .2007AND MOREOVER. SECTION 292BB OF THE ACT HAS NO APPLICATION TO THE FACTS OF THE CASE. SECTION 292BB OF THE ACT PROVIDES THAT WHERE AN ASSESSEE HA S APPEARED IN ANY PROCEEDINGS OR COOPERATED IN ANY INQUIRY RELATING T O AN ASSESSMENT OR REASSESSMENT, IT SHALL BE DEEMED THAT ANY NOTICE UN DER ANY PROVISION OF THIS ACT, WHICH IS REQUIRED TO BE SERVED UPON HIM HAS BE EN DULY SERVED UPON HIM IN TIME IN ACCORDANCE WITH THE PROVISIONS OF TH IS ACT AND SUCH ASSESSEE SHALL BE PRECLUDED FROM TAKING ANY OBJECTION IN ANY PROCEEDINGS OR INQUIRY UNDER THIS ACT THAT THE NOTICE WAS NOT SERVED UPON HIM OR NOTICE WAS NOT SERVED UPON HIM IN TIME OR SERVED UPON HIM IN AN IM PROPER MANNER. IT WILL BE SEEN THAT THE CONTENTION OF THE APPELLANT IS NEI THER THAT NOTICE WAS SERVED- OR NOTICE WAS NOT SERVED UPON HIM IN TIME OR SERVED UPON HIM IN AN IMPROPER MANNER. ON THE CONTRARY, OBJECTION OF THE APPELLANT IS THAT STATUTORY PRE-CONDITION FOR INVOKING PROVISIONS CON TAINED IN SECTION 158BD OF THE ACT HAD NOT BEEN SATISFIED IN AS MUCH AS SAT ISFACTION NOTE SO RECORDED IS NOT RECORDED ON THE BASIS OF SEIZED MATERIAL FOU ND FROM THE SEARCHED PERSON I.E., VATIKA GROUP OF CASES AND THEREFORE, T HERE COULD NOT HAVE BEEN VALID ASSUMPTION OF JURISDICTION. IN LIGHT OF THE A BOVE, IT IS HELD THAT SECTION 292BB OF THE ACT HAS NO APPLICATION TO THE FACTS. 4.9. I SEEK TO ADD HERE THAT UNDISPUTEDLY A SEARCH HAD B EEN CONDUCTED ON THE PREMISES ON 8.5.2003. HOWEVER, IT IS APPARENT T HAT NO ACTION WAS TAKEN ON THE BASIS OF THE SAID SEARCH AS NO NOTICE UNDER SECTION 158BC OF THE ACT WAS EVER ISSUED TO THE APPELLANT. IN FACT, EVEN THE INSTANT PROCEEDINGS CANNOT BE TAKEN AS PROCEEDINGS UNDER SECTION 158BC OF THE ACT SINCE FIRSTLY 18 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. INITIATION OF PROCEEDINGS WAS UNDISPUTEDLY UNDER SE CTION 158BD OF THE ACT AND MOREOVER, LIMITATION FOR FRAMING ASSESSMENT UND ER SECTION 158BC OF THE ACT EXPIRED ON 31.5 2005 WHICH IS THE DATE ON W HICH, NOTICE UNDER SECTION 158BD OF THE ACT WAS ISSUED TO THE APPELLAN T. THE ORDER OF ASSESSMENT IN DATED 21.05.2007, WHICH IS THEN CLEAR LY BARRED BY LIMITATION. IN LIGHT OF THE ABOVE. I HOLD THAT, THE PROCEEDINGS INITIATED UNDER SECTION 158BD OF THE ACT WERE NOT LEGAL, VALID AND ARE THER EFORE QUASHED. 2.5. IT MAY BE NOTED THAT THE IMPUGNED ORDER OF TH E LD. CIT(A) WAS CHALLENGED BY THE DEPARTMENT BEFORE ITAT, A-BENCH IN IT(SS)A.NO.36/DEL./2010 ALONG WITH C.O.NO.380/DEL./2010 OF THE ASSESSEE. THE TRIBUNAL VIDE ORDER DATED 11.07.2014 DISMISSED THE DEPARTMENTAL APPEAL AS WELL AS CROSS OBJECTION FILED BY THE ASSE SSEE. THE REVENUE PREFERRED APPEAL BEFORE THE HONBLE PUNJAB & HARYANA HIGH COURT AGAINST THE ORDER OF THE TRIBUNA L IN INCOME TAX APPEAL NO.55 OF 2015 WHICH IS DECIDED VI DE JUDGMENT DATED 06.01.2016 AND THE MATTER IS REMANDE D TO THE TRIBUNAL TO EXAMINE IT AFRESH AND RECORD REASON BASED FINDINGS. THE DIRECTIONS OF THE HONBLE HIGH COURT IN PARA- 8 ARE REPRODUCED AS UNDER : 19 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. 8. IN THE PRESENT CASE, THE TRIBUNAL BEING A FINAL FACT FINDING AUTHORITY HAD NOT RECORDED ANY FINDING WITH REGARD TO THE RECORDING OF SATISFACTION NOTE ON 31.5.2005. FURTHER, NOTHING WAS OBSERVED WHETHER TH E SATISFACTION NOTE DATED 31.5.2005, IF ANY, PRODUCED BY THE REVENUE WAS ANTE-DATED OR NOT. IN SUCH CIRCUMSTANCES, THE MATTER REQUIRES TO BE REMANDED T O THE TRIBUNAL TO EXAMINE IT AFRESH AND RECORD A REAS ON- BASED FINDING. IT SHALL BE OPEN TO THE PARTIES TO R AISE ALL THE POINTS BEFORE THE TRIBUNAL WHO SHALL ADJUDICATE THE MATTER EXPEDITIOUSLY. THE SUBSTANTIAL QUESTIONS OF LAW ARE ANSWERED ACCORDINGLY. THE APPEAL STANDS DISPOSE D OF. 2.6. IN PURSUANCE TO THE DIRECTIONS OF THE HONBLE PUNJAB & HARYANA HIGH COURT THE MATTER WAS AGAIN RE FIXED FOR HEARING ON MERIT. 3. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD . 20 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. 4. THE LD. D.R. REFERRED TO PB-38 WHICH IS SATISFACTION NOTE DATED 31.05.2005 RECORDED IN THE CASE OF THE ASSESSEE, COPY OF WHICH IS ALREADY REPRODUCED I N THE FINDINGS OF THE LD. CIT(A) ABOVE. THE LD. D.R. SUBM ITTED THAT SEARCH WAS CONDUCTED IN THE VATIKA GROUP OF CA SES ON 08.05.2003. THE A.O. IS SAME IN THE CASE OF VATIKA GROUP OF CASES I.E., THE PERSON SEARCHED AND THE PRESENT ASSESSEE. PB-1 IS PANCHANAMA TO SHOW THAT WARRANT OF SEARCH W AS ISSUED IN THE NAME OF M/S. VATIKA LANDBASED PRIVATE LIMITED, SHRI ANIL BHALLA, SHRI GAURAV BHALLA AND S HRI GAUTAM BHALLA. NO WARRANT OF SEARCH WAS ISSUED IN T HE NAME OF ASSESSEE. HOWEVER, THE WARRANT WAS ISSUED T O SEARCH THE RESIDENCE OF SHRI ANUPAM NAGALIA (ASSESS EE). IN THE CASE OF THE ASSESSEE, THERE HAS BEEN A SEARCH C ONDUCTED ON THE PREMISES OF VATIKA GROUP OF COMPANIES AND AS A RESULT OF MATERIAL FOUND DURING THE COURSE OF SEARC H, SATISFACTION WAS RECORDED BY THE A.O. HAVING JURISD ICTION OVER THE VATIKA GROUP OF COMPANIES. THE LD. CIT(A) QUASHED THE ORDER ON THE GROUND THAT PAPERS ON THE BASIS OF WHICH 21 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. SATISFACTION WAS RECORDED, FOUND AS A RESULT OF SEA RCH ON THE ASSESSEE AND NOT FROM VATIKA GROUP OF COMPANIES . SINCE, NO SEARCH WAS CONDUCTED ON THE ASSESSEE, SEI ZED PAPER RELIED UPON BY THE A.O. WERE FOUND FROM THE P REMISES OF VATIKA GROUP OF COMPANIES, THE A.O. WAS SATISFIE D FROM THE DOCUMENTS SEIZED FROM THE PREMISES COVERED IN S EARCH OF M/S VATIKA LANDBASED PRIVATE LIMITED BELONGS TO ASSESSEE, THEREFORE, SATISFACTION NOTE WAS RECORDED AS PER LAW. THERE IS NO MENTION IN SECTION 158BD TO RECORD SATISFACTION IN WRITING. THE A.O. CAN RECORD SATISF ACTION FOR ISSUING NOTICE UNDER SECTION 158BD IN THE CASE OF P ERSON SEARCHED EVEN AFTER COMPLETION OF BLOCK ASSESSMENT IN THE CASE OF THE SEARCHED PERSON. THE LD. D.R, THEREFORE , SUBMITTED THAT ORDER OF THE LD. CIT(A) MAY BE REVER SED. THE LD. D.R. FURTHER SUBMITTED THAT ASSESSMENT RECORD O F THE ASSESSEE AND PERSON SEARCHED CANNOT BE PRODUCED FOR INSPECTION OF THE COURT BECAUSE SAME ARE NOT AVAILA BLE. 22 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. 5. ON THE OTHER HAND, LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE LD. CIT(A). LEARNED COUNSEL FOR THE ASSESSEE REFERRED T O PB-14 WHICH IS NOTICE UNDER SECTION 158BD DATED 31.05.200 5 ISSUED BY SHRI P.K. SINGH, ACIT, CIRCLE-20, NEW DEL HI WHO IS THE SAME OFFICER RECORDED SATISFACTION ON 31.05. 2005. THE SAID NOTICE WAS ISSUED WITHOUT SATISFACTION NOT E SUPPLIED TO THE ASSESSEE. PB-15 IS LETTER OF THE AS SESSEE DATED 11.06.2005 IN WHICH THE ASSESSEE REQUESTED TH E A.O. TO FURNISH NOTE OF SATISFACTION WHICH IS REQUIRED T O BE RECORDED IN WRITING AS HAS BEEN HELD BY THE HONBLE DELHI HIGH COURT IN THE CASE OF AMITY HOTELS REPORTED IN 272 ITR 75. THE ASSESSEE APART FROM ASKING COPY OF THE SATI SFACTION NOTE ALSO REQUESTED FOR SUPPLY OF THE DOCUMENTS ON THE BASIS OF WHICH A.O. WAS SATISFIED THAT THERE WAS AN UNDISCLOSED INCOME BELONGS TO THE ASSESSEE. PB-16 I S ANOTHER LETTER OF THE ASSESSEE DATED 29.06.2005 IN WHICH THE ASSESSEE SIMILARLY ASKED FOR COPY OF THE SATISF ACTION NOTE AND THE DOCUMENTS FROM THE A.O. FOR COMPLIA NCE. 23 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. PB-31 IS NOTICE ISSUED BY A.O. UNDER SECTION 142(1) DATED 18.01.2006. PB-32 IS REPLY OF THE ASSESSEE DATED 27.01.2006 IN WHICH THE ASSESSEE AGAIN ASKED FOR CO PY OF THE SATISFACTION NOTE AND DOCUMENTS, ON WHICH, A.O. PROPOSED TO RELY UPON. IT WAS REITERATED THAT ASSES SEE HAS BEEN ASKING FOR THESE DOCUMENTS SINCE LONG. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT IN THE INST ANT CASE THE SUBMISSIONS OF THE ASSESSEE HAD BEEN THAT NO VA LID PROCEEDINGS HAD BEEN INITIATED AGAINST THE ASSESSEE BEFORE CULMINATION OF PROCEEDINGS UNDER SECTION 158BC OF T HE I.T. ACT IN THE CASE OF VATIKA LANDBASE PRIVATE LIMITED AND THAT NO SATISFACTION NOTE HAVE BEEN RECORDED BY THE A.O. IN THE CASE OF VATIKA GROUP OF COMPANIES I.E., PERSON SEAR CHED. THE SATISFACTION NOTE WAS SUPPLIED TO THE ASSESSEE ONLY ON 27.01.2006 WAS ANTI DATED. FURTHER, SUCH SATISFACTI ON NOTE WAS NOT RECORDED IN THE CASE OF PERSON SEARCHED. HE HAS RELIED UPON THE DECISION OF HONBLE MADHYA PRADESH HIGH COURT IN THE CASE OF CIT VS. TARACHAND KHUSHIRAM (2 008) 303 ITR 298 (MP) IN WHICH IT WAS HELD AS UNDER : 24 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. IN THE ABSENCE OF ANY EXPLANATION WHATSOEVER BY TH E DEPARTMENT FOR THE INORDINATE DELAY IN SERVICE OF T HE ORDER OF ASSESSMENT ON THE ASSESSEE, THE COURT MUST PRESU ME THAT THE ORDER WAS NOT MADE ON THE DATE IT PURPORTE D TO HAVE BEEN MADE AND MUST HAVE BEEN MADE AFTER THE EXPIRY OF THE PERIOD OF FOUR YEARS PRESCRIBED FOR PASSING, SU CH AN ORDER IN REVISION. 5.1. THE LEARNED COUNSEL FOR THE ASSESSEE ALSO REL IED UPON DECISION OF HONBLE DELHI HIGH COURT IN THE CA SE OF CIT VS. INTERCONTINENTAL TRADING & INVESTMENT CO. LTD., (20 13) 350 ITR 316 (DEL.) IN WHICH IT WAS HELD AS UNDER : WHERE NO SATISFACTION WAS RECORDED BY ASSESSING OF FICER OF SEARCHED PERSON THAT ANY UNDISCLOSED INCOME BELO NGED TO ASSESSEE, CONDITION PRECEDENT FOR ASSUMING JURIS DICTION UNDER SECTION 158BD WAS NOT SATISFIED. 5.2. THERE WERE NO POSITIVE MATERIAL FOUND TO ARRI VE AT SATISFACTION THAT UNDISCLOSED INCOME HAS BEEN EARNE D BY 25 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. ASSESSEE. IN THE ABSENCE OF ANY MATERIAL, NO SATISF ACTION AS IS REQUIRED UNDER SECTION 158BD COULD HAVE BEEN RECORD ED. THE A.O. HAS FAILED TO INITIATE VALID PROCEEDINGS AGAIN ST THE ASSESSEE. THE SATISFACTION NOTE IS AN AFTERTHOUGHT AND ANTE- DATED AND PREPARED AFTER SUBMISSIONS MADE BY THE AS SESSEE. NO EXPLANATION HAVE BEEN GIVEN IN THIS REGARD BY TH E DEPARTMENT. NO SATISFACTION HAVE BEEN RECORDED BY T HE A.O. IN THE CASE OF THE PERSON SEARCHED. THEREFORE, NO INTE RFERENCE IS CALLED FOR IN THE MATTER. PB-365 IS SUBMISSION OF T HE ASSESSEE IN DETAIL WHICH HAVE NOT BEEN REBUTTED BY THE DEPAR TMENT IN WHICH THE ASSESSEE HAS SIMILARLY EXPLAINED THAT THE RE WERE NO INCRIMINATING MATERIAL FOUND DURING THE COURSE OF S EARCH AGAINST THE ASSESSEE IN THE CASE OF VATIKA GROUP OF COMPANIES AND SATISFACTION NOTE IS ANTI DATED. HE HAS RELIED UPON DECISION OF HONBLE SUPREME COURT IN THE CASE OF TAPAN KUMAR DUTTA VS. CIT, WEST BENGAL (2018) 92 TAXMANN.COM 367 (SC) IN WHICH, IN PARA-11, IT WAS HELD AS UNDER : 26 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. 11. A PERUSAL OF SECTION 158BD OF THE IT ACT MAKES IT CLEAR THAT THE ASSESSING OFFICER NEEDS TO SATISFY H IMSELF THAT THE UNDISCLOSED INCOME BELONGS TO ANY PERSON OTHER THAN THE PERSON WITH RESPECT TO WHOM THE SEAR CH WAS MADE UNDER SECTION 132 OR WHOSE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS OR ASSETS WERE REQUISITIONED UNDER SECTION 132A. THE VERY OBJECT O F THE SECTION 158BD IS TO GIVE JURISDICTION TO THE ASSESS ING OFFICER TO PROCEED AGAINST ANY PERSON OTHER THAN TH E PERSON AGAINST WHOM A SEARCH WARRANT IS ISSUED. ALTHOUGH SECTION 158BD DOES NOT SPEAK OF RECORDING OF REASONS' AS POSTULATED IN SECTION 148, BUT SINCE PROCEEDINGS UNDER SECTION 158BD MAY HAVE MONETARY IMPLICATIONS, SUCH SATISFACTION MUST REVEAL MENTAL AND DISPASSIONATE THOUGHT PROCESS OF THE ASSESSING OFFI CER IN ARRIVING AT A CONCLUSION AND MUST CONTAIN REASON S WHICH SHOULD BE THE BASIS OF INITIATING THE PROCEED INGS UNDER SECTION 158BD. 27 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. 5.3. PB-IV CONTAIN OF THE RECORD OF PERSON SEARCHE D BUT NO UNDISCLOSED INCOME RELATING TO ASSESSEE HAVE BEEN FOUND. NO SATISFACTION NOTE HAVE BEEN RECORDED TILL THESE WERE ASKED BY THE ASSESSEE. NO MATERIAL REFERRED IN THE REASONS OF SATISFACTION NOTE TO INDICATE IF ASSESSE E EARNED ANY UNDISCLOSED INCOME. THERE IS NO MATERIAL TO JUS TIFY THE INITIATION OF PROCEEDINGS UNDER SECTION 158BD AGAIN ST THE ASSESSEE. APART FROM THE ABOVE, THE TENOR OF THE SA TISFACTION NOTE CLEARLY SHOWS THAT NOTE OF SATISFACTION WAS RE CORDED BY A.O. HAVING JURISDICTION OVER THE CASE OF THE ASSES SEE AND NOT BY THE A.O. HAVING JURISDICTION OVER THE PERSON SEARCHED I.E., M/S. VATIKA LANDBASED PRIVATE LIMIT ED. IT IS, THEREFORE, CLEAR THAT NOTE OF SATISFACTION HAVE NOT BEEN RECORDED BY THE A.O. OF THE PERSON SEARCHED. HE HAS RELIED UPON DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. CALCUTTA KNITWEARS (2014) 43 TAXMANN.COM 446 (S C) IN WHICH IN PARA-44 IT WAS HELD AS UNDER : 28 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. 44. IN THE RESULT, WE HOLD THAT FOR THE PURPOS E OF SECTION 158BD A SATISFACTION NOTE IS SINE QUA NON AND MUST BE PREPARED BY THE ASSESSING OFFICER BEFORE HE TRANSMI TS THE RECORDS TO THE OTHER ASSESSING OFFICER WHO HAS JURI SDICTION OVER SUCH OTHER PERSON. THE SATISFACTION NOTE COULD BE PREPARED AT EITHER OF THE FOLLOWING STAGES: (A) AT THE TIME OF OR ALONG WITH THE INITIATION OF PROCEEDINGS AGAINST THE SEARCHED PERSON UNDER SECTION 158BC; (B) ALONG WITH THE ASSESSMENT PROCEEDINGS UNDER SECTION 158BC; AND (C) IMMEDIATELY AFTER THE ASSESSMENT PROCEEDINGS ARE COMPLETED UNDER SECTION 158BC OF THE SEARCHED PERSO N. 5.4. THE LEARNED COUNSEL FOR THE ASSESSEE, THEREFO RE, SUBMITTED THAT SATISFACTION NOTE IS NOT VALID AND I S ANTI- DATED, THEREFORE, ASSUMPTION OF JURISDICTION BY A.O . UNDER SECTION 158BD IS ILLEGAL AND INVALID. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. BEFORE PROCEEDING F URTHER, WE 29 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. MAY NOTE THAT WHEN THE MATTER WAS RE-FIXED FOR HEAR ING ON MERITS BEFORE THE TRIBUNAL, THE TRIBUNAL VIDE ORDER DATED 13.12.2017 IN VIEW OF BACKGROUND OF THE CASE AS NOT ED ABOVE AND IN ORDER TO ASCERTAIN THE CORRECT POSITION OF F ACTS AS TO WHETHER THE SATISFACTION HAS BEEN RECORDED IN THE C ASE OF THE PERSON SEARCHED I.E., M/S. VATIKA LANDBASED PRIVATE LIMITED WHO WAS THE PERSON SEARCHED IN TERMS OF SECTION 132 (1) OR IT HAS BEEN RECORDED IN THE CASE OF ASSESSEE, DIRECTED THE LD. D.R. TO PRODUCE THE ORIGINAL RECORD OF THE SAID COMPANY IN WHOSE CASE ORDER UNDER SECTION 158BC HAS BEEN PASSED AND ALSO PRODUCE RECORDS OF THE ASSESSEE. IT WAS ALSO DIRECT ED THAT ON THE DATE OF HEARING, A.O. WOULD PRESENT HIMSELF WITH TH E RECORDS SO THAT PROPER FACTS CAN BE ASCERTAINED AND PARTIES AR E HEARD AT LENGTH. THE ADJOURNMENT WAS GIVEN TO THE DEPARTMENT TO COMPLY WITH THE ORDER AND APPEAL WAS ADJOURNED TO 19.02.20 18 AS THE DATE CONVENIENT TO THE DEPARTMENT. AGAIN ON 28.02.2 018, THE LD. D.R. REQUESTED FOR ADJOURNMENT FOR PRODUCTION O F THE RECORDS AS WAS DIRECTED EARLIER BY THE TRIBUNAL. TH E APPEAL WAS ADJOURNED TO 07.03.2018 WITH THE OBSERVATION THAT CASE CANNOT 30 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. BE KEPT PENDING JUST AT THE MERCY OF THE DEPARTMENT TO PRODUCE THE RECORD. THE LD. D.R. HAS ENSURED THAT THE RECORDS SHALL BE PRODUCED IN THE COURT ON THE NEXT DATE OF HEARING, FAILING WHICH, SHE WILL ADDRESS THE ARGUMENTS WITHOUT RECORD. THE APPEAL WAS TAKEN-UP FOR HEARING FINALLY ON 21.05.2018 AND ON T HE DATE OF HEARING, LD. D.R. DID NOT PRODUCE THE ORIGINAL ASSE SSMENT RECORDS IN THE CASE OF BOTH THE PARTIES I.E., M/S. VATIKA GROUP OF COMPANIES, THE PERSON SEARCHED AND THE ASSESSEE. TH E LD. D.R. SUBMITTED THAT BOTH THE RECORDS ARE NOT AVAILABLE W ITH THE DEPARTMENT. 7. THE ASSESSEE IN THE PAPER BOOK FILED COPY OF TH E SATISFACTION NOTE DATED 31.05.2005 AT PAGE-38 WHICH IS REPRODUCED IN PARA 4.5 OF THE FINDINGS OF THE LD. C IT(A) ABOVE. THIS SATISFACTION IS RECORDED BY SHRI P.K. SINGH, A CIT, CENTRAL CIRCLE-20, NEW DELHI. PB-14 IS NOTICE UNDER SECTION 158BD DATED 31.05.2005 WHICH IS ISSUED BY SHRI P.K. SINGH , ACIT, CENTRAL CIRCLE-20, NEW DELHI. IT IS NOT ACCOMPANIED BY SATISFACTION NOTE IF RECORDED BY THE A.O. THE ASSES SMENT IN THE 31 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. CASE OF ASSESSEE HAS BEEN COMPLETED BY DCIT, CENTRA L CIRCLE- 20, NEW DELHI. THE LANGUAGE USED IN THE SATISFACTIO N NOTE CLEARLY SHOW THAT SATISFACTION NOTE WAS RECORDED BY A.O. IN THE CASE OF ASSESSEE VIZ., SHRI ANUPAM NAGALIA, WHO WAS HAVING JURISDICTION OVER THE ASSESSEE AND NOT THE A.O. HAV ING JURISDICTION OVER M/S.VATIKA LANDBASED PRIVATE LIMI TED I.E., THE PERSON SEARCHED. LEARNED COUNSEL FOR THE ASSESSEE R EFERRED TO VARIOUS LETTERS FILED BEFORE A.O. AFTER SERVICE OF THE NOTICE UNDER SECTION 158BD IN WHICH ASSESSEE ASKED FOR THE COPY OF THE SATISFACTION NOTE AND THE DOCUMENTS ON WHICH A.O. W ANTED TO RELY UPON TO ESTABLISH THAT ASSESSEE EARNED UNDISCL OSED INCOME. HOWEVER, THE SATISFACTION NOTE AND THE DOCUMENTS HA VE NOT BEEN SUPPLIED TO ASSESSEE FOR A CONSIDERABLE PERIOD AND IT WAS ONLY ON 27.01.2006 THE SATISFACTION NOTE WAS SUPPLI ED TO THE ASSESSEE. THERE IS NO EXPLANATION WHATSOEVER BY THE DEPARTMENT FOR INORDINATE DELAY IN SUPPLYING THE CO PY OF THE SATISFACTION NOTE AND THE DOCUMENTS TO THE ASSESSEE . THEREFORE, WE PRESUME THAT THE SATISFACTION NOTE WAS NOT PREPA RED ON THE DATE I.E., 31.05.2005 I.E., DATE ON WHICH IT PURPOR TED TO HAVE 32 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. BEEN MADE AND MUST HAVE BEEN MADE AFTER THE REQUEST MADE BY ASSESSEE FOR SUPPLY OF THE COPY OF THE SATISFACT ION NOTE. THE DECISION OF THE HONBLE MADHYA PRADESH HIGH COURT I N THE CASE OF CIT VS. TARACHAND KHUSHIRAM (SUPRA) CLEARLY APPL Y TO THE FACTS AND CIRCUMSTANCES OF THE CASE. IN THE SAID SA TISFACTION NOTE ALSO, THE A.O. OF THE ASSESSEE HAS NOT RECORDE D ANY SATISFACTION THAT ANY UNDISCLOSED INCOME BELONG TO THE ASSESSEE. THE LD. D.R. WAS GIVEN AMPLE OPPORTUNITIE S TO PRODUCE THE BLOCK ASSESSMENT RECORDS IN THE CASE OF THE PERSON SEARCHED AND THE ASSESSEE TO CLARIFY THE POSITION A S TO IN WHICH CASE SATISFACTION NOTE HAVE BEEN RECORDED ON 31.05. 2005 OR ON A LATER DATE. HOWEVER, THE REVENUE DEPARTMENT HAS F AILED TO PRODUCE THE ASSESSMENT RECORDS IN BOTH THE CASES. T HEREFORE, AN ADVERSE INFERENCE SHALL HAVE TO BE DRAWN AGAINST THE REVENUE DEPARTMENT IN THIS REGARD. THESE FACTS CLEA RLY SHOW THAT NO SATISFACTION UNDER SECTION 158BD HAVE BEEN RECORDED IN THE CASE OF THE PERSON SEARCHED I.E., VATIKA GRO UP OF COMPANIES, WHICH IS MANDATORY FOR INITIATING PROCEE DINGS UNDER SECTION 158BD OF THE I.T. ACT. WE ALSO HOLD T HAT RECORDING 33 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. OF SUCH SATISFACTION NOTE IS ALSO ANTI-DATED AND WA S RECORDED LATER ON WHEN ASSESSEE MADE A REQUEST IN WRITING FO R SUPPLY OF COPY OF THE SATISFACTION NOTE ALONG WITH SEIZED DOC UMENTS FOR MAKING PROPER COMPLIANCE BEFORE THE A.O. THE JUDGME NTS OF HONBLE SUPREME COURT IN THE CASES OF MANISH MAHESH WARI AND CIT VS. CALCUTTA KNITWEARS (SUPRA), ARE SQUARELY AP PLICABLE TO THE FACTS OF THE CASE IN FAVOUR OF THE ASSESSEE. IT IS AN ADMITTED POSITION THAT THE PAPERS REFERRED TO IN THE SATISFA CTION NOTE ABOVE HAVE BEEN FOUND AS A RESULT OF SEARCH ON THE ASSESSEE AND NOT FROM THE PREMISES OF M/S. VATIKA GROUP OF C OMPANIES I.E., THE PERSON SEARCHED CONSIDERED BY THE A.O. FO R ASSUMING JURISDICTION UNDER SECTION 158BD OF THE I.T. ACT. T HUS, SINCE SATISFACTION NOTE IS NOT BASED ON ANY SEIZED MATERI AL FOUND FROM THE PERSON SEARCHED, THE BASIC STATUTORY PRE-CONDIT ION FOR INVOKING THE PROVISIONS CONTAINED UNDER SECTION 158 BD IS NOT SATISFIED IN THE INSTANT CASE. THE ASSESSEE FILED P APER BOOK-IV WHICH CONTAIN ALL THE RECORDS OF THE PERSON SEARCHE D TO EXPLAIN THAT NONE OF THOSE DOCUMENTS BELONG TO THE ASSESSEE . THIS SUBMISSION OF THE LEARNED COUNSEL FOR THE ASSESSEE HAVE NOT 34 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. BEEN REBUTTED BY THE REVENUE DEPARTMENT THROUGH ANY EVIDENCE OR MATERIAL ON RECORD. NO MATERIAL IS REFE RRED TO IN THE REASONS TO INDICATE IF ASSESSEE EARNED ANY UNDISCLO SED INCOME. THE BURDEN IS UPON A.O. TO PROVE THAT A VALID SATIS FACTION NOTE HAD BEEN RECORDED ON THE BASIS OF THE MATERIAL FOUN D AS A RESULT OF SEARCH OF THE PERSON SEARCHED. IN THE INSTANT CA SE, THE PERUSAL OF THE SATISFACTION NOTE WOULD CLEARLY SHOW THAT THERE IS NO MATERIAL FOUND AS A RESULT OF THE SEARCH ON THE PERSON SEARCHED, THEREFORE, NO SATISFACTION COULD HAVE BEE N RECORDED UNDER SECTION 158BD OF THE ACT IN THE CASE OF THE P ERSON SEARCHED. THEREFORE, NO DOCUMENTS OR OTHER RECORDS COULD HAVE BEEN HANDED-OVER TO THE A.O. OF THE SUCH OTHER PERS ON. 8. ON THE OTHER HAND, THE PROCEEDINGS UNDER SECTIO N 158BD HAVE BEEN INITIATED ON THE BASIS OF THE MATER IAL FOUND AS A RESULT OF SEARCH CONDUCTED ON THE ASSESSEE AND NOT ON THE PERSON SEARCHED I.E., VATIKA GROUP OF COMPANIES. TH E CBDT VIDE CIRCULAR NO.24 OF 2015 DATED 31.12.2015 EXPLAI NED THE RECORDING OF SATISFACTION NOTE UNDER SECTION 158BD/ 153C OF THE 35 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. I.T. ACT. THE BOARD EXAMINED THE ISSUE IN THE LIGHT OF JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. CALCUTTA KNITWEARS (2014) 43 TAXMANN.COM 446 (SC) AND IT WAS DIRECTED THAT SEVERAL HIGH COURTS HAVE HELD THAT PROVISION O F SECTION 153C OF THE I.T. ACT ARE SUBSTANTIALLY SIMILAR/PARI MATERIA TO THE PROVISIONS OF SECTION 158BD OF THE I.T. ACT AND , THEREFORE, THE ABOVE GUIDELINES OF THE HONBLE SUPREME COURT A PPLIED TO THE PROCEEDINGS UNDER SECTION 153C OF THE I.T. ACT FOR THE PURPOSE OF ASSESSMENT OF INCOME OF OTHER PERSON THA N THE SEARCHED PERSON. THIS VIEW HAS BEEN ACCEPTED BY THE CBDT. IT WAS FURTHER CLARIFIED THAT EVEN IF THE A.O. OF THE SEARCHED PERSON AND THE OTHER PERSON IS ONE AND THE SAME, THEN ALSO HE IS REQUIRED TO RECORD HIS SATISFACTION AS HAS BEEN HEL D BY THE COURTS. 9. CONSIDERING THE MATERIAL ON RECORD, IT IS CLEAR THAT NO SATISFACTION NOTE HAS BEEN RECORDED ON THE DATE OF ISSUE OF NOTICE UNDER SECTION 158BD OF THE ACT DATED 31.05.2 005. THE SATISFACTION NOTE SUPPLIED TO THE ASSESSEE ON 27.01 .2006 IS 36 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. THUS, ANTI-DATED AND HAD NOT BEEN RECORDED ON THE D ATE PURPORTED I.E., 31.05.2005. OUR FINDINGS ARE BASED MAINLY ON REASONS THAT IN THE CASE OF PERSON SEARCHED, NO INC RIMINATING MATERIAL WAS FOUND AGAINST THE ASSESSEE, THEREFORE, THERE WERE NO REASON TO RECORD SATISFACTION UNDER SECTION 158B D OF THE ACT IN THE CASE OF THE PERSON SEARCHED. FURTHER, WHATEV ER MATERIAL WAS FOUND AND REFERRED TO IN THE SATISFACTION NOTE WAS FOUND DURING THE COURSE OF SEARCH ON THE PERSON OF THE AS SESSEE. THE ASSESSEE MADE A REQUEST FOR SUPPLY OF THE COPY OF T HE SATISFACTION NOTE IMMEDIATELY, BUT IT WAS NOT SUPPL IED TO THE ASSESSEE, THEREFORE, IT WAS RECORDED SUBSEQUENTLY I N THE CASE OF ASSESSEE, WHICH FACT IS STRENGTHENED BY OBSERVATION IN THE IMPUGNED ASSESSMENT ORDER BY MENTIONING THAT COPY O F THE SATISFACTION NOTE WAS PROVIDED TO THE ASSESSEE, THE A.O. OF THE ASSESSEE ONLY COULD HAVE PROVIDED SUCH SATISFACTION NOTE TO THE ASSESSEE AFTER SEVEN MONTHS. THEREFORE, NO SATISFAC TION NOTE HAD BEEN RECORDED BY THE A.O. HAVING JURISDICTION O VER M/S. VATIKA LANDBASED PRIVATE LIMITED WHICH WERE REQUIRE D TO BE RECORDED IN THEIR CASE BEING A PERSON SEARCHED AND NOT IN THE 37 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. CASE OF THE ASSESSEE. IN THE ABSENCE OF ANY MATERIA L PRODUCED BY THE REVENUE DEPARTMENT AND FURTHER THE ORIGINAL RECORDS HAVE NOT BEEN PRODUCED BEFORE US CLEARLY SUPPORT TH E EXPLANATION OF ASSESSEE THAT NO VALID SATISFACTION HAVE BEEN RECORDED IN THE CASE OF THE PERSON SEARCHED. WHATEV ER SATISFACTION HAVE BEEN RECORDED, WAS RECORDED LATER ON, (WAS ANTI-DATED), IN THE CASE OF THE ASSESSEE ONLY. SINC E, NO MATERIAL RELATING TO THE ASSESSEE WAS FOUND OR RECOVERED IN THE CASE OF THE PERSON SEARCHED I.E., M/S. VATIKA GROUP OF CASE S, THEREFORE, THERE IS NO QUESTION OF TRANSMITTING OF THE SEIZED MATERIAL BY THE A.O. OF THE PERSON SEARCHED TO THE A.O. OF THE ASSE SSEE. THEREFORE, THE PRECONDITIONS FOR INVOKING THE JURIS DICTION UNDER SECTION 158BD ARE NOT SATISFIED IN THIS CASE. THE L D. CIT(A), ON PROPER APPRECIATION OF FACTS AND MATERIAL ON RECORD CORRECTLY HELD THE PROCEEDINGS UNDER SECTION 158BD TO BE INVA LID, ACCORDINGLY, RIGHTLY QUASHED THE SAME. NO INTERFERE NCE IS CALLED FOR IN THE MATTER. WE DO NOT FIND ANY MERIT IN THE DEPARTMENTAL APPEAL AND THE SAME IS ACCORDINGLY DISMISSED. 38 I.T.(S.S).A.NO.36/DEL./2010 SHRI ANUPAM NAGALIA, GURGAON. 10. IN THE RESULT, APPEAL OF THE DEPARTMENT IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (L.P. SAHU) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DELHI, DATED 19 TH JUNE, 2018 VBP/- COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT A BENCH 6. GUARD FILE