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TMI Blog2015 (4) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee's cross objections, several grounds are raised. All the grounds relate to the issue of challenging the initiation of proceedings u/s 153C of the Act. 4. At the very outset, the ld. Counsel for the assessee, referring to the grounds raised in the COs, submitted that assessments made u/s 153C of the Act were invalid, since satisfaction was not recorded by the AO in the files of the searched person prior to initiation of proceedings u/s 153C of the Act. The said issue, it was submitted, is covered in favour of the assessee by the orders of the Coordinate Benches of this Tribunal which, in turn, had placed reliance on the judgment of the Hon'ble jurisdictional High Court in the case of M/s. Pepsico India Holding Pvt. Ltd v. ACIT reported in 367 ITR (673)/122 (Del) . 5. The ld. DR present was duly heard. The ld. DR has given a brief Note with reference to the issue raised by the ld. AR. The relevant portion of the Note of the ld. DR reads as follows:- "1. Assessee has relied upon the decision of Hon'ble Delhi High Court in the case of M/s. Pepsico India Holding Pvt. Ltd. in civil appeal no. 28 of 2015. In this regard, it is humbly submitted that the decision of Hon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eking information under RTI Act, 2005 - reg - Please refer to your application on the above mentioned subject. 2. From the assessment records of Sh. Bhupesh Kumar Dhingra which is covered under section 153A, for the asst. years from 2003-04 to 2008-09 (block period), it is noticed that there is no 'satisfaction note' available/recorded in respect of other entities. ............................................." Similar letter addressed to the other searched persons, namely, Smt. Poonam Dhingra and M/s. Madhusudan Buildcon Pvt. Ltd are also placed on record at pages 4 and 5 of the PB filed by the assessee. 8. The contention of the ld. Counsel of the assessee was that it is apparent from the assessment records of the searched entities that the required 'satisfaction Note' under section 153C of the Act was not recorded by the assessing officer of the searched persons/entities. 9. This issue raised by the Ld. counsel for the assessee is no longer res integra. The Co-ordinate Benches of this Tribunal have considered an identical issue to that of the present matter under dispute in their orders. The details of the orders of the earlier Benches of this Tribunal are as under: (i) Tanv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... replies have been given to Smt. Poonam Dhingra and M/s adhusudan Buildcon Pvt. Ltd. On a consideration of the above replies given by the Department to the persons searched, it is manifest that there is 'no satisfaction note available/recorded in respect of other entities'. On a conjoint reading of the Satisfaction note and replies given by the Department to the persons searched under the RTI Act, it clearly emerges that no satisfaction was recorded by the AO in the cases of the persons searched u/s 132(1) of the Act (i.e. Shri B.K. Dhingra, Smt. Poonam Dhingra and M/s Madhusudan Buildcon Pvt. Ltd.) that some books of account or documents etc. belonging to the assessee were found which were handed over to the AO of the 'other person' (i.e. the assessee). The Satisfaction note as reproduced above has been prepared by the AO of the assessee. Para 15. The ld. DR vehemently accentuated on the point that since the AO of the persons searched and the assessee is same, it does not make any difference whether the satisfaction is recorded in the case of the persons searched or other person. She emphasized on the factum of recording satisfaction by the AO, which condition in her opinion stood ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO of the person searched and the assessee is the same person, does not, in any manner, obliterate the requirement of law necessitating the recording of satisfaction in the case of the person searched that money, bullion, jewellery, etc., found from the person searched belongs to the 'other person.' What is crucial to note is capacity of the AO and not his identity. In view of the fact that when the statutory stipulation is for recording the satisfaction by the AO of the person searched, then, it cannot be substituted with the satisfaction of the AO of the 'other person.' This contention also fails. Para 18. At this stage, it is relevant to note that the legislature has substituted the latter part of section 153C(1) by the Finance (No.2) Act, 2014 w.e.f. 1.10.2014. The hitherto part of sub-section (1) : "and that Assessing Officer shall proceed against each such other person and issue notice and assess or reassess the income of the other person .........referred to in sub-section (1) of section 153A.' has been substituted as under : - 'and that Assessing Officer shall proceed against each such other person and issue notice and assess or reassess the income of the other person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the Tribunal, namely, ACIT vs. Inlay Marketing Pvt. Ltd. (ITA No.4200/Del/2012), etc. and DCIT vs. Aakash Arogya Mandir Pvt. Ltd. (ITA No.5437/Del/2013), etc., in which the notices and the consequential assessments u/s 153C, under identical circumstances, have been quashed. The ld. DR contended that the above referred two Tribunal orders are per incurium and should not be followed. The main reason for declaring the tribunal orders as per incurium was the non-consideration of the judgment of the Hon'ble jurisdictional High Court in judgment in the case of SSP Aviation Ltd. VS. DCIT (2012) 252 CTR (Del) 291. Para 23. Let us examine the case of SSP Aviation Ltd. (supra) for evaluating the contention that the instant assessment be declared as per law. The Hon'ble High Court in that case has held that the Assessing Officer having jurisdiction over the searched person should be satisfied that the valuable article or books of account or documents seized during the search belong to a person other than the searched person and there is no requirement in section 153C(1) that the Assessing Officer should also be satisfied that such valuable articles or books of account or documents belon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any satisfaction that some money, bullion, jewellery or books of accounts or other documents found from these persons belonged to the assessee. The absence of such satisfaction, in our considered opinion, failed to confer any valid and lawful jurisdiction on the AO of the assessee to proceed with the matter of the assessment u/s 153C of the Act. We, ergo, set aside the initiation and the ensuing assessment on the assessee as void ab initio. Para 27. The reliance of the ld. DR on some decisions on other legal issues or merits is of no consequence in view of the lack of jurisdiction of the AO to proceed with the assessments u/s 153C of the Act. In view of our decision on the first legal issue, there is no need to espouse the other grounds taken by the assessee dealing with other legal issues or merits." 11. In the case of M/s. Aakash Arogya Mindir P. Ltd v. DCIT (supra), the earlier Bench of this Tribunal had followed the judgment of the Hon'ble jurisdictional High Court in the case of Pepsi Foods P. Ltd v. ACIT (sic) Pepsico India Holding Pvt. Ltd v. ACIT [source: Para 6 on page 6 of the order dt.28.11.2014]. 12. In the light of the judgment of the Hon'ble jurisdictional High Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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