KISHOR KUMAR AGGARWAL,GURGAON vs. ACIT-CENTRAL CIRCLE-30,DELHI, DELHI

ITA 2304/DEL/2026Status: DisposedITAT Delhi07 October 2026AY 2019-209 pages
AI SummaryAllowed

What were the facts?

The assessee, Kishor Kumar Aggarwal, filed appeals for Assessment Years (AY) 2019-20 and 2020-21 against orders of the CIT(A)-30, New Delhi. These orders confirmed additions made by the Assessing Officer (AO) through assessment orders dated 29.03.2024, passed under section 153C of the Income Tax Act, 1961. The appeals were partly allowed by the CIT(A). The original search was conducted on 26.10.2020 on Sanjay Jain and other entities. The AO of the searched person recorded satisfaction on 19.06.2023. The assessee's AO initiated proceedings under section 153C by issuing a notice. The seized documents were received by the assessee's AO on 17.11.2022. The assessee contended that the proceedings under section 153C were vitiated and should have been under section 147.

What did the Tribunal hold?

The Tribunal held that the assessment year 2019-20 falls outside the scope of section 153C as amended. The date of search for unsearched persons is determined by when documents are handed over or satisfaction is recorded. In this case, the original search was on 26.10.2020, but the satisfaction was recorded later. The Tribunal, following the Delhi High Court in PCIT vs. Ojjus Medicare (P.) Ltd. (2024), held that the date of handing over of searched material for recording satisfaction is crucial. Since the documents were received by the assessee's AO on 17.11.2022, the year of search for the assessee would be AY 2023-24. Consequently, the amended provisions of section 153C(3) of the Act, which state that section 153C shall not apply to searches initiated on or after 01.04.2021, would be applicable. The Tribunal also referred to a coordinate bench decision in Lekh Raj vs. DCIT (2026) with identical facts. Therefore, the notice under section 153C and the subsequent assessment order were held to be unsustainable and liable to be quashed on jurisdictional grounds. The reassessment proceedings should have been adopted under section 147 read with section 148. The appeal of the assessee was allowed on this ground. Other grounds were not adjudicated and were kept open. The decision for AY 2019-20 was applied mutatis mutandis to AY 2020-21.

What were the issues?

1. Whether, on the facts and circumstances of the case and in law, the CIT(A) erred in confirming proceedings initiated under section 153C, failing to consider that for a non-searched person, the search year is governed by the date the seized documents are handed over to the jurisdictional AO, and consequently, whether proceedings under section 147 should have been initiated instead of section 153C, thus vitiating the assessment. This issue turns on the interpretation of Section 153C and Section 147 of the Income Tax Act, 1961. Assessee's Contention: The AO initiated proceedings under section 153C based on a satisfaction note dated 19.06.2023. However, the seized documents were received by the assessee's AO on 17.11.2022. As per amended Section 153C(3), proceedings under section 153C cannot be initiated if the search date falls after 01.04.2021. Therefore, proceedings should have been initiated under section 147, making the section 153C assessment liable to be quashed. Reliance was placed on the decision in PCIT vs. Ojjus Medicare (P.) Ltd. (2024) and Lekh Raj vs. DCIT (2026). Revenue's Contention: The ld. DR relied on the orders of the authorities below.

Which sections of the Income-tax Act were involved?

Section 153C,Section 147,Section 148,Section 153C(3),Section 132,Section 132A,Section 127,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘C’, NEW DELHI

Before: Sh. S. Rifaur Rahman & Sh. Raj Kumar Chauhan

Hearing: 24.09.2026Pronounced: 07.10.2026

Heard together (2 matters)

ITA No. 2304/Del/2026
ITA No. 2305/Del/2026

Read from the judgment's own cause title. This page is filed under one of them.

Per Raj Kumar Chauhan, Judicial Member:

These appeals of the assessee are directed against the orders, both dated 27.02.2026 of ld. CIT(A)-30, New Delhi passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) wherein addition made vide assessment order dated 29.03.2024 was confirmed and the appeals of the assessee were partly allowed.

2.

By this common order, we propose to decide the ITA Nos. 2304 & 2305/Del/2026 as the parties are same and factual matrix is also same and in order to avoid multiplicity of decision, the same are being disposed off accordingly. ITA

The order continues below.

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