9911796707
TMI Blog2025 (1) TMI 378X X X X Extracts X X X X X X X X Extracts X X X X ..... jurisdiction on the part of the Assessing Officer. Validity of Satisfaction Note recorded by the AO of the searched person - We find that it is an admitted position that the consolidated satisfaction note was recorded by the Assessing Officer of the searched person before transmitting the documents/ information to the AO of the non-searched person i.e., the assessee in this case for the assessment year 2009 10 to 2019 20 i.e., for 11 years and thereafter the documents have been transferred on 21/01/2021 to the AO of the non searched persons i.e., the assessee company and subsequently the AO of the assessee company has further recorded consolidated satisfaction note for the assessment year 2009 10 and 2010 11 and thereafter the AO further recorded another consolidated satisfaction note for the assessment year 2011 12 to 2013 14, which is clear from the above discussions. We rely on the judgment of Sunil Kumar Sharma [ 2024 (2) TMI 116 - KARNATAKA HIGH COURT ] wherein it has been held that satisfaction note is required to be recorded u/s 153C for each assessment year and in the impugned proceedings, a consolidated satisfaction note has been recorded for different assessment year by b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rds/ satisfaction note or any other documents which could suggest that the Addl.CIT has duly applied his mind before granting approvals. There is no recording of satisfaction by the Addl.CIT in the impugned approval order as to whether the assessment records/ assessment folders/ files/ seized materials or any incriminating documents or other connected documents and papers/ various statements recorded under section 132(4) and section 131(1A) of the assessee or any other person/ appraisal report of the Investigation Wing of the Department/ materials on hand with the Department at the time of initiation of search or material evidences gathered were placed for its verification and the same were duly verified and/or examined by him as mandated under section 153D. In the absence of compliance of the above mandate, the approval order dated 31/03/2022, passed under section 153D becomes an empty formality without due process of law and, thus, not sustainable. This is nothing but an approval by way of mere mechanical exercise accepting the draft assessment order without any independent application of mind by the Addl.CIT. Thus approval given by the Addl.CIT, in our opinion, is invalid in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned orders of even date 18/01/2024 passed under section 250 of the Income Tax Act, 1961 ( the Act ) by the learned Commissioner of Income Tax (Appeals) . Nagpur, [ learned CIT(A) ], for the assessment year 2009 10, 2010 11, 2011 12, 2012 13 and 2013 14 respectively. 2. Since all these appeals pertain to the same assessee, therefore, as a matter of convenience, these appeals were heard together and are being disposed off by way of this consolidated order. 3. We first take up the issue for adjudication which relates to impugned assessment made under section 153C of the Act being barred by limitation. This issue is involved in the following appeals:- ITA no.108/Nag./2024 for A.Y. 2009-10 ITA no.109/Nag./2024 A.Y. 2010-11 ITA no.110/Nag./2024 A.Y. 2011-12 and ITA no.111/Nag./2024 for A.Y. 2012-13 4. The facts of the issue are that whether or not it is beyond the 10 years block as per first proviso to section 153C and Explanation-1 to section 153A of the amended provisions of law by the Finance Act, 2017 w.e.f. 01/04/2017; whether, notice under section 153C of the Act and the assessment made under section 153C for the assessment year 2009-10 to 2012-13 is invalid as time barred by limit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .6-12-21 shall be considered the date of search; AY11-12 would be beyond the block of 10 AYs as per Expln.-1 to section 153A; assessment made under section 153C for AY11-12 is barred by limitation, is liable to be quashed; relied on Ojjus Medicare PL (2024) (Del HC); Jasjit Singh (2023) (SC); Shalimar Town Planners PL (2024) (SC); RB Jewellers PL(2023) (Cal HC); AR Safiullah (2021) (Mad); Rakesh Bansal (2024) (Del-Trib); Bhagwati Suresh Modi (2023) (Mum-Trib). 8. In the appeal being ITA no.111/Nag./2024, for the assessment year 2012 13, the following additional ground of appeal has been raised: Additional Gr.No.1: On the facts circumstances of the case and in law, assessment under section 153C dt.31-3-22 for AY12-13 is invalid; as per first proviso to section 153C, date of search shall be the date of receiving the documents/ material by the AO of the assessee; notice under section 153C dt.6-12-21 shall be considered the date of search; AY12-13 would be beyond the block of 10 AYs as per Expln.-1 to section 153A; assessment made under section 153C for AY12-13 is barred by limitation, is liable to be quashed; relied on Ojjus Medicare PL (2024) (Del HC); Jasjit Singh (2023) (SC); Shali ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of taking additional ground of appeal before us that the assessment made under section 153C of the Act dated 31/03/2022, for the assessment year 2009 10, 2010 11, 2011 12 and 2012 13 is barred by limitation. As per first proviso to section 153C of the Act, the date of search shall be the date of receiving the documents/information by the Assessing Officer of the assessee-Company. The notice under section 153C of the Act dated 11/03/2022 and 06/12/2021 for the assessment year 2009 10, 2010 11, 2011 12 and 2012 13 shall be considered the date of search; and thus, it is submitted by the learned A.R. that the assessment year 2009-10 to 2012-13 would be beyond the block of 10 assessment years as per Explanation-1 to section 153A of the Act. Notice issued under section 153C and assessment made under section 153C for the assessment year 2009-10 to 2012-13 would be barred by limitation and it is requested to quash the impugned assessments for the assessment year 2009-10 to 2012-13. For this, the learned A.R. submitted that there has been amendment made by the Finance Act, 2017 (wef.01/04/2017) in section 153A and section 153C of the Act which read as under: Section 153A. Assessment in cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d (c) the search u/s 132 is initiated or requisition u/s 132A is made on or after the 1-4-17. Explanation-1.- For the purposes of this sub-sec, the expression relevant AY shall mean an AY preceding the AY relevant to the PY in which search is conducted or requisition is made which falls beyond 6 AYs but not later than 10 AYs from the end of the AY relevant to the PY 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. Section 153C. Assessment of income of any other person- (1) Notwithstanding anything contained in sec139, 147, 148, 149, 151 and 153, where the AO is satisfied that,- (a) any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, belongs to; or (b) any books of account or documents, seized or requisitioned, pertains or pertain to, or any information contained therein, relates to, a person other than the person referred to in section 153A, then, the books of account or documents or assets, seized or requisitioned shall be handed over to the AO h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 153A. (3) Nothing contained in this sec shall apply in relation to a search initiated u/s 132 or books of account, other documents or any assets requisitioned u/s 132A on or after the 1-4-21. 13. The learned A.R. for the assessee submitted that the notice under section 153C for the assessment year 2009-10 to 2012-13 has been issued on 11/03/2022 and 06/12/2021 for filing the return of income under section 153C of the Act to the assessee-Company (i.e., non-searched person); search under section 132 was conducted on 22/01/2019 on M/s.RKTC Group, Korba; M/s.Rashi Steels PLtd, Kolkata and Shri Suresh Agrawal, Kolkata (i.e., the searched person). It is submitted that the assessment made under section 153C on 31/03/2022 for the assessment year 2009-10 to 2012-13 is barred by limitation. 14. As per the amended provisions of law by the Finance Act, 2017 w.e.f 01/04/2017, the first proviso to section 153C of the Act reads as under: Provided that in case of such other person, the reference to the date of initiation of the search u/s 132 or making of requisition u/s 132A in the second proviso to section 153A(1) shall be construed as reference to the date of receiving the books of accou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2019-20 5th year AY 2018-19 6th year AY 2017-18 7th year AY 2016-17 8th year AY 2015-16 9th year AY 2014-15 10th year AY 2013-14 AY 2012-13 beyond the block of 10 AYs AY 2011-12 beyond the block of 10 AYs AY 2010-11 beyond the block of 10 AYs AY 2009-10 beyond the block of 10 AYs 17. Thus, the learned A.R. submitted that the assessment year 2009 10 to 2012 13 would be beyond the block of 10 assessment years as per first proviso to section 153C and Explanation-1 to section 153A. The assessment made under section 153C dated 31/03/2022 for the assessment year 2009 10 would be time barred, is liable to be quashed. In support of this argument, reliance is placed on the following case laws: i) PCIT v. Ojjus Medicare (P) Ltd [2024] 161 taxmann.com 160 (Del.); ii) A.R. Safiullah v. ACIT, [2021] W.P. (MD) no.4327 of 2021 (Mad. HC) judgment dated 24/03/2021; iii) CIT v. Jasjit Singh, [2023] 155 taxmann.com 155 (SC); iv) Rakesh Bansal v. ACIT, [2024] 159 taxmann.com 1632 (Del. Trib.); v) Bhagwati Suresh Modi v. ITO [2023] ITA no.3053 and 3054/Mum. /2023 (Mum-Trib); and vi) RB Jewellers (P) Ltd. v. UOI, [2023] 157 taxmann.com 493 (Cal.). 18. The learned Departmental Representative ( the learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r 2011-12 to 2013-14, in the report of the Assessing Officer dated 16/05/2024 submitted by the learned D.R. before us, wherein also, it is clear that the documents/information related to the assessment year 2011 12 to 2013 14 has been transferred from the Assessing Officer of the searched person i.e., DCIT, Central Circle-1, Raipur, to the Assessing Officer of the assessee i.e., DCIT, Central Circle-1(1), Nagpur, which is mentioned in the letter written by the Assessing Officer of the assessee i.e., DCIT, Central Circle-1(1), Nagpur, dated 29/11/2021 to the Addl. CIT, Central Range, Nagpur, which is received by the Addl. CIT, Central Range, Nagpur, on 29/11/2021. The contents of the report of the Assessing Officer are extracted below: Annexure-A An information has been received in this office from DCIT, Central Circle, Raipur dated 15-1-21 in the case of M/s.Maheshwari Coal Benefication Infrastructure P Ltd to initiate proceedings under section 153C of the IT Act, 1961 for AYs 11-12 to 13-14. 21. On a perusal of the submissions made by both the learned Counsel of the parties, we are in complete agreement that in case of non-searched person , the reference to the date of initiation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Y13-14. We, in this regard also bear in consideration the following instructive passages as appearing in the decision handed down by a ld Judge of the Madras HC in AR Safiullah (2021) (Mad HC). We deem it appropriate to extract the following paragraphs from that decision: 9. Explanation-1 is clear as to the manner of computation of the 10 AYs. It clearly and firmly fixes the starting point. It is the end of the AY relevant to the PY in which search is conducted or requisition is made. There cannot be any doubt that since search was made in this case on 10-4-18, the AY is 19-20. The end of the AY19-20 is 31-3-20. The computation of 10 years has to run backwards from the said date i.e., 31-3-20. The first year will of course be the search AY itself. In that event, the 10 AYs will be as follows: 1st year 19-20 2nd year 18-19 3rd year 17-18 4th year 16-15 5th year 15-16 6th year 14-15 7th year 13-14 8th year 12-13 9th year 11-12 10th year 10-11 The case on hand pertains to AY09-10. It is obviously beyond the 10 year outer ceiling limit prescribed by the statute. The terminal point is the 10th year calculated from the end of the AY relevant to the PY in which search is conducted. The lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9, 151 and 153. By virtue of the 2017 Amending Act, significant amendments came to be introduced in section 153A. These included, inter alia, the search assessment block being enlarged to 10 AYs consequent to the addition of the stipulation of relevant AY and which was defined to mean those years which would fall beyond the 6 year block period but not later than 10 AYs. The block period for search assessment thus, came to be enlarged to stretch up to 10 AYs. The 2017 Amending Act also put in place certain pre-requisite conditions which would have to inevitably be shown to be satisfied before the search assessment could stretch to the relevant AY . The pre-conditions include the prescription of income having escaped assessment and represented in the form of an asset amounting to or likely to amount to Rs. 50 lakhs or more in the relevant AY or in aggregate in the relevant AYs . D. The first proviso to section 153C introduces a legal fiction on the basis of which the commencement date for computation of the 6 year or the 10 year block is deemed to be the date of receipt of books of accounts by the jurisdictional AO. The identification of the starting block for the purposes of computa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an AY preceding the AY relevant to the PY in which search is conducted or requisition is made which falls beyond 6 AYs but not later than 10 AYs from the end of the AY relevant to the PY in which search is conducted or requisition is made. The above explanation assigns a particular meaning to the expression relevant AY . It precedes the AY relevant to the PY in which the search is conducted. The search was conducted on 10-4-18. According to sec2(34), PY means the PY as defined in sec3. As per sec3, for the purposes, PY means the FY immediately preceding the AY. AY has been defined in sec2(9) as the period of 12 months commencing on the 1st day of April every year. As per sec3(21) of the General Clauses Act, FY shall mean the year commencing on the 1st day of April. Since the search had taken place on 10-4-18, the AY will be 19-20. The PY would be 18-19. 4. The ld standing counsel pointed out that prior to the amendment made vide FA, 2017 wef., 1-4-17, section 153A mandated the AO to issue notice for 6 AYs immediately preceding the AY relevant to the FY in which the search is initiated. Since the search AY is 19-20, the 6 AYs preceding the same would be 1 18-19 2 17-18 3 16-17 4 15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd, the ld standing counsel would contend that the statutory provision talks of 6 years and 10 years, the second category 10 years must be understood as 6 plus 4 years . 7. The principles of interpreting a taxation statute have been authoritatively laid down by the CB of the SC in Dilip Kumar Co (2018) 9 SCC 1 (SC). It was held therein that other tools of interpretation such as contextual or purposive interpretation cannot be applied nor any resort be made to look to other supporting material in taxation statutes. There is no room for any intendment. Regard must be had to the clear meaning of the words. Equity has no place. One has to strictly look to the language used. There is no room for searching intendment nor drawing any presumption. Nothing has to be read into nor should anything be implied other than essential inferences while considering a taxation statute. (Para 29). This judgment is now a leading authority for the proposition that in the event a provision of fiscal statute is obscure such construction which favours the assessee may be adopted would have no application to construction of an exemption notification, as in such a case it is for the assessee to show that he c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e law has prescribed a particular length, it is not for the court to stretch it. Plasticity is the new mantra in neuroscience, thanks to the teachings of Norman Doidge. It implies that contrary to settled wisdom, even brain structure can be changed. But not so when it comes to a provision in a taxing statute that is free of ambiguity. Such a provision cannot be elastically construed. 11. One other contention urged by the standing counsel has to be dealt with. It is pointed out that the petitioner has invoked the writ jurisdiction at the notice stage. Since the petitioner has demonstrated that the subject AY lies beyond the ambit of the provision, the respondent has no jurisdiction to issue the impugned notice. Once lack of jurisdiction has been established, the maintainability of the WP cannot be in doubt. 12. The notice impugned in the WP is quashed. The WP stands allowed. Consequently, connected misc. petitions are closed. iii) CIT v. Jasjit Singh [2023] 155 taxmann.com 155 (SC) concluded that- 4. Notice was issued by the concerned jurisdictional AOs to the said assessees who contended that the period for which they were required to file returns, commenced only from the date the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted in Rajkesh Jain Group of cases by the Inv.Wing, New Delhi on 2-11-17. 7. Assessment proceedings were initiated against the assessee and assessment order was framed u/s 143(3) on 30-12-21 by which the returned income of Rs. 3,99,140 was assessed under section 153C at Rs. 1,63,99,140. 8. Challenge is validity of this assessment order framed u/s 153C for the reason that it is invalid because the impugned AY is beyond the block of 6 AYs, as per the Act. 9. It is a settled proposition of law that as per section 153C, for taking action under section 153C, date of search in the case of the other person would be date of receiving books of account or documents or assets allegedly belonging to the other person and seized in the course of search of the searched person. In other words, date of recording of the satisfaction in the case of the searched person qua the other person becomes date of search in the case of other person (the assessee in the present case). 10. This has been well settled by Jasjit Singh (2023) (SC). Relevant findings read as under: 9. It is evident on a plain interpretation of section 153C(1) that the Parliamentary intent to enact the proviso was to cater not merely ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s recorded on 31-3-21 for AY08-09 to AY11-12 and AY12-13 to AY17-18. According to first proviso to section 153C the date of search shall be the date of receiving the books of account or documents etc. by the AO of the assessee. As there is no information available about the dates of receiving such material, the date of satisfaction note by the ld AO of the assessee i.e., 31-3-21, shall be the date of search. 20. According to Explanation-1 to section 153A the income of the assessee can be assessed from AY11-12 to AY20-21 being 10 AYs from the date of recording of the satisfaction. Therefore, on this basis the assessment made for AY08-09 to AY10-11 which are beyond 10 years block are barred by limitation. iv) R.B. Jewellers (P) Ltd. v. UOI [2023] 157 taxmann.com 493 (Cal.) concluded that- 2. By this WP, petitioner has challenged the impugned initiation of assessment proceeding u/s 153A and the notice u/s 142(1) issued in course of aforesaid impugned proceeding relating to AY10-11 mainly on two grounds; firstly that the criteria for initiating proceeding u/s 153A has not been fulfilled since no incriminating document or materials have been found in course of search and seizure and sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed; and (d) Appeal being ITA no.111/Nag./2024, for the assessment year 2012-13, vide additional ground no.1, raised by the assessee is dismissed. 24. We now proceed to adjudicate the issue with respect to the Satisfaction Note recorded by the Assessing Officer of the searched person. This issue is involved in the following appeals:- ITA no.108/Nag./2024 A.Y. 2009-10 ITA no.109/Nag./2024 A.Y. 2010-11 ITA no.110/Nag./2024 A.Y. 2011-12 ITA no.111/Nag./2024 for A.Y. 2012-13 and ITA no.112/Nag./2024 for A.Y. 2013-14 25. The learned A.R. contended that the common issue involved in these appeals is that, there is no satisfaction recorded by the Assessing Officer of the searched person (i.e., M/s.RKTC Group/Suresh Agrawal, Kolkata, director of M/s.Rashi Steel Power P. Ltd, Kolkata) and also by the Assessing Officer of the assessee-Company. Since both the Assessing Officers are different, there is no mention in the assessment orders in respect of any satisfaction note recorded by the Assessing Officer of the searched person for the alleged escapment of the income for the assessment year 2009 10 to 2013 14. In absence of a valid satisfaction note recorded by the Assessing Officer of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts circumstances of the case and in law, assessment made u/s 153C is invalid as there is no satisfaction recorded by the AO of the searched person (i.e., RKTC Group) and also by the AO of the assessee-Co, since both the AOs are different; there is no mention of any satisfaction note recorded for the alleged escaped income of Rs. 22,46,300 for impugned AY12-13 in the assessment order; in absence of a valid satisfaction note recorded, which is a pre-requisite, pre condition for assuming valid jurisdiction u/s 153C, search assessment made u/s 143(3) rws.153C would be invalid and is liable to be quashed. ITA No.112/Nag./2024 Assessment year : 2013 14 Ground no.1: On the facts circumstances of the case and in law, assessment made u/s 153C is invalid as there is no satisfaction recorded by the AO of the searched person (i.e., RKTC Group) and also by the AO of the assessee-Co, since both the AOs are different; there is no mention of any satisfaction note recorded for the alleged escaped income of Rs. 75,00,000 for impugned AY13-14 in the assessment order; in absence of a valid satisfaction note recorded, which is a pre-requisite, pre condition for assuming valid jurisdiction u/s 15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 153C M/s. Maheshwari Coal Beneficiation and Infrastructure Pvt. Ltd. PAN AAFCM9298D 4. Date of initiation of search in case of the person referred to in Section 153A 22/01/2019 5. Name, address and PAN of the person in whose case action under section 153C is proposed M/s. Maheshwari Coa Beneficiation and Infrastructure Pvt. Ltd. PAN AAECM9298D House no.647, Behind 16 Kholi, Tikrapara Bilaspur, CG 6. to 7. . .. 8. Satisfaction of the Assessing officer of the person referred to in section 153A that the seized material referred to in S. No.6 belongs to the person referred to in S. No.5 Documents seized from the above mentioned premises belong to/show the person referred to in Sl. No. 5 as one of the party involved in the transaction. The physical verification of the seized documents and statement of the person referred to in Sl. No.3 u/s 132(4) of the I. . Act. 1961 prove that the seized material referred to in S.No.6 belongs to the person referred to in S. No.5. 9. Assessment year involved . .2009-10 . .2010-11 . .2011-12 . .2012-13 . .2013-14 . .2014-15 . .2015-16 . .2016-17 . .2017-18 . .2018-19 . .2019-20 Yours faithfully, Sd// (Sunny Kachhwaha) Deputy Commissioner of Income Tax C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further making assessment under section 153C, on the part of the Assessing Officer, would be liable to be quashed. In support of his arguments, the learned A.R. relied upon the following case laws: Agni Vishnu Ventures P. Ltd. v. DCIT, [2024] (Mad.) 157 taxmann.com 242; PCIT v. Gali Janardhana Reddys, [2023] (Kar.) 152 taxmann.com 332; PCIT v. Smt G Lakshmi Aruna, [2023] (Kar.) 150 taxmann.com 107; DCIT v. Sunil Kumar Sharma [2024] (Kar.) 159 taxmann.com 179. It is necessary to mention here that the Hon ble Supreme Court has dismissed the SLP filed by the Revenue in CIT v. Sunil Kumar Sharma reported as [2024] 165 taxmann.com 846 (SC); In the matter of Gali Janardhana Reddys (supra), the SLP filed by the Revenue has also been dismissed which is reported as [2023] 157 taxmann.com 392; and In the matter of Smt. G. Lakshmi Aruna (supra), the SLP filed by the Revenue has also been dismissed which is reported as [2024] 159 taxmann.com 183. 29. The learned A.R. for the assessee further relied on the following judicial pronouncements for the argument that the satisfaction note must be recorded by the Assessing Officer of the searched person before transmitting the documents to the Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... incriminating materials relate to a third party. Recording of satisfaction by the AO of the third party that the incriminating materials have a bearing on the determination of the total income of that third party. 80. Notice u/s 153C would have to be issued only upon confront satisfaction of both conditions as aforesaid. To this extent, there is, in my considered opinion, a clear and marked distinction between the section 153A and 153C. The contention of the Revenue that a mandate is cast upon the AO of the third party to issue notice u/s 153C for all the years comprising the block, mechanically and automatically, is thus rejected. 81. To clarify it is only where the satisfaction note recorded by the receiving AO, i.e., the AO of the third party reflects a clear finding that the incriminating material received has a bearing on determination of total income of the third party for 6 AYs immediately preceding the AY relevant to the PY in which search is conducted or requisition is made, that such notice would have to be issued for all the years. 82. It thus, flows from the provision that the receiving AO must apply his mind to the materials received and ascertain precisely the specif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o requirement of physical handing over of documents, the recording of satisfaction is still a must as the same is the foundation upon which subsequent proceedings against the other person is initiated. In the aforesaid case of Gopi Apartment (2014) (All HC), the Hon ble Alld HC held as under:- (1) The first stage comprises of a search and seizure operation u/s 132 or proceeding u/s 132A against a person, who may be referred as the searched person . Based on such search and seizure, assessment proceedings are initiated against the searched person u/s 153A. At the time of initiation of such proceedings against the searched person or during the assessment proceedings against him or even after the completion of the assessment proceedings against him, the AO of such a searched person , may, if he is satisfied, that any money, document etc. belongs to a person other than the searched person, then such money, documents etc. are to be handed over to the AO having jurisdiction over such other person . (2) The second stage commences from the recording of such satisfaction by the AO of the searched person followed by handing over of all the requisite documents etc. to the AO of such other per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Trib and Gopi Apartment (2014) (All HC), Calcutta Knitwears (2014) (SC) and Manish Maheshwari (2007) (SC) are applicable to the given facts and circumstances of the case. These judgments were followed by the Trib to hold that the notice issued by the AO u/s 153C deserves to be quashed and accordingly had proceeded to quash the assessment orders framed by the AO u/s 153C rws.143(3). Accordingly, the addl. ground was allowed in all the 7 years. .. The judgment rendered by the Trib does not suffer from any infirmity or absurdity to call for interference the said judgment and further no warranting circumstances arise. Consequently, these appeals deserve to be rejected. 68. In terms of the aforesaid reasons, we are of the opinion that this appeal requires to be dismissed as being devoid of merits. iii) Similar position of law laid down by the Hon ble Karnataka HC in the case of Smt G Lakshmi Aruna (2023) 150 taxmann.com 107 (Karnataka HC) dt.31-3-23; against which, SLP of the revenue has been dismissed by the Hon ble SC in the case of PCIT v. G Lakshmi Aruna (2024) 159 taxmann.com 183 (SC) dt.11-12-23. iv) Thereafter, the Hon ble Karnataka HC in the case of Sunil Kumar Sharma (2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the satisfactgion note is recorded by the Assessing Officer of the searched person for A.Y. 2009 10 to 2019 20 and requested to take action under section 153C for the assessment year 2009 10 to 2018 19 and under section 143(2) for the A.Y. 2019 20. 31. We have heard the submissions of the both the learned Counsel appearing for the parties and considered the materials available on record and gone through the the paper book filed before us along with supporting case laws. We find that the learned D.R. has furnished a report dated 16/05/2024 of the Assessing Officer wherein it is clear that the documents / information related to the assessment year 2009-10 and 2010-11 has been transferred from the Assessing Officer of the searched person i.e., DCIT, Central Circle, Raipur, to the Assessing Officer of the assessee i.e., DCIT, Central Circle-1(1), Nagpur on 21/01/2021, which is mentioned in the letter written by the Assessing Officer of the assessee i.e., DCIT, Central Circle-1(1), Nagpur, vide letter dated 11/03/2022 to the Addl.CIT, Central Range, Nagpur, which is received by the Addl.CIT, Central Range Nagpur on 11/03/2022. The contents of the report of the Assessing Officer are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the Assessing Officer of the searched person i.e., DCIT, Central Circle, Raipur, to the Assessing Officer of the assessee i.e., DCIT, Central Circle-1(1), Nagpur, which is mentioned in the letter written by the Assessing Officer of the assessee i.e., DCIT, Central Circle-1(1), Nagpur, dated 29/11/2021 to the Addl.CIT, Central Range, Nagpur, which is received by the Addl.CIT, Central Range Nagpur, on the same day i.e., 29/11/2021. The contents of the report by the Assessing Officer are reproduced below: Proforma for recording satisfaction u/s 153C of the I.T. ACT, 1961 (To be filled by the Assessing Officer of the person referred to in section 153A) 1. Name of the Group Searched RKTC Group, Korba 2. Name of PAN of the person referred to in Section 153A Shri Suresh Kumar Agrawal (ACIPA8846Q) 3. Name and PAN of the person referred to in Section 153C M/s. Maheshwari Coal Beneficiation and Infrastructure Pvt. Ltd. PAN AAFCM9298D 4. Date of initiation of search in the case of the person referred to in Section 153A 22/01/2019 5. Name, address and PAN of the person in whose case action under section 153C is proposed M/s. Maheshwari Coa Beneficiation and Infrastructure Pvt. Ltd. PAN AAECM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment year 2011 12 to 2013 14, which is clear from the above discussions. In support of this findings, we rely on the judgment of the Hon ble Karnataka High Court rendered in Sunil Kumar Sharma (supra) wherein it has been held that satisfaction note is required to be recorded under section 153C for each assessment year and in the impugned proceedings, a consolidated satisfaction note has been recorded for different assessment year by both the Assessing Officers i.e., the Assessing Officer of the searched person has recorded consolidated satisfaction note for the assessment year 2009 10 to 2019 20 and thereafter the Assessing Officer of the assessee has recorded consolidated satisfaction note for the assessment year 2009 10 and 2010 11 and another consolidated satisfaction note for the assessment year 2011 12 to 2013 14. There is no co relation with the documents year wise to clearly point out as to how the documents pertain to the assessee. Thus, we hold that the assessment order made under section 153C for the assessment year 2009-10 to 2013-14 is treated as invalid, bad in law and unsustainable in the eyes of law for want of valid assumption of jurisdiction on the part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 153A(1) sets out certain further conditions which is required to be fulfilled before issuing notice u/s 153C; in absence of valid assumption of jurisdiction u/s 153C, assessment made u/s 144 rws.153C would be invalid is liable to be quashed. Additional Gr.No.2: On the facts circumstances of the case and in law, assessment made u/s 153C dt.31-3-22 for AY09-10, i.e., relevant AY as per section 153A(1) as amended by FA, 2017 (wef.1-4-17); addition made on unexplained cash credits u/s 68 of Rs. 60,00,000; the AO has not made any addition on undisclosed asset which is sine qua non/ pre-condition for assuming valid jurisdiction for making assessment u/s 153C for relevant AY as per fourth proviso to section 153A(1) read with Expln-2 ; in absence of this, assessment made u/s 153C would be invalid is liable to be quashed; relied on Goldstone Cements Ltd (2023) (Gau HC); Fortune Vanijya (P) Ltd (2023) (Gau HC). 38. The assessee has also raised additional grounds of appeal in ITA No. 109/Nag./ 2024, A.Y. 2010-11. Ground no.2 On the facts circumstances of the case and in law, assessment made u/s 153C is invalid as without having jurisdiction to issue notice u/s 153C, as the reason for issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d (2023) (Gau HC). 40. In the appeal of the assessee bearing ITA No.111/Nag/ 2024, for the assessment year 2012-13 along with following additional ground of appeal has been raised: Ground no.2 On the facts circumstances of the case and in law, assessment made u/s 153C is invalid as without having jurisdiction to issue notice u/s 153C, as the reason for issuing notice u/s 153C does not come within the purview of 4th proviso to section 153A(1) sets out certain further conditions which is required to be fulfilled before issuing notice u/s 153C, more so, reason for escaped income of Rs. 22,46,300 is below the limit of Rs. 50 lakhs; in absence of valid assumption of jurisdiction u/s 153C, assessment made u/s 143(3) rws.153C would be invalid is liable to be quashed. Additional Ground no.2 On the facts circumstances of the case and in law, assessment made u/s 153C dt.31-3-22 for AY12-13, i.e., relevant AY as per section 153A(1) as amended by FA, 2017 (wef.1-4-17); addition made on unexplained cash credits u/s 68 of Rs. 22,46,300; the AO has not made any addition on undisclosed asset which is sine qua non/ pre-condition for assuming valid jurisdiction for making assessment u/s 153C for rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re capital/share application money as unexplained cash credits under section 68 and the Assessing Officer has not made any addition on undisclosed asset which is sine qua non/pre-condition for assuming valid jurisdiction for making assessment under section 153C for the relevant AY/ AYs as per fourth proviso to section 153A(1) r/w Explanation-2 to section 153A as amended by the Finance Act, 2017 (w.e.f. 01/04/2017), the addition on account of unexplained cash credit could not have been made by the Assessing Officer, unless he first made the addition of undisclosed asset; as the Assessing Officer has not made any addition on account of undisclosed asset. There was no jurisdictional fact in the hands of the Assessing Officer or in his possession when he assumed jurisdiction under section 153C for the assessment year 2009-10 to 2013-14 in the first place itself. When the very usurpation of jurisdiction under section 153C is bad in law for want of jurisdiction, the Assessing Officer would be precluded from making any other addition in the relevant AY/ AYs, the action fo the Assessing Officer in making addition under section 68 in the relevant AY/ AYs would be invalid for want of jurisdi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , find ourselves in agreement with the contention of the learned A.R. for the assessee that unless the Assessing Officer made addition of ₹ 50 lakh or more (in aggregate) in relation to the escaped / undisclosed asset, he could not assume jurisdiction to make addition on other items (viz. liabilities like credit entry, etc.) for the reason that, because in such a scenario, it bellies the claim of the Assessing Officer in issuing notice under section 153C / 153A, the Assessing Officer is in possession of the jurisdictional fact i.e., undisclosed asset valued ₹ 50 lakh or more has escaped assessment, which constitutes the key to open the lock and then re-assess the income of the assessee for the extended period of relevant AY / AYs; It is therefore, incumbent upon the Assessing Officer to show that the key used for opening the lock for the concluded the extended period of relevant AY / AYs is the most appropriate key to unlock and thereby reopen the proceedings for bringing to charge any other items of escaped / unexplained income unearthed in the course of search. However in a case where, either the assessee demonstrates that the key used by the Assessing Officer for reo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... umed section 153C jurisdiction is absent or not in existence. In the light of the aforesaid discussion and in our considered opinion, this plea of learned A.R. for the assessee is well founded and deserves to be accepted. In view of the above and on a perusal of the impugned assessment order, we note that the only addition made by the Assessing Officer in the assessment year 2009 10 to 2013-14 was on account of unexplained cash credit represented by loans and advances and share capital / share application monies under section 68 of the Act are as under: A.Y. Addition made by the Assessing Officer 09-10 Addition made by AO of Rs. 60,00,000 on the count of loans/ advances treating it as unexplained cash credits u/s 68 10-11 Addition made by AO of Rs. 4,43,55,00,000 on the count of loans/ advance treating it as unexplained cash credits u/s 68 11-12 Addition made by AO of Rs. 32,46,300 on the count of loans/ advances treating it as unexplained cash credits u/s 68 12-13 Addition made by AO of Rs. 22,46,300 on the count of loans/ advances treating it as unexplained cash credits u/s 68 13-14 Addition made by AO of Rs. 1,30,00,000 on the count of share capital/ share application money trea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of law is not satisfied, the AO does not get the authority of law to invoke the jurisdiction u/s 153A for 7th to 10th AY. At the cost of repetition, it is pertinent to mention that the assessee had disclosed the sale transactions and liquidation of shares in his regular books of accounts and the liquidation of shares were received in bank. Thus the aforementioned assets cannot be termed as undisclosed assets. It has been appositely concluded in the concurrent decisions of the CITA and ITAT that it cannot be held that the allegedly undisclosed assets have escaped assessment. 20. It has emerged from the foregoing discussions that the addition made by the AO in AY11-12 was on account of unexplained cash credit represented by sale proceeds of Rs. 9,63,00,000 u/s 68. The additions on account of unexplained cash credit , could not have been made by the AO, unless he initially made an addition of undisclosed asset valued at Rs. 50 lacs or more. In this case, as there was no addition made by the AO on account of undisclosed assets, ex consequenti, an inference deserves to be drawn that there was no jurisdictional fact for the AO to assume jurisdiction u/s 153C for AY11-12. The usurpatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in possession of the jurisdictional fact i.e., undisclosed asset valued Rs. 50 lakhs or more has escaped assessment, which constitutes the key to open the lock and then re-assess the income of the assessee for the 7th to 10th AY. It is therefore, incumbent upon the AO to show that the key used for opening the lock for the concluded 7th to 10th AY is the most appropriate key to unlock and thereby reopen the proceedings for bringing to charge any other items of escaped/unexplained income unearthed in the course of search. However in a case where, either the assessee demonstrates that the key used by the AO for reopening the assessment is either incorrect or where the AO himself abandons the jurisdictional fact in the course of assessment proceedings, then as a corollary, it has to be held that the key used by the AO for opening the lock was incorrect and thereby the lock placed earlier on the concluded assessment remained unopened and therefore, the AO could not enter upon the arena of reassessing the income of the assessee. So, when the AO fails to make any addition for the undisclosed asset , then it tantamount to admission that there was no jurisdictional fact present before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... when he assumed jurisdiction u/s 153A for AY11-12 in the first place itself. As, the very usurpation of jurisdiction u/s 153A is found to be bad in law for want of jurisdiction, the AO was precluded from making any other addition in the assessment for AY11-12. Hence, the AO s action of making addition u/s 68 in the relevant AY11-12 is held to be unsustainable for want of jurisdiction and is therefore, is quashed. The assessee thus succeeds on this ground raised in the cross objections and the same is allowed. 50. In our opinion, as the very usurpation of jurisdiction under section 153C is found to be bad in law for want of jurisdiction, the Assessing Officer was precluded from making any other addition in the assessments made for the assessment year 2009-10 to 2013-14. Hence, the action of the Assessing Officer in making addition under section 68 in the relevant assessment year 2009-10 to 2013-14 is held to be unsustainable for want of jurisdiction and is, therefore, it is invalied and bad- in law. Therefore, in view of the aforesaid discussions, we hold that the Assessing Officer s action of making addition under section 68 of the Act for the relevant assessment year 2009-10 to 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l, which is also in a mechanical routine manner without application of mind by the Addl. CIT. Moreso, without even considering the facts of the case; without pointing out the mistake / error committed by the Assessing Officer in the impugned draft assessment orders put up before the Addl. CIT for seeking separate approval for assessment year 2009 10 to 2013 14. 54. Thereafter, on the same day itself, i.e., on 31/03/2022, the Addl. CIT has granted separate approval dated 31/03/2022, under section 153D of the Act for each assessment year i.e., 2009 10 to 2013 14. The approval under section 153D dated 31/03/2022, so granted by the Addl. CIT, is reproduced herein below: F.No.Addl. CIT/CR 1/NGP/153D/2021 22 Date: 31.03.2022 To, The Deputy Commissioner of Income Tax Central Circle 1(1), Nagpur Sub: Approval u/s 153D of I.T. Act in the case of M/s. Maheshwari Coal Benefication Infrastructure Pvt. Ltd., PAN:AAECM9298D for A.Y. 2011 12 reg. Ref: Letter F. no.DCIT CC 1(1)/Approval u/s 153D/MCBIPL/2021 22, dated 31.03.2022. 2. I have perused the draft assessment order submitted by you in the case M/s. Maheshwari Coal Benfication Infrastructure Pvt. Ltd. PAN: AAECM9298D for A.Y. 2011 12 vide a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner of Income Tax Central Range 1, Nagpur 55. The learned A.R. for the assessee further argued that the separate approval dated 31/03/2022, granted under section 153D for each assessment year separately for assessment year 2009-10 to 2013-14 are invalid, as it is granted on the same day itself on 31/03/2022 on the basis of letter dated 31/03/2022 by the Assessing Officer for seeking approval from the Addl. CIT, though it is separate approval for each assessment year, but it is stereo-type/copy-paste approval for all the 5 years which is granted in mechanical / routine manner without application of mind by the Addl. CIT, without even perusing the facts of the case and without even perusing assessment record of the case; without pointing out the glaring mistakes / error committed by the Assessing Officer in the draft assessment order put up before him for seeking approval, which is enumerated as under: a) Issue of time barred by limitation has not been cared by Addl. CIT: The assessment for the assessment year 2009-10 to 2013-14, has been assessed under section 153C of the Act. A search under section 132 of the Act was conducted on 22/01/2019, upon the searched person i.e., M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of this jurisdictional fact, whole proceedings for the assessment year 2009 10 to 2011 12 would be vitiated amd to be held as invalid, bad in law, and therefore, there would be futile exercise to give his mechanical approval dated 31/03/2022 under section 153D. Approval granted on the same day itself (i.e., letter seeking approval on 31/03/2022 by the Assessing Officer to Addl. CIT), itself proves that Addl. CIT has not even perused the assessment records and not even read the draft assessment order. For computation of 10 assessment years from the search year, the documents have been transferred on 21/01/2021 and thus, search year would be the assessment year 2021 22 for the assessee under section 153C, as the first year and the tenth year would be assessment year 2012 13 and thus the assessment year 2009 10 to 2011 12 would be clearly beyond the block of 10 assessment years. Had the Addl. CIT applied his mind on these vital facts of the case, he would have certainly not give approval under section 153D for the assessment year 2009 10 to 2011 12. Had there been application of mind, he would not have approved the draft assessment order for the assessment year 2009 10 to 2011 12, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 68 of the Act. This fact has not been cared by the Addl. CIT while granting such mechanical approval on 31/03/2022 for the assessment year 2009 10 to 2013 14. c) The Addl. CIT has not cared that the Assessing Officer has made addition under section 68 of the Act when there is no credits appearing in the books of account and when there is also opening balance appearing which was brought forward from preceding years The learned A.R. for the assessee argued that in the draft assessment order for assessment year 2009 10 to 2013 14, the Assessing Officer has made addition on account of unexplained cash credits under section 68 while there is no such credit entry appearing / recorded / found credited in the books of account of the assessee-Company in the assessment year 2009 10 to 2013-14, which is sine qua non for applying section 68 which is absent in these cases and the Addl. CIT has not cared while granting such mechanical approval on 31/03/2022. Similarly, in the draft assessment order for assessment year 2013-14, the Assessing Officer has made addition of ₹ 35 lakh on account of unexplained cash credits under section 68 of the Act while it is an opening balance of ₹ 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ACIT (2021) 213 TTJ 251 (Chd-Trib) dt.7-6-21, ITA No.1573/Chd/ 2018; xi) Arch Pharmalabs Ltd v. ACIT (2021) (Mum-Trib) dt.7-4-21, ITA No.3752, 7597/Mum /2012; and xii) Sanjay Duggal v. ACIT (2021) (Del-Trib) dt.19-1-21, ITA No.1813/Del/ 2019. 57. The learned Departmental Representative vehemently supporting the impugned order passed the Assessing Officer submitted that the separate approval dated 21/03/2022, granted under section 153D of the Act by the Addl. CIT for the assessment year 2009 10 to 2013 14 is a valid approval after due application of mind by the Addl. CIT which was after considering all the facts and material available on record and the approval so granted by the Addl. CIT is in accordance with law. 58. We have carefully considered the rival contentions, perused the orders of the authorities below and the material placed on record which consist of Paper Book furnished by the learned A.R. and gone through the case laws relied upon. We find that the Addl.CIT has granted approval under section 153D for making assessment under section 153C for the assessment year 2009-10 to 2013-14 separately for each assessment year. The respective approval so granted under section 153 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ile exercise to give his mechanical approval under section 153D for the assessment year 2009-10 to 2011-12. The approval granted on the same day itself (i.e., letter seeking approval on 31/03/2022 by the Assessing Officer to Addl.CIT), which itself proves that Addl. CIT has not even perused the assessment records and not even read / seen / perused the draft assessment order; for computation of 10 assessment years from the search year. The documents has been transferred on 21/01/2021 and thus, search year would be 2021-22 for the assessee under section 153C as the first year and the tenth year would be the assessment year 2012-13 and thus, the assessment year 2009-10 to 2011-12 would be clearly beyond the block of 10 assessment years. Had the Addl.CIT applied his mind on these vital facts of the case, he certainly would have not given approval under section 153D for the assessment year 2009-10 to 2011-12. Had there been application of mind, he would not have approved the draft assessment order for the assessment year 2009-10 to 2011-12 which is time barred as per Explanation-1 to section 153A by the Finance Act, 2017 (wef.01/04/2017), the Addl.CIT has not cared that the assessment m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 68 whereas, there is no such credit entry is appearing / recorded/ found credited in the books of account of the assessee-Company in the assessment years, which is sine qua non for applying section 68 which is absent in these cases which is not cared by the Addl.CIT while granting such mechanical approval on 31/03/2022 for the assessment year 2009-10 to 2013-14 for example, in the draft assessment order for the A.Y. 2013-14, the Assessing Officer has made addition of ₹ 35 lakh on account of unexplained cash credits under section 68, whereas, it is an opening balance of ₹ 35 lakh as on 01/04/2012 which brought forward from earlier year(s) and thus, it is unsustainable in the eyes of law as there is no fresh credits appearing in the books of account, which is against the law laid down under section 68. It is also not cared by Addl.CIT while granting such mechanical approval on 31/03/2022 for the assessment year 2013 14. (e) Though, there is separate approval for each year is granted, but it is stereo-typed approval in same manner, in same fashion, in mechanical manner, merely on formality for all the 5 years i.e., A.Y. 2009-10 to 2013-14 separately, he has not ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the draft assessment order without any application of mind and seized materials were not looked at because that was not available before him at the time of granting of approval to the draft assessment order and other enquiry and examination was never carried out. From the said approval granted on the same day itself on 31/03/2022, it can be easily inferred that the said order was approved solely relying upon the implied undertaking obtained from the Assessing Officer in the form of draft assessment order. Thus, the sanctioning authority has, in effect, abdicated his statutory functions and delightfully relegated his statutory duty to the subordinate Assessing Officer, by virtue of whose action, the Addl.CIT was supposed to supervise. The Addl.CIT, without any consideration of merits in proposed additions with reference to the satisfaction note/incriminating material collected in search etc., has proceeded to grant a simplicitor approval. This approach of the Addl.CIT has rendered the approval to be a mere formality and cannot be considered as actual approval in law. 61. We also find that as per the scheme for framing search assessments, the Assessing Officer can pass the search ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oes not have any access. Moreover, the Act mandates the Assessing Officer to frame the assessment after getting prior approval from Addl.CIT under section 153D. The Addl.CIT getting involved in the search assessment proceedings right from inception does not have any support from the provisions as nowhere the Act mandates so. The scheme mandates due application of mind by the Assessing Officer to examine the seized documents independently dehors the appraisal report of the Investigation Wing and seek explanation / clarifications from the assessee on the contents of the seized documents. 64. When the scheme provides for a leeway to both the Assessing Officer as well as the Addl.CIT to even ignore the conclusions drawn in the appraisal report by the Investigation Wing and take a different stand in the assessment proceedings, the fact of Addl.CIT getting involved in the search assessment proceedings right from the receipt of copy of appraisal report/ satisfaction note, as argued by the learned D.R., has no substance. 65. In our considered opinion, if the arguments of the learned Departmental Representative are to be appreciated that the Addl.CIT need not apply his mind while granting a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d provision being an inbuilt protection against any arbitrary or unjust exercise of power by the AO, casts a very heavy duty on the said high ranking authority to see to it that the requirement of the previous approval, envisaged in the sec is not turned into an empty ritual. Needless to emphasise that before granting approval, the Chief CIT or the CIT, as the case may be, must have before him the material on the basis whereof an opinion in this behalf has been formed by the AO. The approval must reflect the application of mind to the facts of the case. (ii) Dharampal Satyapal Ltd (2019) (Gau HC) Manu/GH/07070/2018 has held as under: 28. When an Authority is required to give his approval, it is also to be understood that such Authority makes an application of mind as to whether the matter that is required to be approved satisfies all the requirements of Law or procedure to which it may be subjected. In other words, grant of approval and application of mind as to whether such approval is to be granted must coexist and, therefore, where an Authority grants an approval it is also to be construed that there was due application of mind that the subject matter approved and satisfies all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rded mechanically and without due application of mind had arisen for our consideration in Pioneer Town Planners (P) Ltd [2024] 160 taxmann.com 652 (Del HC) and where we had held as follows : 13. The primary grievance raised in the instant appeal relates to the manner of recording the approval granted by the prescribed authority u/s 151 for reopening of assessment proceedings as per sec148. 15. A plain reading of the aforesaid provision would indicate that sec151 stipulates that the PCCIT or CCIT or PCIT or CIT must be satisfied , on the reasons recorded by the AO, that it is a fit case for the issuance of such notice. Thus, the satisfaction of the prescribed authority is a sine qua non for a valid approval as per the said Sec. 16. A perusal of the proforma attached as Annex-II in the instant appeal would suggest that though the ACIT has appended his signatures by writing in his hand- Yes, I am satisfied , however, the PCIT has merely written Yes without specifically noting his approval, while recording the satisfaction that it is a fit case for issuance of notice u/s 148. 17. Thus, the incidental que which emanates at this juncture is whether simply penning down Yes would suffice r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e they help in discerning the manner in which conclusion is reached by the concerned authority. 19. In the case of Chhugamal Rajpal, the Hon ble SC refused to consider the affixing of signature alongwith the noting Yes as valid approval and had held as under:- 5. --- Further the report submitted by him u/s 151(2) does not mention any reason for coming to the conclusion that it is a fit case for the issue of a notice u/s 148. We are also of the opinion that the CIT has mechanically accorded permission. He did not himself record that he was satisfied that this was a fit case for the issue of a notice u/s 148. To Que 8 in the report which reads whether the CIT is satisfied that it is a fit case for the issue of notice u/s 148 , he just noted the word yes and affixed his signatures thereunder. We are of the opinion that if only he had read the report carefully, he could never have come to the conclusion on the material before him that this is a fit case to issue notice u/s 148. The important safeguards provided in secs147 and 151 were lightly treated by the ITO as well as by the CIT. Both of them appear to have taken the the duty imposed on them under those provisions as of little impo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng observations that were made in ITA 8/2024: - 4. Accordingly, while we dismiss the instant appeal following the reasons assigned in the earlier case of Anuj Bansal, we leave the que pertaining to the effect and impact of sec144A as well as of the provisions contained in the Search and Seizure Manual, 2007, open to be addressed in appropriate proceedings. 7. In the facts of the present case and those which have come to be recorded by the Tribunal, we find that there arises no occasion for us to examine the said issue. The same be accordingly kept open to be addressed in appropriate proceedings. (iv) PCIT v. Anuj Bansal (2024) 165 taxmann.com 2 (Del HC) dt.13-7-23, concluded that- 7. The Tribunal has via the impugned order set aside the additions made qua the income of the assessee inter alia, on the Gr. that there was no application of mind by the Addl.CIT in granting approval u/s 153D. 8. To be noted, an assessment order was framed qua the assessee u/s 153A, rws.143(3). 9.1. The respondent had declared an income amounting to Rs. 87,20,580. However, while making the additions, strangely, the AO noted that the returned income was Rs. 11,00,460. 10. There were 2 additions made by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iven u/s 153D has been granted in a mechanical manner and without application of mind and thus, it is invalid and bad in law and consequently vitiated the assessment order for want of valid approval u/s 153D. In view of the above discussion, we hold that the order passed u/s 153A rws.43(3) has to be quashed, thus ordered accordingly. The Gr. raised by the Assessee is accordingly allowed . 14. In this appeal, we are required to examine whether any substantial que of law arises for our consideration. 15. Having regard to the findings returned by the Trib, which are findings of fact, in our view, no substantial que of law arises for our consideration. The Tribunal was right that there was absence of application of mind by the ACIT in granting approval u/s 153D. It is not an exercise dealing with a immaterial matter which could be corrected by taking recourse to sec292B. 16. We are not inclined to interdict the order of the Trib. (v) PCIT v. Subash Dabas (2024) (Del HC) dt.17-5-24; ITA No.243/2023 CNAPPL.20652/2023, concluded that- 11. Recently, in Shiv Kumar Nayyar (2024) (Del HC), we had an occasion to deal with an almost identical issue i.e., grant of approval u/s 153D in a mechanic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conclude that after placing reliance on various judicial pronouncements, this Court was of the opinion that approval u/s 153D cannot be accorded in a casual or mechanical manner. Rather, the said exercise involves due application of mind which must be reflected in the order of approval passed by the concerned statutory authority. 13. In the instant case, with respect to the inappropriate approval accorded by the relevant authority, the Tribunal has made a categorical finding, which reads as under:- 36. A perusal of the approval sought by the AO shows that he has requested to grant necessary approval u/s 153D for the cases completed u/s 153A/143(3). A combined perusal of the approval sought by the AO, the approval given by the Addl.CIT and the copy of remand report of the AO show that there is only some namesake approval given by the Addl.CIT on the very same day on which the AO sought approval. The Addl.CIT without verifying the records has given approval in a mechanical manner. This is more so evident from the fact that the opening balance of unsecured loans of Rs. 8 crores was added by the AO, which is not a small amount and the number of unsecured loan creditors are only four an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rds, even the bare minimum requirement of the approving authority having to indicate what the thought process involved was is missing in the aforementioned approval order. While elaborate reasons need not be given, there has to be some indication that the approving authority has examined the draft orders and finds that it meets the requirement of the law. As explained in the above cases, the mere repeating of the words of the statute, or mere rubber stamping of the letter seeking sanction by using similar words like see or approved will not satisfy the requirement of the law. This is where the Technical Mannual of Office Procedure becomes important. Although, it was in the context of sec158BG, it would equally apply to sec153D. There are 3 or 4 requirements that are mandated therein, (i) the AO should submit the draft assessment order well in time . Here it was submitted just 2 days prior to the deadline thereby putting the approving authority under great pressure and not giving him sufficient time to apply his mind; (ii) the final approval must be in writing; (iii) The fact that approval has been obtained, should be mentioned in the body of the assessment order. 14. During the cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsel for the assessee clearly signifies that a single approval has been granted for AYs 11-12 to 17-18 in the case of the assessee. The said order also fails to make any mention of the fact that the draft assessment orders were perused at all, much less perusal of the same with an independent application of mind. Also, we cannot lose sight of the fact that in the instant case, the concerned authority has granted approval for 43 cases in a single day which is evident from the findings of the ITAT, succinctly encapsulated in the order extracted above. 18. Therefore, under the facts of the present case, considering the foregoing discussion and the enunciation of law settled through judicial pronouncements discussed hereinabove, we are unable to find any substantial que of law which would merit our consideration. (vii) PCIT v. Dilip Construction P Ltd (2023) 7 NYPCTR 892 (Ori HC) held as under: 4. We find similarity in facts found in the case by the Trib. The approval does not even say the Jt.CIT had perused the files. As such, the contention sought to be raised in the appeal is covered by Serajuddin Co (2023) (Ori HC). In the circumstances, the appeal and applications are dismissed. ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se may be, must have before him the material on the basis whereof an opinion in this behalf has been formed by the AO. The approval must reflect the application of mind to the facts of the case. 18. The contention of the Revenue in those cases that the non-compliance of the said requirement does not entail civil consequences was negatived. Reiterating the view expressed in Rajesh Kumar, the SC in Sahara India (Firm) Luck held as under: 29. In Rajesh Kumar (2007) 2 SCC 181 it has been held that in view of sec 136, proceedings before an AO are deemed to be judicial proceedings. Sec136, stipulates that any proceeding before an IT Authority shall be deemed to be judicial proceedings within the meaning of sec 193 and 228 of IPC, 1860 and also for the purpose of sec196 of IPC and every IT Authority is a court for the purpose of sec195 of Code of Criminal Procedure, 1973. Though having regard to the language of the provision, we have some reservations on the said view expressed in Rajesh Kumar s case, but having held that when civil consequences ensue, no distinction between quasi judicial and administrative order survives, we deem it unnecessary to dilate on the scope of sec136. It is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rity under great pressure and not giving him sufficient time to apply his mind; (ii) the final approval must be in writing; (iii) The fact that approval has been obtained, should be mentioned in the body of the assessment order. 23. In the present case, it is an admitted position that the assessment orders are totally silent about the AO having written to the Addl.CIT seeking his approval or of the Addl.CIT having granted such approval. Interestingly, the assessment orders were passed on 30-12-10 without mentioning the above fact. These 2 orders were therefore, not in compliance with the requirement spelt out in para 9 of the Manual of Official Procedure. 25. For all of the aforementioned reasons, the Court finds that the ITAT has correctly set out the legal position while holding that the requirement of prior approval of the superior officer before an order of assessment or reassessment is passed pursuant to a search operation is a mandatory requirement of sec153D and that such approval is not meant to be given mechanically. The Court also concurs with the finding of the ITAT that in the present cases such approval was granted mechanically without application of mind by the Addl.C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment folders/ files/ seized materials or any incriminating documents or other connected documents and papers/ various statements recorded u/s 132(4) and sec131(1A) of the assessee or any other person/ appraisal report of the Investigation Wing of the Department/ materials on hand with the Department at the time of initiation of search or material evidences gathered were placed for its verification and the same were duly verified and/or examined by him as mandated u/s 153D. In the absence of compliance of the above mandate, the approval order dt.25-12-18 passed u/s 153D becomes an empty formality without due process of law and, thus, not sustainable. The ld Addl.CIT, in fact, abdicated his statutory functions and delightfully relegated the statutory duty to his subordinate being the Dy.CIT, Central-1, Bhopal adopting a shortcut method. Merely, an undertaking given by the ld AO was considered to be adequate by the Addl.CIT to accord approval in all assessments involved without considering any merit in the proposed adjustments with reference to appraisal report, incriminating material collected in search etc.; this is nothing but an approval by way of mere mechanical exercise ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amining the replies filed by the assessee and drawing conclusions thereon. Hence, it is very easy for the Jt.CIT to grant approval of the draft assessment order on the same day since he is involved with the assessment proceedings right from the inception. Accordingly, he argued that the objection raised by the ld AR has no force. Further, the ld DR vehemently argued that bare reading of sec153D talks only about existence of approval from the Jt.CIT. There is no mention of application of mind on the part of the Jt.CIT or the approving authority in the said sec. The expression application of mind is only provided by the Judicial decisions and not provided in the statute. Hence, the ld DR argued that literal interpretation is to be given to the sec153D which does not provide for application of mind of the approving authority and hence, any other interpretation contrary to the same would only result in re-writing the law. 9. We find, as per the scheme, for framing search assessments, the ld AO can pass the search assessment order u/s 153A or u/s 153C only after obtaining prior approval of the draft assessment order and the conclusions reached thereon from the Jt.CIT in terms of sec153D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the search assessment proceedings right from the receipt of copy of appraisal report, as argued by the ld DR, has no substance. In other words, irrespective of the conclusions drawn in the appraisal report by the Investigation Wing, both the AO and the Jt.CIT are supposed to independently apply their mind in a judicious way before drawing any conclusions on the contents of the seized documents while framing the search assessments. In our considered opinion, if the arguments of the ld DR are to be appreciated that the Jt.CIT need not apply his mind while granting approval of the draft assessment orders u/s 153D as it is not provided in sec153D, then it would make the entire approval proceedings contemplated u/s 153D otiose. The law provides only the AO to frame the assessment, but, certain checks and balances are provided in the Act by conferring powers on the Jt.CIT to grant judicious approval u/s 153D to the draft assessment orders placed by the ld AO. 10. Let us now examine whether in the aforesaid background of the scheme, whether the approval in terms of sec153D has been granted by the Jt.CIT in a judicious way after due application of mind or not, in the instant case. 11. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merely says that Necessary statutory approval u/s 153D is given to pass the above assessment order as such. Assessment record in this case is returned herewith... which clearly proves that the Addl.CIT had routinely given approval to the AO to pass the order only on the basis of contents mentioned in the draft assessment order without any application of mind and seized materials were not looked at because that was not available before him at the time of granting of approval to the draft assessment order and other enquiry and examination was never carried out. From the said approval, it can be easily inferred that the said order was approved solely relying upon the implied undertaking obtained from the AO in the form of draft assessment order that AO has taken due care while framing respective draft assessment orders and that all the observations made in the appraisal report relating to examination/ investigation of seized material and issues unearthed during search have been statedly considered by the AO seeking approval. Thus, the sanctioning authority has, in effect, abdicated his statutory functions and delightfully relegated his statutory duty to the subordinate AO, whose actio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Addl.CIT, was supposed to supervise. The addl.CIT in short appears to have adopted a short cut in the matter and an undertaking from AO was considered adequate by him/ her to accord approval in all assessments involved. Manifestly, the Addl.CIT, without any consideration of merits in proposed adjustments with reference to appraisal report, incriminating material collected in search etc. has proceeded to grant a simplicitor approval. This approach of the Addl.CIT, Central has rendered the Approval to be a mere formality and can not be countenanced in law. 11.6. There are several decisions, which supports the view that approval granted by the superior authority in mechanical manner defeats the very purpose of obtaining approval u/s 153D. Such perfunctory approval has no legal sanctity in the eyes of the law. Shreelekha Damani (Mum-Trib) approved by jurisdictional HC subsequently as reported in 307 CTR 218 affirms the plea of the assessee. 11.7. Very recently, Sanjay Duggal (Del-Trib) dt.19-1-21 has also echoed the same view after a detailed analysis of similar facts and also expressed a discordant note on such mechanical exercise of responsibility placed on designated authority u/s 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision to be exercised by the higher Revenue Authority enabling the AO to pass assessment order or reassessment order in search cases, then, it is the duty of the Jt.CIT to exercise such powers by applying his judicious mind. We are of the view that the obligation of the approval of the Approving Authority is of 2 folds; on one hand, he has to apply his mind to secure in build for the Department against any omission or negligence by the AO in taxing right income in the hands of right person and in right AY and on the other hand, Jt.CIT is also responsible and duty bound to do justice with the tax payer (Assessee) by granting protection against arbitrary or unjust or unsustainable exercise and decision by the AO creating baseless tax liability on the assessee and thus, the Jt.CIT has to discharge his duty as per Law. Thus, granting approval u/s 153D is not a mere formality, but, it is a supervisory act which requires proper application of administrative and judicial skill by the Jt.CIT on the application of mind and this exercise should be discernable from the Orders of the approval u/s 153D. 11.7. In the following Orders of various Benches of the Trib, it is held that while granting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... instead of paying the entire sale consideration to M/s.JIL. Thus, the nature of total receipt/ addition is the sale proceeds originally to be received by M/s.JIL. If the part of the sale proceeds which were to be received by M/s. JIL and when transferred to the account of M/s.Alfa India Ltd., the entire part sale receipts cannot be the income either in the hands of M/s. JIL or M/s. Alfa India or the assessees who may be the conduit as argued before us. The AO has failed to consider the concept of real income for the purpose of determining the correct tax liability and correct determination of income of the assessees. We rely upon Godhra Electricity Co Ltd (SC). This fact is also not verified and considered by the Jt.CIT while granting approval u/s 153D. It may be noted here that entire sale proceeds when cannot be added in the hands of M/s JIL as income which is also not done in the case of M/s. JIL, rightly so, how the same sale proceeds could be added as income in the hands of assessees u/s 68 is not understandable. Thus, the Approving Authority without application of mind and in a most mechanical and technical manner granted approval u/s 153D even without reference to any reaso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been granted either on the same day or on the next day. Further, there is no reference that seized material as well as appraisal report have been verified by the Jt.CIT. It is not clarified whether assessment record is also seen by the Jt.CIT. It may also be noted that even in some of the Talwar group of cases approval is granted prior to 30-12-17 but in main cases of Shri Sanjay Duggal and Rajnish Talwar the approval is granted on 30-12-17. Therefore, without granting approval in the main cases how the Jt.CIT satisfied himself with the assessment orders in group cases which is also not explained. Therefore, the approval granted by the Jt.CIT in all the cases are merely technical approval just to complete the formality and without application of mind as neither there was an examination of the seized documents and the relevance of various observations made by the Investigation Wing in appraisal report. Thus, we hold the approval u/s 153D have been granted without application of mind and is invalid, bad in Law and is liable to be quashed. (i) SMW Ispat (P) Ltd v. ACIT (2024) 163 taxmann.com 119 (Pune-Trib) held as under: 15. Heard both the parties and perused the material availab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mining the relevant material. According to the AO, the case of the assessee was covered by search action u/s 132 conducted at Bhilwara concerning Mantri-Soni Group of Jalna/ Bhilwara and their family members and business concerns at the business and resi-premises of different members/ associate which is evident from para 1 of the assessment order. Admittedly, the AO sought approval u/s 153D in 49 assessment orders vide letter dt. 18-3-16 which is on record placed on by the ld DR on 9-10-23. The approving authority has to examine number of evidences, documents, statements of various persons etc. recorded which were necessarily to be taken into consideration while granting approval u/s 153D by the Jt.CIT. On an examination of the approval dt.21-3-16 which is on record placed by the ld DR on 9-10-23, we find no such indication of examination of evidences, documents, statements of various persons etc. at least, no reference whatsoever made by the Jt.CIT i.e., approving authority. Thus, we find the facts and circumstances in the present case are similar to the facts of the case before the Serajuddin Co (2023) (Ori HC) and the ratio laid down therein is applicable to the present case. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Even otherwise also, the exercise is shown to have been performed in less than 24 hours of time which also goes to indicate that the CIT did not apply his mind at all while granting sanction. The satisfaction has to be with objectivity on objective material. 8. If the case in hand is analysed on the basis of the aforesaid principle, the mechanical way of recording satisfaction by the Jt.CIT, which accords sanction for issuing notice u/s 148, is clearly unsustainable and we find that on such consideration both the appellate authorities have interfered into the matter. In doing so, no error has been committed warranting reconsideration. 9. As far as explanation to sec151, brought into force by Finance Act, 2008 is concerned, the same only pertains to issuance of notice and not with regard to the manner of recording satisfaction. That being so, the said amended provision does not help the revenue. 10. In view of the concurrent findings recorded by the ld appellate authorities and the law laid down in Arjun Singh (MP HC), we see no que of law involved in the matter, warranting reconsideration. 11. The appeals are, therefore, dismissed. 23. We find the Department of Revenue filed SLP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. Thus, we hold as under: a) Ground no.4, in the appeal being ITA No.108/Nag./2024, A.Y. 2009-10, is allowed; b) Ground no.4, in the appeal being ITA No.109/Nag./2024, A.Y. 2010-11, is allowed; c) Ground no.4, in the appeal being ITA No.110/Nag./2024, A.Y. 2011-12, is allowed; d) Groundn no.4, in the appeal being ITA No.111/Nag./2024, A.Y. 2012-13, is allowed; and e) Ground no.3, in the appeal being ITA No.112/Nag./2024, A.Y. 2013-14, is allowed. 69. Now we proceed to adjudicate the issue on merits which relates to the addition made on account of unexplained cash credit under section 68 of the Act. This issue arose in the following appeals: ITA no.108/Nag./2024 A.Y. 2009-10 ITA no.109/Nag./2024 A.Y. 2010-11 ITA no.110/Nag./2024 A.Y. 2011-12 ITA no.111/Nag./2024 for A.Y. 2012-13 and ITA no.112/Nag./2024 A.Y. 2013-14 70. Ground no.5 and Additional Grounds no.3 and 4, relates to addition on account of unexplained cash credit under section 68 of the Act in assessment year 2009 10, 2010 11. 2011 12, 2012 13 and 2013 14. The only difference in the said grounds are variation in figures and name of parties involved. Rest the facts and circumstances of the issue in the aforesaid assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted. Ground no.5 On the facts circumstances of the case and in law, the ld CIT(A) has erred in sustaining addition of Rs. 35,00,000 made u/s 68 on count of unexplained cash credits, while, it was opening balance as on 1-4-12 and there is no fresh credits appearing in the books of account of the assessee-Co in the impugned AY13-14; addition is not justified; addition is liable to be deleted. Additional Ground no.3 On the facts circumstances of the case and in law, the ld CIT(A) has erred in sustaining addition of Rs. 5,00,000 made u/s 68 on count of unexplained cash credits while, there is no such credit entry is appearing in the books of account of the assessee-Co in the impugned AY13-14; addition is not justified in absence of any corroborative material/ evidence brought on record by the AO; addition is liable to be deleted. Additional Gr.No.4: On the facts circumstances of the case and in law, the ld CIT(A) has erred in sustaining addition of Rs. 1,25,00,000 made u/s 68 on count of unexplained cash credits, which had already recorded in the books of account and it had also included in IDS, 2016 dt.29-9-16 of Rs. 5,25,00,000 made for AY13-14 on the count of impugned share capital ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecorded in the books of account of the assessee-Company in the assessment year 2009 10. In the assessment order dated 31/03/2022 made under section 153C at Page 2, there is a mention of Raj Roadways against which the Revenue pleaded that a ledger account was found at third party premises of Shri Suresh Agrawal, Kolkata, the alleged accommodation entry provider as per the statement recorded under section 132(4) in respect of Shri Suresh Agrawal, Kolkata on 22/01/2019 to 25/01/2019 and on 14/03/2019, on a separate search action under section 132 conducted upon Shri Suresh Agrawal, Kolkata, the director of M/s.Rashi Steel Power P. Ltd, Kolkata, on 22/01/2019 (i.e., Suresh Agrawal, Kolkata, who is director of the assessee-Company also but he is not involved in any of the affairs/ business of the assessee-Company since last 9-10 years, he is not even in touch with the assessee-Company in any manner since last 9-10 years). The alleged party Raj Roadways , which is not even transacted/ related/ linked/ pertain to the assessee-Company in the assessment year 2009-10 in any manner and on this count also, the Assessing Officer made addition of Rs. 60 lakh under section 68 in assessment year 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT(A), the Revenue filed an appeal before the Trib, that is, ITA No.1527/Del/2003 for the AY99-00 and the same was dismissed by the Del-Trib, vide the impugned order. 4. It has been contended by ld counsel for the Revenue that despite several opportunities, the assessee had failed to file confirmation from Bhai Manjeet Singh and, therefore, the AO was justified in making addition u/s 68. 6. Here, the CIT(A) has deleted the addition of Rs. 15 lacs mainly on the ground that this credit balance of Rs. 15 lacs is being reflected in the accounts of the assessee over the past 4 to 5 years or so and hence, this was not a fresh credit entry of the PY u/c and these credit entries were already made and accounted for in the AY95-96 and 97-98 which were introduced in the form of advance against breeding stallions owned by the assessee and thus, these credit entries did not relate to the year u/c for being considered u/s 68. Since it is a finding of fact recorded by the CIT(A) that this credit balance appearing in the accounts of the assessee, does not pertain to the year u/c, under these circumstances, the AO was not justified in making the impugned addition u/s 68 and as such no fault can be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ported by Usha Stud Agricultural Farms Ltd (2008) (Del HC), cited supra wherein held that credit balance in the account of the assessee did not pertain to the year u/c, the AO was not justified in making the addition u/s 68. Hence, in our opinion, the liabilities which were not credited in the PY relevant to the AY u/c, the the sec68 cannot be applied and the AO is directed to exclude the same from the addition u/s 68 after duly verifying the same. 10. In this view of the matter and considering facts and circumstances of this case, we are of the considered view that the ld AO was erred in making additions towards credits shown in the books of accounts u/s 41(1)/68. The ld CIT(A) without appreciating facts, has simply confirmed additions made by the AO. Hence, we reverse the findings of the CIT(A) and direct the AO to delete additions made towards sundry creditors u/s 41(1) 68. 78. We also find that the said sum is not found credited in the books of account of the assessee-Company in the assessment year 2009 10, which is sine qua non/ pre-requisite/ pre-condition for making addition under section 68 on account of unexplained cash credits and in absence of this pre-condition of recor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the assessment year 2009 10, 2010 11, 2011 12 2012 13 is allowed and ground no.5 and additional grounds no.3 and 4 for the assessment year 2013 14, are hereby allowed. 80. Now we take up the issue which relates to unabated year in which no incriminating material found during the course of search from the premises of the searched person and no cross examination has been provided by the Revenue. 81. The aforesaid issue is involved in the following assessment year: 2009 10 ground no.3 and 6 2010 11 ground no.3 and 6 2011 12 ground no.3 and 6 2012 13 ground no.3 and 6 2013 14 ground no.2 and 6 82. The learned A.R. for the assessee submitted that the year of assessment year 2009-10 to 2013-14 was an unabated/ completed assessment on the deemed date of search i.e., on 21/01/2021 for the non-searched person when the documents has been transmitted from the Assessing Officer of the searched person to the Assessing Officer of the assessee. No assessment was pending for the assessment year 2009 10 to 2013-14 on the deemed date of search on 21/01/2021. There is no incriminating material found from the searched premises of Shri Suresh Agrawal, Kolkata (i.e., the searched person who is directo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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