DCIT, CENTRAL CIRCLE-13, NEW DELHI V. ANNEX INFRAREALITY PRIVATE LIMITED , NEW DELHI

ITA 2163/DEL/2023

AI Insights

The case involves an appeal by the Department against Annex Infrarealty Pvt. Ltd. concerning an assessment for the year 2011-12 under section 153C of the Income-tax Act, 1961. The primary legal issue was the validity of the 153C assessment, as the assessment year in question was beyond the statutory 'six assessment years' block following a search conducted in 2015. The Department argued that the case fell within the amended provisions applicable from 2017, which were interpreted to include the relevant assessment years. However, the Tribunal upheld the assessee's position, referencing precedents and the specific statutory language that did not support the Department's interpretation.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 30476 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Other Referred Cases: CIT v. Jasjit Singh (2023) 458 ITR 437 (SC), PCIT v. Ojjus Medicare Pvt. Ltd. [2024] 465 ITR 101 (Delhi)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Search and seizure
• Section: 143(3); 119; 153A; 153C; 101

Judgement Text

"1 ITA no. 2163/Del/2023 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘A’ NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER ITA No. 2163/Del/2023 Assessment Year: 2011-12 DCIT, Central Circle-13, New Delhi. Vs Annex Infrarealty Pvt. Ltd., Shop no. 8, 32-B G/F, (back side), Patparganj village, New Delhi-110091. PAN: AAFCP 6434 P APPELLANT RESPONDENT Assessee represented by Shri Kapil Goel, Adv. Department represented by Shri Subhash Kumar, Sr. DR Date of hearing 31.12.2024 Date of pronouncement 08.01.2025 O R D E R PER SATBEER SINGH GODARA J.M: This Revenue’s appeal for assessment year 2011-12 arises against Commissioner of Income-tax (Appeals)-28, New Delhi’ order dated 19.05.2023 in case no. 26/10134/2019-20 in proceedings u/s 153C read with section 143(3) of the Income-tax Act, 1961, hereinafter referred to as the ‘Act’. 2. It emerges at the outset that there arises the first and foremost legal issue of validity of the impugned 153C assessment itself. This is for the precise reason that 2 ITA no. 2163/Del/2023 the assessment year herein is A.Y. 2011-12. Learned departmental authorities had carried out the search in question on 23.07.2015 followed by the corresponding section 153C satisfaction recorded in assessee’s case on 23.03.2018. The assessee’s case accordingly is that impugned assessment year 2011-12 is beyond the statutory “six assessment years” block and therefore, the assessment framed herein in its case deserves to be quashed going by CIT v. Jasjit Singh (2023) 458 ITR 437 (SC); and PCIT v. Ojjus Medicare Pvt. Ltd. [2024] 465 ITR 101 (Delhi). 3. The Revenue’s case on the other hand is that assessee’s case herein falls within the amended statutory expression “and for the relevant assessment year/(s) referred to in sub-section (1) of section 153A” and therefore it falls within the statutory block period. 4. We have given our thoughtful consideration to the instant first and foremost legal issue between the parties. There would be hardly any dispute that section 153C(1) 1st proviso adopts the date of initiation of search in such a third person’s case as “date of receiving books …. .” , by the jurisdictional Assessing Officer of the person other than the searched person. We adopt the very statutory expression herein and find that going by the date of section 153C satisfaction recorded on 23.3.2018 by the assessee’s jurisdictional Assessing Officer, the assessment year 2011-12 before us is than beyond the said block of six assessment years. 3 ITA no. 2163/Del/2023 5. So far as the Revenue’s reliance on statutory amendment in Section 153A (second proviso) inserted by a Finance Act, 2017 with effect from 1.4.2017 and adopted mutatis mutandis for section 153C(1) is concerned, we quote PCIT v. Ojjus Medicare Pvt. Ltd. (supra) in para 119 sub para ‘B’ that before the learned Assessing Officer records the corresponding section 153C satisfaction, there has to be a clear cut indication therein that the income having escaped ……. must satisfy the threshold limit of Rs. fifty lakhs. We thus accept the assessee’s instant legal ground as the learned Assessing Officer; be that in case of the searched assessee as well as the appellant herein, had nowhere recorded any such satisfaction invoking the pecuniary limit of Rs. fifty lakhs and therefore the Revenue’s endeavour to treat the impugned A.Y. 2011-12 as falling within section 153C is declined in very terms. 6. This is further, coupled with the fact that as it is evident from a perusal of these twin impugned section 153C satisfactions, both dated 23.3.2018, that there is no clarity found as to whether the corresponding seized material ‘Annexure A-4” in fact pertains or pertained to or any information contained therein, relates to the assessee(s) as prescribed under clause (b) thereof. 7. Faced with this situation, the Revenue sought to invite our attention that the said twin satisfaction had made it duly clear at the bottom that the seized document(s) in fact belonged to the appellant herein. We are afraid that the 4 ITA no. 2163/Del/2023 amended section 153C(1) with effect from 1.6.2015 stipulates that such document could only “pertains or “pertain” to/or any information contained therein could “relevant to” any third person other than the searched assessee. This is for the precise reason that the legislature’s instant amendment had substituted the earlier provision wherein such seized document(s) could also belong to persons other than the searched assessee. We thus conclude that both going by the specified assessment years as well as validity of the impugned section 153C satisfaction note herein the impugned section 153C assessment framed on 28.12.2018 in the instant case is not sustainable in law. The same is accordingly quashed. All other pleadings on merits herein stand rendered academic. 8. This Department’s appeal is dismissed. Order pronounced in open court on 08.01.2025. Sd/- Sd/- (M. BALAGANESH) (SATBEER SINGH GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER *MP* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "