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TMI Blog2014 (10) TMI 903X X X X Extracts X X X X X X X X Extracts X X X X ..... hether the satisfaction stands correctly recorded; whether the same is in the manner as contemplated under the Act; whether these matters are at all justiciable, etc. are all matters of arguments, which do not arise out of the tribunal’s order, including the questions raised, and the arguments made in pursuance thereof, before it. Even otherwise, it is doubtful if these aspects could be considered in the rectification proceedings. Rather, as apparent from the reading of paras 3 to 7 of the impugned order, the arguments pertained to the satisfaction dated 30.08.2000, i.e., by the assessee’s A.O., and which having not been separately recorded again by the present A.O., was argued by the assessee to be violative of the scheme of the Act. As we observe, the tribunal confused the issue of notice u/s.158BD, i.e., on 30.07.2001, with the recording of the relevant satisfaction - which is to be by the A.O. of the person searched, comparing the said date with that of the finalization of his assessment u/s.158BC on 29.12.2000, and which are clearly not to be compared, particularly in the facts and circumstances of the case. The satisfaction in terms of section 158BD, it is clear from the rele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... late Tribunal, dismissing its appeals arising out of the assessee s assessment u/s.158BD for the block period 01.04.1988 to 17.12.1988 and the penalty order u/s.158BFA qua the said assessment. 2. It would be relevant to recount the background facts of the case. Assessment in the instant case was framed in the first instance u/s. 158BC by the Asstt. CIT (Investigation), Circle 9(1), Mumbai on 29.12.2000 pursuant to a notice u/s.158BC dated 30.08.2000, consequent to a search carried out on 17.12.1998 and 18.12.1998 at the office premises of R. K. Madhani Co. and other group cases. The matter travelled to the tribunal, which vide its order dated 28.11.2008 (in IT(SS) A No. 238/Mum/2001), annulled the assessment on the short legal ground that the assessee being not the person searched, no assessment u/s.158BC(c) could be made thereon. The tribunal having in fact upheld the order by the first appellate authority dated 30.05.2001, the Revenue proceeded against the assessee by the issue of notice u/s.158BD on 30.07.2001, finalizing the assessment thereunder on 28.07.2003 at ₹ 77.67 lacs, i.e., the sum at which the assessment was initially made u/s.158BC. Penalty order u/s. 158B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the plea being now adopted by the Revenue had been duly considered by the tribunal, and which therefore cannot be considered now in view of the limited scope of the proceedings u/s. 254(2), precluding review. Reference to the letter dated 27.01.2010 by the assessee s then A.O. (Asst. CIT, Circle 18(2), Mumbai) addressed to the ld. CIT-DR, as well as the arguments advanced by both the sides, recorded at paras 3 through 7 of the impugned order, was made for the purpose. It has also sought to place a chart showing date-wise sequence of events on record, even as without doubt only the material already on record can be taken cognizance of by the tribunal. Recording of satisfaction is a condition precedent for initiation of proceedings u/s.158BD, even as clarified by the apex court in Manish Maheshwari (Indore Construction Pvt. Ltd.) vs. CIT [2007] 289 ITR 341 (SC). A mere intimation could not be regarded as a satisfaction. 4. We have heard the parties, and perused the material on record. 4.1 As evident from the foregoing, the Revenue claims that there has been due recording of satisfaction by the A.O. (of the person searched), coupled with it s conveyance, along with the relevan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the assessee s A.O. It could have said that the letter dated 21.08.2000 did not amount to satisfaction; that a fresh satisfaction ought to have been recorded for initiating proceedings u/s.158BD, so on and so forth. There is, however, complete absence of any reference to the letter dated 21.08.2000, which forms the basis on which, firstly, notice u/s. 158BC (on 30.08.2000) and then u/s.158BD (on 30.07.2001) had been issued to the assessee. It is only in such a case that the assessee could make out a case, and perhaps validly, of the matter having been considered by the tribunal, so that it could not be revisited again u/s. 254(2), but only subject to review following the appellate procedure. The assessee alludes to letter dated 27.01.2010, and which further has reference to letter dated 21.08.2000. The same does not assist the assessee s case in any manner. On the contrary, it establishes that of the Revenue. The letters enclosed along with, being dated 23.09.2009 and 29.12.2008, is the communication between the assessee s A.O. and the ld. CIT-DR, representing the Revenue s case before the tribunal, in respect of the Revenue s appeals before it. Also enclosed along with is the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ord, i.e., the letter dated 21.8.2000 by the A.O. of the person searched, which speaks of disclosure (on account of inflated expenses), incriminating documents found at the time of search, also referring to the appraisal report, which it states as selfexplanatory. Besides, the Act does not prescribe any particular format or manner for recording satisfaction. What else does the A.O. of the person searched, alluding therein to the disclosure u/s. 132(4), inflated expenses, etc., request the addressee to proceed in the matter/take necessary action for, if not for assessment of income as per law? The letters 21.07.2010, 23.09.2009 and 29.12.2008 (supra); the statement recorded u/s. 132(4) of Shri G. R. Madani on 18.12.1998 (PB pg.4); the warrant of authorization dated 17.12.1998, et. al. are all supplementary materials, and have to be considered. Whether the satisfaction stands correctly recorded; whether the same is in the manner as contemplated under the Act; whether these matters are at all justiciable, etc. are all matters of arguments, which do not arise out of the tribunal s order, including the questions raised, and the arguments made in pursuance thereof, before it. Even otherw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceed and before the words against such other person , by Finance Act, 2002 w.e.f. 01.06.2002, which is therefore only clarificatory in nature, operating to validate even the assessment in the first instance on 29.12.2000; the second being on 28.07.2003. Reference may be made inter alia to the decisions in L. Hazari Mal Kuthiala vs. ITO [1961] 41 ITR 12 (SC) and Calcutta Knitwears (supra). The latter decision would render the reliance by the tribunal on the decision in the case of Manoj Agarwal (supra) as invalid. Further, the Revenue had, we also note, not accepted the order by the tribunal dated 28.11.2008 (supra), dismissing the Revenue s appeal quashing the assessment u/s.158BC dated 29.12.2000, but preferred an appeal there-against before the hon ble jurisdictional high court (in ITA No. 5138 of 2010). The hon ble court, however, vide its order dated 27.03.2012 (copy on record), disposed of the same by stating that the Revenue had since framed an assessment (i.e., the subject assessment), and which stands also reviewed by the tribunal vide its order dated 29.12.2010, so that it declined to answer the questions of law sought to be raised before it by the Revenue, which was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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