HC Upholds Section 153C Notices as Satisfaction Was Recorded Before Completing Search Assessment

Bhavin Kishorebhai Zinzuwadia Vs ACIT (Gujarat High Court)

The petitioner challenged notices dated 06.11.2019 issued under Section 153C of the Income-tax Act, 1961 for Assessment Years 2009-10 to 2014-15. Earlier notices dated 05.08.2019 had been issued for Assessment Years 2011-12 to 2017-18 but were subsequently withdrawn on 23.10.2019, following which fresh notices were issued. The petitioner sought copies of the satisfaction notes and documents relied upon by the Assessing Officer. The Revenue supplied the satisfaction note of the Assessing Officer of the searched person dated 31.03.2018 and the jurisdictional Assessing Officer’s satisfaction note dated 23.10.2019. According to the satisfaction notes, a search conducted on 10.03.2015 in the cases of the Venus Group resulted in seizure of documents and digital data, including eleven documents pertaining to the petitioner.

The jurisdictional Assessing Officer recorded that analysis of the seized material indicated that the petitioner had purchased property in the Venus Amadeus project and had allegedly made cash payments over and above the recorded consideration. The satisfaction note referred to seized documents, coded entries, and cash vouchers allegedly evidencing unaccounted cash receipts connected with the petitioner’s property purchases. On that basis, the Assessing Officer concluded that the seized material had a bearing on the determination of the petitioner’s total income for Assessment Years 2009-10 to 2014-15.