CHAWLA ASSOCIATES,DEHRADUN vs. ACIT, C C HALDWANI, HALDWANI

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ITA 43/DDN/2026Status: DisposedITAT Dehradun26 May 2026AY 2015-164 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 held that the Section 153C satisfaction recorded by the Assessing Officer was invalid as it did not specify that the seized material had a bearing on the determination of taxable income. Furthermore, the common Section 153D approval was also found to be invalid.

What were the facts?

The assessee's appeals concerned assessments made under Section 153C read with Section 143(3) of the Income Tax Act for assessment years 2013-14 to 2017-18. The core issues revolved around the validity of the Section 153C satisfaction and the Section 153D approval.

What were the issues?

The primary issues were the validity of the satisfaction recorded for initiating proceedings under Section 153C and the validity of the common approval granted under Section 153D for the assessments.

Which sections of the Income-tax Act were involved?

Section 153C,Section 143(3),Section 153D

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DEHRADUN BENCH “SMC”, DEHRADUN

Before: SHRI SATBEER SINGH GODARA & SHRI MANISH AGARWAL

For Respondent: Ms. Poonam Sharma, CIT(DR)
Hearing: 25.05.2026Pronounced: 25.05.2026

PER SATBEER SINGH GODARA, JM: These assessee’s five appeals ITA Nos.26, 25, 219 & 218/DDN/2024 & 43/DDN/2026 for assessment years 2013-14 to 2017-18, arise against the Commissioner of Income Tax (Appeals) [in short, the “CIT(A)”], Lucknow’s -3 orders dated 31.01.2024, 09.02.2024, 26.12.2025 and 08.11.2024 (in AYs 2016-17 & 2017- 18) having DINs and orders no. ITBA/APL/S/250/2023-

ITA No.26, 25, 219 & 218/DDN/2024 & 43/DDN/2026

24/1060332213(1), ITBA/APL/S/250/2023-24/1060724499(1), ITBA/APL/S/250/2025-26/1084121228(1), ITBA/APL/S/250/ 2024-25/1070214952(1) and ITBA/APL/S/250/2024- 25/1070215539(1), involving proceedings under section 153C r.w.s. 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’). Heard both the parties at length. Case files perused. 2. We notice at the outset that there arise the twin issues of validity of all these section 153C r.w.s. 143(3) assessments itself for want of valid satisfaction(s) as well as the corresponding section 153D approval(s) herein. 3. Suffice to say, learned CIT(A) has declined the assessee’s challenge of validity of all these identical assessments in his lower appellate discussion under challenge forming subject matter of adjudication before us. That being the identical factual position, learned counsel representing assessee not only takes us to the Assessing Officer’s section 153C satisfaction; a common one recorded on 26.09.2018, nowhere indicating as to whether the corresponding material found/seized in the departmental search action dated 8th/9th March, 2017 in M/s. Alliedplus Infra and Ors.

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ITA No.26, 25, 219 & 218/DDN/2024 & 43/DDN/2026

Pvt. Ltd. and other groups carried a “bearing” on determination of the total taxable income but also the prescribed authority herein had granted a common section 153D approval on 26.12.2019 for assessment years 2013-14, 2015-16, 2016-17 to 2017-18; as the case may be. 4. The Revenue vehemently supports the learned lower authorities’ action on both these counts. Learned CIT (DR)’s case accordingly is that we ought to go by the substantive compliance than adopting a narrow approach in such an instance. We find no merit in the Revenue’s stand herein qua both the foregoing issues. Case law Saksham Commodities Ltd. Vs. ITO (2024) 464 ITR 1 (Delhi)(HC) has already decided the issue in assessee’s favour and against the department that any satisfaction(s) ought to be recorded by latter Assessing Officer under section 153C of the Act must incorporate therein that the seized material in question carries a “bearing” on determination of taxable income and failure thereof indeed vitiates the same. Various case law(s) PCIT Vs. Shiv Kumar Nayyar (2024) 467 ITR 186 (Del.), PCIT Vs. Anuj Bansal (2024) 466 ITR 254 (SC) and PCIT Vs. MDLR Hotels (P.) Ltd. (2024) 166 taxmann.com 327 (Del.) have also held that such an

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ITA No.26, 25, 219 & 218/DDN/2024 & 43/DDN/2026

assessment passed on common 153D approval are non-est once in the eyes of law. The same stands quashed in very terms therefore. All other remaining pleadings between the parties stand rendered academic. 5. These assessee’s five appeals ITA Nos.26, 25, 219 & 218/DDN/2024 & 43/DDN/2026 are allowed. A copy of this common order be placed in the respective case files. Order pronounced in the open court on 25th May, 2026 Sd/- Sd/- (MANISH AGARWAL) (SATBEER SINGH GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 26th May, 2026. RK/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi

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