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TMI Blog2016 (6) TMI 282X X X X Extracts X X X X X X X X Extracts X X X X ..... , dated 05-04-2013 in case no. CIT(A)- I/CC.1(1)/268/2011-12. 3. The Revenue has preferred appeal IT(SS)A 256/Ahd/2013 in case of third asssessee Shri Narendra R. Patel in assessment year 2008-09 followed by his CO No. 213/Ahd/2013 against the CIT(A)-I order dated 05-04-2013 passed in case no. CIT(A)- I/CC.1(1)/279/2011-12. Relevant proceedings in assessment years 2007-08 and 2008- 09 hereinabove are u/s. 153C r.w.s 143(3) of the Income Tax Act, 1961; in short "the Act". Last assessment year 2010-11 involves proceedings u/s. 143(3) of the Act. 4. We come to respective pleadings first. First assessee Shri Anil R. Darji pleads two substantive grounds in assessment year 2007-08. The first one challenges validity of section 153C proceedings. Latter ground on merits assails correctness of unexplained investment addition u/s. 69 of Rs. 56,61,200/- made by the Assessing Officer and affirmed in the lower appellate order. This assessee in assessment year 2008-09 raises identical no. of grounds inter alia testing validity of section 153C proceedings as well as unaccounted short term capital gain enhancement of Rs. 1,61,21,622/-; respectively. Shri Anil R. Darji raises multiple grounds i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under consideration as land had been purchased and the payment was made for this land as land was not sold to Suresh Patel & Vishnu Patel, therefore, ground No. 2 of the departmental appeal deserves to be dismissed/rejected." 6. This leaves us with the third Shri Narendra R. Patel. The Revenue has preferred IT(SS)A 256/Ahd/2013 against the CIT(A)'s order deleting unaccounted capital gains addition on sale of lands of Rs. 53,70,646/- and Rs. 32,53,733/- made on substantive and protective basis respectively by the Assessing Officer on the basis of various seized documents. The assessee's CO therein is stated to be identical to those extracted in preceding paragraphs. 7. We come to relevant facts first in assessment years 2007-08 and 2008-09. These three assessees are assessed as individuals. Shri Anil Darji deals mainly in petroleum products. Latter two assessees derive income from partnership firms, capital gains and other sources. The department conducted a search in case of M/s. Umiya Group and one of its partner Shri Vikas R. Patel. It came across an MOU(memorandum of understanding) dated 07-04-2007 pertaining to land plot no. 32, TP no. 29 of survey no 217/01 and 217/02 at C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the relevant satisfaction note reading as under:- "A search operation u/s 132 was conducted on Umiya Group by issuing warrants of authorization u/s 132 of the IT Act on 04.03.2010 and various documents/books of account/other valuable articles/other things were found and seized from the various premises covered u/s 132 of the IT Act. On verification of various documents found and seized from the residential premises of Shri Vikas R Patel situated at 23, Uma Bungalows, R.C. Technical Road, Ghatlodia, Ahmedabad, it is noticed that the page no 1-6 of annexure A-1 are 'Memorandum of Understanding' dated 07/04/2007 pertaining to the land at Final Plot No.32, TP No. 29 of Survey No.217/1 and 217/2 at Chandlodia admeasuring 2472 sq.mt. (2956 sq.yd). This memorandum of understanding is between Shri Brijesh S. Patel and Shri Mahendra D. Patel (First Party) and Shri Anilkumar G. Darji, Shri Amitkumar K Patel and Shri Narendra R Patel (Second Party). This memorandum of understanding has signature of all the above persons. Thus, I am satisfied that the page no 1-6 of Annexure A-1 belongs to Anilkumar G Darji. It is further noticed that page no 128 -135 of Annexure A-3 seized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted in this assessee's case. His case is that the revenue authorities have not placed on record any satisfaction to have recorded in searched parties' cases. Case law of hon'ble jurisdiction high court (2014) 222 Taxman 96 (Guj) DCIT vs. Lalitkumar M. Patel upholding tribunal's order in IT(SS)A No. 61/Ahd/2007 is also quoted. Shri Divetia submits that the impugned assessment framed u/s. 153C of the Act is liable to be quashed on this ground alone. 11. Next comes Shri Darji's argument that the impugned satisfaction for initiating section 153C proceedings does not comply with hon'ble apex court decision in Calcutta Knitwears case Civil Appeal no. 3958/2014 decided on 12-03-2014 that the same has to be recorded inter alia at the time or along with the initiation of proceedings against the searched persons u/s. 158BC or in course of the said proceedings or immediately after conclusion of the said assessment being framed. Our attention is invited to Board's circular No. 24/2015 date 31-12-2015 in pursuance to the above stated decision requiring an Assessing Officer to record section 153C satisfaction first in case of the searched assessee followed by a similar exercise in case of other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... age 10 of the CIT(A)'s order holding that this seized material belonged to the assessee. Case law of hon'ble jurisdictional high court in Kamleshbhai Dharamshibhai Patel vs. CIT Special Civil No. 13635/2012 decided on 24-12-2012 is quoted in support holding that the term ' belongs to' can be stated to be having relation or reference to Shri Jagdish invites our attention to facts narrated in this judgemnt treating vendors payment receipt containing their signatures held as to be belonging to them. Another case law (2014) 162 TTJ 171(AHD) Pravinbhai Keshavbhai Patel vs. DCIT treating an MOU to be belonging to parties therein is quoted in support. Shri Jagdish accordingly seeks to defend the impugned assessments by stating that the same confirms to all the legal requirements necessary for initiating section 153C proceedings. 15. Shri Anil Kshtriya represents the remaining two assessees Shri Amit K. Patel and Shri Narendra R. Patel. He files voluminous written submissions after putting a lot of effort for supporting the above extracted cross objections. He clarifies that the Assessing Officer had framed protective assessment in his cases. Shri Kshtriya strongly submits that the Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d his search statement deposing that these three assessees had received unaccounted cash money of Rs. 2.5 crores. The Assessing Officer is admittedly common in all these cases. He initiated section 153A proceedings against Shri Vikas R. Patel on 18-02-2011. This followed three separate satisfaction under challenge. The Assessing Officer recorded section 153C satisfaction in case of Shri Darji on 14- 07-2011 as followed by remaining two dated 19-07-2011 in cases of S/sh Amit K. Patel and Narendra R. Patel. We have already extracted hereinabove satisfaction note in case of Shri Anil R. Darji. We find that remaining two satisfactions dated 19-07-2011 are repetition thereof in extempore except namesake difference. We put up a specific query to Shri Jagish appearing at Revenue behest as to whether or not the Assessing Officer recorded satisfaction in case of Shri Vikas R. Patel's. His reply is in negative. He reiterates his submission already made that the impugned satisfaction has to be taken as a common one in case of the searched party as well as all the three assessees herein as per Kolkata bench decision (supra). We tend to disagree with this Revenue's contentions. The law is very ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d section 153C proceedings. Latter ground on merits challenged correctness of the above stated addition. We reiterate that the instant adjudication is confined to legal aspect only. The assessee argued in the course of lower appellate proceedings that none of the seized material belonged to him as contemplated under section 153C of the Act. The CIT(A) concurs with the Assessing officer to hold that above stated incriminating material annexure-55, 64 to 65 belongs to assessee only thereby rejecting assessee's legal plea. 7. This leaves the assessee aggrieved. 8. Learned authorised representative opens up assessee's arguments. We are taken to the satisfaction note relevant for initiation of the impugned section 153C proceedings reading as under :- "Satisfaction note to initiate proceeding u/s. 153C r.w.s.153A of the IT Act in the case of Mr. Shailesh R. Daxini A search u/s 132 of the IT. Act 1961 was conducted in the case of Kunwaji Commodities & Brokers Pvt. Ltd. and other persons of Kunwarji Group on 25.03.2008 & subsequent dates and various documents were found & seized. On verification of various documents found and seized from the business premises of Kunwarji Commod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed assessee under section 153C. We are informed that the department has furnished the above extracted satisfaction only to have been entered for the purpose of initiating the impugned proceedings. The assessee accordingly contends that this course of action adopted by the Assessing Officer is not sustainable as per the case law of hon'ble jurisdictional high court (2014) 222 Taxman 96 (Guj) DCIT vs. Lalitkumar M. Patel upholding tribunal's order in IT(SS)A No.61/Ahd/2007 propounding this two tier exercise of satisfaction first in case of the searched party followed the one in case of the other assessee as under :- "7. Copy of the reasons recorded for issue of notice under Section 158BC is at page no.25 of the Revenue's paper book which reads as under: "REASONS FOR ISSUE OF NOTICE U/S.158BD OF THE ACT. Assessee : Shri Upendra N. Patel, Shri Lalit M. Patel & Shri Champak M. Patel "A search and seizure action in the Jayraj Group was carried out u/s.132 (1) on 19 12.2001. Certain incriminating documents pertaining to Shri Upendra N.Patel, Shri Lalit M.Patel & Shri Champak M.Patel has been seized, which have not been accounted for in his regular books of accounts. The seized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her hand, relied upon the orders of the authorities below and stated that the satisfaction recorded by the AO under Section 158BC is a valid satisfaction because the persons who recorded the satisfaction was the AO for Jayaraj Group of cases as well as the assessee. He also submitted that notice under Section 158BD was duly issued before the completion of the assessment under Section 158BC read with section 263, in the Jayraj Group of cases. 9. We have heard both the parties and perused the material placed before us. The provisions of section 158BD has been considered by the Hon'ble Apex court in the case of Manish Maheshwari (supra). At Page No.348 of the report, Their Lordships held as under: "The condition precedent for invoking a block assessment is that a search has been conducted under section 132, or documents or assets have been requisitioned under section 132A. The said provision would apply in the case of any person in respect of whom search has been carried out under section 132A or documents or assets have been requisitioned under section 132A. Section 158BD, however, provides for taking recourse to a block assessment in terms of section 158BC in respect of any ot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 158BC proceeding and nowhere else. It is the Assessing Officer assessing the person searched who goes, through the seized material and comes to a decision as to whether there is any undisclosed income unearthed as a result of search, if so its nature and to whom it belongs. If the said undisclosed income belongs to the person searched that is the end of the matter. If, on the other hand, the material examined shows that the undisclosed income pertains to some other person he has to give a finding to this effect and thereupon transmit the related seized material to the Assessing Officer having jurisdiction over the other person. All these findings have to be recorded after an honest appreciation of the seized material with an objective mind and there has to be a record reflecting such findings on the basis of which alone the other Assessing Officer can assume jurisdiction to proceed against the other person and it is this record which forms the 'note of satisfaction' or the 'record of satisfaction'. In such circumstance, the recording of such satisfaction is impliedly to be done in the course of the section 158BC proceeding as the satisfaction has to be recorded o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of the assessee we have reproduced the satisfaction note in para-7 above. 12. From the satisfaction note, it seems that it is recorded by the AO of the assessee and not the AO of Jayraj Group of cases. This inference of ours is on the following basis: i) Heading of the note is "Reasons for issue of Notice u/s.158BD of the Act". Thus, it is the reasons recorded by the AO before the issue of notice under Section 158BD. Obviously, the reason is recorded by the AO who issued the notice under Section 158BD. It seems that the AO considered the provision of section 158BD similar to Section 148 and therefore before the issue of notice, he recorded the reasons for issuing of such notice. ii) The name of the assessee mentioned in the satisfaction note is Shri Upendra N. Patel, Shri Lalit M. Patel & Shri Champak M. Patel. Thus, the reason is recorded in the case of these assessee and not in the case of Jayraj Group of cases. Had the satisfaction recorded by the AO of Jayraj Group of cases, then the name of the assessee would have been "Jayraj Group of cases" and not as Shri Upendra N. Patel, Shri Lalit M. Patel & Shri Champak M. Patel. iii) In the first line of the sat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore respectfully following the decision of the Hon'ble Apex Court in the case of Manish Maheshwari (supra) and the decision of the Special Bench of the ITAT in the case of Manoj Aggarwal (supra), hold that the issue of notice under Section 158BD in the case of the assessee was not valid. We quash the same. Once the notice under Section 158BD itself is quashed, the assessment order passed under Section 158BC in pursuance to the notice issued under section 158BD is also quashed. " Learned authorised representative accordingly submits that the Assessing Officer has erred in taking recourse to above stated satisfaction note as the triggering point for initiation of section 153C proceedings under challenge. 10. We afforded ample opportunity to the learned departmental representative for defending legality of the impugned proceedings. These case files were part heard on 10.03.2016. We directed the Revenue to produce the relevant satisfaction note(s) entered before initiation of the impugned section 153C proceedings. The case stood fixed for 22.03.2016 and 01.04.2016. Learned departmental representative could not produce any specific satisfaction note in the case of the search ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he end of assessee. The law does not require the manner and the procedure of keeping the files. The section only requires that a satisfaction be recorded and it should be during the period propounded by Hon'ble S.C. in Calcutta Knitwears, that has been recorded in the present case. It is available on page 74 of the Paper Book. The second scenario can also happen that seized material of KPC group might be kept in a common bundle, wrapped in a cloth where all the files are emanating from search and survey are being placed. If the above satisfaction note was found to be tagged with other file would it be held that no satisfaction was recorded. In our understanding the reply will be that satisfaction was recorded." Learned departmental representative thereafter takes us to the co-ordinate bench conclusion of the Assessing Officer having recorded satisfaction after noticing that both assessee's case files were on the same table as under :- "20. As far as the judgments relied upon by the ld. counsel for the assessee are concerned, we have considered them and they are distinguishable on facts. The emphasis of the ld. counsel for the assessee was on the decision of ITAT in the case o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rst level in case of the searched entity opposed by the Revenue by saying that the Assessing Officer is the same who has expressed satisfaction in assessee's case. The law about entering of such a satisfaction is very well settled now. Hon'ble apex court in the case of Manish Maheshwari vs. ACIT (2007) 289 ITR 341 (SC) holds that such a satisfaction is indeed mandatory. We deem it appropriate to observe that this case dealt with block assessment scheme under section 158BD of the Act as it existed in the erstwhile avatar under Chapter XIV-B of the Act. The same stands repealed by newly inserted sections 153A to 153C by the Finance Act 2003. It comes to our notice that the Central Board of Direct Taxes has issued its Circular No.24 of 2015 already accepting that rigor of section 153C vis-a-vis 158BD is substantially similar/pari materia as held by various hon'ble courts. It further clarifies that recording of section 153C/158BD satisfaction is a must in case of searched person followed by transmission of the case records to the Assessing Officer of the other assessee. Para no.4 of this Circular further envisages that this dual exercise is to be complied with even if the Assessing Off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned co-ordinate bench in Lalit Kumar M. Patel's case, the Assessing Officer in the impugned satisfaction mentions only assessee's name on top of the satisfaction note and not that of the searched entity. There is no material placed on record before us that the Assessing Officer had kept the case files of the searched party and that of the assessee together before drawing the impugned satisfaction note. It is made clear that the Revenue's contention based on Kolkata bench decision of the tribunal puts a heavy onus on the department to positively prove that the same Assessing Officer in case of searched assessee as well as the third party had collectively examined the case files before recording a satisfaction note contemplated under section 153C of the Act. Needless to say, this burden stands un-discharged. We hold in these peculiar facts and circumstances that the Revenue's arguments justifying the impugned satisfaction note are devoid of merits being not supported by any evidence much less in the nature of substantive material. We conclude in view of the above stated legal position, board's circular and our discussion hereinabove that the Assessing Officer has not recorded a v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income instead of short term capital gain on substantive basis in the hands of the appellant in respect of land deal bearing survey No.206 at Chandlodiya. The enhancement made by CIT(A) was illegal unlawful and without jurisdiction apart from against the principles of natural justice. 3.1 The Ld. CIT(A) has grievously erred in law and or on facts in holding that the entire sales consideration in cash from Shri Vikas Patel was received by the appellant alone and had not paid over a part of their share to Shri Amit Patel and Narendra Patel. The observations made and conclusion reached by CIT(A) to hold that the entire consideration paid in cash as belonging to the appellant and had not passed on their share to the remaining co-purchasers are not admitted by the appellant so that the same should be condemned. The Ld. CIT(A) ought not to have arrived at these conclusions without allowing sufficient opportunity to the appellant or furnishing the material produced by the said co-purchasers or before passing the appellate order in their cases. The Ld. CIT(A) has grossly erred in ignoring the overwhelming evidence including the findings given by AO in asstt order as well as in remand re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le deed price of Rs. 73.58 lacs. He referred to assessee's statement u/s. 131 dated 16-06-2010 recorded before the ADIT(Investigation) confirming cash receipt of Rs. 36 lacs. The Assessing Officer sought to add further sum of Rs. 3,14,84000/- in the nature of undisclosed income. 23. The assessee filed reply on 10-11-2011 inter alia stating that there were five partners in the above stated land transaction (supra). He pleaded for equal addition in all these cases. Shri Darji highlighted that he had received Rs. 36 lacs only in cash and Rs. 73.58 lacs by cheques. Latter sum was clarified to have been obtained on behalf of all other partners. The Assessing Officer thereafter issued notices to the remaining two assessees. S/sh Amit K. Patel and Narendra Patel. They denied to have signed the MOU in question. And pointed that no opportunity to cross examine or copy of Shri Patel's search statement had been given. The Assessing Officer summoned Shri Darji as well as Shri Patel. The other two assessees did not cross examine them. They claim to have waived off all their rights in the land in question in the relevant revenue record on 25-04-2008 duly stated in page 6 of the sale deed as in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... these payments, it is established that the said MoU was duly executed and unaccounted payment of Rs. 150 lakhs was made on this land transaction (in accordance with statement of Shri Vikas R Patel recorded u/s 132(4) of the IT Act on 05/03/10 and submission of Shri Bhagwan K Ajara dated 12/12/11). In view of this, total short-term capital gain on sale of land at 206, Chandlodiya is computed at Rs. 2,19,33,000 (ie Rs. 1,50,00,000 (cash) + Rs. 73,58,000 (cheque) -Rs 4,25,000). It is considered that the cash payment of Rs. 150 lakhs was distributed equally among the five persons (viz Shri Amitkumar K Patel, Anilkumar G. Darji, Narendra Patel, Chandu Patel & Shri Bhagyesh Patel as the land was originally held jointly by each of these persons), the taxable capital gain in the hands of Shri Anil G Darji comes at Rs. 73,15,000 (ie Rs. 30,00,000 (cash) + Rs. 44,15,000 (cheque)- Rs. 1,00,000) as follows Sale Consideration Payment made for purchase (Rs) Taxable Capital Gain (Rs) Cash (Rs ) Cheque (Rs ) Shri Anil G Darji 30,00,000 44,15,000 1,00,000 73,15,000 However, the assessee (Shri Anil G Darji) in his return of income for AY: 10-11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee preferred an appeal. Other parties/assessees S/sh. Amit K. Patel and Narendra Patel preferred their separate appeals. The CIT(A) inter alia holds that the latter two assessees do not have any stake in the seized material documents dated 03-05- 2008 and 13-05-2008 thereby waiving off all their rights and interests in the revenue record on 25-04-2008, Shri Darji had entered into an adventure in real estate business thereby deciding the issue against him as follows:- "5. I have gone through the assessment order and submission of the A.R. of the appellant and also submissions of Shri Narendra R. Patel and Shri Amit K. Patel in their appeals in appeal No.CIT(A)- I/CC. 1(1)7280/2011-12 and appeal No. CIT(A)-I/CC.l(l)/269/2011-12 dated 05.04.2013 respectively. I have also perused the statement recorded of the concerned persons. It is seen that the inferences drawn by the Assessing Officer are mostly on sound footing except in a few cases where he has erred. From the sequence of events, it is clear that the contention of Shri Amit K. Patel and Shri Narendra R. Patel that they were only name holder does not appear to be sound because it is seen that Shri Anil G. Darji himself is a agri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Shri Amit K. Patel, Shri Anil G. Darji, Shri Narendra R. Patel, Shri Chandu Patel and Shri Bhagyesh Pate! (the selling party) for the sale of land has been signed by Shri Brijesh Patel, Shri Deepak Prajapati and Shri Anil G. Darji only. This finding has been recorded by the Assessing Officer on page No. 14 of the assessment order. 5.4 Further, the sale deed for this land (at Survey No.206 at Chandlodia) was executed by Shri Anil G. Darji, Shri Chandu Patel, Shri Bhagyesh Patel as sellers and Shri Brijesh Patel and Shri Deepak Prajapati as buyers for sum of Rs. 73,58,000/-. This deed was not signed by Shri Narendra R. Patel or Shri Amit K. Patel. This finding has been recorded by the Assessing Officer on page 15 of the assessment order. In view of the above, it is clear that Shri Amit K. Patel and Shri Narendra R. Patel received only a sum of Rs. 1,00,000/- each at the time of transferring their rights to Shri Anil G. Darji and had no rights left in the land after 02.04.2008. 5.6 It is seen that as far as Shri Amit K. Patel and Shri Narendra R. Patel are concerned, these persons had joined with the appellant and other two partners namely Shri Bhagyesh Patel and Shri Chand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have not signed the banakhat which was made between Shri Brijesh Patel and Shri Deepak Prajapati (purchasers) and Shri Anil G. Darji (seller) for a sum of Rs. 73,58,000/- by cheque of Rs. 1,50,00,000/- by cash. This deed has been signed by Shri Brijesh Patel and Shri Deepak Prajapati on behalf of the purchasers. However, on behalf of sellers, only Shri Anil G. Darji has put his signatures. (iii) However, the sale deed has been executed at 73,58,000/- by cheque where all the three persons i.e. Shri Anil G. Darji, Bhagyesh Patel and Shri Chandubhai Patel have signed as sellers. Thus, it is clear that Shri Bhageysh Patel and Shri Chandubhai Patel not being signatories to the banakhat dated 13.05.2008 cannot be said to be parties to the cash transactions. However, the cash receipts as evidenced by page No.128, 129 and 132 of Annexure-A-3 seized from the residential premises of Shri Vikas R. Patel have been signed only by Shri Anil G. Darji. (iv) Part of the cheque payment was to be received by Shri Chandubhai Patel (20%) and Bhagyesh Patel (20%). 5.7 The above clearly indicates that the money has been received by Shri Anil G. Darji alone. In view of the above, the following in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Assessing Officer having jurisdiction over such third person. He emphasizes that this section 153C satisfaction date 14-07-2011 is the relevant date for taking into account preceding six assessment years before the assessment year relevant to the previous year of the search. His contention is that the impugned assessment year 2010-11 comes within block of six assessment years preceding the date of search to be constructed as 14-07-2011 on the basis of first proviso to section 153C(1). It strongly argues that the relevant six assessment years would accordingly be 2006-07 to 2011-12 including the impugned assessment year 2010-11. Learned counsel submits that this illegality is assumption of jurisdiction violates the entire assessment as held by hon'ble Delhi high court in (2016) 380 ITR 612 CIT vs. RPJ Securities. 28. Learned counsel thereafter argues on merits of the impugned addition by inter alia stating that this assessee had only 1/5 share in the land in question, he received Rs. 36 lacs as already declared in the return, his signature are not thereon, the receipt which leads to an inference all the five partners (supra) have received the cash component alike the one by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amed the impugned regular assessment u/s. 143(3) of the Act making the impugned additions in assessee's hands as confirmed/modified in the lower appellate order. The first issue between the parties is about validity of this regular assessment. The assessee's case is that the impugned assessment year 2010-11 comes within six preceding assessment years from date of section 153C satisfaction/receipt of record by his Assessing Officer on 14-07- 2011 and therefore, he ought not to have been proceeded u/s. 143(3) of the Act. The Revenue seeks to reject this legal plea. We are of the opinion that Special Bench decision of the tribunal (supra) has taken into account all the relevant law to conclude that such a legal plea can be allowed to be raised if necessary for determining appropriate tax liability without requiring any new endings. We quote the same to overrule the Revenue's objections. 32. We come to assseess's legal argument now. Section 153C of the Act as applicable in the impugned assessment year 2010-11 reads asunder:- "153C(1)[Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person, such Assessing Officer shall issue the notice and assess or reassess total income of such other person of such assessment year in the manner provided in section 153A.]" 33. A perusal of the above extracted section makes it clear that the same applies in case it is found that any money, bullion or jewellery or other material stated therein belongs to any other person, the Assessing Officer shall arrive at the necessary satisfaction to proceed against such a third party by handing over the necessary record to the Assessing Officer having jurisdiction. Section 153C(1) contains a proviso to the effect that reference of the date of search or requisition in case of a third person is to be construed as the date of receiving the books of accounts or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over the third person in question. This is followed by sub-section 2 to section 153C. This provision envisages the course of action to be adopted by the latter Assessing Officer having jurisdiction over a third person on receiving the relevant record afte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11 i.e. well within the statutory limit of six months from the end of the financial year of filing of return. This section 143(2) proviso limitation expires on 30-09- 2011. The legislature envisages in section 153C(2) clause (b) that this limitation for issuing section 143(2) has to expire so as to result in initiation of section 153C proceedings. This admittedly is not the case here. We apply reverse implication rule that the legislature in its full wisdom does not include a case wherein limitation for serving section 143(2) notice has not expired after a third party has furnished return. Clause (c) to sub-section 2 of section 153C of the Act applies in case assessment or reassessment have been framed. There is no such factual position exiting herein. We conclude in these facts and circumstances that all the relevant conditions in sec. 153C(2) clause (a) to (c) must be satisfied before an Assessing Officer having jurisdiction over such third party for initiating section 153C proceedings. We are of the opinion that the proviso to sub-section 153C(1) applies only if the main provision is attracted and not in isolation. Our view is that the Assessing Officer could not have invoked se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... He does not dispute the correctness of having received cash amount in principle since he has already declared Rs. 36 lacs in the return turning out to be more than his share of Rs. 30 lacs. This itself is sufficient to decline his apportionment plea. It further transpires that his two partners S/sh Amit K. Patel and Narendra R. Patel had already waived off their interests in revenue record on 25-04-2008 in Shri Darji's favour. The same precedes the impugned seized material dated 03-05-2008 and 13-05-2008. The assessee accordingly acquired 60% interest in land in question. This fact is evident from the contents of the registered sale deed dated 17-11-2009. We are of the view that 60% of the impugned cash amount of Rs. 1.5 crores coming to Rs. 90 lacs has to be assessed in assessee's hands in any case even if his apportionment plea is accepted. 39. The assessee's further case that the two co-shares/covendors have to be assessed for the remaining sums. We find that it is the assessee only who has signed the relevant documents revealing cash payments in question. He is the only person receiving even the cheque payments on behalf of other co-vendors. We are of the opinion that it was f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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