HIMALAYA INFRAVENTURE (P) LTD,DELHI vs. DCIT CENTRAL CIRCLE GHAZIABAD, GHAZIABAD

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ITSSA 7925/DEL/2025Status: DisposedITAT Delhi21 May 2026AY 2014-153 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 assessment proceedings initiated under Section 153C were not sustainable. The reasoning was based on the assessee's contention that the Assessing Officer had failed to record the requisite satisfaction as per the provisions of the Act. The Tribunal relied on the landmark decision of Saksham Commodities Ltd. Vs. ITO (2024) 464 ITR 1 (Delhi)(HC), which mandates that the Assessing Officer must record satisfaction that seized documents have a "bearing" on the determination of taxable income. Since this was not done in the assessee's case, the assessment was quashed. The ratio decidendi is that a failure to record the mandatory satisfaction under Section 153C renders the assessment invalid. All other pleadings were rendered academic. The operative direction was to quash the assessment.

What were the facts?

The assessee, Himalaya Infraventure (P) Ltd., has filed two appeals (IT(SS)A Nos. 7925 & 7926/Del/2025) against the orders of the Commissioner of Income Tax (Appeal)-3, Noida, dated 02.09.2025. These orders were passed under Section 153C of the Income Tax Act, 1961, for Assessment Years 2014-15 and 2015-16. The appeals arise from proceedings initiated following a search conducted in M/s Alankit Group of Companies on 18.10.2019. The Assessing Officer of the searched assessee recorded satisfaction on 21.06.2022, which was forwarded to the assessee's Assessing Officer, who then recorded his own satisfaction on 21.09.2023. The total amount in dispute is not explicitly stated.

What were the issues?

1. Whether the assessment proceedings initiated under Section 153C of the Income Tax Act, 1961, are valid, given the satisfaction recorded by the Assessing Officer. Assessee's Contention: The assessee argues that its Assessing Officer failed to record a categorical satisfaction that the seized documents had a "bearing" on the determination of its taxable income, which is a mandatory requirement as per the Delhi High Court's decision in Saksham Commodities Ltd. Vs. ITO (2024) 464 ITR 1. Revenue's Contention: The Revenue contends that the satisfaction note is valid, and the expression "bearing" need not be explicitly incorporated, as the relevant facts should be appreciated in totality of the circumstances.

Which sections of the Income-tax Act were involved?

Section 153C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: “E” NEW DELHI

Before: SHRI SATBEER SINGH GODARA & SHRI NAVEEN CHANDRA

For Appellant: Ms. Uma Upadhyay, CA
For Respondent: Ms. Amisha S Gupt, CIT DR
Hearing: 18.05.2026Pronounced: 18.05.2026

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: “E” NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER & SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER IT(SS)A Nos. 7925 & 7926/Del/2025 Assessment Year: 2014-15 & 2015-16 Vs. Deputy Himalaya Infraventure (P) Commissioner of Ltd. Income Tax C/o CA Vaibhav Goel Central Circle Ghaziabad 75, Navyug Market, First Income Tax Office, CGO Floor, Ghaziabad Complex-1 Ghaziabad, Uttar Pradesh- 201002 PAN: AAACH5174R (Appellant) (Respondent) Assessee by Sh. Ved Jain, Adv, Ms. Uma Upadhyay, CA Department by Ms. Amisha S Gupt, CIT DR

Date of hearing 18.05.2026 Date of pronouncement 18.05.2026

ORDER These assessee’s twin appeals; ITA 7925 & 7926/Del/2025, arise against the Commissioner of Income Tax (Appeal)-3 [in short, “CIT(A)”], Noida’s orders dated 02.09.2025, passed in DINs & Orders No. ITBA/APL/M/250/2025-26/1080271472(1) & ITBA/ APL/ M/ 250/2025-26/108271099(1), involving proceedings u/s 153C

ITA No. 7925 & 7926/Del/2025 of the Income Tax Act, 1961; hereinafter referred to as ‘the Act’. Heard both the parties. Case files perused.

2.

It transpires during the course of haring that the assessee raises its first and foremost legal ground challenging validity of the impugned section 153C assessments dated 18.03.2024 itself. We make it clear that the learned departmental authorities had carried out the search in question in M/s Alankit Group of Companies on 18.10.2019. And that the learned Assessing Officer of the said searched assessee recorded his satisfaction on 21.06.2022; which, in turn, was forwarded to the assessee’s Assessing Officer followed by his latter round of satisfaction recorded on 21.09.2023 (pages 45 to 47 in the papaerbook).

3.

The assessee’s vehement contention in this factual backdrop is that its learned Assessing Officer has failed to record any categoric satisfaction that the alleged seized documents forming basis to proceed in its case had a “bearing” on determination of its taxable income which forms a mandatory provision as per Saksham Commodities Ltd. Vs. ITO (2024) 464 ITR 1 (Delhi)(HC).

4.

The Revenue’s vehemently supports the impugned satisfaction note that such an expression need not be explicitly 2 | P a g e

ITA No. 7925 & 7926/Del/2025 incorporated therein as we ought to appreciate the relevant facts in totality of circumstances.

5.

We have given our thoughtful consideration to the assessee and the revenue’s vehement submissions. We are of the considered view that once the learned Assessing Officer has failed to record his section 153C satisfaction in the assessee’s case as per provisions of the Act in preceding terms, the assessment herein is not sustainable as per their lordships aforesaid landmark decision. Quashed accordingly. All other pleadings between the parties stand rendered academic. 6. These assessee’s twin appeals ITA No. 7925 & 7926/Del/2025 are allowed. A copy of this common order be placed in respective case files.

Order pronounced in the open court on 18.05.2026.

Sd/- Sd/- (NAVEEN CHANDRA) (SATBEER SINGH GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 21.05.2026 Pooja Mittal/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi 3 | P a g e

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