SRB Promoters Pvt Ltd Vs ACIT (ITAT Delhi)
Delhi ITAT Quashes Section 153C Assessments as Notices Were Time-Barred and Based on Defective Satisfaction Notes
The Delhi ITAT quashed the assessments framed under section 153C read with section 143(3) for AYs 2011-12 and 2012-13, holding that the Assessing Officer had assumed jurisdiction contrary to settled law. For AY 2011-12, the Tribunal held that in the case of a person other than the searched person, the relevant date for computing the six assessment years is the date on which the seized material is handed over and satisfaction is recorded by the jurisdictional Assessing Officer, and not the date of the original search. Since the satisfaction under section 153C was recorded on 23.03.2018, the permissible block extended only to AYs 2012-13 to 2017-18, rendering the notice for AY 2011-12 barred by limitation. Relying on the Supreme Court’s decision in CIT v. Jasjit Singh and the Delhi High Court’s ruling in PCIT v. Ojjus Medicare Pvt. Ltd., the Tribunal quashed the assessment for AY 2011-12. For AY 2012-13, the Tribunal held that the common satisfaction note recorded for multiple assessment years was legally defective, as it failed to identify the seized documents relatable to each assessment year or record year-specific satisfaction regarding escapement of income. Following Saksham Commodities v. ITO, DCIT v. Sunil Kumar Sharma (affirmed by the Supreme Court), and its earlier coordinate bench decisions, the Tribunal held that a separate and year-specific satisfaction under section 153C is mandatory. Consequently, the proceedings initiated on the basis of a consolidated and defective satisfaction note were declared void ab initio, and both assessment orders were quashed.
