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TMI Blog2018 (1) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... d CIT (A) is erroneous and is not tenable on facts and in law. 3. The facts in the case of ITA No. 156/Del/2012 for AY 2007-08 in case of Shri Vikram Bahal are noted here. The search and seizure u/s 132 of the Act was carried in Gopal Zarda Group of cases on 15.01.2009. Therein certain documents belonging to the assessee were found. Therefore, notice u/s 153C of the Act was issued to the assessee. In response to which the assessee filed returned of income on 28.10.2010 for ₹ 3009836/-. The original return was filed on 31.07.2007. The ld Assessing Officer on those documents which determine undisclosed income of capital gain on sale of shares of M/s. BahalSons Properties Pvt. Ltd was added wherein, assessee s share is to the extent of 33% of unaccounted receipt of ₹ 13.5 crores was determined. On appeal before the ld CIT (A) the addition was deleted with detailed reasoning. Therefore, revenue is in appeal before us. 4. In the hands of Mr. Vijay Bahal identical addition was made which is contested in ITA No. 1855/Del/2012. 5. The third person was Mr. Vinod Bahal in whose case the similar addition was made. The issue in case of Mr. Vinod Bahal came before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come of ₹ 1,15,53,740. The assessee also demanded copy of letter of handing over material to Assessing Officer, copy of seized material belonging to assessee, copy of statement recorded etc. vide letter dated 19.10.2010. The assessee also raised objection against the issuance of notice under sec. 153C on 11.11.2010 vide his letter dated 9.11.2010. These objections were summarily rejected by the Assessing Officer and the requested copies of documents were not supplied to the assessee. Vide letter dated 8.12.2010, objections were again raised stating further that no satisfaction note‟ etc. was given. 4.2 The Learned AR contended that following objections were raised during the course of assessment proceedings: a) No document or material belonging to assessee is found in the search. b) Neither there is any satisfaction nor there is any handing over of seized material in terms of provisions of sec. 153C of the I.T. Act. c) Neither any material/statement of Sh. Sri Gopal Gupta/satisfaction note etc. as referred in the rejection letter or otherwise, except page Nos. 46-47 of Ann. A-30, is given/shown to assessee nor even replies on the allegations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are not of the assessee or belonging to assessee. The alleged satisfaction note supplied during the course of first appellate proceeding, there is reference of page No. 39 to 63 of Annexure-5 of party R-l but during whole assessment proceedings and even in assessment order, the said pages have not been referred/relied upon by the same Assessing Officer. Despite request, these papers were not supplied to the assessee. 4.4 The Learned AR further submitted that the basis of issue of notice under sec. 153C of the Act was stated to be the share sale in the present year and page Nos. 46-47 of Annexure A-30 found during the course of search stated to have been conducted at various persons of Gopal Group. As pr order sheet entry dated 11.11.20101, page Nos. 50 to 58 contends the details of expenses on acquisition/renovation of hotel Grace Mount, Mussorie of ₹ 40.36 crores and page Nos. 46 and 47 reflects that ₹ 12.05 crores were booked in the accounts while ₹ 13.5 crore was out of accounts and on the basis of said papers, Shri Gopal Gupta had surrendered ₹ 25 crores as income. The Learned AR referred page Nos. 6 to 9 of the assessment order wherein relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . - ITA No. 164/2015 and Ors. - Judgment dated 30.10.2015, also reported in 2015 (11) TMI 19 - Delhi High Court; ii) Pepsico India Holding (P) Ltd. vs. ACIT (2015) - 50 taxmann.com 299 (Del.); iii) DCIT vs. Qualitron Commodities (P) Ltd. (2015) - 54 Taxman.com 295 (Del.); iv) Natural Products Bio-tech Ltd. DCIT (2015) - 53 Taxmann.com 400 (Delhi-Tribunal). 5. The Learned CIT(DR) on the other hand placed reliance on the assessment order and submitted that the documents seized which find reference in the assessment order belonged to the assessee and thus the Assessing Officer was justified in making the addition of ₹ 4,50,00,000 in the hands of the assessee on account of undisclosed capital gain on sale of shares of Bahai Sons Properties Pvt. Ltd. The assessment has been framed on the basis of valid notice issued under sec. 153C of the Act. 6. Having gone through the orders of the authorities below, we find that an identical issue on the validity of notice issued under sec. 153C read with 153A of the Act was raised before the Assessing Officer but the assessee could not succeed. The same issue was again raised before the Learned CIT(Appeals) vide g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat neither any material/statement of Shri Gopal Gupta/satisfaction note etc. except page Nos. 46 47 of Annexure A-30 was given/shown to the assessee. Page Nos. 46 47 of the said annexure, did not belong to the assessee. There was no information in those documents about the assessee and about any transaction related to the said company/hotel. It was contended that neither Mr. Ashok Aggarwal nor Shri Gopal Gupta has ever entered into the transactions of sale or any other transaction and while Mr. Aggarwal is a total stranger but Mr. Gupta is remotely known as he acquired some shares from other shareholders under the agreement dated 19.6.2007. It was reiterated that issue of sale of shares of said company/hotel was already examined and finalized by the assessment order framed under sec. 143(3) on 27.11.2009. It was submitted that page Nos. 50 to 58 contains the details of expenses on acquisition/renovation of hotel Grace Mount, Mussorie of ₹ 40.36 crores and page Nos. 46 47 reflects that ₹ 12.05 crores were booked in the accounts while ₹ 13.05 crores was out of account and on the basis of said papers Shri Gopal Gupta had surrendered ₹ 25 crores as income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e qua non for initiating action under sec. 153C is recording of objective satisfaction by the Assessing Officer that Articles/Documents which are seized or requisition belong to a person other than the person searched. 10. As discussed hereinabove in die present case, there was no seized material (which includes document) belonging to the assessee and when the assessment under sec. 143(3) accepting the sale consideration per share was already framed, invocation of provisions under sec. 153C of the Act in the present case was not valid. We hold so with this further finding that the assessment framed in furtherance to the such invalid initiation of proceedings under sec. 153C is also invalid and is quashed as void ab initio. The objection No.l of the cross objection is thus decided and allowed in favour of the assessee. The remaining objection of the cross objection preferred by the assessee and the grounds of the appeal of the Revenue questioning the validity of deletion of addition of ₹ 4,50,00,000 made in the hands of the assessee on account of undisclosed capital gain on sale of shares of Bahai Sons Properties Pvt. Ltd., thus do not survive in view of the above findin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n his favour by the order of the Hon ble ITAT in ITA No. 1857/Del/2012 and CO No. 208/Del/2012 in the case of a family member of the assessee. In the sand decision the Hon ble ITAT allowed the cross objection of the assessee holding that invocation of provisions of section 153C was invalid and void abinitio. The revenue s appeal was dismissed on the ground that since proceedings u/s 153C were held to be void abinitio; the Revenue s appeal did not survive. Since the evidence of unaccounted payment was found in this case, it again raised the issue common to that involved in the other cases, for which requested for constitutions of Special Bench has been made, as to whether such addition should be made u/s 153C or the proceedings u/s 148 can be started simultaneously, while proceedings u/s 153C are in progress. 7. The Ld. and authorized representative vehemently submitted that the issue in the present appeal is squarely covered in favour of the assessee in view of the decision of the coordinate bench in case of Sri Vinod bahal. He further submitted that there is no issue of notice under section 148 and therefore the argument made by the Ld. departmental representative is in appropr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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