Case Law Details
KBL Layout Vs ACIT (ITAT Bangalore)
ITAT Bangalore held that in case where AO of the searched person and the other person is the same, there can be one satisfaction note prepared by AO. Preparation of one satisfaction note will satisfy the requirement of section 153C of the Income Tax Act.
Facts- The assessee M/s KBL Layout belongs to Sri C R Lakshminarayanan and K B Lakshman group of cases. There was a search action u/s 132 of Income Tax Act conducted in the case of Sri C R Lakshminarayanan and Sri K B Lakshman group on 06.10,2009. In response to Notice u/s 153C, the assessee filed its return of income on 02.09.2011. However, the same was revised on 23.09.2011.
CIT(A) observed that it is relevant to note in the return of income filed on 23.09.2011, the appellant has himself admitted Rs.1,11,22,908/- (including Rs.75 lakhs additional income offered) as his income but claimed additional expenses of Rs.57,81,981/-. He observed that these additional expenses claimed of Rs. 57,81,9817- are clearly not allowable. These expenses or provisions cannot be allowed against income pertaining to 2006-07 and therefore are disallowed. Accordingly, CIT(A) has enhanced the income by Rs.57,81,981/- and total income determined at Rs.1,11,22,908/-. Being aggrieved, the present appeal is filed.
Conclusion- Failure by the Assessing Officer of the searched person, after preparing and dispatching the satisfaction note and the documents to the Assessing Officer of the other person, to make a note in the file of a searched person, will not vitiate the entire proceedings under Section 153C against the other person.
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