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TMI Blog2018 (8) TMI 510X X X X Extracts X X X X X X X X Extracts X X X X ..... this case may be followed in remaining ITA.Nos.1615 to 1618/Del./2011 for A.Ys. 2002- 2003 to 2005-2006. We, therefore, proceed to decide ITA.No.1614/Del./2011 as under : ITA.No.1614/Del./2011 - A.Y. 2001-2002 : 4. This appeal by assessee has been directed against the Order of the Ld. CIT(A)-1, Ludhiana, Dated 28.01.2011, for the A.Y. 2001-2002. 5. Briefly, the facts of the case are that a search and seizure operation was conducted at the residential premises of Shri Navneet Jhamb and Shri Shri S.D.Kathuria partners of assessee-firm on 04.08.2005. A survey under section 133A of the I.T. Act, 1961 was also carried out at the business premises of the assessee-firm. During the course of search operation at the residential premises of Shri Navneet Jhamb documents/ loose papers detailed as A-l to A-2 were seized as per Panchanama dated 04.08.2005. Documents detailed as A-l to A-3 were also seized from residential premises of Shri S.D.Kathuria as per Panchnama dated 04.08.2005. Further, documents detailed as Annexures A-l to A-9 and D-l to D-26 were impounded from business premises of assessee-firm. On examination of Annexure A-l seized from the residential premises of Shri Navneet J ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d with. Further, the A.O. was not satisfied that any books of account or documents seized in any search belong to the assessee-firm. No copies of the satisfaction note have been given to the assessee-firm and statutory conditions are not satisfied. The remand report from the A.O. was called for, in which, the A.O, reiterated the same facts as noted in the assessment order that assessee-firm earned undisclosed commission and profit and that satisfaction as required under section 153C have been recorded. The assessee-firm also filed rejoinder in which same facts have been explained and it was submitted that satisfaction as required under section 153C have not been recorded, therefore, assumption of jurisdiction is illegal and void abinitio. The assessee-firm relied upon the Judgment of the Hon'ble Supreme Court in the case of Manish Maheshwari 289 ITR 341 and Order of ITAT, Lucknow Bench in the case of ACIT vs. Smt. Surinder Kaur 120 TTJ 618. The A.O. did not bring any evidence on record that the documents found during the course of search belong to the assessee-firm. Several decisions in support of the above contention were also relied upon. The Ld. CIT(A), however, rejected the con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purchase, and sale of land measuring 89 Kanal 13 Merla at Jharsetli were seized from the residence of Sh. Navneet Jambh. There are calculations of these papers regarding receipt of cheque amount and cash amount in respect of sale of above said land. Reference is invited to page 56- 62. Document A-1 and also pages 13-17 of Document A-l and further pages 53-57 of Document A-2. Page 53 of annexure A-2 contains details, of commission and profit earned by M/s. Reliance Estate Agency. Pages 45 to 48 of annexure A-l also contain details of commission account earned, by the Reliance Estate Agency. 2. Document A-l seized from the residence of Sh S.D.Kathuria partner is a pocket diary and contains entries pertaining to M/s. Reliance Estate Agency. Some of entries are reflected, in the books of account of M/s. Reliance Estate Agency and some of the entries are not reflected. Similarly seized annexure A-3 contains 25 pages most of the pages pertain to M/S Reliance Estate Agency. There are details of commission earned by the M/S Reliance Estate Agency. A. part of the cash seized from the residences of the partners, stated to pertain, to M/S Reliance Estate Agency. 3. Keeping in view the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and if so, its prima facie nature. Whilst an AO of the searched party and that of the individual under Section 153C may be the same, nevertheless at the stage of sending notice under Section 153C, the AO has to record a specific reason or reasons, why the material seized from the other person has a nexus to the assessee, to whom the notice under that provision is addressed. In this case, this never happened. Thus, for the previous years, the rule in Commissioner of Income Tax v Kabul Chawla 380 ITR 573 (Del), i.e., that in the absence of any incriminating materials, the previous years‟ assessments cannot be disturbed, applies." 7.2. In the same decision, the conclusion is as under : "Where in course of search carried out at premises of a third person, a hard disk was seized and on basis of same proceedings under section 153C were initiated against assessee, since Assessing Officer of searched person failed to record a specific satisfaction as to how said hard disk belonged to assessee, impugned proceedings under section 153C were unjustified." 7.3. Learned Counsel for the Assessee also relied upon the Order of the ITAT, Delhi Bench in the case of ACIT & Another vs. JMSW ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y which documents belongs to the assessee-firm or to a particular assessment year. Therefore, proceedings under section 153C are invalid and bad in law. In support of his contention, he has relied upon the decision of Hon'ble Supreme Court in the case of CIT vs. Sinhgad Technical Education Society 397 ITR 344 (SC). He has submitted that the assesseefirm is situated in Faridabad and the decision of the Tribunal in the case of JMSW Infra.com Pvt. Ltd., (supra) is a later decision, therefore, it should be given preference. In support of his contention, he has relied upon the following decisions : * Govindanaik G. Kalaghatigi vs. West Patent Press Co. Ltd. And Anr. - AIR 1980 (Karnataka) 92. * Shri Vasant Tatoba Hargude and others vs. Dikkaya Muttaya Pujari - AIR 1980 Bombay 341. * Karnataka State Road Transport Corporation, Bangalore vs. R. Maheshwari and others - AIR 2003 Karnataka 456. 7.10. He has also relied upon the decisions of the Hon'ble Supreme Court in the case of Manish Maheshwari vs. ACIT (2007) 289 ITR 341 (SC) and CIT vs. Calcutta Knitwears (2014) 362 ITR 673 (SC) which specify at which stage satisfaction note could have been recorded by the A.O. of the person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh Court in the case of PCIT vs. Sheetal International Pvt. Ltd., 2017-TIOL-1355-HCDEL, in which it was held as under : "Where Hon'ble Delhi High Court held that proceedings u/s 153C cannot be invalidated, merely because the AO of the searched who was also that of the Assessee, did not record a separate satisfaction note." 8.2. Judgment of Hon'ble Delhi High Court in the case of PCIT vs. Instronics Ltd., (2017) 82 taxmann.com 357 (Del.) (HC), in which it was held as under : "Delhi High Court held that where satisfaction note was recorded by Assessing Officer of searched person who also happened to be Assessing Officer of assessee (other person) to effect that seized documents belonged to assessee, issuance of notice under section 153C against assessee on basis of said note was justified." 8.3. Judgment of Hon'ble Delhi High Court in the case of Ganpati Fincap Services (P.) Ltd., vs. CIT (2017) 82 taxmann.com 408 (Del.), in which it was held as under : "Where Hon'ble Delhi High Court held that where Assessing Officer of searched person recorded that documents seized during search belonged to assessee, merely because he had not categorically stated that documents mentioned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prima facie material to suggest that satisfaction as per section 153C was duly recorded and thus, notice issued to file return to assessee was justified." 8.8. Judgment of Hon'ble Gujarat High Court in the case of Kamleshbhai Dharamshibhai Patel vs. CIT-3 (2013) 263 CTR 362 (Gujarat), in which it was held as under : "Where assessee sold certain land to purchaser, documents, viz., sale deeds of said land and agreements executed between assessee and erstwhile tenants regarding their eviction, found during search upon purchaser, would be said to be belonging to assessee for purpose of section 153C." 8.9. The Ld. CIT-D.R. accordingly submitted that since satisfaction note have been recorded as per Law and the seized material belongs to the assessee-firm, therefore, A.O. has correctly assumed jurisdiction under section 153C of the I.T. Act, 1961. 9. We have considered the rival submissions. According to Section 153C of the I.T. Act, 1961, action under section 153C can be taken in respect of any other person than the person searched, if the A.O. of the searched person is satisfied that any money, bullion, jewellery, or other valuable article or thing or books of account seized or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction u/s 153C, even if the AO of the searched person and the AO of such other person is same, it is mandatory that he has to first record satisfaction note in the file of the person searched and thereafter such satisfaction note along with the seized documents or books of account to be placed in the file of such other person. 3. The Commissioner of Income Tax (Appeals) erred in law and on facts in holding that no fair opportunity of hearing u/s 143(2) of the Act was given to the assessee before completing the assessment u/sl53C of the !T Act. 4. The Commissioner of Income Tax (Appeals) erred in law and on facts in deleting the addition of Rs. 48,00,000/- on account of deemed income under section 68 of the Income Tax Act, 1961." 2. Brief facts of the case as mentioned in the impugned orders are that assessee-company is engaged in the business of a Builder and a Developer of Real Estate. A search and seizure operation u/s 132 of the I.T. Act, 1961, was conducted by the Investigation Wing of the Department in Victory group of cases (Main Jagat Group) including its Directors, Other Individuals and Connected Associates on 14.09.2010. Since one of the Directors of the assessee- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gs initiated under section 153C of the I.T. Act as well as the addition on merit before Ld. CIT(A). The assessee-company contended that the assessment order under section 153C of the I.T. Act is bad in law and contrary to principles of natural justice. No incriminating material belonging to assessee-company was found during the course of search. No search was conducted in the case of the assessee-company. The A.O. did not raise any query on documents filed by the assessee-company in respect of evidence of share application money received. The A.O. merely initiated the proceedings under section 153C of the I.T. Act, on the basis of copy of the balance sheet seized during the course of search which pertains to A.Y. 2010- 2011. No undisclosed income was unearthed on examination of any documents found in search. Several case Laws were relied upon in support of the same. 3.1. The Ld. CIT(A) reproduced Section 153C of the I.T. Act in the order and on going through the interpretation of the said provision, he noted that action under section 153C can be taken in respect of any other person other than the person searched, if the Assessing Officer of the searched person is satisfied that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Profit loss account, pertaining to M/s Victory Accommodations Pvt. Ltd. for the fin. year ending 31.03.2010. The case of M/s Victory Accommodations Pvt. Ltd. was centralized with this office vide F.NO;. ClT-Delhi- Vl/Centralization/2011-12/648 dated 22.06.2011 issued by the CIT, Delhi-Vl, New Delhi. I am therefore satisfied that the documents seized, as referred to above, belong to M/s Victory Accommodations Pvt. Ltd. warranting action u/s 153C in this case. 27.02.2013 (Sumesh Swani) Deputy Commissioner of Income Tax Central Circle-09, New Delhi Notices u/s 153C of the Income-tax Act, 1961 are hereby issued for the assessment years 2005- 06 to 2010-11. (Sumesh Swani) Deputy Commissioner of Income Tax Central Circle-09, New Delhi" 3.2. The Ld. CIT(A) on reading the above satisfaction note found that the Assessing Officer of the assesseecompany recorded the satisfaction note under section 153C of the I.T. Act who has initiated action under section 153C of the I.T. Act, which is also supported by the fact that the said satisfaction note was recorded on 27.02.2013 and notice under section 153C have been issued on the same date. The A.O. who recorded satis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 133A at the business premises of assessee-company at Azadpur, in which, some documents have been impounded which were Annexurised as A-5, pages 51 to 55, which contain the transactions of the Company of Victory Group with different companies in tabular form. The same were scanned in the assessment order, upon perusal, the A.O. noted that various companies purchased the shares of the company of the Victory Group at a premium of Rs. 90/- to Rs. 190/- per share on a face value of Rs. 10/- per share. According to A.O. the transactions for M/s. Victory Apartments P. Ltd., were arranged by Shri Tarun Goel, Entry Operator, who are running several companies. The assessee-company filed several documents before A.O. in support of genuineness of the share application money received such as share application form, copy of the ITR, PAN, Board Resolution, Bank Statements, Copy of Certificate of Incorporation, Ledger Account, Challan for filing return with Registrar of Companies etc. The assesseecompany, therefore, submitted that it has received genuine share application money, on which, A.O. has not conducted any enquiry. Ld. CIT(A), accepted the contention of assessee-company that on filing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... artment in the premises of the assessee and on the same date, there were survey in the premises of Elegant Constructions and Interiors Ltd., who constructed and decorated the house of the assessee. Pursuant to the same, the fact that the assessee having engaged the above work of Contractor for construction of houses came out, in these premise, it was held that "the power of survey has been provided under Section 133A of the I.T. Act. Therefore, any material or evidence found/collected in a Survey which has been simultaneously made at the premises of a connected person can be utilized while making the Block Assessment in respect of an assessee under Section 158BB read with Section 158 BH of the IT Act." The Ld. D.R. relied upon order of ITAT, Delhi Bench in the case of Shri Parag Dalmia, New Delhi vs. DCIT, Central Circle-26, New Delhi in ITA.No.5499/Del./2017 dated 26.02.2018 in which the documents received by the Government of India from a Sovereign Country containing information regarding the undisclosed foreign accounts were received prior to the search and was confronted to the assessee during the course of search. Therefore, it was held that the same constitutes incriminating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during the course of search against the assessee-company, therefore, the issue is covered in favour of the assessee-company by the Judgment of Hon'ble Supreme Court in the case of CIT vs. Sinhgad Technical Education Society (supra). He has submitted that assessee company filed all the documents before A.O. on merits but the A.O. without making any enquiry or without verifying any fact, made the addition which was correctly deleted by the Ld. CIT(A). A.O. relied upon the report of the Investigation Wing, Kolkata, which was not connected with the assessee-company. He has also relied upon the decision of Hon'ble jurisdictional Delhi High Court in support of his contention in cases of CIT vs. Fair Finvest Ltd., 357 ITR 146 and ACIT vs. Best Infrastructure (India) Pvt. Ltd., 2017-(8)-TMI-250. 6. We have considered the rival submissions. According to Section 153C of the I.T. Act, action under section 153C can be taken in respect of any other person than the person searched, if the A.O. of the searched person is satisfied that any money, bullion, jewellery, or other valuable article or thing or books of account seized or requisitioned belongs or belonged to a person other than the per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oes not record any satisfaction on the part of the Assessing Officer. Documents and other assets recovered during search had not been handed over to the Assessing Officer having jurisdiction in the matter." 6.2. It was further held in para-22 by the Apex Court in the case of Manish Maheshwari (supra) as under : "As the Assessing Officer has not recorded his satisfaction, which is mandatory; nor has he transferred the case to the Assessing Officer having jurisdiction over the matter, we are of the opinion that the impugned judgments of the High Court cannot be sustained, which are set aside accordingly. The appeals are allowed. However, in the facts and circumstances of the case, there shall be no order as to costs." 6.3. The CBDT vide Circular No.24/2015 dated 31st December, 2015 issued the following directions : "Subject : Recording of satisfaction note under section 158BD/153C of the Act - Reg. The issue of recording of satisfaction for the purposes of section 158BD/153C has been subject matter of litigation. 2. The Hon'ble Supreme Court in the case of M/s Calcutta Knitwears in its detailed judgment in Civil Appeal No.3958 of 2014 dated 12.3.2014 (available in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing Officer having jurisdiction over that person. The assessee was an educational institution since the assessment year 1994-95. A search and seizure operation was carried out and certain loose papers were seized from the president of the assessee. Simultaneously a survey action was conducted on the assessee. On the basis of loose papers found with and seized from the president the Assessing Officer issued a notice under section 153C on the assessee and assessed the income. The Tribunal set aside the assessments. On appeals to the High Court: Held, dismissing the appeals, that the reasons assigned by the Assessing Officer in the satisfaction note were silent about the assessment year in which specific incriminating information or unaccounted or undisclosed hidden information was discovered or seized by the Revenue from the assessee. In the circumstances, the general satisfaction and as recorded in the note was not enough. There was absolutely nothing to indicate as to in which educational courses, the education was imparted and institution wise, whether the admissions were granted to the technical courses merit-wise or on the basis of marks obtained in XII standard HSC e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 03, material pertaining to "on-money" payment paid to the assessee in respect of property purchased from the assessee were seized. Based on that, the Assessing Officer issued notice under section 153C of the Income-tax Act, 1961, and reworked the capital gains. The Commissioner (Appeals) and the Tribunal held that the notice under section 153C was not valid. On appeal to the High Court : Held, dismissing the appeals, that the Assessing Officer did not have the benefit of the seized material while issuing the notice under section 153C. In the light of the fact that the Revenue did not produce any material to show that the materials were available at the hands of the Assessing Officer at the time of issuing notice, the Tribunal rightly came to the conclusion that he assumption of jurisdiction under section 153C was not valid." 6.7. The ITAT, Agra Bench in the case of ACIT, Circle- I, Gwalior vs. Global Estate (2013) 142 ITD 740 (Agra) held as under : * The assessee had a case for quashing of proceedings under section 153C. No material is produced to prove that the Assessing Officer in the case of person searched was satisfied that any money, bullion, jewellery or other valuab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arched person has not recorded any satisfaction rather the satisfaction is recorded by the AO of the other person i.e. the assessee which is evident from the satisfaction note, copy of which is placed at page no. 21 of the assessee's paper book. Therefore, the assessment framed in the hands of the assessee was not valid. Moreover, from the observation of the AO in the satisfaction note also it is crystal clear that no incriminating material was found, the addition was made only on the basis of the copy of balance sheet, profit and loss account and schedule of advances against supplies pertaining to the assessee, those documents were already in the knowledge of the department as the same were furnished along with the regular return of income. Therefore, those documents by no stretch of imagination can be said to be incriminating as those were made out of the regular books of accounts of the assessee and the return of income was filed on the basis of those documents only. - Decided in favour of assessee." 6.9. The Hon'ble jurisdictional Delhi High Court in the case of Pr. CIT vs. Index Securities Private Limited, Vidya Shankar Investment Private Limited 2017 (9) TMI 585 (Del.) (HC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the assessee referred to balance sheet of the assessee-company for other year, therefore, the same cannot be considered to be incriminating in nature against the assessee-company as it is part of Department record and in public domain. Therefore, it is clear from the above facts that the condition precedent for issuing notice under section 153C are not satisfied in this case because no satisfaction have been recorded under section 153C in the case of the person searched and no incriminating material was seized pertaining to assessment year under appeal. Even during the course of survey, no incriminating material was found against the assessee-company because the same were regarding purchase of shares of the group companies and ultimately, A.O. made the addition based on books of account that the share application money have not been explained by assessee-company. Such material found in survey is not relatable to the material found during the course of search in the case of the person searched because the balance-sheet does not belong to assessment year under appeal. Therefore, there is no incriminating material found during the course of search against the assesseecompany so as t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... satisfaction note under section 153C have been recorded by the A.O. of the person searched. The Ld. CIT-D.R. has produced the assessment records on both the person searched and the assessee-firm. The satisfaction note under section 153C dated 22.02.2007 (supra) found placed in the assessment record of the assessee-firm and the same is also noted in the satisfaction note itself and the notice under section 153C have been issued on the same day by the A.O. of the assessee-firm. Since satisfaction under section 153C have been recorded in the case of the assessee-firm, therefore, A.O. of the assessee-firm could only issue notice under section 153C on the same day on 22.02.2007. The satisfaction note have been recorded without sanction of law. The Ld. CIT-D.R. also submitted during the course of arguments that no other satisfaction note have been recorded in the assessment records of the persons searched i.e., Shri Navneet Jhamb and Shri Shri S.D.Kathuria. The assesseefirm also filed reply to the RTI application in the case of Shri S.D.Kathuria in which the DCIT, Central Circle-I, Faridabad intimated that no satisfaction have been recorded under section 153C in the case of the person s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the view that A.O. of the searched person has not recorded satisfaction note as per law. The notice under section 153C was issued on the same day when satisfaction note was recorded by the A.O. of the assessee-firm i.e., other person. The same A.O. who recorded satisfaction in the case of the assessee-firm passed the assessment order under section 143(3)/153C of the I.T. Act. Therefore, the condition precedent for issuing notice under section 153C are not satisfied in this case because no satisfaction note have been recorded under section 153C in the case of the person searched and no specific incriminating material was seized pertaining to assessment year under appeal. Therefore, assumption of jurisdiction under section 153C of the I.T. Act is illegal and bad in law. The reasoning given in the case of M/s. Victory Accommodations Pvt. Ltd., Delhi (supra), squarely apply to the facts and circumstances of the case. Following the same reasonings, we set aside the orders of the authorities below and quash the proceedings under section 153C of the I.T. Act. In this view of the matter, there is no need to decide the addition on merit which is left with academic discussion only. 10. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, prayed that the same may be admitted for disposal of the appeal. In support of his contention, he has relied upon the following decisions : (i) CIT vs. Sinhgad Technical Education Society (2017) 397 ITR 344 (SC) (ii) NTPC Ltd., vs. CIT (1998) 229 ITR 383 (SC) (iii) CIT vs. Sam Global Securities (2014) 360 ITR 682 (Del.) (HC) (iv) VMT Spinning Co. Ltd., vs. CIT & Another (2016) 389 ITR 326 (P & H) (HC) (v) Inventors Industrial Corporation Ltd., vs. CIT (1992) 194 ITR 548 (Bom.) (HC). 14.2. Learned Counsel for the Assessee submitted that search was conducted on 04.08.2005 and satisfaction note under section 153C was recorded on 22.02.2007 for A.Ys. 2000- 2001 to 2005-2006. No satisfaction note have been recorded for assessment year under appeal i.e., A.Y. 2006-2007. The A.O. had taken it a year of the search, therefore, assessment have been framed under section 143(3) of the I.T. Act vide order dated 24.12.2007. The A.O, thus, has not issued notice under section 153C of the I.T. Act. The conditions of Section 153C are not satisfied in A.Y. 2006-2007. He has submitted that First Proviso to Section 153C of the I.T. Act provides that six assessment years for which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reference to the date of initiation of the search under section 132 or making of requisition under section 132A in the second proviso to sub-section (1) of section 153A shall be construed as reference to the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person. [Provided further that the Central Government may by rules made by it and published in the Official Gazette, specify the class or classes of cases in respect of such other person, in which the Assessing Officer shall not be required to issue notice for assessing or reassessing the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made except in cases where any assessment or reassessment has abated.] [(2) Where books of account or documents or assets seized or requisitioned as referred to in sub-section (1) has or have been received by the Assessing Officer having jurisdiction over such other person after the due date for furnishing the return of income for the assessment year relevant to the previous year in which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... viso to section 153A has to be construed as the date on which the Assessing Officer receives the documents or assets from the Assessing Officer of the searched person, that further proceedings, by virtue of section 153(1) of the Act, would have to be in accordance with section 153A of the Act and the reference to the date of search would have to be construed as the reference to the date of recording of satisfaction. It would follow' that the six assessment years for 'which assessments or reassessments could be made under section 153C of the Act would also have to be construed with reference to the date of handing aver of assets or documents to the Assessing Officer of the assessee. The amendment in section 153C of the Act by the Finance Act, 2017 with effect from April 1, 2017 to the effect that the Block Period for the person in respect of whom the search was conducted as well as the "other person" would be the same six assessment years immediately preceding the year of search is prospective. A search under section 132 of the Income-tax Act, 1961 took place on November 11,2010 in the T group of cases. The documents pertaining to the assessee were forwarded along with a s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essments made in respect of assessment year 2003-04 and 2004-05 would be beyond the period of six assessment years as reckoned with reference to the date of recording of satisfaction by the AO of the searched person. It is contended by the Revenue that the relevant six assessment years would be the assessment years prior to the assessment year relevant to the previous year in which the search was conducted. If this interpretation as canvassed by the Revenue is accepted, it would mean that whereas in case of a person searched, assessments in relation to six previous years preceding the year in which the search takes place can be reopened but in case of any other person, who is not searched but his assets are seized from the searched person, the period for which the assessments could be reopened would be much beyond the period of six years. This is so because the date of handing over of assets/documents of a person, other than the searched person, to the AO would be subsequent to the date of the search. This, in our view, would be contrary to the scheme of Section 153C(1) of the Act, which construes the date of receipt of assets and documents by the AO of the Assessee (other than one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would eligible for assessment/reassessment would commence from assessment year 2004-05 to assessment year 2009-10. The assessment/re-assessment in respect of assessment year 2003-04 would, thus, be beyond the period of six assessment year as reckoned with reference to the date of satisfaction recorded by the Assessing Officer of the searched person. We, therefore, hold that the learned CIT(A) was quite justified in considering the assessment for assessment year 2003-04 as outside the scope of section 153C of the Act, being barred by limitation and without jurisdiction. Accordingly, the impugned assessment order is liable to be quashed. We decide accordingly." 7.3. The ITAT, Delhi, C-Bench, in the case of Pavitra Realcon Pvt. Ltd., New Delhi vs. ACIT, C.C.32, New Delhi (supra) under the same circumstances held that "assessment completed under section 143(3) is invalid". The relevant para-16 of the order is reproduced as under : 16. "We find the year for which the impugned assessment order has been passed u/s 143(3) is for assessment year 2011-12. This year falls within the period of six years when counted from the date of recording of satisfaction note u/s 153/153C of the I.T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the I.T. Act which have not been done in this case. The issue of notice under section 153C is mandatory and a condition precedent for taking action against the assessee under section 153C of the I.T. Act. The assessment order, therefore, vitiate, void, illegal and bad in law and cannot be sustained. The contention of the Ld. D.R. have already taken care in the above judgments. 9. Considering the totality of the facts and circumstances of the case, we set aside the orders of the authorities below and quash the same and allow the additional grounds of appeals. Resultantly, all additions stands deleted. Since the assessment order is set aside on legal grounds, therefore, there is no need to decide the addition on merit which has been left with academic discussion only. 10. In the result, ITA.No.504/Del./2013 of the Assessee is allowed." 17. Considering the facts of the case in the light of decision of the Tribunal in the case of M/s. BNB Investment & Properties Ltd., Gurgaon, Haryana vs. DCIT, Central Circle-1, Faridabad (supra), in which the Judgments of the Hon'ble Delhi High Court relied upon by Learned Counsel for the Assessee have been considered and issue have been d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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