Revelation Unique Retail And Marketing Pvt. Ltd. Vs ACIT (ITAT Delhi)
Mechanical Satisfaction Note, No Incriminating Material: ITAT Delhi Strikes Down Entire 153C Assessment
Assessee challenged reassessment u/s 153C arising from search in the case of Shri Pranjil Batra on 17.08.2020. Assessee had not filed return for AY 2019-20. AO issued notice u/s 153C r.w.s 153A on 14.01.2022 after recording a “satisfaction note”. Assessee did not respond to multiple notices, & AO, relying on alleged seized material, made additions of ₹17,70,12,272 u/s 69A r.w.s 115BBE & ₹5,92,32,502. CIT(A) upheld the assessment.
Assessee contended that the satisfaction note was wholly vague, generic, & mechanical. It did not specify annexure number, page number, nature of documents, parties, transaction values, or how the documents “pertained to” Assessee. It recorded the same satisfaction for other unrelated persons, indicating a copy-paste exercise. It even recorded satisfaction for AYs prior to Assessee’s incorporation (company incorporated on 09.06.2018), making the note inherently defective.
Assessee relied on Tribunal decisions in Renu Singh, Pradeep Singh, Harish Kumar Agarwal & Royal Multiplex, where the same Pranjil Batra search-related satisfaction notes were held vague, cryptic & non-descript, lacking nexus between seized documents & relevant AYs. Assessee further argued that no incriminating material belonging to it was found, & as per Saksham Commodities (Del HC), U.K. Paints (SC), Kabul Chawla (Del HC), RRJ Securities (Del HC) & Abhisar Buildwell (SC), no addition can be made u/s 153C without incriminating material.
