Kishore Kumar Sharma Vs ACIT (Delhi High Court)
The Delhi High Court, in the case of Kishore Kumar Sharma Vs. ACIT, quashed notices issued under Section 153C of the Income Tax Act, 1961, spanning seven Assessment Years (AYs) from 2014-15 to 2020-21, due to a defective ‘Satisfaction Note.’ The core issue was the failure of the petitioner’s jurisdictional Assessing Officer (AO) to record the requisite satisfaction that the material received from a search conducted on a third party had a bearing on the petitioner’s total income for the years in question.
Read SC Judgment in this case: SC Upholds Quashing of Section 153C Notices Due to Defective Satisfaction Note
The court noted that the jurisdictional AO’s Satisfaction Note, dated June 30, 2022, did not refer to any incriminating material for any of the contested AYs. While the AO of the searched person mentioned incriminating material for one year (AY 2016-17), the petitioner’s AO failed to adopt this material or record any independent reasons indicating how that material would impact the determination of the petitioner’s total income across the block of assessment years. The Delhi High Court relied entirely on the principles it had established in its precedent-setting judgment, Saksham Commodities Limited vs. Income Tax Officer, Ward 22(1), Delhi & Anr.
