Gujarat High Court
Laxcon Steels Limited vs Deputy Commissioner Of Income Tax ... on 10 November, 2025
Author: A.S. Supehia
Bench: A.S. Supehia
NEUTRAL CITATION
C/SCA/3544/2024 JUDGMENT DATED: 10/11/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO.3544 of 2024
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE A.S. SUPEHIA
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
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Approved for Reporting Yes No
✔
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LAXCON STEELS LIMITED
Versus
DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 2(1)(1) & ANR.
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Appearance:
MR B S SOPARKAR(6851) for the Petitioner(s) No. 1
MR.VARUN K.PATEL(3802) for the Respondent(s) No. 1
NOTICE SERVED for the Respondent(s) No. 2
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CORAM:HONOURABLE MR. JUSTICE A.S. SUPEHIA
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
Date : 10/11/2025
ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE A.S. SUPEHIA)
1. Heard learned advocate Mr. B.S. Soparkar for the petitioner and learned Senior Standing Counsel Mr. Varun K. Patel for the respondents.
2. Rule returnable forthwith. Learned Senior Standing Counsel Mr. Varun K. Patel waives service of notice of Rule for the respondent.
3. The petitioner has prayed for the following reliefs :-
"7(a) quash and set aside the impugned notices under Section 153C for AY 2014-15 at Annexure-'A' dated 30.06.2022, to this petition.
(b) Pending the admission, hearing and final disposal of Page 1 of 5 Uploaded by PHALGUNI PATEL(HC00175) on Sat Nov 15 2025 Downloaded on : Mon Nov 17 20:41:42 IST 2025 NEUTRAL CITATION C/SCA/3544/2024 JUDGMENT DATED: 10/11/2025 undefined this petition, to stay assessment proceedings undertaken in consequence to the impugned notices u/s. 153C for AY 2014-15 at Annexure-A"
4. The brief facts of the case are as under :-
4.1. The petitioner is a Limited Company of which the shareholders are individuals and citizen of India. It is the case of the petitioner that a search and seizure operation was carried out in one Alankit Group of Cases on 18.10.2019. During the course of assessment proceedings under Section 153A of the Income Tax Act, 1961 (for Short "the Act") in case of Alankit Group, certain material and document related to the petitioner were found. Based on the same, the respondent no. 1 recorded satisfaction and issued the notice under Section 153C of the Act on 30.06.2022 for Assessment Year 2010-11 to Assessment Year 2019-20.
4.2. On receipt of the notice, the petitioner vide letter dated 23.07.2022 sought for the satisfaction note. It is the case of the petitioner that though satisfaction note was sought for, the respondent issued notice under Section 142(1) of the Act asking the return of income on 02.08.2022. The petitioner again requested for satisfaction note vide communication dated 16.08.2022 and 08.09.2022. It is the case of the petitioner that only one satisfaction note was supplied to the petitioner on 29.11.2022. However, the satisfaction note recorded by the Assessing Officer of the searched person is not supplied to the petitioner.
4.3. Thereafter the case of the petitioner was transferred from respondent no. 1 to respondent no. 2 and on 14.06.2023, respondent no.2 issued notice under Section 143(2) of the Act. Subsequently, Page 2 of 5 Uploaded by PHALGUNI PATEL(HC00175) on Sat Nov 15 2025 Downloaded on : Mon Nov 17 20:41:42 IST 2025 NEUTRAL CITATION C/SCA/3544/2024 JUDGMENT DATED: 10/11/2025 undefined notice under Section 142(1) of the Act was issued on 07.08.2023 and the petitioner filed its objections against the proceedings vide communication dated 21.08.2023. The respondent no.2 vide order dated 31.10.2023 disposed of the objections filed by the petitioner. It is the case of the petitioner that on 30.11.2023 the respondent no. 2 passed the Assessment Orders for Assessment Years 2012-13, 2013- 14 and 2015-16 to 2019-20 accepting the return of income of the petitioner without making any additions. It is the case of the petitioner that the assessment for Assessment Years 2010-11, 2011- 12 and 2014-15 continued and the petitioner filed replies to the notices issued by providing the necessary details sought for.
4.4. Thereafter on 15.01.2024 the petitioner raised objections to the validity of the notices as well as the consequential proceedings in view of the decision of the Apex Court in case of Commissioner of Income Tax vs. Jasjit Singh, [2023] 155 Taxmann.com 155(SC). It is the case of the petitioner that on 30.06.2022 respondent no. 1 issued notice under Section 153C of the Act stating to provide the correct return of total income for the Assessment Year 2014-15. Hence, this petition.
5. At the outset, learned advocate Mr. B.S. Soparkar has placed reliance on the decision of the Apex Court in the case of Jasjit Singh (supra) and submitted that in the facts of the present case, the Assessment Year 2014-15 is of the 10 th year and in the satisfaction recorded the amount of undisclosed income for the period of 10 years is less than Rs.50 lakhs and therefore, fourth proviso provided that the impugned action of the respondent is required to be quashed and set aside. Moreover, it is pointed out that as per the decision of the Apex Court in the case of Jasjit Singh (supra) the impugned Page 3 of 5 Uploaded by PHALGUNI PATEL(HC00175) on Sat Nov 15 2025 Downloaded on : Mon Nov 17 20:41:42 IST 2025 NEUTRAL CITATION C/SCA/3544/2024 JUDGMENT DATED: 10/11/2025 undefined notices travelled the beyond the period of ten years and the same may be quashed and set aside.
6. Learned advocate Mr.B.S.Soparkar for the petitioner submitted that the notice under Section 153C of the Act is time barred in view of the decision in case of Jasjit Singh (supra) whereby the period of assessing the Assessment Years prior to search begins from the date of receiving books of accounts/documents/assets seized or requisitioned from Assessing Officer of searched person.
7. Learned Senior Standing Counsel Mr.Varun K. Patel for the respondents has submitted that as per the decision of the Apex Court in case of Jasjit Singh (supra), the Assessing Officer of the searched person has received the Jurisdictional Assessing Officer (JAO) of the assessee on 20.06.2022 for the Assessment Year 2023-24 and, hence he is unable to controvert the facts as narrated in the writ petition and also the scope of the action of the respondent being outside the period of ten years as the income escaping the assessment is less than Rs.50,00,000/-.
8. Having heard the learned advocates for the parties, at this stage we may incorporate the relevant observations of the Apex Court in case of Jasjit Singh (supra), which reads as under :-
"9. It is evident on a plain interpretation of Section 153C(1) that the Parliamentary intent to enact the proviso was to cater not merely to the question of abatement but also with regard to the date from which the six year period was to be reckoned, in respect of which the returns were to be filed by the third party (whose premises are not searched and in respect of whom the specific provision under Section 153-C was enacted). The revenue argued that the proviso [to Section 153(c)(1)] is confined in its application to the question of abatement.
10. This Court is of the opinion that the revenue's argument is insubstantial and without merit. It is quite plausible that without the kind of interpretation which SSP Aviation adopted, the A.O. seized of Page 4 of 5 Uploaded by PHALGUNI PATEL(HC00175) on Sat Nov 15 2025 Downloaded on : Mon Nov 17 20:41:42 IST 2025 NEUTRAL CITATION C/SCA/3544/2024 JUDGMENT DATED: 10/11/2025 undefined the materials - of the search party, under Section 132 - would take his own time to forward the papers and materials belonging to the third party, to the concerned A.O. In that event if the date would virtually "relate back" as is sought to be contended by the revenue, (to the date of the seizure), the prejudice caused to the third party, who would be drawn into proceedings as it were unwittingly (and in many cases have no concern with it at all), is dis-proportionate. For instance, if the papers are in fact assigned under Section 153-C after a period of four years, the third party assessee's prejudice is writ large as it would have to virtually preserve the records for at latest 10 years which is not the requirement in law. Such disastrous and harsh consequences cannot be attributed to Parliament. On the other hand, a plain reading of Section 153-C supports the interpretation which this Court adopts ."
9. Since the learned Senior Standing Counsel Mr. Varun Patel is unable to controvert the facts which are mentioned as above and as canvassed by learned advocate Mr. Soparkar it relates to escapement of the income which is less than Rs.50,00,000/- (i.e. Rs.26,00,000/-), the impugned notices under Section 153C of the Act for the Assessment Year 2014-15 at Annexure-'A' dated 30.06.2022 is required to be quashed and set aside the same is hereby quashed and set aside.
10. The present petition stands disposed of. Rule is made absolute accordingly.
(A. S. SUPEHIA, J) (PRANAV TRIVEDI,J) phalguni/58 Page 5 of 5 Uploaded by PHALGUNI PATEL(HC00175) on Sat Nov 15 2025 Downloaded on : Mon Nov 17 20:41:42 IST 2025