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TMI Blog2019 (2) TMI 1828X X X X Extracts X X X X X X X X Extracts X X X X ..... me third party, notice issued u/s 148 of the Act and subsequent assessment framed u/s 147 of the Act is void ab initio and as such, assessment framed u/s 147/143(3) of the Act is liable to be quashed. Following the mandate of section 153C and orders passed by the coordinate Bench of the Tribunal in cases of Rajat Shubra Chatterji vs. ACIT [ 2016 (7) TMI 258 - ITAT DELHI] and ITO vs. Arun Kumar Kapoor [ 2012 (6) TMI 403 - ITAT AMRITSAR] , assessment framed in this case u/s 147/143 (3) of the Act on the basis of incriminating material unearthed in case of a third party is not sustainable, hence ordered to be quashed without entering into the merits of the case. - Decided in favour of assessee. - ITA No.1571/Del./2015, 1573/Del./2015 - - - Dated:- 28-2-2019 - Shri Kuldip Singh, Judicial Member And Dr. M.L. Meena, Accountant Member ASSESSEE BY: Shri Girish Shukla, Advocate REVENUE BY: Shri Ashok Kumar Saroha, CIT DR ORDER Kuldip Singh, Judicial Member : Since common questions of facts and law have been raised in the aforesaid appeals, the same are being disposed of by way of composite order to avoid repetition of discussion. 2. The appellants, Shr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... up of cases wherein certain loose papers marked as LP-103 A-1 pages 30 was seized showing the fact that M/s. R.B. Enterprises has purchased land from Meer Hassan and Ali Hassan, assessees in these cases, for a total sale consideration of ₹ 52,43,720/-. On the basis of these evidences, Assessing Officer issued a show-cause notice to the assessees; that as against the sale consideration of ₹ 52,43,720/- shown in the sale deed, the property in question was actually sold for ₹ 2,53,60,140/- and why it should not be presumed that the assessees have received a sum of ₹ 2,01,16,420/- in cash over and above the sale proceeds mentioned in the sale deed. Declining the contentions raised by the assessee that they along with their family members got the sale consideration as per sale deed and no amount other than mentioned in the sale deed was ever paid to them and memorandum of understanding Annexure LP-103 A-1 pages 30 is an irrelevant document, AO proceeded to compute the capital gain of the assessee by taking into consideration the total sale consideration at ₹ 2,53,60,140/- and calculated the capital gains at ₹ 51,06,435/- ₹ 50,29,105/- in case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eipt of the relevant notice but, in the instant case, this jurisdictional issue was categorically raised by the assessee before the AO as is evident from page 13 of the assessment order as well as before ld. CIT (A) as ground no.3. So, the contentions raised by the ld. DR is misconceived being against the facts on record and the judgments relied upon are not applicable to the facts and circumstances of the case. Thus, additional ground sought to be raised by the assessee is allowed being necessary for complete adjudication of the controversy at hand. 10. We would like to decide the additional ground no.1A which is a legal issue first. 11. undisputedly, AO initialed the proceedings u/s 147 of the Income-tax Act, 1961 (for short the Act ) on the basis of one loose paper found and seized, marked as LP-103 A-1 pages 30, which is a memorandum of understanding containing details of sale consideration qua the land sold by both the assessees in favour of M/s. R.B. Enterprises. It is also not in dispute that originally, assessment was completed u/s 153C read with section 153A of the Act vide order dated 30.12.2011 on the basis of same seized material LP-103 A-1 pages 30. It is also n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of section 153A, if, that Assessing Officer is satisfied that the books of account or documents or assets seized or requisitioned have a bearing on the determination of the total income of such other person 17[for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made and] for the relevant assessment year or years referred to in sub-section (1) of section 153A : Provided that in case of such other person, the reference to the date of initiation of the search under section 132 or making of requisition under section 132A in the second proviso to subsection (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 rules18 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 im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erial/document LP-103 A-1 pages 30, which is a memorandum of understanding alleged to have been entered into between the assessees and M/s. R.B. Enterprises. 18. So, we are of the considered view that when provisions contained u/s 153C are applicable in this case to initiate assessment proceedings on the basis of seized material seized in case of some third party, notice issued u/s 148 of the Act and subsequent assessment framed u/s 147 of the Act is void ab initio and as such, assessment framed u/s 147/143(3) of the Act is liable to be quashed. 19. Identical issue has been decided by the coordinate Bench of the Tribunal in case cited as Rajat Shubra Chatterji vs. ACIT ITA No.2430/Del/2015 order dated 20.05.2016 by returning following findings :- 7. On having gone through the decisions cited above especially the decision of Amritsar Bench in the case of ITO vs. Arun Kumar Kapoor (supra), we find that in that case as in the present case before us, reassessment was initiated on the basis of incriminating material found in search of third party and the validity of the same was challenged by the assessee before the Learned CIT(Appeals) and the Learned CIT(Appeals) vitiated ..... X X X X Extracts X X X X X X X X Extracts X X X X
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