Income Tax Appellate Tribunal - Delhi
Acit, New Delhi vs Sri Prem Properties Private Limited, ... on 17 November, 2025
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH 'A', NEW DELHI
Before Sh. Satbeer Singh Godara, Judicial Member
&
Sh. S. Rifaur Rahman, Accountant Member
ITA No. 4248/Del/2025 : Asstt. Year: 2009-10
ACIT, Vs Sri Prem Properties Pvt. Ltd.
Room No. 331, 3rd Floor, ARA D-6/6032, Vasant Kunj,
Centre, Jhandewaln Extension, New Delhi-110070
New Delhi-110055
(APPELLANT) (RESPONDENT)
PAN No. AAACS2554E
Assessee by : Sh. Somil Agarwal, Adv.
Revenue by : Sh. Jitender Singh, CIT-DR
Date of Hearing: 17.11.2025 Date of Pronouncement: 17.11.2025
ORDER
Per Satbeer Singh Godara, Judicial Member:
This Revenue's appeal for Assessment Year 2009-10, arise s against the CIT(A)-23, Delhi's DIN & order No. ITBA/APL/S/250/2024-25/1074397437(1) dated 12.03.2025, in proceedings u/s 153C r.w.s. 144 of the Income Tax Act, 1961 (in short "the Act").
2. Heard both the parties at length. Case file perused.
3. This Revenue's appeal raises the following substantive grounds:
"1. That the Ld. CIT(A) has er red in law and on fac ts in holding that the Assessing O fficer did no t have valid juris dic tio n to initiate proceedings under Se ctio n 153C of the Income-tax Act, 1961 fo r the A.Y. 2009-10, without appreciating that the satisfaction note and incriminating 2 ITA No. 4248/Del/2025 Sri Prem Properties Pvt. Ltd.
documents seized pertain to the assessee and were prope rly recorded and transferre d in accordance with law.
2. That the Ld. CIT( A) has erred in law in concluding that the impugned assessment is time- barre d by relying on the computatio n of the block period of ten assessment years unde r Section 153C r .w .s. 153A, calculated from the date of receipt of seize d material i.e ., 10.06.2021, thereby excluding A.Y. 2009-10 from the permissible, block , which is contrary to the proper interpre tatio n of law and facts.
3. That the Ld. CIT(A) has e rred in law in re lying o n judic ia l precedents, including PCIT v. Ojjus Medicare Pvt. Ltd., CIT v . J asjit Singh, and Saurabh G upta v. JC IT, without appreciating that the facts in those cases are distinguishable a nd that in the present case the documents seized were directly related to the appellant and invo lved income that escape d a ssessment.
4. That the Ld. CIT(A) has failed to c onside r that the seized documents comprising loa n agreements were incriminating in nature and clearly pertained to the A.Y. 2009-10 and ha d a direct nexus with the undisclo sed income detected as une xplained cre dit under Se ctio n 68 and unexplaine d e xpenditure under Section 69C.
5. That the Ld. CIT(A ) has er red in allo wing the appeal of the assessee without gr anting the Assessing Officer an effec tive opportunity to present a rebuttal on the le gal issues raised, the reby viola ting the pr inciples of natural justice .
6. That the Ld. CIT( A) has faile d to adjudicate on the merits of the additions made by the Assessing Officer aggre ga ting to ?4,16,00,000 under Sectio n 68 and Section 69C of the Act, despite specific gro unds being raised and doc umentary evide nce being placed on record."
4. We next note that this tr ibunal in Revenue's appea l ITA No. 4169/Del/2025 decided on 28.10.2025 has already upheld the CIT(A)'s action quashing the impugned section 153C assessment itself reading as under:
3 ITA No. 4248/Del/2025Sri Prem Properties Pvt. Ltd.
"3. We now advert to the first and fore most legal issue between the parties wherein the R evenue is aggrieved aga inst the CIT(A)'s lower appellate discussion quas hing the impugned s ection 153C assessment dated 23 r d March, 2023 as no t sustainable in law as follo ws:-
"Brief facts of the case:
3. The a ppe llant had filed its original re turn of inco me u/s 139 o f the Income-tax Act, 1961 (hereinafter referred to as the Act') on 30.09.2010 at an income of Rs. 53,32,040/- A search and se izure action u/s 132 of the Act was car ried out in the case of M/s CIFSL, M/s BIDPL, Shri Harish Gahlot, shri Kailash Gahlot. Shri Viresh Ga hlot and Shri Hitesh Gahlot (M/s CIFSL gro up of cases) (DOS 10.10.2018) during the asses sment proceedings and on perusal of seize d digital data/doc uments o f M/s CIFSL gro up of cases certain incriminating documents have been found which per tain to the appellant.
3.1 Thereafte r notice u/s 153C r.w.s 153A was issue d to assessee on 13.07.2021. In respo nse to the no tice u/s 153C r.w .s. 153A of the Act, the assessee file d the return of income on 27.05.2022. declar ing to tal inco me of Rs. 53,32,040/- The notice u/s 143(2) of the Act was issued on 27.06.2022. Further notic es u/s 142(1) o f the Act on vario us da tes were Issue d seeking the re quis i te details . Ho wever, the assessee did not file any reply in response of the notices . Further assessee, vide show cause date d 13.03.2023 was specific ally as ked to submit the documentary evidence in suppor t of transac tion amounting to Rs. 3,00,00,000/- with M/s Rak am Infrastruc ture paid as earnest money and late r due to non-payment of remaining amount, this earnes t money was c laimed forfeited a nd claimed as expense in P&L account, but the appe llant has not filed any reply. As the time barring date of completion o f assessment proceedings is ge tting closer as well as no compliance made by assessee, the assessment is completed on the material availa ble on reco rd 3.2 Subseque ntly, assessment order u/s 153C r.w.s 144 of the Ac t has been passed on 23.03.2023 assessing total income at Rs.3,77,06,150/ - where in follo wing addition has bee n made: -
Additio n of Rs.3,00,00,000 on account of unexplained expenses .4 ITA No. 4248/Del/2025
Sri Prem Properties Pvt. Ltd.
4. Since , appellant has raised legal grounds that the Assessing Officer has made addition in the abse nce of incriminating mate rial at all found in the premises where the impugned search actio n was undertake n and where from the alle ged info rmatio n mater ial was gathered by the revenue to initiate the impugned reassessment pro ceedings for an already completed assessment.
5. Aggrieve d by the assessment o rder of the Assess ing Office r, the a ppe llant filed this appeal . Notices u/s 250 of the I ncome Tax Act, 1961 ha ve been issued to the appe llant o n v arious dates. In response to the notices issued, the appellant has filed wr itte n submissio n in respect o f ground of appe al raised.
6. During the course of appe llant pro ceeding the appe llant submitted written submissions , relevant portion of the same is as under:
"4. Ground Nos. 2.3 and 4 are to the effect that the Ld. AO erre d in passing the asse ssment order u/s 1530/144 without assuming jurisdict ion as pe r law and without recording the mandatory satisfac tio n as laid down in Section 153C. It is stated that the ass umptio n of jurisdict ion u/s 153C is illegal and bad in law it is fur ther state d that the action o f the Ld. AC in pass ing the impugned o rder u/s 153C/144 is illegal and bad in law and the same is not sustainable on various legal and factual grounds.
4.1. in this connection, the appellant had requested the Ld. AO to furnish two satisfaction note recor ded by the AO of the searche d person and the AO of the appe llant company, as mentio ned in Section 153G of the Act. Ho weve r, he furnishe d only the note dated 10.06.2021 (PB 46- 47) reco rded by the asses sing officer of the a ppe lla nt for ten years. Briefly spe aking. it is mentioned in this note that a search and seizur e operation was conducte d in the gro up cases of CIFSI. On analysis of the seized material, it w as fo und that the doc uments a ppended below were found to be related to the appe llant company. The assessing officer of the se arche d pe rson, the ACIT, Central Circ le-4, recorde d the satisfaction note in the case of searche d pe rson and the reafter transferred the info rmation to the assessing officer of the appellant company. The details o f the docum ents in so far as this yea r is co ncerned are stared to be the documents 5 ITA No. 4248/Del/2025 Sri Prem Properties Pvt. Ltd.
in the fo rm of details of e arnest money for feited, evide nces in form of communica tion with various buye rs, agreement to se ll, arbitration documents etc . It is further mentioned that after going through the contents of these documents, he wa s satis fie d that the above incriminating material pertained to the appe llant company and that these documents have bearing o n deter mination of the total income of the appe llant. A further no te was recorded in hand o n 10.06.2021 that separ ate satis faction recorded for beyond six years was also pl aced o n the file i n relatio n with income escapement aggregating to Rs. 8.22 cro re evide nt from seize d do cuments as mentio ned abo ve.
4.2. At the outset, it is submitted that the satisfac tio n note recorde d in the case of the se arche d person has not bee n fur nis he d to the appel lant. There fore , it may be presumed that no such note exists . Witho ut prejudice to the above , the appe llant company will like to make submissions in respect of such satisfaction note as and when it is made availa ble to it. Thus, it is reques ted that the decision may be kept pending till such note is hande d over to the appe llant. Furthe r, the Ld. A O has jumped to the co nclus ion that the documents re garding fo rfe iture of the earnes t money found in the course of search a re in the nature of incriminating material. This conclusion is not base d on any reaso ning and the Ld. A O has jumped to this conclus ion witho ut comparing these documents with the return of inco me, in which the loss in the form of for feiture of money has been duly disclosed. This point has been discussed in detail subsequently while dealing with the genuineness o f this loss . There fore, the note has be en reco rde d without application of mind and hence it is bad in law . Further, the alleged documents pe rtain to a number of years and the Ld. AO has no t segregated the documents year-w ise. Therefore, from the general statement made in the note, it is no t cle ar as to which do cument pe rtains to this ye ar.
4.3. Considering this, it is submitte d that satisfaction note has been pre pared in an omnibus manner for the all the years without co-re lating the documents and years . Hon' ble Supreme Cour t, in the case of CIT vs. Sinhgad Tec hnical Educa tional So ciety (S C), S.L. Appeal (C) No(s). 25257/2015, dated 29.08.2017 has held that fo r assuming jurisdiction u/s 1530, satisfaction w ith refere nce to year-wise , document -6 ITA No. 4248/Del/2025
Sri Prem Properties Pvt. Ltd.
wise satisfaction needs to be recorded u/s 153C, before jurisdiction u/s 153C can be said to be validly assumed. Since this has no t been done in the instant case, hence jurisdiction assumed under section 153C is bad in la w.
4.4. Fur the r, the Ld. CIT(A) may kindly apprec iate that this note wa s recorded on 10.06.2021. Therefo re, the Ld. AO would have rece ived the satis faction note recorde d by the AD of the searched person and the seized material o n or about 10.06.2021 In terms of the pro visions of Section 1530, the date of search in the case of the appe llant would be deemed to be 10.06.2021 o r the reabo ut, pertaining to AY 2022-23. The year under conside ration falls beyond 10 years from the end of AY 2022-23. In this co nnection, the atte ntion of the L d. CIT(A) is invited tow ards the firs t proviso of Se ctio n 153C(1). It is provided that the refere nce to the date o f initiation o f searc h u/s 132 o r making of requisition u/s 132A in t he second pro viso of Section 153A(1) shall be construed as reference to the date of receiving the book s of account or documents o r assets seized or requisitio ned by the assessing officer having j urisdictio n over such othe r person. Thus, the number of years for which the assessment can be reopened u/s 153C is to be reckoned w ith reference to the date of receipt of the documents e tc. Therefore, the date of deemed search would be AY 2022-23 and the ins tant AY falls be yond the s tipulate d period o f 10 ye ars .
4.5. In order to suppo rt this contention, re liance is place d on the decision o f the Ho n'ble Supreme Court in the case of CIT-14 vs. Jasj it Singh (2023) 155 laxmann.com 155. In this case, it has been he ld that the parliamentary intent to ena ct proviso to Sectio n 153C( 1) was to cater not merely to the ques tio n of aba tement but also with regard to date from which 6- year period was to be recko ned, in respect of which returns were to be filed by thi rd pa rty whose premises were no t searched and in respect of whom specific provisio ns u/s 1530 were e nacted. In this connection, a reference may be made to par agraph no. 10 of the judgement, which reads as under:
10. This Cour t is of the o pinion that the re venue's argument is insubstantial and w ithout merit. It is quite plausible that without the kind of interpretation whic h SSP Av ia tion adopted. the A.O. se ized o f the 7 ITA No. 4248/Del/2025 Sri Prem Properties Pvt. Ltd.
materials-o f the search party, under sectio n 132- would take his o wn time to forward the papers and materials be longing to the third party, to the concerne d AO. In tha t event if the date would vir tually "rela te back" as is sought to be contende d by the revenue (to the date of the seizure), the prejudice caused to the third party, who would be drawn into proceedings as it we re unwittingly (and in many cases have no concern with it at all), is dis propo rtionate. For instance , if the papers are in fac t assigned under Se ction 153-C after a pe rio d of fo ur years , the third-party assessee's prejudice is writ large as it wo uld ha ve to virtually preserve the records for at latest 10 years which is no t the requirement in law Such disastr ous and harsh conseque nces ca nnot be attributed to Par liament. O n the othe r hand, a plain reading of sectio n 153-C suppo rts the inte rpretation which this Court adopts."
4.6. In this connectio n, reliance is place d on the decis ion of Ho n'ble Madras High Co urt in the case of A.R. Safiullah vs. ACIT, W.P(MD) No. 4337 of 2021 and WMIYMD) Nos. 3313, 3313 and 3516 o f 2021, date d 24.03.2021. The facts in this cane are that the search w as made on 10.04.2018, relevant to AV 2019-
20. The e nd o f the AY 2019-20 is 31.03.2020. The Hon'ble Court po inted out that computation of 10 years had to run backwards from the said date, ie 31.03.2020. The first year w ill of course be the searc h assessment year itsel f. In that event, the te n assessment years will be from AY 2010-11 to 2019-20. The case o n ha nd pertains to A V 2009-10. It is obvio usly beyo nd the 10- year o uter ceiling limit prescribed by the statute .
4.7. Coming to the facts of our case, the date of search will be deemed to be 10.06.200 or thereabout, pertaining to AY 2022- 23. Following the r atio of the decis ion of A.R S afiullah (Supra) , the 10 years would include AV 2022-23 also. There fore , proceedings upto AY 2013-14 only could have bee n subject matter conside ration fo r making assessment u/ s 153C . The instant case pe rtains AY 2010- 11 and therefore, it falls beyond the stipulated limit of 10 years.
4.8. In view o f these decisions, it is argued that the Ld. AO had no jurisdiction to reopen this case unde r the provisions of Sectio n 153C of the A ct and thus notice w's 153C is bad in law . Accordingly, it is 8 ITA No. 4248/Del/2025 Sri Prem Properties Pvt. Ltd.
reques ted that Ground Nos. 2, 3 and 4 may be allo wed and the assessment may be s tr uck down.
4.9. Further , reliance is placed o n the decis ion of Hon'ble Delhi High Court in the case of B rahm Datl vs . ACIT (2018) 100 taxmann.com 324 dated 06.12.2018. In this c ase, it wa s inter-alia held that the assessment could not have been reopene d beyond 31.03.2005 in terms of pro visions of Section 149 as applicable at the relev ant time. It was furthe r held that subseque nt amendment to Se ction 149 by the Finance Act, 2012, whic h extended limita tio n fo r initiation of reassessment pro ceeding, co uld no t be resorted to for reopening the co ncluding proceedings in res pect of whic h limitation had expired befo re the amendment became effective . The facts o f the case o f the appe llant company are that the search was conducted on 10.10.2018, re levant to AY 2019-20 Therefore, in terms of the pro visions of Sectio n 153A(1)( b), the proceedings of AY 2013-14 to AY 2018- 19 could be reopened. Subse quently, fourth pro viso was inserted in Sec tion 153A(1) which permitted the reope ning of 10 Assessment ye ars, as clarified in Explanatio n of the sald Pro viso. This prov iso wa s inserted by the Finance Act, 2017, w.e .f. 01.04.2017. T hus, this provis o becomes applicable to the proceedings of AY 2017-18 and onw ards. Ho wever, this proviso is no t applicable to the proceedings of AY 2009-10 as is the case he re. Therefore, this pr oviso could not have been invo ked in view of the decision of Branm Datt. As state d earl ier, the procee dings o f AY 2013-14 to 2018-19 only could have been reo pened as per the law as applic able to AY 2009-10 Thus, the issuance of notice u/s 153C/153A is bad in law and accordingly, the assessment made on such a notice is also bad in law.
4.10. In result, it is praye d that the assessment o rder may be s truck dow n as ille gal."
Findings and Decision
7. An ide ntical issue arose before the Hon' ble Juris dic tio na l High Court also. The Hon'ble Delhi High Court in dec isio n date d 03.04.2024 in the c ase of PCI T. Central-1 Vs Ojjus Medicare Pvt. Ltd. ITA No. 52/2024 has held as unde r:-
"A. Prio r to the insertio n of Sectio ns 153A, 1538 and 153C, an assessment in respect of search cases was 9 ITA No. 4248/Del/2025 Sri Prem Properties Pvt. Ltd.
regulate d by Chapter XIVB of the Act, compris ing of Sections 1588 to 15881 and which embodied the concept o f a block assessment. A block assessment in search cases undertake n in terms of the provisio ns place d in Chapte r XIVB was ordained to be unde rtake n simultaneously and parallelly to a r egular assessment. Contrary to the scheme underlying Chapter XIVB, Sections 153A, 153B and 153C contemplate a merge r of re gular assessments w ith those that a search may trigger . On a se arch being undertaken in te rms of Section 153A , the jurisdictional AO is enabled to initiate an assessment or reassessment, as the cas e may be, in respect of the six AYs' immediately preceding the AY releva nt to the yea r of search as also in respect of the "rele vant asse ssment ye ar", an expres sion which stands defined by Explanatio n 1 to Section 153A . Of equal significance is the introduction of the conce pt of abatement of all pe nding assessments as a conseque nce of which curtains com e down on regular assessments.
B. Bo th Sections 153A and 1530 em body non-o bstante clauses and are in express terms ordained to o verride Sections 139, 147 to 149, 151 and 153 of the Act. By vir tue of the 2017 Amending Act, significant amendments came to be introduce d in Sectio n 153A. These included, inte r alia, the search assessment block be ing enlar ged to ten AYs consequent to the addition o f the stipulation of "re levant assessment year", which B wa s defined to mean those ye ars whic h would fall beyond the six-year blo ck period but not late r than ten A Ys'. The block period for search assessment thus came to be e nlarged to stre tch up to ten AYs' The 2017 Amending Act also put in place certain pre requisite conditions which would have to inev itably be sho wn to be sa tisfie d before the searc h assessment could stretch to the "relevant assessment year. The preconditions include the prescription of income hav ing escaped assessment and re prese nted in the form o f a n asset amounting to o r "likely to amount to INR 50 lakhs o r more in the "relevant assessment year" or in aggr egate in the " relevant assessment years C. Section 1530, on the other hand, pe rtains to the non-searched entity and to whom any material, book s of accounts, or do cuments may have been seized and found to be long to or pertain to a person o ther than the searched person. As in the case of Section 153A, 10 ITA No. 4248/Del/2025 Sri Prem Properties Pvt. Ltd.
Section 153C w as also to apply to all searches that may have been undertaken betwe en the period 01 June 2003 to 31 March 2021. In terms of that provisio n, the AO stands similarly empowe red to underta ke and initiate a n assessment in respec t o f a non-searched entity for the six AYs' as well as fo r "the relev ant assessm ent ye ar" . The AYs', whi ch would conseque ntly be thrown o pen for assessment o r reassessment under Sectio n 1530 follows lines pari- materia with Section 153A.
D. T he First Pro viso to Section 153C introduces a legal fic tion based on whic h the commencement date for computa tion of the six year or the ten year block is deemed to be the date of receipt of books of accounts by the jurisdictio nal AO . The ide ntification of the starting block for the purpo ses of computation o f the six and the te n year pe rio d is go verned by the Firs t Pro viso to Section 1530, which s ignificantly shifts the refere nce point spoken o f in Section 153A(1), w hile defining the po int from which the perio d of the "rele vant assessment year" is to be calc ulated, to the date o f receipt of the books o f accounts, documents o r assets se ize d by the jurisdictional AO o f the non- searche d person. The shift of the re levant date in the case of a non-searched pe rson be ing regulated by the Firs t Proviso of Section 153C(1) is an issue which is no longe r res integra and stands authoritative ly settle d by virtue of the decisio ns o f this Court in SSP Aviatio n and RRJ Securities as well as the dec isio n of the Supreme Court in Jasjit S ingh. The afo resaid legal position also stoo d reite rated by the Supreme Court in Vikram Suj itkumar Bhatia. T he submiss ion of the respondent s, ther efore, that the block periods would have to be reckoned w ith refe rence to the date of search can neither be countena nced nor accepted.
E. The recko ning of the six AYs' would require one to firstly identify the FY in which the searc h was underta ken and w hich would lead to the ascertainment of the AY relevant to the previous year o f search. The block o f six AYs' would conse quently be those which immediate ly prece de the AY re leva nt to the ye ar of search. In the case of a E. search assessment underta ken in te rms of Section 153C, the so litary distinc tio n would be that the pre vious year of searc h would sta nd substitute d by the date or the year in whic h the books o f accounts o r documents and asse ts seized are hande d over to the jurisdictional AO as 11 ITA No. 4248/Del/2025 Sri Prem Properties Pvt. Ltd.
opposed to the y ear o f se arc h w hich cons titutes the basis for an assessment under Section 153A.
F. While the identification and computation o f the six AYs' hinges upon the phrase "Immediately preceding the assessment year rele vant to the pre vio us year of search, the te n ye ar period would have to be reckoned from the 31st day of March of the AY relevant to the year o f se arch. This, since undisputedly, Explanation 1 of Section 153A F . re quires us to reckon it "from the end of the assessment year". This distinction would have to necessa rily be ackno wledged in light o f the statute having consciously ado pte d the phraseology "immedia tely preceding" when it be in relation to the six year period and emplo ying the expres sion "from the end o f the assessment year" while speaking o f the ten year block .
G. I nsofar as the thresholds put in place by virtue of the Fourth Pro viso to Sectio n 153A are concemed and the argument o f the writ pe titioners of the conditio n of INR 50 lakhs bei ng an unwaver ing preconditio n, we find ourse lves unable to sustain that submission bearing in mind the indubitable fact that proceedings for se arch assessment commence upon the issuance of a notice and the AO at that stage having really not had the occasion to unde rtake a de tailed or in depth examination of the evidence collected or come to a definitive opinio n with respect to the total incom e whic h may have escape d assessment. Since the computa tion and a ssessment of income that is likely to have esca ped assessment would at this stage be provisio nal, it w ould be incorrect to strike do wn initiation of action on a mere ex facie examination of the Satisfaction Note. We also in this regar d bear in mind the Fourth Proviso using the expressio n "amounts to or is like ly to amount". The usage of the phrase " likely to " is indicative of the Legislature being conscious of the provisional character o f the o pinio n that the AO may have formed at that stage.
H. Howeve r, and at the same time, even if the identified asse t at that stage be quantified as less than INR 50 lakhs , the AO mus t fo r reasons to be duly recorde d, be of the o pinion that the ultimate computa tion of escaped income is likely to e xceed IN R 50 lakhs . The afo resaid satisfaction would have to be based o n an assessment of the material gathe red and the potentiality of the same being indic ative of the 12 ITA No. 4248/Del/2025 Sri Prem Properties Pvt. Ltd.
escaped assessment exceeding IN R 50 lak hs. The formation of opinion in this respect would have to be based no t on mere ipse dixit but reflective of a fair assessment of the quantum of Inco me likely to have escaped assessment as distinct fro m mere speculatio n and conjecture.
I. We further hold that since the precondition of IN R 50 lekhs or mor e constitutes a sine qua non for initiating action for the extended ten year block , the afores aid sa tisfaction and the re asons in support thereo f wo uld have to bo rne o ut from the Satis factio n Note 1. itself. We are also o f the opinio n that the precondition of IN R 50 lakhs is no t liable to be viewe d as being the qualifying criteria for each "relevant assessment year" that may be thrown open and that the said condition would stand s atisfied if the escaped income cumulativ ely or in the aggregate meets the minimum be nchm ark o f INR 50 The contention o f finality and closure addresse d w ith respec t to AYs ' 2010-11 and 2011-12 o n the basis of the statutor y timeframes prescribed for a ssessment or reassessment and as those pro visions stood prior to 01 Apri l 2017 is misconceived, since it proceeds o n the ass umption that once the pe riod of assessment or massessment were to come to an end, it would inevitably led to the creation o f a vested right in favo ur of the as sessee. The aforesaid a rgument proceeds on the Incorrect premise of the re assessment provisions contro lling or cabining the power confe rre d by Sections 1534 and 1530. Acce pta nce of the aforesaid contention would amount to ignoring the plain and e vident intent of the Legis lature for Sections 1534 and 1530 operating above a nd beyo nd the reassessment powers .
K. The submissio n of closure and finality also fails to bear in consider ation the indubitable fact that a search is an eventuality which is inhe rently unpredictable, a circums tance which would de fy prophecy and it conseque ntly being who lly irratio nal to read the time frames pertaining to re assessment as regulating or controlling the K. period within w hich an assessment predicated on that event may be initiate d. It would be wholly itlo gical to conceive o f a connection be tween the statutor y time frames which are otherwise embodied in the Act and search assessments. In fact the a cceptance of this submission would amount to vir tually erasing the non obstante clause contained in Sections 153A and 153C.13 ITA No. 4248/Del/2025
Sri Prem Properties Pvt. Ltd.
L. The legislative intent of those provisio ns having retro active applicatio n is clearly evide nced from the statue declaring that they would apply to all searc hes conduc ted be twee n 31 May 2003 to 31 March 2021, and the Fourth Proviso in unambiguous terms extending the applicability o f those pro vis ions to all searches conducte d post 01 April 2017 and Sections 153A and 153C supe rseding the provis ions for reassessment, otherwise appea ring i n the Ac t."
8. The decisio n o f Ojjus Medicare Pvt. Ltd. was further relied by the Hon' ble High Co urt o f Delhi in the case of Soura bh Gupta v s. JCIT 167 T axmann.com 362( 2024) date d 17.09.2024.). The relev ant finding o f the Hon' ble court a re reproduced as under:
"We note that while dea ling with a similar question of computa tion of the time limit for the "rele vant assessment yea r as provided under Explanation 1 to Section 153A o f the Act, we had in the case of Principal Commissioner o f Income Tax-Ce ntral-1 v. Ojjus Medicare Pvt. Ltd. (2024 S CC Online De l 2439] held as follo ws: -
"The First Prov iso to Section 153C introduces a legal fic tion on the basis of which the commencement date for computa tion o f the six yea r or the ten year block is deemed to be the date of receipt of books of accounts by the jurisdictio nal AO . The ide ntification of the starting block for the purpo ses of computation o f the six and the te n year pe rio d is go verned by the Firs t Pro viso to Section 1530, which s ignificantly shifts the refere nce point spoken o f in Section 153A(1), w hile defining the po int from which the perio d of the "rele vant assessment year" is to be calc ulated, to the date o f receipt of the books o f accounts, documents o r assets se ize d by the jurisdictional AO o f the non- searche d person. The shift of the re levant date in the case of a non-searched pe rson be ing regulated by the Firs t Proviso of Section 153C(1) is an issue which is no longe r res integra and stands authoritative ly settle d by virtue of the decisio ns o f this Court in SSP Aviatio n and RRJ Securities as well as the dec isio n of the Supreme Court in Jasjit S ingh. The afo resaid legal position also stoo d reite rated by the Supreme Court in Vikram Suj itkumar Bhatia. T he submiss ion of the respondent s, ther efore, that the block periods would 14 ITA No. 4248/Del/2025 Sri Prem Properties Pvt. Ltd.
have to be reckoned w ith refe rence to the date of search can neither be countena nced nor accepted.
The reckoning of the six AYs' would require one to firstly identify the FY in which the searc h was underta ken and w hich would lead to the ascertainment of the AY relevant to the previous year o f search. The block o f six AYs' would conse quently be those which immediate ly prece de the AY re leva nt to the ye ar of search. In the case of a sea rch asse ssment undertake n in terms of Sectio n 1530, the solitary dis tinction would be that the pre vious year of se arch would stand substitute d by the date or the year in which the books of accounts or documents and assets seize d ar e handed o ver to the jurisdictional AO as opposed to the year of sea rch which constitutes the basis for an assessment under Section 153A.
While the identi fication and computation o f the six AYs' hinges upon the phrase "Immediately preceding the assessment ye ar relevant to the , previous year" of search, the te n ye ar period would have to be reckoned from the 31st day of March of the AY relevant to the year o f se arch. This, since undisputedly, Explanation 1 of Sectio n 153A requires us to recko n it " from the end of the a ssessment year". This distinctio n would have to necessarily be acknowledged in light o f the statute hav ing consciously adopted the phraseo logy "Immediate ly preceding' when it be in relation to the six year period and emplo ying the expres sion "from the end o f the assessment year" while speaking o f the ten year block ."
5. In view of the aforesaid, we find ourse lves unable to sustain the impugne d notice dated 13 March 2023 issued unde r Section 148 o f the Act.
6. The writ pe tition is accordingly allowe d and the impugne d orde r dated 18 May 2023 dispos ing off the objectio ns of the petitio ner is he reby quashe d. We in conseque nce also quash the notice date d 13 Marc h 2023 purporting to commence proceedings unde r Section 148 o f the Act."
7. Be ar ing in mind the aforesaid, the computatio n of the " relevant assessment year fro m the date of the impugne d Section 148 no tice date d 30 March 2023 would be as follows-
15 ITA No. 4248/Del/2025Sri Prem Properties Pvt. Ltd.
Computatio n of the ten- No. o f years year block Pe riod AY 2023-24 1 AY 2022-23 2 AY 2021-22 3 AY 2020-21 4 AY 2019-20 5 AY 2018-19 6 AY 2017-18 7 AY 2016-17 8 AY 2015-16 9 AY 2014-15 10
8. It is there fore ex facie evident that AYs 2012-13 and 2013-14 falls beyond the ten- ye ar block period as set out under Section 153C re ad with Section 153A of the Act. Co nsequently, the impugned notices are rende red unsustainable."
9. Thus , it is se ttled proposition that the date of handling o ver o f the seize d mater ial by the AO of the searche d pe rson/r ecording o f satisfaction note shall be the refe rence da te for the issuance of no tice u/s 153C and to assess or reassess the total income of the othe r person for the 6 previo us ye ars pre ceding the previous year o r 10 A .Ys from the end o f the AY relevant to the F.Y. in which the such seized mate rial is hande d over to the AO of the such o ther per son ("appellant" in the present case).
10. Now coming back to the present case of the appe llant, the fo llowing dates are relevant fo r the refere nce:
S.No. Particulars Date
1. Date sea rch and seizure 10.10.2018
opera tion conducted in the
case of M/s M/s CIFSL
group of cases) (Searched
person)
2. Date of handling over the 10.08.2021
seized mate rial by the AO
of Searched person (As
per satisfaction note of
searche d perso n's AO)
16 ITA No. 4248/Del/2025
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11. Considering the above state d factual matrix, the refere nce da te of search and seizur e operation in case of appellant being other person as per 1s t proviso to the sub sectio n 1 to the Sectio n 153C of the I.T. Act 1961 shall be 10.06.2021 a nd hence pre vious year of search and seizure operatio n shall be 2021- 22(AY 2022-23). Co nsidering the Assessment Year 2022-23 as a search year the block perio d o f 10 AYs' wo ul d be as follows: -
Computatio n o f ten-yea rs Number of block perio d as provide d years Years u/s. 153Cr.w.s. 153A of the Act. Α.Υ. 2022- 23 1 Α.Υ. 2021- 22 2 Α.Υ. 2020- 21 3 Α.Υ. 2019- 20 4 Α.Υ. 2018- 19 5 Α.Υ. 2017- 18 6 Α.Υ. 2016- 17 7 Α.Υ. 2015- 16 8 Α.Υ. 2014- 15 9 Α.Υ. 2013- 14 10
12. Thus, it is held that the A O had jurisdiction to serve upon the a ppella nt notice ufs 153C o f the Ac t only up to the AY 2013-14 and not pr ior to that AY. Therefore, the a ssessment proceeding-initiated u/s 153C o f the I.T. Act 1961 by the AO for the AY 2010- 11, based o n the search and seizure ope ration conduc ted on M/s CIFSL gro up of cases is agains t the clear mandate of legislature and against the ratio laid down by the Hon' ble Apex Court In the c ase of CIT V Jasjit Singh (Supra) and of Hon' ble Delhi High Court in the c ase o f Ojjus Medicare Pvt. Ltd (s upra) and Saurabh Gupta ( supra). Hence , the proceeding u/s 153C o f the I. T. Act fo r the AY 2010-11 initiated and completed unde r the instant case of the appe llant is found without jurisdiction and time barred.
13. T herefo re, the assessment order passed u/s 153C r.w.s 144 of the I. T. Act 1961 dated 23.03.2023 by the AO in the case of appellant for the AY. 2010-11 is bad in law , witho ut jurisdiction, time barred and void ab initio . T hus, grounds o f a ppea l no. 2, 3 & 4 are allo wed."
17 ITA No. 4248/Del/2025Sri Prem Properties Pvt. Ltd.
This is what le aves the Revenue aggrieved w ho has filed its instant appeal be fore the tribunal.
4. Both the lea rned representatives vehemently reiterate the ir respective s tands against and in support of the learned CIT(A)'s a bove extrac ted de tailed discussion quashing the impugned assessment. We mak e it c lear that the re is no dispute on facts, inter alia, indicating the learned de pa rtmental autho rities to have carried out the search in question on 10.10.2018 followed by centr alizatio n of all these cases le ading to initiation o f sectio n 153C notices issued to the assessee on 13 t h July, 2021. That being the case and in light of the fact that the impugned assessm ent ye ar before us is AY 2010-11, it transpires that the legis lature has not only s tipulate d u/ s 153C( 1) 1 s t pro viso that the date of search in an instance involving a third party is that of handing over of the rele vant seized material to the juris dic tio nal Asse ssing Officer but also section 153A(1) Explanation 1 provides that ten assessment years in issue ought to be computed "from end of the asses sment year re lev ant to the previo us year in which search is conduc ted or requisition is made". We thus find that the learned CIT(A) has rightly computed ten asse ssment years from AY: 2022-23 backwards not reaching upto assessment year 2010- 11 in issue going by their lords hips' de taile d discussio n in PCIT Vs. Ojj us Medicare (P) Ltd., (2024) 465 ITR 101 (Del) and CIT Vs. Jas jit Singh (2024) 465 ITR 101 (SC). We thus express our complete agreeme nt w it h the learne d CIT(A)'s foregoing detaile d discussio n. The Revenue fails in its firs t and foremost legal ground therefore."
5. We adopt the above extracted detailed disc ussion muta tis mutandis to affirm the learned CIT(A)'s findings under challenge herein quashing the impugned section 153C as sessment. We further make it clear for the sake of completeness that no t only the impugned assessment year 2009-10 would be out of the purview of se ction 153C but also both these appeals emanate from department's very search action. Rejected ac cordingly.
18 ITA No. 4248/Del/2025Sri Prem Properties Pvt. Ltd.
6. This Revenue's appeal is dismissed.
Order Pronounced in the Open Court on 17/11/202 5.
Sd/- Sd/-
(S. Rifaur Rahman) (Satbeer Singh Godara)
Accountant Member Judicial Member
Dated: 17/11/2025
*Subodh Kumar, Sr. PS*
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
5. DR: ITAT
ASSISTANT REGISTRAR
19 ITA No. 4248/Del/2025
Sri Prem Properties Pvt. Ltd.
Date
1. Date of dictation of Tribunal Order 17.11.2025
2. Date on which the typed draft Tribunal Order is placed before 19.11.2025 the Dictating Member
3. Date of which the typed draft Tribunal Order is placed before the other Member
4. Date on which the approved draft Tribunal Order comes to the Sr.PS/PS
5. Date on which the fair Tribunal Order is placed before the Dictating Member for pronouncement
6. Date on which the signed order comes back to the Sr. PS/PS
7. Date on which the final Tribunal Order is uploaded by the Sr. PS/PS on Official Website
8. Date on which the file goes to the Bench Clerk alongwith Tribunal Order
9. Date of killing of the disposed off files on the judiSIS portal of ITAT by the Bench Clerks
10. Date on which the file goes to the Supervisor (Judicial)
11. The date on which the file goes to the Assistant Registrar for endorsement of the order
12. Date of dispatch of the order
13. Date on which the file goes to the superintendent for checking
14. The date on which the file goes to the Assistant Registrar for signature on the tribunal order
15. Date on which the file goes to dispatch section
16. Date of dispatch of the order