M/S. DEEPAK PURSHOTTAM SHAH (HUF),MUMBAI vs. ACIT, CENTRAL CIRCLE -2, THANE

आयकर अपीलीय अधिकरण, म ुंबई पीठें, म ुंबई INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, MUMBAI BENCH: D BEFORE SMT. BEENA PILLAI, HON’BLE JUDICIAL MEMBER AND SHRI ARUN KHODPIA, HON’BLE ACCOUNTANT MEMBER ITA 7352/MUM/2025 (निर्धारण वर्ा/Assessment Year: 2009-10) M/S. DEEPAK PURSHOTTAM ACIT, CENTRAL CIRCLE -2 SHAH (HUF) 6TH FLOOR, A WING ASHAR DEEP DARSHAN BUNGLOW IT PART, ROAD, NO 16Z CROSS NAKA BHANDARWADA WAGLE INDUSTRIAL Vs. AGASHI VIRAR (WEST), ESTATE , THANE MUMBAI-401303, MUMBAI-400604, MAHARASHTRA MAHARASHTRA अपीलधर्थी Appellant प्रत्यर्थी Respondent

Permanent Account Number of AADHD5651B Assessee:

अपीलधर्थी द्वारा/Appellant represented Shri Sanjiv Brahma & Jayant by: R. Bhatt, ARs प्रत्यर्थी द्वारा/Respondent represented by: Shri Sandeep Lakra CIT DR. सुनवाई की तारीख / Date of conclusion of hearing: 21-Jul-2026 घोषणा की तारीख / Date of pronouncement: 25-09-2026 आदेश / ORDER PER SMT. BEENA PILLAI, JUDICIAL MEMBER: Present appeal is filed by the assessee against the order dated 15/09/2025 passed by the Ld. Commissioner of Income Tax (Appeals), Pune–11 [“Ld. CIT(A)”] u/s. 250 of the Income-tax Act, 1961 (“the Act”) for A.Y. 2009-10.

“1.0 On the facts and in the circumstances of the case, and in law, the order of the Ld. CIT(A) is bad in law on various grounds, and in equity and the same should be annulled or set aside. 1

ITA 7352/MUM/2025 M/S. DEEPAK PURSHOTTAM SHAH (HUF) 2.0 On the facts and in the circumstances of the case and in law, the order of the CIT(A) erred in confirming the assessment order passed u/s.143(3) r.w.s.254 r.w.s.153C of the Income-tax Act, 1961 without appreciating the fact that the assessment was completed without valid jurisdiction in absence of ‘Satisfaction Note’ recorded by the Assessing Officer of the searched person which is pre-requisite to assessment u/s.153C of the Act and same must be prepared by Assessing Officer of the searched person before the handover of the records to the assessee’s Assessing Officer who has jurisdiction over assessee. 3.On the facts and in circumstances of the case and in law, the order of the CIT(A) erred in confirming the assessment order passed u/s.143(3) r.w.s.254 r.w.s.153C of the Income-tax Act, 1961 without appreciating the fact that the assessment was completed without valid jurisdiction as no specific satisfaction note was recorded for A.Y.2009-10 by the Ld. AO. 4.On the facts and in the circumstances of the case and in law, the order of the CIT(A) erred in confirming the assessment order passed u/s.143(3) r.w.s.254 r.w.s.153C of the Income-tax Act, 1961 without appreciating that the satisfaction was recorded for six assessment years without quantifying the escapement of income for each assessment year as mandated by the Income-tax Act, 1961. 5.0 On the facts and in the circumstances of the case and in law, the order of the CIT(A) erred in confirming the assessment order passed u/s.143(3) r.w.s.254 r.w.s.153C of the Income-tax Act, 1961 without appreciating the fact that the assessment made by the Ld. AO u/s.153C of the Act was beyond jurisdiction as no incriminating material was found during the course of search action u/s.132 of the Act in case of Swastik Group with respect to the addition made by the Ld. AO in hands of the assessee. 6.0 On the facts and in the circumstances of the case and in law, the order of the CIT(A) erred in confirming the assessment order passed u/s.143(3) r.w.s.254 r.w.s.153C of the Income-tax Act, 1961 without appreciating that the assessment order was passed without mentioning the Document Identification Number (DIN) which makes the order invalid as per CBDT Circular No.19/2019 dated 14.08.2019. 7.0 On the facts and in the circumstances of the case and in law, the order of the learned Commissioner of Income-tax confirming the assessment order passed u/s.143(3) r.w.s.254 r.w.s.153C of the Income-tax Act, 1961, solely citing non-prosecution, without independent examination of facts, seized material or computation, thereby rendering the order per incuriam and violative of natural justice. 8.0 On the facts and in the circumstances of the case and in law, the order of the CIT(A) erred in confirming the addition made by the Assessing Officer amounting to Rs.14,80,00,000/- as undisclosed income in form of profit in respect of sale of land to Tata Housing Development Co. Limited disregarding the fact of the case and merely based on the search proceeding and Investigation Wing report.

ITA 7352/MUM/2025 M/S. DEEPAK PURSHOTTAM SHAH (HUF) 9.0 On the facts and in the circumstances of the case and in law, the order of the CIT(A) erred in confirming the addition made by the Assessing Officer amounting to Rs.14,80,00,000/- as income of the appellant without there being any incriminating material or either corresponding cash or unexplained assets to show that the appellant had ever indeed received such income and hence the same should be deleted. 10.0 The appellant craves to add, alter, classify, reclassify, delete or modify any of the above grounds of appeal and requests to consider each of the above grounds without prejudice to one another.” 2.1. The assessee has further filed the following additional grounds of appeal dated 12/07/2026:

“1. Under the fact and circumstances of the case and in law order passed by the Assessing Officer in absence of assumption of valid jurisdiction on various counts and so also in the absence separate satisfaction notes the order being bad in law, the same be declared null and void. 2. In the instant case hearing was held on 16.06.2026 where it was pointed out to the honourable bench that the order passed by the Assessing Officer on the basis of common consolidate satisfaction note as against individual separate satisfaction for each year being bad in law the order passed therefore being bad in law the same should be annulled. 3. Since the grounds of appeal on legal ground were all being asked to raise additional ground. In view of the same we are submitting an additional ground as above and request your honour to admit the same and deal with it. 4. Since this ground being Legal ground where all the facts were available on record the same may please be admitted and deliberated. In this regards reliance is placed on the judgement of Supreme Court in case of NTPC Limited reported in 229 ITR 383. 5. Under the fact and circumstances of the case and in law order passed by the Assessing Officer in absence of assumption of valid jurisdiction on various counts being bad in law, the same should be annulled. 6. Under the facts and circumstances of the case and in law order passed by the Assessing Officer on the basis of Common consolidated Satisfaction note as against individual separate satisfaction note issued for the year under consideration being bad in law the same should be annulled. 7. We are also relying on the following judgements which were already quoted by my AR and the printouts were handed over in the last hearing, the copies are once again enclosed herewith: Shri Rajendra Rameshlal Gugale Vs. Pr. CIT

ITA 7352/MUM/2025 M/S. DEEPAK PURSHOTTAM SHAH (HUF) ITA No.1676/PUN/2024, Pune ITAT Order dated 30.12.2024 Supreme Court of India DCIT Vs. Sunil Kumar Sharma – 168 Taxman.com 77 (2024) The Thrust Of the Judgements is as under: Consolidated Notes Vitiate Proceedings: The court held that the Assessing Officer must record a separate, year-specific satisfaction note for each individual assessment year. Merging them into one overarching note is a fatal procedural flaw that invalidates the entire assessment process.” 2.2. The additional grounds challenge the very assumption of jurisdiction u/s.153C and arise from the satisfaction note and material already forming part of the assessment record. No fresh investigation of facts is necessary for their adjudication. The Hon’ble Supreme Court in NTPC Ltd. v. CIT, (1998) 229 ITR 383 (SC) has held that a legal ground arising from facts already available on record can be raised before the Tribunal. We accordingly admit the additional grounds and proceed to adjudicate the jurisdictional issue along with Grounds Nos.2 to 5 of the original grounds.

A search action u/s.132 was carried out in the case of Swastik Group on 31/07/2014. The assessee is stated to be a partner in various concerns of the said group. The assessee filed its return of income for A.Y.2009-10 on 21/12/2010 declaring total income of Rs.85,36,940/-. Pursuant to the search, proceedings u/s.153C were initiated and assessment was originally completed making various additions. In the first round of appellate proceedings, the matter travelled before this Tribunal in ITA No.7011/Mum/2017 and connected appeals and, vide order dated 28/11/2018, the matter was restored for fresh adjudication.

ITA 7352/MUM/2025 M/S. DEEPAK PURSHOTTAM SHAH (HUF) 3.1. Pursuant thereto, the Ld.AO passed the assessment order dated 30/12/2019 u/s.143(3) r.w.s.254 r.w.s.153C of the Act, whereby an addition of Rs.14,80,00,000/- was made as alleged profit arising from sale of land to Tata Housing Development Co. Ltd.

Aggrieved by the order of the Ld.AO the assessee preferred appeal before Ld.CIT(A).

Aggrieved by the order of the Ld.CIT(A) the assessee is in appeal before us.

5.1. He further submitted that the very same satisfaction note has already been considered by the Coordinate Bench in assessee’s own case for A.Ys.2012-13 and 2013-14 in ITA Nos.5591 & 5593/Mum/2024, order dated 01/09/2025, wherein it has been categorically held that the documents at pages 206 and 208 of

ITA 7352/MUM/2025 M/S. DEEPAK PURSHOTTAM SHAH (HUF) Bundle No.13 pertain to F.Y.2010-11 corresponding to A.Y.2011- 12. Reliance was also placed on the following decisions:-

 CIT v. Sinhgad Technical Education Society, reported in (2017) 397 ITR 344 (SC);  PCIT v. Abhisar Buildwell (P.) Ltd., reported in (2023) 454 ITR 212 (SC);  DCIT v. U.K. Paints (Overseas) Ltd., reported in (2023) 454 ITR 441 (SC);  Ashok Commercial Enterprises v. ACIT, reported in (2023) 459 ITR 100 (Bom.); and  Saksham Commodities Ltd. v. ITO, reported in (2024) 464 ITR 1 (Del.). 5.2. The Ld. DR, on the contrary, relied upon the orders passed by the authorities below and submitted that there was sufficient material for initiation of proceedings u/s.153C.

We have perused the submissions advanced by both sides in light of the record placed before us.

ITA 7352/MUM/2025 M/S. DEEPAK PURSHOTTAM SHAH (HUF) 6.1. He submitted that, the very same satisfaction note dated 02/02/2015 has been examined by the Coordinate Bench in assessee’s own case in ITA Nos.5591 & 5593/Mum/2024 for A.Ys.2012-13 and 2013-14, order dated 01/09/2025. The Coordinate Bench specifically noticed that the satisfaction note covered A.Ys.2009-10 to 2014-15; that the documents referred therein were pages 206 and 208 of Bundle No.13 relating to the land transaction with Tata Housing Development Co. Ltd.; and that the said documents pertained to F.Y.2010-11 corresponding to A.Y.2011-12. The Coordinate Bench therefore held that the documents forming the basis of the satisfaction could not sustain proceedings for A.Ys.2012-13 and 2013-14. He referred to following observations from the order passed by this Tribunal in assessee’s own case for assessment year 2012-13 and 2013-14(supra) that read as under:

“(i) The Satisfaction Note has been recorded as a combined note covering AY’s 2009-10 to 2014-15, rather than recording separate Satisfaction Notes for each of the six assessment years in the case of the assessee. (ii) The AO’s satisfaction note refers only to documents in Bundle No.13, specifically pages 206 and 208, which relate to a land sale transaction with Tata Housing Development Co. Ltd. (iii) The documents in question pertain to FY 2010-11, corresponding to AY 2011-12. Therefore, the proposed addition under the said Satisfaction Note relates to AY 2011-12 and not to the years under consideration, i.e., AY 2012-13 and AY 2013-14.” 6.2. The Coordinate Bench thereafter recorded that no satisfaction connected the seized documents with the assessment years then under consideration and held the proceedings to be invalid. The aforesaid factual finding squarely applies to the year before us. Once it has already been found in assessee’s own case that pages 206 and 208 of Bundle No.13 pertain to F.Y.2010-11/A.Y.2011-12, 7

ITA 7352/MUM/2025 M/S. DEEPAK PURSHOTTAM SHAH (HUF) the same material cannot constitute incriminating material for A.Y.2009-10.

6.3. This legal position is also supported by the decision of Hon’ble Supreme Court in case of CIT v. Sinhgad Technical Education Society, (supra), wherein Hon’ble Court approved the proposition that the seized material relied for assumption of jurisdiction u/s.153C must have a document-wise correlation with the assessment year sought to be assessed and that such correlation constitutes a jurisdictional fact.

6.4. Further, it is noted that in PCIT v. Abhisar Buildwell (P.) Ltd. (supra), Hon’ble Supreme Court held that, in respect of completed/unabated assessments, no addition can be made in search assessment proceedings in the absence of incriminating material found during the course of search. The same principle in the specific context of assessments u/s.153C stands reiterated in DCIT v. U.K. Paints (Overseas) Ltd. (supra), wherein assessments u/s.153C were held unsustainable where no incriminating material was found during search either from the assessee or from a third party.

6.5. We also find support from the decision of the Hon’ble Bombay High Court in case of Ashok Commercial Enterprises v. ACIT, (supra), wherein it was held that, existence of incriminating material for assumption of jurisdiction u/s.153C has to be tested from the satisfaction note itself and the Revenue cannot subsequently augment, supplement or improve upon the satisfaction so recorded. The Coordinate Bench in assessee’s own case relied on the said decision while considering this very satisfaction note. Similarly, the Hon’ble Delhi High Court in Saksham Commodities 8

ITA 7352/MUM/2025 M/S. DEEPAK PURSHOTTAM SHAH (HUF) Ltd. v. ITO, reported in (2024) 464 ITR 1 held that proceedings u/s.153C cannot be sustained for assessment years in respect of which no incriminating material has been gathered and the satisfaction note does not show how the material discovered has a bearing upon determination of total income of the concerned assessment year.

6.6. Applying the above principles to the facts before us, we find that the satisfaction note contains no reference to any seized material relatable to A.Y.2009-10. The only documents referred therein, namely pages 206 and 208 of Bundle No.13, have already been held by the Coordinate Bench in assessee’s own case to pertain to F.Y.2010-11 corresponding to A.Y.2011-12. The year under consideration was also a completed/unabated assessment and, in the absence of any incriminating material pertaining to this year, the concluded assessment could not have been disturbed in proceedings u/s.153C.

6.7. In view of the foregoing discussion, respectfully following the decision of the Coordinate Bench in assessee’s own case in ITA Nos.5591 & 5593/Mum/2024 and the ratio laid down by the Hon’ble Supreme Court in Sinhgad Technical Education Society (supra), Abhisar Buildwell (P.) Ltd. (supra) and U.K. Paints (Overseas) Ltd. (supra), read with the decision of the Hon’ble Jurisdictional High Court in Ashok Commercial Enterprises (supra), we hold that assumption of jurisdiction u/s.153C for A.Y.2009-10 cannot be sustained. Accordingly, the assessment order dated 30/12/2019 passed u/s.143(3) r.w.s.254 r.w.s.153C of the Act is hereby quashed.

ITA 7352/MUM/2025 M/S. DEEPAK PURSHOTTAM SHAH (HUF) Accordingly, Grounds Nos. 5 raised by the assessee stands allowed.

In the result, the appeal filed by the assessee stands allowed.

Order pronounced in the open court on 25-09-2026.

Sd/- Sd/- ARUN KHODPIA BEENA PILLAI ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai Dated: 25-09-2026 Shamik, Sr. P.S.

ITA 7352/MUM/2025 M/S. DEEPAK PURSHOTTAM SHAH (HUF) Copy to: M/S. DEEPAK PURSHOTTAM SHAH (HUF), DEEP DARSHAN BUNGLOW CROSS 1 NAKA BHANDARWADA AGASHI VIRAR (WEST), MUMBAI-401303, MAHARASHTRA ACIT, CENTRAL CIRCLE -2, 6TH FLOOR, A WING ASHAR IT PART, 2 ROAD, NO 16Z WAGLE INDUSTRIAL ESTATE , THANE, MUMBAI-400604, MAHARASHTRA 3 THE PCIT / CIT, 4 THE D.R., ITAT, MUMBAI BENCH 5 GUARD FILE TRUE COPY

ASSISTANT REGISTRAR / SR. PRIVATE SECRETARY I.T.A.T., MUMBAI