ACIT, V. Shri Rajkumar Gupta,

ITSSA 41/JAB/2007

• Counselvise Citation: [2013] 121 COUNSELVISE.COM (IT) 9450 (ITAT-JABALPUR)
• Duration Of Justice: 5 year(s) 8 month(s) 30 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 19-09-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 20-12-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHISHEK SHUKLA
• Keywords: Loose papers; Document seized; Block assessment; Documents seized
• Section: 132; 15

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, JABALPUR BENCH, JABALPUR BEFORE SHRI JOGINDER SINGH(JM) AND SHRI R.C. SHARM A (AM) I.T.(SS)A. NO.41//JAB/2007 BLOCK PERIOD : 1.04.1995 TO 24 .01.2002 ACIT, CIRCLE, CHHINDWARA, OPP: DANIELSON COLLEGE, NAGPUR ROAD, CHHINDWARA. VS. SHRI RAJ KUMAR GUPTA, S/O SHRI SHIV CHARANDAS GUPTA, VIDHYA NAGAR, KHANDWA DIST: KHANDWA PAN/GIR NO. : ACKPG 1396 S I.T.(SS)A. NO.44//JAB/2007 BLOCK PERIOD : 1.04.1995 TO 24 .01.2002 ACIT, CIRCLE, CHHINDWARA, OPP: DANIELSON COLLEGE, NAGPUR ROAD, CHHINDWARA. VS. M/S. J.B.ENTERPRISES, NARSINGHPUR ROAD, CHHINDWARA. PAN/GIR NO. : AADFG 2205 K I.T.(SS)A. NO.46/JAB/2007 BLOCK PERIOD : 1.04.1995 TO 24 .01.2002 ACIT, CIRCLE, CHHINDWARA, OPP: DANIELSON COLLEGE, NAGPUR ROAD, CHHINDWARA. VS. SHRI KHALSA ENTERPRISES, NARSINGHPUR ROAD, CHHINDWARA, DIST: CHHINDWARA PAN/GIR NO. : AAIFK 0804 E APPELLANT ) .. RESPONDENT ) 2 I.T.(SS)A. NO.45//JAB/2007 BLOCK PERIOD : 1.04.1995 TO 24 .01.2002 ACIT, CIRCLE, CHHINDWARA, OPP: DANIELSON COLLEGE, NAGPUR ROAD, CHHINDWARA. VS. PINKU TRADERS, NARSINGHPUR ROAD, CHHINDWARA, DIST: CHHINDWARA PAN/GIR NO. : AAFFP 2380H APPELLANT BY : SHRI ABHISHEK SHUKLA, SR DR RESPONDENT BY : SHRI G.N.PUROHIT, ADV SHRI ABHISHEK OSWAL, ADV DATE OF HEARING : 18/9/20 13 DATE OF PRONOUNCEMENT : 19/09/2013 O R D E R PER R.C.SHARMA, AM: THESE ARE APPEALS FILED BY THE REVENUE AGAINST THE ORDER OF LD COMMISSIONER OF INCOME TAX (APPEALS) DATED 12.10.20 07, IN THE MATTER OF ASSESSMENT FRAMED UNDER SECTION 158BD OF THE I.T.AC T, 1961. 2. SINCE FACTS AND GROUNDS INVOLVED IN ALL THESE AP PEALS ARE COMMON, THEREFORE, ALL THESE APPEALS WERE HEARD TOGETHER AN D ARE BEING DISPOSED OF BY A CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. 3 3. WE NOW TAKE UP THE APPEAL IN THE CASE OF J B ENT ERPRISES AND THE DECISION WILL APPLY MUTATIS-MUTANDIS IN OTHER APPEA LS. 4. FACTS IN BRIEF ARE THAT DURING THE COURSE OF ASS ESSMENT PROCEEDINGS, THE ASSESSING OFFICER OBSERVED THAT A SEARCH WAS CO NDUCTED UNDER SECTION 132 OF THE I.T.ACT, 1961 IN THE RESIDENCE OF SHRI P RITIPAL SINGH BEDI AND OTHERS, PARTNERS IN THE ASSESSEE FIRM, AT NARSINGHP UR ROAD, CHHINDWARA ON 24.1.2002. IN THE SEARCH, BOOKS OF ACCOUNT AND LOO SE PAPERS FOUND AND SEIZED WERE DULY INVENTORISED AS PER THE PANCHANAMA DATED 25.1.2002 IN THE CASE OF SHRI PRITHIPAL SINGH BEDI AND OTHERS. THE ASSESSING OFFICER WITHIN WHOSE JURISDICTION THE SEARCH WAS CONDUCTED LATER CENTRALIZED THE ENTIRE GROUP OF CASES WITH THE ACIT, CIRCLE, CHHIND WARA, WHO PROCEEDED WITH AND COMPLETED THE BLOCK ASSESSMENT UNDER SECTI ON 158 BC IN THE CASE OF SHRI PRITHIPAL SINGH AND OTHERS WHOSE NAMES WERE MENTIONED IN THE SEARCH WARRANT. ACIT, CIRCLE CHHINDWARA HAD FOUND T HAT A CERTAIN LOOSE PAPERS PERTAINED TO THE FIRM WAS EXPLAINABLE IN THE HANDS OF THE ASSESSEE, AS THEY BELONGED TO THE ASSESSEE. 4 5. ACCORDINGLY, PROCEEDINGS UNDER SECTION 158 BD WE RE INITIATED AND UNDISCLOSED INCOME WAS DETERMINED IN RESPECT OF YEA RS FALLING IN THE BLOCK PERIOD. IN THE APPEAL FILED BEFORE LD COMMISSIONER OF INCOME TAX (APPEALS), THE MAIN GRIEVANCE OF THE ASSESSEE WAS T HAT THE ASSUMPTION OF JURISDICTION TO MAKE AN ASSESSMENT UNDER SECTION 15 8BC BY INVOKING SECTION 158BD WAS BAD IN LAW AS NO SATISFACTION TO THE EFFECT THAT ANY UNDISCLOSED INCOME WAS ASSESSABLE IN THE HANDS OF T HE ASSESSEE HAD BEEN RECORDED AND HENCE, THE ORDER SO PASSED IS AB-INITI O, NULL AND VOID AND, THEREFORE, BE CANCELLED. 6. IN RESPECT OF SPECIFIC GROUND RAISED BY THE ASSE SSEE, LD COMMISSIONER OF INCOME TAX (APPEALS) HAS OBSERVED IN PARAS 2 TO 5 AS UNDER: 2.ON THE REQUEST OF THE APPELLANT, THE AO IN THE M ONTH OF JULY,2007 WAS DIRECTED TO MAKE AVAILABLE COPY OF THE SATISFACTION NOTE, IF ANY RECORDED. BUT NO SUCH SATISFACTION NOTE WAS EITHER MADE AVAILABLE TO THE ASSESSEE OR TO THIS OFFICE. THEREUPON THE AO WAS AGAIN INFORMED VIDE LETTER DTD , 23 RD AUGUST, 2007 TO MAKE AVAILABLE COPY OF THE SATISFACTION NOTE BY 30.8.200 7, BUT STILL THERE WAS NO RESPONSE. A COPY OF THIS LETTER WAS ALSO FORWARDED TO THE ADDL.CIT RANGE CHHINDWARA, WHO IN RESPONSE, VIDE LETTER DTD. 28.9. 2007 FORWARDED THE AO'S FOLDER CONTAINING THE CORRESPONDENCE CARRIED OUT BE FORE INVOKING SECTION 158BD BUT WITH THE FOLLOWING REMARKS: 'EVEN THOUGH THERE WAS A MISTAKE IN COMMUNICATING T HE REQUIREMENT OF ACTION U/S 15HBD TO THE ITO, CHHINDWARA, WHO LEGALL Y DID NOT HOLD 5 JURISDICTION, THE FACT THAT PRIOR TO SUCH COMMUNICA TION, THE ACIT HAD VERIFIED THE FACTS AND SATISFIED HIMSELF ABOUT NECE SSITY OF INVOKING THE PROVISIONS OF SECTION 158BD OF THE ACT IN THESE CAS ES IS BEYOND ANY DOUBT. THIS CONSTITUTE THE ASSESSING OFFICERS I.E. ACITS S ATISFACTION NOTE.' 3. AGAIN THE ASSESSING OFFICER AS WELL AS THE ADDL. CIT VIDE OFFICE LETTER DTD. 1.10,2007 WAS ASKED TO STATE WHETHER ANY SEPARATE S ATISFACTION NOTE WAS RECORDED AND IF SO, TO FORWARD A COPY OF THE SAME P OSITIVELY BY 10 TH OCT.,2007 ELSE IT WOULD BE PRESUMED THAT NO SATISFACTION HAD BEEN RECORDED. HOWEVER, THIS LETTER REMAINED UN-RESPONDED. 4. ON PERUSAL OF THE CORRESPONDENCE FOLDER, IT IS N OTICED THAT ACTION U/S 158BD WAS TAKEN IN THIS CASE ON THE BASIS OF THE LETTER D TD. 9.2.2004 WRITTEN BY THE ACIT CIRCLE CHHINDWARA TO ITO WARD CHHINDWARA, WHO AT THAT TIME WAS HOLDING JURISDICTION OVER THE CASE. THE CONTENTS OF THIS LE TTER ARE REPRODUCED HEREUNDER: DURING THE PROCEEDINGS U/S. 158BC IN THE CASES OF M /S GURUNANAK GENERAL STORES, CHHINDWARA, SHRI PRITHPAL SINGH BEDI, CHHIN DWARA, SHRI J.S.CHAWLA, KHANDWA, SHRI K.S.BEDI, KHANDWA AND M/S PENCH LIQUOR TRADERS, CHHINDWARA THE DOCUMENTS RELATED TO THE FO LLOWING ASSESSEE HAVE BEEN FOUND: 1. TO 4. NOT RELATED 5. M/S J.B.ENTERPRISES,CHHINDWARA PAGE 234 OF A-9, PAGE 119, 122 TO 127 OF A-10 IN THE CASE OF P.S.BEDI. 6. KHALSA ENTERPRISES,CHHINDWARA SEIZURE IN THE CA SE OF SHRI J.S.CHWAIA,KHANDWA 7. PINKU TRADERS, CHHINDWARA SEIZURE IN THE CASE O F SHRI J.S.CHAWLA, KHANDWA 6 I WOULD, THEREFORE, REQUEST YOU TO PLEASE INITIATE THE PROCEEDINGS U/S 158BD IN THE CASE OF THE ABOVE ASSESSEES AS THEY ARE ASSESSE D BY YOU.' 5. THE ID. AR WAS PROVIDED WITH THE COPIES OF BOTH THE ABOVE REFERRED LETTERS DTD. 28.9.2007 AND 9.2.2004 AND ALSO WAS ALLOWED IN SPECTION OF THE CORRESPONDENCE FOLDER. THE ID. AR THEREUPON MADE DE TAILED SUBMISSION AND IN WHICH HE HAS STATED THAT ON PERUSAL OF THE CORRESPO NDENCE FOLDER AND THE LETTERS, IT IS NOTED THAT THE AC IT IN HIS LETTER DTD. 9.2.2 004 HAS ONLY COMMUNICATED ABOUT THE VARIOUS DOCUMENTS PERTAINING TO THE ASSES SEE WHICH ARE PART OF THE SEIZURE MADE IN THE CASES OF M/S GURUNANAK GENERAL STORES AND OTHERS AND THEREUPON HAS MADE THE REQUEST TO THE AO I.E. THE I TO TO INITIATE PROCEEDINGS U/S 158BD AGAINST THE NAMED PERSONS. BUT THIS LETTE R DOES NOT CONSTITUTE TO BE A SATISFACTION NOTE ON THE UNDISCLOSED INCOME IF ANY, ASSESSABLE IN THE ASSESSEE'S HANDS. FURTHER IN THIS REGARD HE HAS REFERRED TO TH E DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF MANISH MAHESHWARI VS. ACIT - 289 ITR 341 WHEREIN, THE HON'BLE SUPREME COURT HAS CLEARLY STAT ED THE VARIOUS PREREQUISITE CONDITIONS WHICH ARE NEEDED TO BE SATISFIED FOR VAL IDLY TAKING ACTION U/S 158BD. THE RELEVANT PORTION OF WHICH IS AS UNDER: ' SECTION 158BD, HOWEVER, PROVIDES FOR TAKING RECOURS E TO A BLOCK ASSESSMENT IN TERMS OF SECTION 158BC IN RESPECT OF ANY OTHER PERSON, THE CONDITIONS PRECEDENT WHERE FOR ARE: (I) SATISFA CTION MUST BE RECORDED BY THE ASSESSING OFFICER 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; (II) THE BOOKS OF ACC OUNT OR OTHER DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED HAD BEEN HANDED O VER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON; AND(III) THE ASSESSING OFFICER HAS PROCEEDED UNDER SECTION 158BC AGAINST S UCH OTHER PERSON. ' FURTHER HE HAS STATED THAT NEITHER FROM THE LETTER OF THE ACIT NOR FROM THE OBSERVATION MADE BY THE ADDL. COMMISSIONER IT IS CO MING-FORTH AS TO WHAT SATISFACTION HAD BEEN REACHED AT BY THE ACIT AS NO COPY OF THE SATISFACTION NOTE HAS BEEN PROVIDED AND WHICH LEADS TO THE PRESUMPTIO N THAT NO SATISFACTION NOTE 7 WAS RECORDED AND THUS THE PROCEEDINGS SO INITIATED BECOME VOID AB-INITIO IN VIEW OF THE ABOVE QUOTED DECISION OF THE HON'BLE SUPREME COURT. . 7. AFTER CONSIDERING THE ASSESSEES CONTENTION AND MATERIAL PLACED ON RECORD, LD COMMISSIONER OF INCOME TAX (APPEALS) HEL D THAT NO SATISFACTION WAS RECORDED. ACCORDINGLY, PROCEEDINGS INITIATED U NDER SECTION 158BC R.W.S. 158BD WAS HELD WITHOUT JURISDICTION AND ORDE RS SO PASSED IS ILLEGAL AND NOT TENABLE, SAME WAS DECLARED TO BE AB-INITO N ULL AND VOID. THE PRECISE OBSERVATION OF LD COMMISSIONER OF INCOME TA X (APPEALS) IS AS UNDER: 6. I HAVE CAREFULLY CONSIDERED THE FACTS ON RECORD AND THE SUBMISSIONS MADE BY THE ID. AR. A BARE READING OF SECTION 158BD MAKES IT AMPLY CLEAR THAT FOR INVOKING SECTION 158BD THERE HAS TO BE AN OBJECTIVE SATISFACTION TO THE EFFECT THAT SOME UNDISCLOSED INCOME IS REQUI RED TO BE BROUGHT TO TAX IN THE HANDS OF A PERSON OTHER THAN THE PERSON SEARCHED. FURTHER AS PER THE DEFINITION OF 'UNDISCLOSED INCOME 1 GIVEN IN SECTION 158B(B), THE SAME IS TO BE COMPUTED ON THE BASIS OF THE UNRECORD ED TRANSACTIONS AND ASSETS WHICH COME TO LIGHT AS A RESULT OF A SEARCH ACTION. THE UNDISCLOSED INCOME IS THUS TO BE COMPUTED ON THE BASIS OF THE S EIZED RECORD OR THE CONSEQUENTIAL FACTS WHICH COME TO NOTICE WHILE VERI FYING THE TRANSACTIONS LYING RECORDED IN THE SEIZED RECORD. IT IS ALSO PER TINENT TO STATE THAT THESE PROVISIONS ARE PENAL IN NATURE AND THUS TO PROCEED AGAINST A PERSON, WHO HAS NOT BEEN SEARCHED, THE REQUIREMENT OF THE LAW H AS TO BE STRICTLY COMPLIED WITH. THE HON'BLE SUPREME COURT IN THE CAS E OF MANISH MAHESHWARI (SUPRA) HAS CLEARLY ENUMERATED THOSE CONDITIONS, ONE OF 8 WHICH IS RECORDING OF A SATISFACTION NOTE TO THE EF FECT OF POINTING OUT TO SOME UNDISCLOSED INCOME TO BE WORKED OUT ON THE BAS IS OF THE MATERIAL GATHERED AS A RESULT OF THE SEARCH ACTION AND FU RTHER THAT THE SAME IS REQUIRED TO BE BROUGHT TO TAX IN THE HANDS OF A PER SON OTHER THAN THE PERSON SEARCHED. THE SATISFACTION OF THIS R EQUIREMENT IS THE VERY FOUNDATION FOR ASSUMPTION OF JURISDICTION TO PROCEE D AGAINST THE ASSESSEE AND IN THE ABSENCE OF WHICH, IT CANNOT BE HELD THAT THE AO WAS RIGHT IN INVOKING SECTION 158BD TO PROCEED AGAINST THE ASSES SEE U/S 158BC. THE LETTER OF THE ACIT TO THE ITO DTD. 9.2.2004 BY NO S TRETCH OF IMAGINATION CAN BE CONSIDERED TO BE A SATISFACTION NOTE. IT IS ONLY AN INTIMATION TO THE ITO OF THE VARIOUS DOCUMENTS PERTAINING TO THE ASSE SSEE WHICH ARE LYING SEIZED. THE SEIZURE OF DOCUMENTS PERTAINING TO SOME OTHER PERSON BY ITSELF DOES NOT LEAD TO THE ASSUMPTION THAT THE SAM E CONTAINED RECORD OF TRANSACTIONS WHICH HAVE NOT BEEN RECORDED BY THAT P ERSON. FURTHER EVEN IF IT CONTAINS RECORD OF CERTAIN TRANSACTIONS WHICH AR E NOT PART OF THE BOOKS OF ACCOUNT, STILL IT CANNOT BE SAID THAT THESE WO ULD LEAD TO COMPUTATION OF SOME UNDISCLOSED INCOME. THUS FOR INVOKING SECTI ON 158BD, IT HAS TO ESTABLISH THAT THE TRANSACTIONS RECORDED IN THE SEIZED DOCUMENTS AND PERTAINING TO THE PERSON OTHER THAN THE PERSON SEAR CHED ARE SUCH AS HAVE NOT BEEN RECORDED IN THE BOOKS OF ACCOUNT AND FUR THER THE SAME LEAD TO COMPUTATION OF SOME INCOME NOT DISCLOSED. BUT NO SU CH SATISFACTION WAS RECORDED AND IN VIEW OF WHICH THE PROCEEDINGS INITI ATED U/S.158BC ARE HELD TO BE WITHOUT JURISDICTION. THE ORDER SO PASS ED THEREFORE IS LEGALLY NOT TENABLE. THE SAME IS DECLARED TO BE AB-INITIO NULL AND VOID. 8. AGAINST THE ABOVE ORDER OF LD COMMISSIONER OF IN COME TAX (APPEALS), REVENUE IS IN FURTHER APPEAL BEFORE US. 9 9. IT WAS CONTENDED BY LD D.R. THAT LD COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN TREATING THE ORDER OF ASSESS MENT PASSED UNDER SECTION 158BC R.W.S 158BD OF THE ACT HELD TO BE ABI NITIO, NULL AND VOID. 10. ON THE OTHER HAND, LD AR. PLACED ON RECORD THE ORDER OF A CO- ORDINATE BENCH IN THE CASE OF ACIT VS. MUKTA GOENK A & ORS (IT (SS) A NO.23(JAB), 27, 28 & 29(JAB)/2007 ORDER DATED 28 TH MAY, 2010 WHEREIN, PROCEEDINGS INITIATED UNDER SECTION 158BC WAS HELD TO BE AB-INITIO, NULL AND VOID FOR WANT OF SATISFACTION. RELIANCE WAS PLACED ON THE DECISION OF A LARGER BENCH OF DELHI TRIBUNAL IN THE CASE OF MANOJ AGARWAL, 113 ITD 377 (DEL). 11. LD A.R. FURTHER CONTENDED THAT THE HONBLE SUPR EME COURT IN THE CASE OF MANISH MAHESWARI(SUPRA) HAVE CLEARLY LAID DOWN THE CONDITION OF RECORDING OF SATISFACTION NOTE AS A REQUIREMENT OF LAW FOR INITIATING THE PROCEEDINGS UNDER SECTION 158 BD. 12. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND CA REFULLY GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. FACTS IN BRIEF AR E THAT SEARCH WAS INITIATED 10 UNDER SECTION 132 OF THE ACT IN THE RESIDENCE OF SH RI PRITIPAL SINGH BEDI AND OTHERS ON 24.1.2002. THEREAFTER, ASSESSING OFFIC ER INITIATED PROCEEDINGS UNDER SECTION 158BD IN RESPECT ABOVE ASSESSES AND C OMPLETED THE ASSESSMENT BY DETERMINING UNDISCLOSED INCOME. THE MAIN CONTENTION BEFORE LD COMMISSIONER OF INCOME TAX (APPEALS) WAS THAT NO SATISFACTION WAS RECORDED WHICH IS SINE QUA NON FOR INITIATION OF PROCEEDINGS U/S.158BD. LD COMMISSIONER OF INCOME TAX (APPEALS) HAS GIVEN F ULL OPPORTUNITY TO THE ASSESSING OFFICER TO PROVIDE SATISFACTION NOTE, IF ANY, RECORDED IN THE ABOVE CASES. HOWEVER, ASSESSING OFFICER COULD NOT PROVID E THE SATISFACTION NOTE. DETAILED FINDING HAS BEEN RECORDED BY LD COMMISSION ER OF INCOME TAX (APPEALS) WITH RESPECT TO THE QUERIES TO THE ASSESS ING OFFICER FOR SUPPLYING COPY OF SATISFACTION NOTE, HOWEVER, NO SATISFACTION NOTE WAS PROVIDED. RECORDING OF OBJECTIVE SATISFACTION TO THE EFFECT T HAT SOME UNDISCLOSED INCOME IS REQUIRED TO BE BROUGHT TO TAX IN THE HAND S OF PERSON OTHER THAN PERSON SEARCHED IS ESSENTIAL REQUIREMENT BEFORE INI TIATING PROCEEDINGS U/S.158BD. EVEN AS PER REQUIREMENT OF PROVISIONS O F SECTION 158B(B) UNDISCLOSED INCOME IS TO BE COMPUTED ON THE BASIS OF UNRECORDED TRANSACTIONS AND ASSETS WHICH COME TO THE LIGHT AS A RESULT OF SEARCH ACTION. SUCH UNDISCLOSED INCOME IS TO BE COMPUTED ON THE BASIS OF SEIZED 11 RECORD OR CONSEQUENTIAL FACT WHICH COMES TO THE NOT ICE OF THE DEPARTMENT SUBSEQUENTLY, HONBLE SUPREME COURT IN THE CASE OF MANISH MAHESWARI (SUPRA) HAVE CLEARLY LAID DOWN THE REQURIREMENT FOR INITIATION OF PROCEEDINGS UNDER SECTION 158BD, ONE OF WHICH IS RE CORDING OF SATISFACTION NOTE TO THE EFFECT OF POINTING OUT SOME UNDISCLOSED INCOME TO BE WORKED OUT ON THE BASIS OF MATERIAL GATHERED AS A RESULT O F SEARCH ACTION AND THE SAME IS REQUIRED TO BE TAXED IN THE HANDS OF THE PE RSON OTHER THAN PERSON SEARCHED. RECORDING OF SUCH SATISFACTION IS A FOUN DATION FOR ASSUMPTION OF JURISDICTION TO PROCEED AGAINST PERSON OTHER THAN P ERSON SEARCHED. 13. IN THE CASE OF MANOJ AGRAWAL (SUPRA), THE FIVE MEMBERS SPECIAL BENCH OF THE TRIBUNAL HAS HELD IN PARA 113 OF THE R EPORT THAT THE SATISFACTION TO INITIATE BLOCK ASSESSMENT PROCEEDIN GS IN THE CASE OF OTHER PERSON IS TO BE RECORDED IN WRITING AND HAS TO BE O BJECTIVE/JUDICIOUS SATISFACTION AND HAS TO BE RECORDED BY THE AO OF TH E PERSON SEARCHED DURING THE COURSE OF I58BC PROCEEDINGS. THE RELEVAN T PORTION FROM PARA 113 IS REPRODUCED HEREIN BELOW: '113. SECTION 158BD COMMENCES WITH THE WORDS 'WHERE THE ASSESSING OFFICER IS SATISFIED THAT ANY UNDISCLOSED INCOME BE LONGS TO ANY PERSON, OTHER THAN THE PERSON WITH RESPECT TO WHOM SEARCH W AS MADE' 1 AND THUS 12 IT IS CLEAR THAT THE SATISFACTION OF THE ASSESSING OFFICER ASSESSING THE PERSON SEARCHED IS THE FIRST AND FOREMOST REQUIREME NT. THE ASSESSING OFFICER CAN ARRIVE AT THIS SATISFACTION ONLY AFTER ASCERTAINING WHETHER THERE IS ANY UNDISCLOSED INCOME AT ALL AND THIS FINDING C AN BE ARRIVED AT BY HIM ONLY IN THE COURSE OF THE SECTION 158BC ASSESSMENT PROCEEDINGS. THEREAFTER, HE HAS TO ARRIVE AT A FINDING AS TO THE PERSON TO WHOM SUCH INCOME BELONGS. THIS FINDING ALSO CAN BE ARRIVED AT ONLY IN THE COURSE OF THE SECTION 158BC PROCEEDING IN THE CASE OF THE PER SON SEARCHED.' 14. THE HON'BLE SUPREME COURT IN THE CASE OF MANISH MAH ESHWARI (SUPRA) HAS SPECIFIED THE FOLLOWING CONDITIONS PREC EDENT FOR TAKING ACTION TINDER SECTION 158BD OF THE ACT: SECTION 158BD, HOWEVER, PROVIDES FOR TAKING RECOURS E TO A BLOCK ASSESSMENT IN TERMS OF SECTION I58BC IN RESPECT OF ANY OTHER PERSON, THE CONDITIONS PRECEDING WHEREFORE ARE: (I) SATISFACTIO N MUST BE RECORDED BY THE ASSESSING OFFICE THAT ANY UNDISCLOSED INCOME BE LONGS TO ANY PERSON OTHER THAN THE PERSON WITH RESPECT TO WHOM SEARCH W AS MADE UNDER SECTION 132 OF THE ACT,(II) THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED HAD BEEN HANDED OVER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON; AND (IN) THE ASSESSING OFFICER HAS PROCEEDED UNDER SECTION 158BC AGAINST S UCH OTHER PERSON.' THE HON'BLE SUPREME COURT HAS CONCLUDED AS FOLLOWS : ' AS THE ASSESSING OFFICER HAS NOT RECORDED HIS SAT ISFACTION, WHICH IS MANDATORY; NOR HAS HE TRANSFERRED THE CASE TO THE ASSESSING OF FICER HAVING JURISDICTION OVER THE MATTER, WE ARE OF THE OPINION THAT THE IMPUGNED JUDGMENTS OF THE HIGH 13 COURT CANNOT BE SUSTAINED, WHICH ARE SET ASIDE ACCO RDINGLY. THE APPEALS ARE ALLOWED.' 15. APPLYING THE PROPOSITION OF LAW LAID DOWN BY HO NBLE SUPREME COURT IN THE CASE OF MANISH MAHESWARI (SUPRA) AND ALSO DE CISIONS OF CO-ORDINATE BENCHES (SUPRA) AS DISCUSSED ABOVE TO THE FACTS OF THE INSTANT CASE, CLEAR CUT FINDING OF WHICH HAS BEEN RECORDED BY LD COMMIS SIONER OF INCOME TAX (APPEALS) IN HIS ORDER, WE DO NOT FIND ANY REASON T O INTERFERE IN THE ORDER OF LD COMMISSIONER OF INCOME TAX (APPEALS) FOR HOLD ING THAT INITIATION OF PROCEEDINGS UNDER SECTION 158BD WAS AB-INITIO NULL AND VOID. 16. IN THE RESULT, ALL APPEALS FILED BY REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 19 TH SEPTEMBER, 2013. SD/- SD/- (JOGINDER SINGH) (R.C.SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER JABALPUR DATED 19 / 09/2013 B.K.PARIDA, SR. PS 14 COPY OF THE ORDER FORWARDED TO : 1. ACIT, CIRCLE, CHHINDWARA, OPP: DANIELSON COLLEGE, NAGPUR ROAD, CHHINDWARA. 2. / THE RESPONDENT: SMT. BARKHA AIAS SATPREET KAUR, C/O MANJEET SINGH BEDI, NARSINGHPUR ROAD, CHHINDWARA, DIST: CHHINDWARA 3. ( ) / THE CIT(A)- 4. / CIT 5. , , / DR, ITAT, JABALPUR 6. / GUARD FILE. / BY ORDER, //TRUE COPY// SR.PRIVATE SECRETARY,ITAT CAMP AT JABALPUR