M/S SUPER MALLS PRIVATE LIMITED versus PRINCIPAL COMMISSIONER OF INCOME TAX 8, NEW DELHI

Citation: [2020] 4 S.C.R. 676 · Decided: 05-03-2020 · Supreme Court of India · Bench: ASHOK BHUSHAN · Disposal: Dismissed

cites 1 · see the full citation network in Lexace

Judgment (excerpt)

A
B
C
D
E
F
G
H
676
SUPREME COURT REPORTS
[2020] 4 S.C.R.
M/S SUPER MALLS PRIVATE LIMITED
v.
PRINCIPAL COMMISSIONER OF INCOME TAX 8,
NEW DELHI
(Civil Appeal Nos. 2006-2007 of 2020)
MARCH 05, 2020
[ASHOK BHUSHAN AND M. R. SHAH, JJ.]
Income Tax Act, 1961 – s.153C – Search and seizure operation
carried out at residential/business premises of Director (the searched
person) of assessee-company – A pen drive was found and seized –
Some documents were seized containing details of cash receipts on
sale of shops/offices at assessee-company – Notice issued to assessee
u/s.153C by Assessing Officer who co-incidentally happened to be
the same for the assessee and the searched person – Assessee filed
return for assessment year 2008-09 – Assessment finalised by the
Assessing Officer – Assessment order challenged contending that
satisfaction note recorded u/s.153C w.r.t the assessee, i.e., a third
party, was invalid – Dismissed by CIT (Appeals) – Assessee’s appeal
allowed by ITAT – Revenue’s appeal allowed by High Court – Held:
Before issuing notice u/s.153C, the Assessing Officer of the searched
person must be “satisfied” that, inter alia, any document seized or
requisitioned “belongs to” a person other than the searched person
– After recording such satisfaction, he may transmit the records/
documents/papers etc. to the Assessing Officer having jurisdiction
over such other person – After receipt of the said satisfaction & on
examination of such other documents relating to such other person,
the jurisdictional Assessing Officer may proceed to issue notice for
completion of assessment u/s.158BD – There can be two
eventualities- Assessing Officer of the searched person is different
from the Assessing Officer of the other person; the Assessing Officer
of the searched person and the other person is the same – Where
the Assessing Officer is different, there shall be a satisfaction note
by the Assessing Officer of the searched person who then is required
to transmit the documents so seized to the Assessing Officer of the
other person – Simultaneously he shall forward his satisfaction note
and is also required to make a note in the file of searched person
[2020] 4 S.C.R. 676
676
A
B
C
D
E
F
G
H
677
that he has done so – However, in case where the Assessing Officer
is the same, it is sufficient by the Assessing Officer to note in the
satisfaction note that the documents seized from the searched person
belonged to the other person – Once the note says so, then the
requirement of s.153C is fulfilled – Second requirement of
transmitting the documents so seized would not be there as he himself
will be the Assessing Officer of the other person also – In the facts
of the present case, it cannot be said that the mandatory requirements
of s.153C were not complied – High Court justified in observing
that requirement of s.153C was fulfilled – ITAT to decide and dispose
of the appeals afresh on merits, at the earliest, in accordance with
law.
Dismissing the appeals, the Court
HELD: 1.1 Before issuing notice under Section 153C of
the Income Tax Act, 1961, the Assessing Officer of the searched
person must be “satisfied” that, inter alia, any document seized
or requisitioned “belongs to” a person other than the searched
person. That thereafter, after recording such satisfaction by the
Assessing Officer of the searched person, he may transmit the
records/documents/things/papers etc. to the Assessing Officer
having jurisdiction over such other person. After receipt of the
aforesaid satisfaction and upon examination of such other
documents relating to such other person, the jurisdictional
Assessing Officer may proceed to issue a notice for the purpose
of completion of the assessment under Section 158BD of the Act
and the other provisions of Chapter XIV-B shall apply. The
aforesaid requirements are held to be mandatorily complied with.
There can be two eventualities. It may so happen that the
Assessing Officer of the searched person is different from the
Assessing Officer of the other person and in the second
eventuality, the Assessing Officer of the searched person and
the other person is the same. Where the Assessing Officer of
the searched person is different from the Assessing Officer of
the other person, there shall be a satisfaction note by the
Assessing Officer of the searched person and as that thereafter
the Assessing Officer of the searched person is required to
transmit the documents so seized to the Assessing Officer of the
other person. The As

Excerpt shown. Read the full judgment & AI analysis in Lexace.