SUBODH KANT SAHAY HUF,DWARKA vs. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-27, JHANDEWALAN EXTENSION

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ITA 6263/DEL/2025Status: DisposedITAT Delhi21 July 2026AY 2019-20204 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal quashed the assessment, finding that the Assessing Officer had not explicitly recorded satisfaction that the seized assets had a bearing on the determination of the assessee's total income. This decision was based on the precedent set by the Delhi High Court in Saksham Commodities Ltd. Vs. ITO.

What were the facts?

The Income Tax Appellate Tribunal (ITAT) heard an appeal concerning assessment year 2019-20, arising from proceedings under section 153C of the Income Tax Act. A search action was conducted in the Alankit group of cases, and the Assessing Officer initiated section 153C proceedings against the assessee, believing seized assets belonged to them.

What were the issues?

The primary issue was the validity of the section 153C assessment due to the Assessing Officer's failure to record explicit satisfaction regarding the bearing of seized assets on the assessee's income.

Which sections of the Income-tax Act were involved?

Section 153C,Section 132

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘H’ NEW DELHI

Before: SHRI SATBEER SINGH GODARA & SHRI SANJAY AWASTHI

For Appellant: Adv. Ms. Sakshi Rustagi, Adv
Hearing: 29.06.2026Pronounced: 29.06.2026

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘H’ NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER ITA No.6263/Del/2025 Assessment Year: 2019-20 Subodh Kant Sahay HUF, Vs. DCIT, 302, NAV Sansad Vihar, Central Circle-27, Sector-22, Plot -4, Dwarka Delhi Raj Nagar-II, Delhi PAN: AAJHS1872H (Appellant) (Respondent)

Assessee by Sh. Sumit Lal Chandani, Adv. Ms. Sakshi Rustagi, Adv. Department by Sh. Bhopal Singh, CIT(DR)

Date of hearing 29.06.2026 Date of pronouncement 29.06.2026 ORDER PER SATBEER SINGH GODARA, JM This assessee’s appeal for assessment year 2019-20, arises against the Commissioner of Income Tax (Appeals)-25 [in short, the “CIT(A)/NFAC”], New Delhi’s order dated 25.08.2025 having DIN no. ITBA/APL/M/250/2025-26/1079958794(1), involving

ITA No.6263/Del/2025

proceedings under section 153C of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’). Heard both the parties. Case file perused. 2. Coming to the first and foremost legal issue of validity of the impugned section 153C assessment herein framed by the learned Assessing Officer in the assessee’s case on 20.03.2024; we notice at the outset that there is hardly any dispute between the parties that the learned departmental authorities had carried out section 132 search action in Alankit group of cases on 18.10.2019 and that the learned Assessing Officer of the said searched assessee appears to have recorded its satisfaction that the same resulting in initiation of section 153C proceedings as they belonged to the assessee. This satisfaction note dated 24.06.2022 very well forms part of the case records at pages 89 & 90 that the corresponding valuable assets found/seized during the course of search in fact belonged to the assessee i.e. a third person. He forwarded the relevant case records to the jurisdictional Assessing Officer who recorded his latter satisfaction under section 153C without even making explicitly clear that the aforesaid seized materials or valuables or assets had a bearing in the assessee’s case.

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ITA No.6263/Del/2025

3.

Faced with this situation, learned CIT(DR) vehemently argues that we need not adopt such a hyper technical approach once the Assessing Officer’s aforesaid satisfaction had been duly recorded in tune with the procedure prescribed in the statute itself. 4. All these Revenue’s arguments fail to impress upon us. We make it clear at the cost of repetition that the assessee’s Assessing Officer had nowhere recorded a satisfaction that the valuables/assets in question found/seized during the course of search had any “bearing” on determination of the assessee’s total income. Case law Saksham Commodities Ltd. Vs. ITO (2024) 464 ITR 1 (Delhi)(HC) has already settled the very issue in the asseessee’s favour and against the department to the very effect. We thus quash the impugned assessment framed in assessee’s case in very terms. All other pleadings/arguments between the parties stand rendered academic. 5. This assessee’s appeal is allowed in above terms. Order pronounced in the open court on 29th June, 2026 Sd/- Sd/- (SANJAY AWASTHI) (SATBEER SINGH GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 21st July, 2026. 3 | P a g e

ITA No.6263/Del/2025

RK/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi

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