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TMI Blog2024 (11) TMI 1304X X X X Extracts X X X X X X X X Extracts X X X X ..... national Ltd. Hence there was no conclusion drawn by the ld AO that the assessee s claim of exemption of LTCG is bogus as such or such conclusion is drawn from any seized material or investigation findings. It is trite law that no assessment proceedings u/s 153C of the Act could be initiated on a person merely to examine a particular aspect. This examination should be done prior to initiation of proceedings u/s 153C of the Act only then satisfaction could be drawn by the assessee that exempt LTCG shown by the assessee is only out of conversion of his unaccounted income. If this is not done, then the element of satisfaction of the ld AO to initiate proceedings u/s 153C of the Act preceded by formation of his opinion vanishes in thin air. The entire satisfaction note does not even state that whether the findings of investigation , if any, or the seized documents, if any, on the aspect of exempt LTCG has any bearing on determination of total income of the assessee before us. We hold that the entire assumption of jurisdiction u/s 153C of the Act in the instant case is void- ab-initio and hence quashed. Assessee appeal allowed. - Shri Saktijit Dey, Hon ble Vice President And Shri M. B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ogus long term capital. Accordingly, notice under section 153C of the Act is issued on 11/10/2017 to examine the matter. 2. As per provisions of section 153C of the Act, the assessing officer shall notice, assess or reassess the income of the other person in accordance with the provisions of section 153A. Thus, if the return of income has been filed under this section, then provisions of this act shall apply accordingly, if such return were a return required to be furnished under section 139. 5. We find that the following deficiencies are evident from the aforesaid satisfaction note:- a) First of all there was no search conducted in the hands of the assessee. Hence factually incorrect statement was made in the satisfaction note. b) The satisfaction note does not make any reference to any seized material found in the hands of Dev Priya Group of cases. On what basis, the investigation team or the Assessing Officer of Dev Priya Group had come to a conclusion that the exempt long term capital gain (LTCG) derived by the assessee on sale of shares of CCL International Ltd is bogus is not brought out. Neither the seized material, if any, to support the said allegation is brought on record ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aterial documents related to your case have been found. 1. Annexure A-1, MCAR, page 1 to 17:- found and seized at 173, Sita Ram Apartments, IP Extension, Delhi wherein copy of Sale deed dated 26.08.2015 in favour of Shri Mukesh Chandra Agrawal found - Residential Plot Sale deed made in Agra, Uttar Pradesh, Plot no. 21, Area 166.47 Sq. Mtr. Located in Swapn Lok Kaloni Kakua, Agra by Vishal Infra Pvt Ltd for Sale to Shri Mukesh Chandra Agrawal, Total Value of Property Rs. 6,00,000/-. 2. Annexure A-1, MCAR, page 30 to 46:- found and seized at 173, Sita Ram Apartments, IP Extension, Delhi wherein copy of Sale deed dated 30.05.2019 of Residential flat in favour of Shri Mukesh Chand Agrawal found copy of Sale Deed in case of Residential Plot Area 138.28 Sq. Mtr Flat no. 173, Sitaram Apartment, I P Extention Delhi- 92 in favour of Shri Mukesb Chand Agarwal and Smt Neeta Agarwal, by Shri Ajay Tiwari, F14/118, Krishna Nagar, Delhi-51.Total Value of Property Rs. 1,80,00,000/- 3. Annexure A -1, MCAR, page 51 to 65:- found and seized at 173, Sita Ram Apartments, IP Extension, Delhi wherein copy of Sale deed dated 21.04.2014 of Residential Plot in favour of Shri Mukesh Chand Agrawal found- copy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above. While in the case of the former, a notice would inevitably be issued the moment a search is undertaken or documents requisitioned, whereas in the case of the latter, the proceedings would be liable to be commenced only upon the AO having formed the opinion that the material gathered is likely to inculpate the assessee. While in the case of a Section 153A assessment, the issue of whether additions are liable to be made based upon the material recovered is an aspect which would merit consideration in the course of the assessment proceedings, under Section 153C, the AO would have to be prima facie satisfied that the documents, data or asset recovered is likely to have a bearing on the determination of the total income . It is only once an opinion in that regard is formed that the AO would be legally justified in issuing a notice under that provision and which in turn would culminate in the abatement of pending assessments or reassessments as the case may be. 65. We would thus recognize the flow of events contemplated under Section 153C being firstly the receipt of books, accounts, documents or assets by the jurisdictional AO, an evaluation and examination of their contents and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce would be liable to be issued and thus resulting in the abatement of pending proceedings and reopening of concluded assessments. 5. Mr. Maratha, learned counsel for the respondent has however drawn our attention to a Show Cause Notice which refers and alludes to material gathered from a laptop found and seized from the residence of an individual. He specifically draws our attention to the following recitals as appearing in the SCN dated 18 February 2023: 1. During the course of search and seizure operation, several ledgers maintained with regard to various cash payments have been obtained from accounts maintained in the name Anarkali Complex in Tally found in folder named DATA 24 in the laptop of Sh. Sunil Kumar Gupta found and seized from the residence of Sh. Sunil Kumar Gupta, at 3584/4, Narang Colony, Gali No. 4 Tri Nagar Delhi (Path: F:\SKGR A-32\SUNIL KUMAR GUPTA HP LAPTOP EXTRACTED DATA\Tally [root].1\Local Disk ANARKALI BACKUP DATA24\DATA24). 2. Copy of the relevant ledgers extracted from the laptop found and seized from the residence of Sh. Sunil Kumar Gupta at 2584/4, Narang Colony, Gali No. 4, Tri Nagar, Delhi are enclosed with this notice. Further, during the course of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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