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| The Tax Publishers2020 TaxPub(DT) 1436 (Ahd-Trib) INCOME TAX ACT, 1961
Section 153C
Since satisfaction by AO of searched person was not recorded therefore, the assessment passed under section 153C, was not sustainable and addition made was liable to be deleted.
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Search and seizure - Assessment under section 153C - No satisfaction recorded by AO -
A search operation under section 132 was conducted in a group concern and a consequential search was conducted on M/s. A. AO observed that certain loose papers were found and he assumed that three concerns owned by assessee were operating from this address. These papers alleged to have been related or belonging to the assessee. On the basis of such loose papers, he issued notice under section 153C and thereafter took cognizance of the details of the seized documents. He found that (cheque discounting business appeared to have been noticed whose total value of transactions is Rs. 2,29,26,071 as well as cash transactions of Rs. 36,28,449. AO made additions of these transactions by treating them as undisclosed income of assessee. Held: A perusal of section 153C would indicate that satisfaction of AO of the searched person is must exhibiting the fact that documents/evidences shown escapement of undisclosed income of a person other than the searched person is available which required to be assessed, thereafter, he would transmit his satisfaction note along with that evidences to AO of such other person having territorial jurisdiction. Since satisfaction by AO of searched person was being not recorded, then assessment under section 153C was not sustainable.
Followed:CIT v. Calcutta Knitwears (2014) 362 ITR 673 (SC) : 2014 TaxPub(DT) 1547 (SC); Dy. CIT v. K.M. Nagaraj (2017) 166 ITD 53 (Beng.) : 2017 TaxPub(DT) 1726 (Bang-Trib); ACIT v. Jay Dee Securities & Finance (2017) 57 ITR (Trib.) 681 (Del) : 2017 TaxPub(DT) 2047 (Del-Trib)
REFERRED :
FAVOUR : In assessee's favour
A.Y. : 2009-10
IN THE ITAT, AHMEDABAD BENCH
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