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Income Tax Appellate Tribunal, “B” BENCH : BANGALORE
Before: SHRI ARUN KUMAR GARODIA & SHRI LALIET KUMAR
Assessment Year : 2007-08 Shri K. Shekar Raju, The Deputy #169, 3rd Cross, CEX Layout, Commissioner of RMV 2nd Stage, vs. Income Tax, Bhoopasandra, Central Circle – 2 [2], Bangalore – 560 004. Bangalore. PAN: AFSPS7129H APPELLANT RESPONDENT Assessee by : Shri Chandrashekar, Advocate Revenue by : Shri K.R. Narayana, JCIT (DR) Date of hearing : 20.03.2019 Date of Pronouncement : 22.03.2019 O R D E R
Per Shri A.K. Garodia, Accountant Member
This appeal is filed by the assessee and the same is directed against the order of ld. CIT (A)-VI, Bangalore dated 28.02.2014 for Assessment Year 2007-08.
The grounds raised
by the assessee are as under. “1. The orders of the authorities below in so far as they are against the appellant are opposed to law, equity, weight of evidence, probabilities, facts and circumstances of the case.
2. The order of re-assessment passed u/s.143[3] rws 153C of the Act is without jurisdiction and void-ab-initio in as much as the assessment having already been completed by the very learned A.O. for the impugned assessment year earlier on 15/12/2009 and thus cannot re- assess/revise his own order which is outside the purview and scheme of the Act envisaged and thus the impugned assessment requires to be held as null and void and are non-est in law.
3. Without prejudice to the above, the order of assessment passed u/s.143[3] 153C of the I.T.Act wherein the impugned additions assessed by the A.O. were already dealt and deliberated in the earlier proceedings completed on 15/12/2009 by the very learned A.O. and the A.O. being satisfied by the explanations tendered then and that no additions were made in such assessment and it is therefore now not open to the very A.O. to revist/revise/negate his own findings which are not permissible as per the scheme of the Act.
4. Without prejudice to the above, the order of reassessment is bad in law as reasons for issuance of such notice u/s.153C of the I.T.Act have not been given and the appellant has reasons to believe that the same has not been recorded and that the mandatory conditions to assume jurisdiction is to record reasons and in the absence of the same, the assessment is bad in law and liable to be cancelled.
Without prejudice to the above, the order of assessment passed u/s.153C of the Act is barred by limitation as envisaged u/s.153B of the I.T.Act and thus the impugned assessment requires to be annulled. 6. Without prejudice to the above, the learned authorities below are not justified in assessing a sum of Rs.1,00,00,000/- as the cash purported to have been paid by the appellant to the Vendors in terms of an agreement date 25/10/2006 impounded during the course of search on one Sri Ravichandran, which requires to be deleted under the facts and circumstances of the appellant's case. 7. Without prejudice to the above, the authorities below are not justified in assessing on the appellant a sum of Rs.25,00,000/- as the unaccounted cash loan alleged to have been advanced by the appellant to Sri R.Ravinchandran, which requires to be deleted under the facts and circumstances of the appellant's case. 8. Without prejudice to the right to seek waiver before the Hon'ble CCIT/DGIT, the appellant denies himself liable to be charged to interest u/s.234A, 234B and 234C -1 the Act, which requires to be cancelled under the facts and in the circumstances of the appellant's case. 9. For the above and other grounds that may be urged at the time of hearing of the appeal, your appellant humbly prays that the appeal may be allowed and Justice rendered” 3. At the very outset, it was submitted by ld. AR of assessee that in the present case, the assessment order is u/s. 143(3) r.w.s. 153C of IT Act. Thereafter he submitted that this is a settled position of law by now that in respect of assessment u/s. 153C of IT Act, this has to be established by the revenue that satisfaction were recorded by the AO of the searched person to the effect that any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, belongs to; or any books of account or documents, seized or requisitioned, pertains or pertain to, or any information contained therein belongs to a person other than the person searched. He submitted that in the present case, this issue was raised by assessee before CIT (A)
Page 3 of 4 also as per ground no. 4 raised before CIT (A). But while deciding this ground, ld. CIT(A) has not passed any reasoned order on this aspect and hence, this matter may be restored back to the file of CIT(A) for fresh decision by way of a speaking and reasoned order. The ld. DR of revenue supported the order of CIT(A).
We have considered the rival submissions. We find that as per ground no. 4 of the appeal raised before us as reproduced above, this is the objection of the assessee that reasons for issuance of notice u/s. 153C of IT Act were not given to assessee and the assessee feels that the same has not been recorded and this is the mandatory condition to assume jurisdiction. We find that although the issue in this ground is this that the AO should have recorded reasons but this is true that as per the section 153C of IT Act, the AO of the searched person has to record satisfaction. Similar issue was raised by assessee before CIT(A) as per ground no.
4. The same was decided by CIT(A) as per para 4.3 of his order which is reproduced hereinbelow for ready reference. “4.3. As regards reasons for initiating proceedings u/s 153C, these can be inferred from the Assessment Order, where specific mention of some of the documents belonging to the appellant seized from the search premises is made. No evidence has been brought on record that the appellant at any stage during the course of assessment, has asked for a copy of the said reasons and that they were not provided to him. This ground raised
by the appellant is superfluous and is dismissed.”
5. From the above Para reproduced from the order of CIT (A), it is seen that the order of CIT (A) is not a speaking and reasoned order. He has not given any finding as to whether satisfaction was recorded by the AO of the searched person or not. Hence we feel it proper that this matter should go back to the file of CIT (A) for fresh decision by way of a speaking and reasoned order on this aspect as to whether necessary satisfaction as required u/s. 153C was recorded or not by the AO of the searched person. If it is found that required satisfaction was not recorded then the assessment will not survive. But if it is found that the satisfaction as required u/s. 153C was recorded by the AO of the searched person, then in that situation, the assessment will survive and the issue on merit has to be decided afresh Page 4 of 4 because the decision on merit should be after final decision on technical aspect. In view of this discussion, we set aside the order of CIT(A) and restore the entire matter back to the file of CIT(A) for fresh decision first on this aspect as to whether necessary satisfaction as required u/s. 153C of IT Act was recorded or not by the AO of the searched person and after that if it is found that required satisfaction was recorded, then he should decide the issue on merit afresh. In view of this decision, no adjudication on merit is called for at the present stage. Hence we do not discuss and decide any other ground.
In the result, the appeal filed by the assessee stands allowed for statistical purposes in the terms indicated above. Order pronounced in the open court on the date mentioned on the caption page.