PCIT Vs Divine Developwell Pvt Ltd (Delhi High Court)
In the case of PCIT vs. Divine Developwell Pvt. Ltd. Hon’ble Delhi High Court held that the documents which were seized during the course of search does was unsigned Agreement to sell (ATS) which does not contain name of assessee, the said material cannot be said to pertain/pertains to assessee.
The ITAT’s examination focused on the satisfaction note, which formed the basis for initiating proceedings under Section 153C of the Act. This note highlighted an unsigned Agreement to Sell (ATS) dated 8th September 2007, allegedly involving the assessee company, Divine Developwell Pvt. Ltd. However, the ATS did not bear the name of the assessee company, and it was unsigned, raising doubts about its relevance to the company.
The satisfaction note also referred to a sale deed executed by the assessee company, indicating a substantial difference between the disclosed amount in the deed and the actual amount paid. This led the assessing officer to conclude that the company had made undisclosed investments, warranting further investigation.
During the proceedings, the ITAT examined whether the seized documents truly belonged to the assessee company. It observed that the unsigned ATS lacked any reference to the company’s name and did not establish a connection with the sale deed. Additionally, the receipt mentioned in the satisfaction note did not contain the company’s name either. Therefore, the ITAT concluded that the seized documents did not pertain to the assessee company, rendering the initiation of proceedings under Section 153C unjustified.
