DCIT Vs N. K. Malhotra (HUF) (ITAT Delhi)
For A “Non-Searched Person”, The Clock U/s 153C Starts When Documents Reach His AO—Ay 2014-15 Escapes As ₹50-Lakh Gate Remains Closed; ₹50-Lakh Threshold Mandatory for Section 153C Assessment Beyond Six Years; AY 2014-15 Escapes Section 153C as ₹50-Lakh Threshold Remains Unmet; Pending SLP Does Not Dilute Binding Jurisdictional High Court Precedent; Section 153C Assessment Below ₹50-Lakh Extended-Period Threshold Invalid: Delhi ITAT
Summary: The Delhi ITAT, following the binding judgment of the Delhi High Court in PCIT v. Ojjus Medicare Pvt. Ltd. [2024] 465 ITR 101 (Delhi), has held that for proceedings u/s 153C against a person other than the searched person, the block of six or ten assessment years must be reckoned with reference to the date on which the seized material is received by the jurisdictional AO of such other person. Since AY 2014-15 fell outside the six-year block & the alleged escaped income was below the statutory threshold of ₹50 lakh applicable to the extended period, the assessment u/s 153C was held invalid.
Search on Alankit Group
The assessee, N. K. Malhotra (HUF), filed its original return of income for AY 2014-15 on 08.03.2015 declaring income of ₹3,28,070.
A search & seizure action u/s 132 was conducted on 18.10.2019 in the cases of the Alankit Group, Shri Alok K. Agarwal, his son & certain close associates and key employees.
