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TMI Blog2015 (12) TMI 1081X X X X Extracts X X X X X X X X Extracts X X X X ..... thout jurisdiction. In the circumstances, it is not necessary to consider the other issues sought to be raised by the Revenue. - Decided against revenue - ITA 719/2015, ITA 728 to 734 /2015, ITA 751/2015, ITA 791, 792, 794, 795/2015 - - - Dated:- 18-12-2015 - S. Muralidhar And Vibhu Bakhru, JJ. For the Appellant : Ms Suruchi Aggarwal, Senior Standing counsel with Ms Lakshmi Gurung. Mr Shiv Raj Singh, Dy. CIT For the Respondent : Mr C.S. Aggarwal, Senior Advocate with Mr Prakash Kumar and Mr.Gautam Jain JUDGMENT Vibhu Bakhru, J 1. The Revenue has filed these appeals under Section 260A of the Income Tax Act, 1961 (hereafter the Act ) impugning a common order dated 29th October, 2014 passed by the Income Tax Appellate Tribunal (hereafter the Tribunal ) in a batch of 12 appeals in respect of six Assessment Years ( AY ) being 2003-04, 2004-05, 2005-06, 2006-2007, 2007-2008, and 2009-10. The aforesaid 12 appeals included 6 appeals preferred by the Assessee and 6 appeals preferred by the Revenue. The said appeals, respectively, impugned six separate orders passed by the Commissioner of Income Tax (Appeals) [CIT(A)] all dated 22nd February, 2012 - disposing of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s forming core of the SVP Group, had been charging on-money on sale of flats and shops which was not accounted for in the regular books of accounts. According to the Revenue, usually this on-money was taken in cash and was routed back into the Group companies in the form of share application/unsecured loans, share capital, etc. These funds were further invested by the SVP Group of companies to purchase lands for new projects as well as for booking bogus expenses, as site development charges, for inflating the cost of construction. In addition to the four companies forming the core of the SVP Group, warrants for search and seizure operations were also issued in respect of twenty other companies. 6. The AO categorized the 106 companies, which had invested in the share capital of the aforesaid four companies of the SVP Group during the AYs 2003-04 to 2009-10, into 3 groups tabulated in Table-I, II and III. Table-I shareholders consisted of 20 companies which had been subjected to search and seizure operation under Section 132 of the Act; Table II shareholders comprised of 12 companies against whom proceedings were initiated under Section 153C of the Act consequent to the search con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 153C of the Act. The Assessee contended that the assessing officer of the searched person had not recorded his satisfaction that any money, bullion, jewellery or other valuable article or thing or books of accounts or documents seized or requisitioned belonged to the Assessee. It was contended that in the absence of such satisfaction, the AO could not have assumed jurisdiction to commence proceedings under Section 153C of the Act. The Assessee further contended that the amounts received by it were duly recorded in its books of accounts and, thus, no addition could be made under Section 68 of the Act. The CIT(A) called for a remand report on the submissions made by the Assessee. The AO submitted the remand report, inter alia, enclosing a satisfaction note recorded by the AO, which reads as under:- A search operation u/s 132(1) of the Income Tax Act, 1961 was conducted in the case of SVP Group of cases and concerned person at various officers and residences by issuing warrants of authorization u/s 132(1) of the Income Tax Act, 1961 on 14.10.2008 and various documents books of account, other valuable articles and other things were found and seized from various premises. On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Annexure A-84- Pages no 41- loose papers regarding purchase of shares by M/S Flucky Leasing Finance (P) Ltd B-4/71-A, Lawrence Road, New Delhi. These papers include resolution dated 30-03-2005 in favour of Mr. Ghansyam Dass, director, affidavit of Mr. Ghansyam Dass dated 05-02-2007 regarding investment of ₹ 1600000/- (in cash) in purchase of shares of M/s SVP Builders India Ltd., 5-share applications, acknowledgement receipt of return for assessment year 2006-07 along with P L A/c balance sheet, certificate incorporation of the company, one page of memorandum of association. Therefore, in view of the provision of section 153C(1) read with section 153A of the Income Tax Act, 1961, I am satisfied that proceedings u/s 153C read with section 153A is required to be initiated in the case of M/S Flucky Leasing Finance (P) Ltd., B-4-71-A, Lawrence Road, New Delhi. Accordingly, notice u/s 153C read with section 153A of the Income Tax Act, 1961 is being issued for the assessment years 2003-2004 to 2008- 2009. 10. The Assessee disputed that the documents referred to in the satisfaction note belonged to the Assessee. It was submitted that although some of the documen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lour to illegal transactions. 13. The Assessee as well as the Revenue preferred appeals against the orders passed by the CIT(A). Whilst the Assessee was mainly aggrieved by the decision of the CIT(A) in rejecting its contention that the proceedings under Section 153C of the Act were without jurisdiction; the Revenue challenged the deletion of the additions made under Section 68 of the Act. 14. The ITAT upheld the Assessee s contention that the documents found during search and seizure operation conducted with respect to SVP Group did not belong to the Assessee and, therefore, the assumption of jurisdiction under Section 153C of the Act was unsustainable. The ITAT also held that a satisfaction note had not been recorded by the assessing officer of the searched person and, therefore, initiation of proceedings under Section 153C of the Act was invalid. Insofar as the addition under Section 68 of the Act is concerned, the ITAT held that the sources of money received by the Assessee were duly explained, and therefore, deleted the addition made under Section 68 of the Act. Accordingly, the ITAT allowed the appeals preferred by the Assessee and rejected the appeals preferred by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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