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Income Tax Appellate Tribunal, BANGALORE BENCH ‘B’, BANGALORE
Before: SHRI A. K. GARODIA & SHRI VIJAY PAL RAO
and are being disposed of by this common order for the sake of convenience.
In all the seven appeals filed by the assessee, the assessee has raised one identical Additional ground which is reproduced below:
“ On the facts there being no satisfaction note of the assessing authority of the raid party which was a pre- requisite condition before transmitting the records to the appellant’s assessing authority provided to the appellant, the assessment under section 153C rws 143(3) of the Act, as made by the assessing authority is opposed to law and liable to be cancelled”.
It was submitted by the ld.AR of the assessee that in none of the years, the satisfaction was recorded by the AO of the searched person which is a pre requirement for invoking provisions of Sec.153C of the IT Act, 1961 and therefore, the consequent assessment framed by the AO in all the seven assessment years is to be quashed.
The ld. DR of the revenue supported the assessment order.
We have considered the rival submissions. We find that in the assessment order for each year, the AO has noted as under;
“There was a search u/s 132 of the IT Act in the case of one Shri S.M.Kamal Pasha, Golden Hatcheries No.3, Thimmaiah Road, Queen’s Road Cross, Bangalore on 20- 11-2009. During the course of above search a copy of sale deed dated 30-09-2003 executed by the assessee company in favour of M/s Millennia Realtors Pvt.Ltd. Bangalore was seized vide seized documents No.A/S/MK/GH/3. In view of the above, the case of assessee company attracted the provisions of sec.153C of the Act. The case was notified to this office vide notification order in F No. Notification/CIT-B- III/2011-12 dated 25-04-2011 of CIT, Bangalore-III, Bangalore. Accordingly, a notice u/s 153C dated 29-04- 2011 was served on the assessee requiring it to file return of income for AY: 2004-05. In response to the above the assessee filed a reply letter dated 03-10-2011 intimating that the return of income filed by it before DCIT, Circle-12(1), Bangalore on 13-10-2004 may be treated as return filed in response to notice u/s153C dated 29-04-2011. In the said return the assessee had declared a total income of Rs.18,43,77,740/- (Eighteen Crore forty three lakh seventy seven thousand seven hundred and forty). The break-up of the above total income is given below”.
From the above noting by the AO in the assessment order in each of these years, it comes out that there is no reference to any satisfaction recorded by the AO of the searched person, as required u/s 153C of the IT Act, and the Notice u/s 153 C was issued by the AO on 29.04.2011 on the basis of Notification order dated 25-04-2011 of CIT-III, Bangalore. The ld. DR of the revenue was confronted on this aspect but he could not produce any evidence to show that required satisfaction was recorded by the AO of the searched person in any of the years and therefore, we have no hesitation in holding that the assessment order passed by the AO in any of these years on the basis of such improper invocation of Sec.153C of the IT Act, 1961is not valid although, the income declared by the assessee in the return of income filed by the assessee in each of these years has to be taxed as per the return of income but no addition can be made as has been made by the AO in these assessment orders. We hold accordingly and quash all the seven assessment orders.
In view of our above decision with regard to additional grounds raised by the assessee in each of the seven years, the other issues raised by the assessee in these appeals do not require any adjudication because when the assessment order itself has been quashed the addition made by the AO does not survive and therefore, no adjudication is called for these grievances of the assessee on merit of these additions. Similarly, the appeal of the revenue for AY: 2004-05 has become infructuous because when the assessment order itself is quashed, no addition survives and therefore, deletion of such addition by ld. CIT(A) also cannot be disputed on merit.
In the result, all the seven appeals filed by the assessee are allowed whereas the appeal filed by the revenue for AY: 2004-05 is dismissed.
Order pronounced in the open court on the date mentioned on the caption page.