For Other Person, Date of Search is Date of Handing Over of Seized Material: Delhi ITAT

Sanchar Nest Sahakari Awas Samiti Limited Vs DCIT/ACIT (ITAT Delhi)

The Delhi ITAT quashed assessments framed under section 153C for AYs 2014-15 to 2016-17, holding that in the case of an “other person”, the relevant date of initiation of search is the date on which the seized material is handed over to the jurisdictional Assessing Officer. Since the seized material was handed over after 1 April 2021, section 153C itself was inapplicable by virtue of section 153C(3).

The assessee challenged the jurisdiction of the Assessing Officer on the ground that although the search on the Alankit Group was conducted on 18.10.2019, the satisfaction note and seized material were handed over to the jurisdictional Assessing Officer only on 24.06.2022 (and ultimately received on 19.12.2022). Therefore, for the assessee, being a non-searched person, the proceedings were barred by section 153C(3), which excludes searches initiated on or after 1 April 2021.

The Tribunal relied extensively on the Madras High Court’s decision in Harigovind v. ACIT (485 ITR 509), which held that for an “other person”, the date of handing over of seized material to the jurisdictional Assessing Officer is the date of initiation of search for all purposes, including the applicability of section 153C(3). It also noted the Supreme Court’s observations in CIT v. Jasjit Singh while approving the High Court’s reasoning.

Applying the above principle, the ITAT held that since the seized material was first handed over on 24.06.2022, no proceedings under section 153C could legally be initiated thereafter. Consequently, the notices issued under section 153C and the consequential assessment orders were quashed for lack of jurisdiction.

As the jurisdictional issue itself was decided in favour of the assessee, the Tribunal did not adjudicate the additions on merits and allowed all three appeals solely on the ground of invalid assumption of jurisdiction.

Cases Discussed

• Harigovind vs. ACIT (Mad. HC), 485 ITR 509 (Mad.) [2025]
• CIT vs. Jasjit Singh (SC), [2023] 155 com 155 (SC)/ [2023] 295 Taxman 612 (SC)/ [2023] 458 ITR 437 (SC)

FULL TEXT OF THE ORDER OF ITAT DELHI