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2026 Supreme(Online)(ITAT) 13445
INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH)
C.N. Prasad, JM, Sanjay Awasthi, AM
ACIT – Appellant
Versus
Kishore Kumar Kaya – Respondent
ITA No.4613/Del/2025
For the Appellants/Petitioners: Pooja Swaroop
For the Respondents: None
For a non-searched person under Section 153C of the Income Tax Act, the block period of six years is computed from the date of receipt of documents by the jurisdictional AO, not the date of the original search.
Headnote:(A) Income Tax Act, 1961 - Sections 143(3), 153A, 153C - Search and seizure - Assessment of non-searched person - Block period - Satisfaction note - Date of deemed search - Validity of assessment order - The date of receipt of books of accounts or documents by the jurisdictional Assessing Officer of the non-searched person, and not the date of original search, is the relevant date for computing the block of six assessment years for initiating proceedings under Section 153C of the Act. (Paras 5, 10.9, 10.11)
(B) Income Tax Act, 1961 - Section 153C - First Proviso - Parliamentary intent in enacting the proviso was to prevent prejudice to a third party who would be drawn into proceedings unwittingly, and the date of receipt by the jurisdictional officer is the date of reference for calculating the six assessment years. (Para 10.10)
(C) Appeal - Legal validity - Assessment order passed under Section 143(3) of the Act for an assessment year that falls within the block period under Section 153C is bad in law and is liable to be quashed. (Para 9)
Facts of the case:
A search and seizure operation was carried out on 06.01.2021 in the cases of a group and its associates. During the search, certain documents and digital evidence were seized. The Assessing Officer (AO) of the assessee recorded a satisfaction note on 23.08.2022, initiating proceedings under Section 153C for certain years and under Section 143(2) for the Assessment Year (AY) 2021-22. The AO passed the assessment order for AY 2021-22 under Section 143(3) of the Act. The Commissioner of Income Tax (Appeals) [CIT(A)] allowed an additional ground raised by the assessee, holding that the assessment should have been completed under Section 153C as AY 2021-22 fell within the block period of six assessment years computed from the date of the satisfaction note (23.08.2022), which covered AYs 2017-18 to 2022-23.
Findings of Court:
The Tribunal upheld the order of the CIT(A), finding no infirmity in the conclusion that the assessment for AY 2021-22 should have been made under Section 153C and not under Section 143(3). The Tribunal dismissed the revenue's appeal.
Issues: Whether the assessment order for AY 2021-22 should have been passed under Section 153C of the Act instead of Section 143(3), given that the satisfaction note was recorded on 23.08.2022.
Ratio Decidendi: The Tribunal relied on the decisions of the Supreme Court in Jasjit Singh and the jurisdictional High Court in Ojjus Medicare Pvt. Ltd., which held that for a non-searched person, the date of receipt of books of accounts or documents by the jurisdictional AO of such other person is the date of reference for calculating the six assessment years for initiating assessment under Section 153C. Since the satisfaction note was recorded on 23.08.2022, the block period covered AY 2017-18 to AY 2022-23, and AY 2021-22 fell within this block. Consequently, the assessment for AY 2021-22 under Section 143(3) was held to be invalid. Result : Appeal of revenue dismissed.
| Table of Content |
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| 1. issue resolved per precedent, no appearance (Para 2) |
| 2. assessment must be under section 153c, not 143(3) (Para 3 , 4 , 5 , 6) |
ORDER
PER C.N. PRASAD, J.M.
This appeal is filed by the revenue against the order of Ld. CIT(A)-30 dated 25.04.2025 for the A.Y. 2021-22.
2. Inspite of issue of notice none appeared on behalf of the assessee nor any adjournment was moved. Since the issue is no more res-inte-gra the appeal is disposed off on hearing the Ld. DR.
3. We have perused the order of the Ld. CIT(A) wherein the assessee had raised an additional ground and contended that the date of deemed search in the case of the assessee shall be the date on which the satisfaction note recorded by the AO of the assessee or the materials handed over to the AO of the assessee.
4. The assessee contended that the date of handing over all the materials or the date of satisfaction recorded by the AO is taken as deemed search in the case of the assessee, in view of the decision of the Hon’ble Supreme Court in the case of Jasjit Singh (458 ITR 437) and the Hon’ble jurisdictional High Court in the case of Ojjus Medicare Pvt. Ltd. (161 taxmann.com 160), the assessment year under consideration shall fall within the block period of six assessment years and therefore, the assessment should have been completed u/s.153C of the Act and not u/s.143(3) of the Act as was done by the AO. This contention of the assessee was accepted by the Ld. CIT(A) and allowed additional ground raised by the assessee. The correct block period of six assessment years for the purpose of making assessment u/s.153C of the Act in the case of the assessee would be from A.Y. 2017-18 to A.Y.2022-23 and therefore, the assessment year under consideration i.e. 2021-22 falls within the block period of six years and in which the case the assessment for the impugned assessment year i.e. 2021- 22 should have been carried out in accordance with law u/s.153C of the Act and not under the provisions u/s.143(3) of the Act. While holding so the Ld. CIT(A) observed as under :-
10. Legal position regarding the contentions raised by the assessee through additional grounds:
10.1 The assessee submitted that the issue of the "terminal date" or "relevant date," being the date of handing over the seized documents or the date of recording satisfaction by the JAO, for computing the six-year block period in the case of a non-searched person, is no longer res integra.
Appellant mainly relied on the Hon'ble Supreme Court judgment in the case of CIT 14 vs. Jasjit Singh [2023] 458 ITR 437 (SC)[26-09-2023] which has interpreted the legislative intent behind inserting the first proviso to Section 153C (1) of the Act and stated that 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 153-C was enacted. The Hon'ble Supreme Court has finally concluded that in are not searched and in respect of whom the specific provision under Section case of non- searched person, the date of receipt of books of accounts by the jurisdictional officer of such other person shall be the date of reference for calculation of six assessment years for which the Assessing Officer may initiate assessment in terms of Section 153C of the Act.
10.2 case Further, appellant relied on the very recent decision of Hon'ble Delhi In the of OJJUS MEDICARE 161 taxmann.com 160 (Delhi)[03-04-2024] which has dealt this issue in PVT. LTD. [2024] length after considering the history of amendments made in Section 153A and 153C by various Finance Acts including the Finance Act, 2017 and also took into consideration the various decisions on this issue including the decision of the Hon'ble Supreme Court in the case of Jasjit Singh [2023 SCC Online SC 1265] and held that Block period of six preceding AYs u/s 153C shall be computed from t
