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TMI Blog2018 (8) TMI 1246X X X X Extracts X X X X X X X X Extracts X X X X ..... le 11, as under 1. That order passed by Ld AO and Ld CIT-A are bad in law and void ab initio as much as it is factually admitted by the Ld AO before Ld CIT-A IV, Kanpur in penalty proceedings u/s 271AAB of the same assessee for same period that no warrant was issued in assessee s case and assessee was not covered under search operation u/s 132, and therefore admittedly once there is search u/s 132 on the assessee and it is settled that on the basis of documents found from search action on other person only possible legal course of action is to initiate the proceedings u/s 153C which is not validly done in the instant case as per conditions prescribed under the Act, so entire proceedings including orders passed by Ld AO and Ld CIT-A are invalid. 1.1 That order passed by Ld AO and Ld CIT-A are bad in law and void ab initio in as much as no where assessee has been communicated any available satisfaction note recorded u/s 153C by the AO of the searched person in the assessment of searched person for alleged documents found during search and for want of valid satisfaction note u/s 153C, entire proceedings including orders passed by Ld AO and Ld CIT-A are invalid. 1.2 T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rendered only ₹ 1,50,00,000/- in the return of income; that from a diary Shanker Note Book found during the search, the AO noted that total of expenses mentioned was at ₹ 4,69,16,899/- and he gave a show cause notice dated 12/03/2016 calling explanation of the assessee and thatthe assessee denied any transactions made and also claimed the diary to be a dumb and unreliable document. Accordingly, the Assessing Officer made an addition of 3,19,16,899/-, by giving credit of ₹ 1,50,00,000/- surrendered by the assessee in his return. In appeal Ld CIT(Appeals)-IV, Kanpur confirmed the addition on the basis of finding in the assessment order.In the aforementioned background, challenge before us is not only to the addition but to the entire proceedings on account of valid jurisdiction of the Ld AO passing the order. 4. Heard both the sides, perused material on record and considered thelegal aspects. 5. The Ldcounsel for the appellant assessee referred to the assessment order and submitted that AO,though has mentioned that a search was conducted at the premises of Eminent Dynamic Group, including premises of the assesee, but it wasnowhere specifically mentioned th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... categorically admitted, vide letter No. Addl. DIT(Inv)/Agra/2017-18/1697 dated 11.12.2017,that no search was conducted on the assessee and in view this fact the penalty U/s 271 AAB has been treated as ab-initio invalid and thus it was annulled. 6.2 Ld. AR also argued that in the given facts of the case assessee cannot be treated as searched person and no proceedings could have been initiated against him U/s 153A of the Act and consequently entire proceedings including the assessment order under challenge is illegal and void ab-initio. 7. The Ld DR has not disputed the fact that no search warrant was issued u/s 132(1) on the assessee in the search conducted 12/11/2013 on Eminent Dynamic group. 8. Section 153A of the Act reads as under - 153A. (1) Notwithstanding anything contained in section 139, section 147, section 148, section 149,section 151 and section 153, in the case of a person where a search is initiated under section 132 or books of account, other documents or any assets are requisitioned under section 132A after the 31st day of May, 2003, the Assessing Officer shall- (a) issue notice to such person requiring him to furnish within such period, as may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereof has escaped assessment for such year or years; and (c) the search under section 132 is initiated or requisition under section 132A is made on or after the 1st day of April, 2017. Explanation 1.-For the purposes of this sub-section, the expression relevant assessment year shall mean an assessment year preceding the assessment year relevant to the previous year in which search is conducted or requisition is made which falls beyond six assessment years but not later than ten assessment years from the end of the assessment year relevant to the previous year in which search is conducted or requisition is made. Explanation 2.-For the purposes of the fourth proviso, asset shall include immovable property being land or building or both, shares and securities, loans and advances, deposits in bank account.] (2) If any proceeding initiated or any order of assessment or reassessment made under sub-section (1) has been annulled in appeal or any other legal proceeding, then, notwithstanding anything contained in sub-section (1) or section 153, the assessment or reassessment relating to any assessment year which has abated under the second proviso to sub-secti ..... 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