M/S MPS STRUCTURE (P) LTD.,DELHI vs. DEPUTY COMMISSIONER OF INCOME TAX, DELHI

ITA 3648/DEL/2025Status: DisposedITAT Delhi23 June 2026AY 2016-1716 pages
AI SummaryAllowed

What were the facts?

During a search in a group case, it was found that the assessee company had received accommodation entries in the form of loans from entities controlled by the searched person. The Assessing Officer (AO) initiated proceedings under Section 153C based on a satisfaction note.

What did the Tribunal hold?

The Tribunal held that the satisfaction note recorded by the AO was defective as it was a common note for multiple assessment years without correlating the seized material to the specific year under appeal. Consequently, the assumption of jurisdiction under Section 153C was vitiated.

What were the issues?

Whether the satisfaction note recorded for initiating proceedings under Section 153C was valid and specific enough to confer jurisdiction on the AO, and whether the assessment order passed based on such satisfaction was sustainable.

Which sections of the Income-tax Act were involved?

Section 153C,Section 68,Section 69C,Section 132,Section 250,Section 153D,Section 292BC

AI-generated summary — verify with the full judgment below

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

For Appellant: Dr. Rakesh Gupta, Adv. and Shri Somil Agarwal, Adv
For Respondent: Ms. Ankush Kalra, Sr. DR
Pronounced: 07/04/2026

PER MANISH AGARWAL, AM: This appeal is filed by the assessee against order of Learned Commissioner of Income Tax (Appeals)-24, New Delhi dated 20.05.2025 u/s 250 of the Income Tax Act, 1961 (“the Act” in short) arising out of the assessment order passed u/s 153C of the Act dated 29.12.2022 for Assessment Year 2016-17. 2. Briefly stated the facts are that a search and seizure action u/s 132 of the Income Tax Act, 1961 was carried out in the case of Ashish Bhegwani Group of cases on 22.10.2016. During the course of search, it was found that he was providing accommodation entries through various concerns after charging commission to various beneficiaries and one of such beneficiary was the assessee company wh

The order continues below.

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