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2019 (11) TMI 875 - HC - Income TaxAssessment u/s 153C - Assessment completed u/s 144 - HELD THAT - The aforesaid assessment note nowhere satisfies the requirements referred to, in the preceding paragraph. Before the Tribunal, the Revenue could not adduce any cogent material or evidence to prove that the addition in all the assessment years was made in the case of Assessee in the Assessment completed u/s 144 read with section 153C on the basis of any incriminating material or document being found during the course of the search. As further noticed that even no such incriminating material or document has been referred to by the Assessing Officer during the course of the search while completing Assessment. The order passed by the Assessing Officer has been passed in contravention of the law laid down by the Hon ble Supreme Court in the case of M/s. Calcutta Kintwears 2014 (4) TMI 33 - SUPREME COURT . Therefore, the appeal preferred by the Assessee was rightly allowed by the CIT (Appeals) and the appeal preferred by the Revenue was rightly dismissed by the Income Tax Appellate Tribunal.
Issues involved:
Appeal under Section 260A of the Income Tax Act, 1961 against an order passed by the Income Tax Appellate Tribunal, Panaji Bench, Panaji regarding addition made to the income of the respondent-assessee in a trading of iron ore case, deletion of addition by the Commissioner of Income Tax (Appeals), invoking provision of Section 153C of the Act, satisfaction note requirements, compliance with guidelines laid down by the Hon'ble Supreme Court, and the legality of the order passed by the Assessing Officer. Analysis: 1. The appeal was filed under Section 260A of the Income Tax Act, 1961 against an order passed by the Income Tax Appellate Tribunal, Panaji Bench, Panaji, involving an addition of ?3,00,63,324/- to the income of the respondent-assessee engaged in the trading of iron ore. The Commissioner of Income Tax (Appeals) had deleted the addition, citing that it cannot be made without incriminating material found during the search. The Revenue challenged this decision, leading to the current appeal. 2. The main issue raised was the compliance with the provision of Section 153C of the Act and the satisfaction note requirements. The Ministry of Finance, Government of India, issued Circular No.24/2015 regarding the recording of satisfaction note under Section 158BD/153C of the Act. The court emphasized the importance of following the guidelines set by the Hon'ble Supreme Court in previous judgments while recording such satisfaction notes. 3. The court examined the satisfaction note recorded by the Assessing Officer and found that it did not meet the requirements specified under Section 153C of the Act. It was noted that there was no incriminating material found during the search to justify the addition made to the income of the assessee. The Assessing Officer's order was deemed to be in contravention of the law laid down by the Hon'ble Supreme Court, leading to the dismissal of the Revenue's appeal by the Income Tax Appellate Tribunal. 4. Ultimately, the court concluded that no substantial question of law arose for consideration in the appeal. The appeal was found to lack merit and was dismissed accordingly. The judgment highlighted the importance of adhering to legal requirements and guidelines while making additions to an assessee's income under the Income Tax Act, ensuring fairness and compliance with established legal principles.
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