Brief of the case:
ITAT Ahmedabad in the case of M/s. Parshwa Corporation Vs. DCIT observed the basic necessities & condition for issuing notice u/s 153 C and it was held that it is mandatory to follow the procedure prescribed under the section i.e.
(1) Satisfaction is to be recorded by the Assessing Officer of the persons searched;
(2) After recording the satisfaction, Assessing Officer of person searched should handover the seized material to the Assessing Officer of such other person;
(3) Thereafter, the Assessing Officer of such other person should issue notice u/s 153C.
Facts of the case:
- A search action u/s 132 was conducted in the case of Shri Rameshbhai Babulal Shah. During search a laptop was found in which Mr. Shah maintained books of account in tally in respect of 65 companies including assessee.
- AO issued notice u/s 153C r.w.s. 153A of the Income-tax Act to the assessee for all the six Assessment Years.
Contention of the Assessee:
- Assessee referred to the copy of the notice issued u/s 153C and it is was contested:
(i) No satisfaction was recorded by the Assessing Officer of person searched,
(ii) No satisfaction was recorded by the Assessing Officer of the assessee before the issuance of the notice u/s 153C and
(iii) In the notice u/s 153C the AO mentioned about his satisfaction. From which it is clear that it is totally vague and has not specified whether any money, bullion, jewellery or other valuable article/thing or books of account/documents belonging to the assessee was seized from Shri Rameshbhai B. Shah.
