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TMI Blog2010 (8) TMI 731X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessees against the consolidated order of this Tribunal dated December 7, 2007 in the above mentioned appeals. Grievance of the assessees raised through these miscellaneous applications is that there was no recording of "satisfaction" by the Assessing Officer of the searched persons and handing over of the seized material to the Assessing Officer of the "other person" as mandated in section 158BD of the Income-tax Act, 1961 ("the Act") and the decision of the hon'ble Apex Court in the case of Manish Maheshwari v. Asst. CIT [2007] 289 ITR 341 dated March 23, 2007 was not considered by the Tribunal. The assessee also relies on the decision of the hon'ble jurisdictional High Court in Southern Industrial Corpn. Ltd. v. CIT [2002] 258 ITR 481 (Mad.). 2. The facts of the case are that during the course of search under section 132 of the Act in the case of one Shri T. Rangroop Chand Chordia on June 7, 2000, details regarding property transactions in Ramaniyam Citadel at Block No. 10, Arumbakkam Village, Poonamallee High Road, Chennai, was found in the case of the assessees, Shri M. Janakiraman and his wife, Smt. P. A. Rani. It has been noted that both of them had sold the residentia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me-tax (Appeals) having found that extensive enquiries having been made during post survey enquiry all the facts relating to the land transaction already forms part of the Department records and as such it is incorrect to hold that the details had come to surface only because of the search. 2.3 The view of the Commissioner of Income-tax (Appeals) that since the assessee had not come forward with any disclosure during the survey, the Assessing Officer was within his powers to invoke the provisions of section 158BD of the Income-tax Act is totally incorrect." 4. The learned Commissioner of Income-tax (Appeals) was also not agreeable with the contention of the assessee. Vide paragraph 10.18, he has held as under : "10.18 So, if a survey operation is followed by a search operation and when the appellant had not come forward with any disclosure during the survey or search, the Assessing Officer was well within his jurisdiction to invoke the provisions of section 158BD against the appellant." 5. Thereafter, being further aggrieved, the assessee came up in appeal before the Tribunal in the second appeal. The Tribunal has given the following finding : "(2) IT (SS)A. Nos. 62 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transactions other than relating to the development of the property 'Ramaniyam Citadel', Arumbakkam Village, Poonamallee High Road, Chennai. There was specific information regarding investment of Rs.7.5 lakhs with Hotel Saravana Bhavan and also other property at No. 9, 'AA' Block, III Street, Anna Nagar West, Chennai-40. This information was not disclosed to the Department prior to the search action. The Assessing Officer has therefore prima facie reason to believe that these are undisclosed transactions. The Assessing Officer after complying with the requirement of section 158BD issued notice accordingly. We do not find any fault in issuing the notice under section 158BD. The same is therefore confirmed and the assessees' grounds in this regard are rejected." 6. Now, the assessees, through these miscellaneous applications have prayed for recall of the order of the Tribunal on jurisdiction aspect by mentioning that there was no recording of "satisfaction" of the Assessing Officer of the "searched person" and that the seized documents were not handed over by the Assessing Officer of the "searched person" to the Assessing Officer of the "other person", i.e., the assessees. Accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer of these assessees is an irrelevant matter in so far as assumption of jurisdiction under section 158BD is concerned. What transpires from the records is that the Assessing Officer of these assessees had initiated action after being satisfied that formed the basis for issue of notice and not the satisfaction of the Assessing Officer of the "searched party". 8. The Income-tax Appellate Tribunal, who exercises judicial powers, can hear the appeal filed against the order of the learned Commissioner of Income-tax (Appeals) and pass an order under section 254(1) of the Act. In case, any mistake apparent from the record creeps in this order, the same can be rectified under sub-section (2) of section 254 of the Act within a specified time provided therein on an application to that effect either filed by the Income-tax Officer or the assessee. Section 254(2) is being extracted below for ready reference : "254. (2) The Appellate Tribunal may, at any time within four years from the date of the order, with a view to rectifying any mistake apparent from the record, amend any order passed by it under sub-section (1), and shall make such amendment if the mistake is brought to its notic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt decision of the hon'ble Supreme Court rendered in the case of Manish Maheshwari (supra), wherein it has been categorically held that for proceedings under section 158BD, the Assessing Officer is required to record his satisfaction in writing in the case of the assessee who has been searched. Held portion of this decision is being reproduced hereinbelow for ready reference (headnote) : "Before the provisions of section 158BD of the Income-tax Act, 1961, are invoked against a person other than the person whose premises have been searched under section 132 or documents and other assets have been requisitioned under section 132A, the conditions precedent have to be satisfied. Held accordingly, that where the premises of a director of a company and his wife were searched under section 132 of the Income-tax Act, 1961 and a block assessment had to be done in relation to the company, the Assessing Officer had to (i) record his satisfaction that any undisclosed income belonged to the company, and (ii) hand over the books of account and other documents and assets seized to the Assessing Officer having jurisdiction against the company." 11. It seems that inadvertently the issue regar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal High Court was not brought to the notice of the Tribunal and it was brought to its notice by way of rectification application filed under section 254(2), this amounts to a mistake apparent from record which requires rectification. In the given case, the decision of the hon'ble Supreme Court was either not brought to the notice of the Bench or it was inadvertently lost site of. Therefore, in the given facts and circumstances of the case, non-recording of satisfaction and not handing over of the records as stated above to the Assessing Officer of these assessees, does amount to a mistake apparent from record in view of the abovementioned celebrated decision of the hon'ble Supreme Court in the case of Manish Maheshwari (supra). The hon'ble Madras High Court in the case of Southern Industrial Corpn. Ltd. (supra), has clearly held that when a statutory provision is interpreted by the Supreme Court in a manner different from the interpretation made in the earlier decisions of a smaller Bench, the order which does not conform to the law so laid down would clearly suffer from a mistake which would be apparent from the record. 13. The hon'ble Karnataka High Court in the case of Neeta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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