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TMI Blog2015 (8) TMI 218X X X X Extracts X X X X X X X X Extracts X X X X ..... agreement, Smt. Nanjamma, Shri Kumar, Shri Sanjeeva and Smt. Anamma; the owners of the property agreed to sell the property to the assessee herein for a sale consideration of Rs. 75 lakhs. A sum of Rs. 25 lakhs had been paid by way of cash at the time of signing of agreement and remaining sum of Rs. 50 lakhs was agreed to be paid within 15 months from the date of agreement at the time of registration of sale deed. It is very pertinent to mention that this agreement for sale has been signed only by the Vendor and not by the assessee, who is stated to be the purchaser in the agreement for sale. 3. The Assessing Officer assessing the assessee as well as Skyline group of cases was one and the same person. He recorded the satisfaction note in the case of assessee for proceeding to make an assessment us/. 153C of the Act as follows:- "Satisfaction note for initiating action u/s. 153C Action u/s. 132 was conducted in the premises of Skyline group of cases on 28/02/2008 based on the Authorization issued by the Addl. DIT (Inv)-II, Bangalore vide Warrant No. dated During the course of search in the case of Skyline group of companies and others, the following books/documents were found a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oresaid provisions that the crucial condition for assuming jurisdiction u/s. 153C of the Act is that the AO of the searched person should be satisfied that the document found in the course of search "belongs" to some other person. It was the plea of the assessee before the CIT(Appeals) that the agreement for sale dated 18.4.2009 which was seized in the course of search of Skyline group of cases was not signed by the assessee. In such circumstances, according to the assessee, seizure of an unsigned document in the course of search of a third party, cannot be the basis on which satisfaction as required u/s. 153C of the Act can be arrived at for assuming jurisdiction u/s. 153C. Pointing to the satisfaction note extracted in the earlier part of this order, the assessee contended that the basis on which the AO arrived at a conclusion that the seized document belongs to the Assessee was not proper and therefore proceedings u/s. 153C of the Act should be held without jurisdiction and quashed. 8. Apart from the above, the assessee also submitted cash book before the CIT(A) showing that there was availability of cash balance as per books of account from which the alleged cash payments coul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lfilled with the recording of satisfaction by the AO of the assessee. We are again unable to appreciate this contention that the commonness of the AO would make no difference in so far as the recording of satisfaction in the case of the persons searched is concerned. What is relevant for this purpose is not the identity of the person assessing but his position and the capacity. When the law requires the AO of the person searched to record the necessary satisfaction, it is the AO having jurisdiction over the person searched who is obliged to record such satisfaction in the capacity of that AO and that too in the case of the person searched. The mere fact that 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of indulgence of justice. 21. We agree in principle that technicalities cannot come in the way of dispensation of justice. However, it is important to note that the lack of jurisdiction by the AO cannot be put under the carpet in the guise of a technical defect. It goes without saying that no assessment or other proceedings can be lawfully taken up and completed unless the concerned authority has jurisdiction to do so. Lack of jurisdiction goes to the very root of the matter and cuts the tree of assessment if the foundation of jurisdiction is missing." 13. The ld. AR drew our attention to the satisfaction note and submitted that the same cannot be the basis to initiate proceedings u/s. 153C of the Act. 14. The ld. DR, on the other hand, placed reliance on the order of CIT(Appeals). 15. We have given a careful consideration to the rival submissions. The condition precedent for issuing notice u/s. 153C is that the document seized in the course of search of Skyline group of cases should belong to the assessee. In the present case, what was found was a photocopy of the agreement for sale dated 18.4.2004. Purchaser has not signed this document. In the course of search nobody was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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