M L R FOODS PRIVATE LIMITED,SHAKARPUR, DELHI vs. DCIT, CC-16, JHANDEWALA EXT

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: ‘A’, NEW DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER AND SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER ITA Nos.- 1796 to 1799/DEL/2026 [Assessment Years: 2015-16 to 2018-19] MLR Foods Private Limited, DCIT, CC-16, C-713, Ganesh Nagar, II, Jhandewalan Extn. Shakarpur, Delhi-110092. Vs New Delhi-110055. PAN- AABCL0568Q ITA Nos.- 1800/DEL/2026 to 1802/DEL/2026 [Assessment Years: 2019-20 to 2021-22] MLR Foods Private Limited, DCIT, CC-16, C-713, Ganesh Nagar, II, Jhandewalan Extn. Shakarpur, Delhi-110092. Vs New Delhi-110055. PAN- AABCL0568Q Assessee by Shri Priyansh Jain, CA Revenue by Shri Ashok Gautam, CIT(DR) Date of Hearing 09.07.2026 Date of Pronouncement 10 .07.2026

ORDER Per Bench:

ITA No.- 1796/Del/2026 & six other appeals MLR Foods Pvt. Ltd. hence, these seven appeals are being disposed of through a single order. In this case, a search and seizure operation was conducted on 28.10.2020 on AIMS Group and others. Thereafter, the AO of AIMS group recorded his satisfaction that certain information contained in the material seized during the said search pertained to the assessee. It is a matter of record that such satisfaction was recorded on 18.08.2023 (for F.Y. 2023-24 corresponding to A.Y. 2024-25), a copy of this satisfaction note has been placed on record for the perusal of this Bench. Thereafter, the ld. AO completed the assessment in all these cases with certain additions to income.

1.2 For the sake of convenience, the matter pertaining to A.Y. 2015-16 in ITA no. 1796/Del/2026 is being taken as the lead case.

1.3 Aggrieved, the assessee approached the CIT(A) for all the assessment years involved but has suffered ex-parte orders since there was no compliance to the notices issued by the CIT(A).

1.4 Further aggrieved, the assessee has approached the ITAT with grounds challenging the assumption of jurisdiction as also the additions on merits. The assessee has filed certain additional grounds, which were requested to be adjudicated before proceeding any further on the merits of the matter. For the sake of reference, the additional grounds deserve to be extracted as under:

“The appellant begs to move the following ground as additional ground: -

ITA No.- 1796/Del/2026 & six other appeals MLR Foods Pvt. Ltd. 1. That on the facts and circumstances of the case and in law, the notice u/s 153C dated 23.08.2023 issued by the Ld. AO u/s 153C (1) of the ("the Act") is void ab initio and without jurisdiction. As per the first proviso to Section 153C (1), the date of initiation of search is to be reckoned as 18.08.2023, being the date of recording of the satisfaction note. Accordingly, the impugned notice is invalid in law in view of the ratio laid down in PCIT vs. Ojjus Medicare (P.) Ltd. 2. That on the facts and circumstances of the case and in law, the issuance of the impugned notice u/s 153C dated 23.08.2023 is in gross violation of section 153C(3) of the Act. The said provision is rendered inapplicable to searches initiated on or after 01.04.2021, when read in conjunction with the first proviso to Section 153C (1) of the Act. 3. That on the facts and circumstances of the case and in law, section 153C of the Act, being a machinery provision, must be interpreted in a manner that effectuates the object and purpose of the statute. Any amendment thereto, including the prescribed cut-off date, would apply even to searches conducted prior to the date of amendment, in light of the law laid down by the Hon'ble Supreme Court in ITO v. Vikram Sujitkumar Bhatia."

ITA No.- 1796/Del/2026 & six other appeals MLR Foods Pvt. Ltd. the date which is of significance for the purposes of assumption of jurisdiction. For this proposition, the ld. AR relied on the case of Ojjus Medicare (P.) Ltd. reported in [2024] 465 ITR 101 (Delhi). It was also averred that in the case of Karina Airlines International Ltd. reported in 474 ITR 340 (Del.), it has been held that the date of recording of the satisfaction in the case of non-searched persons becomes the date of search in case of “other person”. For this purpose, the ld. AR read out para 20 of this case law. Thereafter, the ld. AR pointed out that through Finance Act, 2021, the provisions contained in sections 147 to 151 of the Act were substituted with effect from 01.04.2021. Therefore, through this amendment, the re-assessment proceedings are required to be undertaken in accordance with the new scheme prescribed under section 147 and 148 of the Act. It was emphasized by the ld. AR that this amendment effectively made the provisions of section 153A and 153C of the Act in-applicable to searches conducted on or after a 01.04.2021. Thus, drawing an inference from the case laws cited earlier, whereby the date of satisfaction for the purposes of section 153C was considered to be the date of search in the case of “other person”, the ld. AR stated that since the date of recording of satisfaction was 18.08.2023, hence, it was beyond 01.04.2021. Accordingly, it was canvassed that the search in the case of the “other person”, being the assessee under consideration, was after 01.04.2021 and therefore the provisions of section 153C of the Act would not apply. For this proposition, the Ld. AR relied on a number of judgments, including

ITA No.- 1796/Del/2026 & six other appeals MLR Foods Pvt. Ltd. the case of Shivdham Buildtech (P.) Ltd. vs. Joint Commissioner of Income tax reported in [2026] 187 taxmann.com 1103(Del-Trib.). This co-ordinate bench’s order has been authored by one of us.

2.1 The Ld. DR relied on the orders of the authorities below.

“Considered the rival submissions and material placed on record. The assessee in appeal has assailed validity of the assessment order passed under section 153C read with section 143(3). It is an undisputed fact that addition has been made in the hands of the assessee on protective basis consequent to search in the case of Alankit Group on 18-10-2019. The satisfaction note in case of the assessee was drawn by the AO on 11-10-2022. As per the first proviso to section 153C(1), the date of search in the case of person other than the searched person shall be the date on which books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person are received by the AO of other person. Thus, in the case of a person other than the searched person, the relevant date would be the date on which relevant documents or seized material is received by the AO of the person other than the searched person. [Para 19] It is viewed that in absence of specific date of handing over the seized material to AO of the assessee, the date of issue of order under section 127 has been wrongly assumed by the CIT(A) as the date on which seized material was received by the AO of assessee. The Jurisdictional High Court in the case of Pr. CIT (Central-1) v. Ojjus Medicare (P.) 5

ITA No.- 1796/Del/2026 & six other appeals MLR Foods Pvt. Ltd. Ltd. [2024] 161 taxmann.com 160/465 ITR 101 (Delhi) has held that where the date of handing over of documents is not available, date of issuance of satisfaction note by the Assessing Officer under section 153C would be pertinent for the purpose of first proviso to section 153C. In the present case, the AO had recorded satisfaction on 11- 10-2022. Since, the date of handing over of seized material is not emanating from the records, the date of recording of satisfaction i.c., 11-10-2022 shall be considered as the date of receiving seized material by the AO of the assessee. [Para 20] Section 153C was amended by the Finance Act, 2021 with effect from 1-4-2021 whereby sub-section (3) was inserted. [Para 21] By virtue of above amendment to section 153C, no assessment under section 153C can be made in the case of other person under section 153C if the date of search falls beyond 1-4-2021. As a corollary, any notice issued for making assessment under section 153C in the case of a non-searched person after 1-4-2021 would be non-est. [Para 22] Thus, applying the amended provisions of section 153C and the law explained by the Jurisdictional High Court in the case of Ojjus Medicare (supra), to the facts of the instant casc, it is found that the notice under section 153C issued by the AO to assessee and thereafter, assessment order passed under section 153C is unsustainable and is liable to be quashed on the ground of jurisdiction. In this regard, force is also drawn from the decisions of coordinate Benches in the case of Smt. Geetanjali Bhayana v. DCIT [2026] 183 taxmann.com 95 (Delhi - Trib.) and Lekh Raj v. DCIT [ITA No.3181/Del/2025, dated 30-3-2026]. It is held accordingly. [Para 23]”

Accordingly, all the seven appeals filed by the assessee are allowed.

Order pronounced in the open court on 10.07.2026.

Sd/- Sd/- [ANUBHAV SHARMA] [SANJAY AWASTHI] JUDICIAL MEMBER ACCOUNTANT MEMBER Dated- 10.07.2026. Pooja. Copy forwarded to: 1. Assessee 2. Respondent

ITA No.- 1796/Del/2026 & six other appeals MLR Foods Pvt. Ltd. 3. CIT 4. CIT(A) 5. DR

Asst. Registrar, ITAT, New Delhi,

1 Date of dictation of Tribunal order 09.07.26 2. Date on which typed draft order is placed before the 09.07.26 dictating Member 3 Date on which typed draft order is placed before the other Member (in the case of DB) 4. Date on which the approved draft order comes to P.S/Sr.P.S 5. Date on which the fair Order is placed before the dictating Member for sign 6. Date on which the fair Order is placed before the other Member for sign ( in the case of DB) 7. Date on which the Order comes back to P.S./Sr.P.S for uploading on ITAT website 8. Date of uploading, if not, reason for not uploading 9. Date on which the file goes to the Bench Clerk 10. Date on which order goes for xerox 11. Date on which order goes for endorsement 12. Date on which the file goes to the Superintendent/O.S. for checking 13. Date on which the file goes to the Assistant Registrar for signature on the order 14. Date on which the file goes to dispatch section for dispatch the Tribunal Order 15. Date of dispatch of order 16. Date on which file goes to Record Room after dispatch the order