DCIT CC 2 2 , CHENNAI, CHENNAI vs. SOUTHERN AGRIFURANE INDUSTRIES PVT LTD, CHENNAI

आयकर अपीलीय अिधकरण, ’सी’ ायपीठ, चेई।
IN THE INCOME TAX APPELLATE TRIBUNAL
‘C’ BENCH: CHENNAI

ी एबी टी. वक
, ाियक सद एवं
एवं
एवं
एवं
ी अिमताभ शुा, लेखा सद के सम

BEFORE SHRI ABY T. VARKEY, JUDICIAL MEMBER AND SHRI AMITABH SHUKLA, ACCOUNTANT MEMBER

आयकरअपीलसं./ITA Nos. 1254, 1255, 1258, 1260/Chny/2025
िनधारणवष/Assessment Years: 2014-15 to 2017-18

The DCIT,
Central Circle-2(2),
Chennai.

v.
M/s. Southern Agrifurane –
Industries Pvt Ltd.,
MGM Centre No.1,
9th Cross Street,
Dr. Radhakrishnan Salai,
Mylapore,
Chennai – 600 004. [PAN: AAGCS 9705 F]
(अपीलाथ/Appellant)

(यथ/Respondent)

आयकरअपीलसं./ITA Nos.1233, 1235, 1237, 1238 /Chny/2025
िनधारणवष/Assessment Years: 2014-15 to 2017-18
M/s. Southern Agrifurane-
Industries Pvt Ltd
MGM Centre No.1,
9th Cross Street,
Dr. Radhakrishnan Salai, Mylapore,
Chennai – 600 004. v.
The DCIT,
Central Circle-2(2),
Chennai.

[PAN: AAGCS 9705 F]

(अपीलाथ/Appellant)

(यथ/Respondent)

Department by :
Mrs. C. Yamuna, CIT &
Mr. Bipin, CIT
Assessee by :
Mr. N. Arjun Raj, Advocate
सुनवाईकतार ख/Date of Hearing
:
08.10.2025
घोषणाकतार ख /Date of Pronouncement
:
21.11.2025

PER ABY T. VARKEY

These appeals p against the orders of th
19, (hereinafter referred for the Assessment Ye
2017-18 u/s. 250 of the ‘the Act‘).
2. Before we advert first be relevant to cull brief in respect of these the assessee is a priv business of manufactur u/s 132 of the Act was AY 2020-21. As a seque
Crystal Bottles located
According to the Reven course of search at M/s the assessee viz., M/s.
of the assessee by raisi and that the payment
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 2 ::

आदेश / O R D E R
Y, JM:
referred by the assessee and the e Learned Commissioner of Income d to as ‘Ld.CIT(A)‘), Chennai, all dat ears(hereinafter referred to as ‘AY e Income Tax Act, 1961 (hereinafte t to the grounds taken in these ap out the basic facts of the case and e AYs. Briefly stated, the facts of the vate limited company which is e ing and sale of Indian made foreign conducted against SNJ Group on 06
el to this search, the business premi d at Coimbatore was also subjec nue, the seized material which wa s Crystal Bottles contained informa
Crystal Bottles had facilitated inflati ing bogus invoices for supplying old s received by M/s. Crystal Bottle

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
e Revenue are Tax (Appeals)- ted 21.02.2025
Y‘) 2014-15 to r referred to as ppeals, it would effect of law in e case are that, ngaged in the n liquor. Search
6.08.2019, i.e., ses of one M/s.
ted to search.
as found in the tion relating to ion of expenses d empty bottles s against such bogus invoices was retu their commission @ 6%
handed over to the AO satisfaction note was re
23; and on the same da the assessee for AYs 20
having regard to the d juri iction to issue n assessment years prec present case search too
153C of the Act to reop searched assessment y
It is not in dispute that the impugned AYs 20
143(1)/143(3) of the A 143(2) of the Act had e for AYs 2014-15 to 20
search, therefore, those the issue of notice u/s 1
2017-18, the AO is assessments u/s.153C/
after making addition(s
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 3 ::

urned back to the assessee in cash
% on the bogus bill value. The seize
O of the assessee on 18-06-2021
ecorded by the AO on 24-06-2021
ate, notice(s) u/s 153C of the Act w
014-15 to 2019-20. According to the ate of search i.e. 06-08-2019, he notices u/s 153C of the Act in ceding the assessment year of sea ok place, so, ordinarily the AO was e pen six preceding assessment years ear and those AY's were AYs2014- t, the income-tax assessments of th
014-15 to 2017-18 were either
Act and/or the time limit for issue expired. Accordingly, the income-ta
17-18 weren’t pending before AO e years didn’t abate consequent to t
153C of the Act for these unabated A noted to have completed all t
/143(3) of the Act by orders dat s) on account of bogus purchases.

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
after deducting ed material was 1 and then the i.e., AY 2022- was issued upon e AO, ordinarily was within his respect of six arch i.e. in the empowered u/s.
s preceding the 15 to 2019-20. he assessee for completed u/s e of notice u/s ax assessments on the date of he search. Post
AYs 2014-15 to he income-tax ted 28.03.2023
Apart from the foregoing, the AO is als on account of deductio
14A of the Act and disal
3. Aggrieved by the appeal before the Ld. C the validity of the notic
Taking into account the CIT(A) observed that, t
AYs only contained re relating to the AY(s) 2
didn’t contain any me material in relation to decision of the Hon’ble
Education Society (39
there was evidently n incriminating material fo
2017-18 prior to issuan the notices issued u/s 1
in law. The Ld. CIT(A 143(3)/153C of the Act initio void. Additionally
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 4 ::

so noted to have made addition(s)/
on(s) claimed u/s 80G / 80GGB, di llowance of certain items of expense above order(s) of the AO, the asse
CIT(A). The assessee is noted to h ces issued u/s 153C of the Act on e submissions put forth by the ass the satisfaction note recorded by th eference to existence of incrimin
018-19 & 2019-20 and that the sa ention about the existence of any AY(s) 2014-15 to 2017-18. Re e Apex Court in the case of Sinhg
97 ITR 344), the Ld. CIT(A) there no nexus made out by the AO ound as a result of search with the A nce of notice u/s 153C of the Act a 153C of the Act for these AYs were A) accordingly quashed the orde t for AY(s) 2014-15 to 2017-18 hold
, while deciding the appeals for A , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
disallowance(s) isallowance u/s es.
essee preferred have challenged several fronts.
sessee, the Ld.
he AO for these nating material atisfaction note y incriminating lying upon the gad Technical efore held that,
O between the AYs 2014-15 to and accordingly held to be bad ers passed u/s ding it to be ab
AYs 2014-15 to 2015-16, the Ld. CIT(A the period of six (6) a which was to be deeme over by the AO of searc
2021 (AY 2022-23) and have lawfully issued no possession, any incrim represented in the form escaped assessment. A defined in Explanation concluded that there wa in the satisfaction note
153C of the Act and a 153C of the Act for AYs as well.
4. Being aggrieved b
Revenue and the asses satisfaction note record making addition(s) on a all the AYs 2014-15 to have also argued the ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 5 ::

A) held that the notices for these A assessment years preceding the y ed to be the year in which the book ched person to the AO of the assess d therefore the Ld. CIT(A) held tha otice u/s 153C of the Act only when minating material, which revealed m of ‘asset’ valued at Rs.50,00,000/
fter analyzing the definition of the (2) to Section 153A of the Act, as no such unexplained asset ident e for him to have validly assumed accordingly, held the initiation of p
2014-15 & 2015-16 to be bad in la by the above order(s) of the Ld. CI ssee are in appeal before us. It is ded by the AO and the reasoning gi account of bogus purchases were i o 2017-18 impugned before us. Bo ese appeals together. Hence, for , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
AYs was beyond year of search, ks were handed see i.e., 14-06- at the AO could n he had in his d that income
/- or more had term ‘asset’ as the Ld. CIT(A) tified by the AO juri iction u/s proceedings u/s w on this count
IT(A), both the noted that the iven by him for identical across oth the parties r the sake of convenience, and to avo each of the common iss legal issue(s) which was the validity to exercise both the parties, we con
5. We first take up t for AY 2014-15 as the mutatis mutandis apply
6. Assailing the actio proceedings initiated un
2017-18 by way of s contained sufficient refe course of search. Accord search, though related t inherent link with the im the Ld. CIT(A) had gro invalid. The Ld. CIT, DR have been validly initia
AYs 2014-15 to AY 2019
be 06-08-2019, in ligh
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 6 ::

oid repetition of facts; we deem it f ues across these AYs before us toge s adjudicated by the Ld. CIT(A) goe juri iction over the assessee, with nsider it fit to decide the legal issue( the Revenue’s appeal in ITA No. 12
e lead case. Our decision for AY to other AYs 2015-16 to 2017-18 a on of Ld. CIT(A), the Ld. CIT, DR, a nder Section 153C of the Act for A satisfaction notes were valid in a erence to the incriminating materia ding to her, the information unearth to AYs 2018-19, 2019-20 & 2020-2
mpugned AYs as well. She therefore ossly erred in holding the satisfact
R further submitted that, the procee ated for the preceding six assessm
9-20, by taking the reference of ‘da t of the amendment brought in Se

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
fit to adjudicate ether. Since the es to the root of the consent of (s) first.
254/Chny/2025
2014-15 shall s well.
rgued that, the AYs 2014-15 to as much as it al found in the hed in course of 1, but it had an contended that tion note to be edings u/s 153C ment years viz., ate of search’ to ection 153C by Finance Act, 2017.In t
Jasjit Singh [2023] SC
7. Per contra, the Ld the Ld. CIT(A). On the the Act, he took us thro and pointed out that incriminating material r only to AYs 2018-19 to of existence of any inc and therefore, accord incriminating material correlation of seized satisfaction note and th
Act to be invalid as it Supreme Court in the Society (supra).
8. The Ld. AR furt actually 7th and 8th ye had not validly invoked read with Section 153C to the Ld. AR, the refere
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 7 ::

his regard, she relied on the deci
CC Online SC 1265. d. Counsel for the assessee, support validity of the impugned proceedin ough the contents of the common s the AO had clearly spoken the received from the AO of searched
2020-21. He submitted that, there criminating material qua AYs 2014- ding to him in absence of refe found relating to these AYs and material, the Ld. CIT(A) had rig he consequent issue of notice(s) u t didn’t meet the criteria laid do case of CIT Vs Singhad Techni her urged that, AYs 2014-15 &
ear preceding the date of search an the powers under fourth proviso t of the Act to cover the extended pe ence to date of search, for the purp

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
sion of CIT v.
ted the order of ngs u/s 153C of atisfaction note erein that, the person related was no whisper
-15 to 2017-18
erence to any the year-wise ghtly held the /s 153C of the wn by Hon'ble cal Education
2015-16 were nd that, the AO o Section 153A eriod. According poses of Section 153C, ought to be the recording of satisfaction search i.e., 06-08-2019
Tribunal in the case of Nos. 797 & 798/Chn the Ld. CIT(A) on this a 9. We have heard b before us. We first tak
2015-16 viz., whether period or did these AYs
Explanation (2) to Secti had validly initiated issu proviso to Section 153A
15 & 2015-16 before us search had been condu on 06-08-2019 i.e., in A material relating to th searched person to the ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 8 ::

date of handing over of the seized n note i.e. 14-06-2021 and not the 9;for the purposes of Section 153C o mendment made by the Finance Act ision rendered by the Hon'ble Delh
Ojjus Medicare (P) Ltd. (465 ITR
M/s KSJ Infrastructure Pvt Ltd ny/2024) in support of the finding spect.
both the parties and perused the m ke up the common legal issue for A these AYs ordinarily fell within the s qualify as ‘relevant assessment ye ion 153A of the Act, and therefore w ued notice u/s 153C of the Act, in t
A of the Act. It is not in dispute that, s are unabated assessments. In the ucted upon M/s. Crystal Bottles (se
AY2020-21. It is also not in dispute e assessee was handed over by AO of the assessee on 18-06-202

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
AYs 2014-15 &
e six-year block ear’ in terms of whether the AO terms of fourth
, the AYs 2014- e present case, arched person) that the seized the AO of the 1 i.e. AY 2022-

23 and that the satisfa himself that the asse belongs/pertains to "th this case) on 24-06-20
recorded by the AO on 2
AY 2014-15
Thus it is evid
Agrifurane Indust bogus purchase o of bogus purchas
2017), Rs. 5,69,7
the F.Y. 2019-20
The above seized
18.06.2021. On seized materials
Southern Agrifura got a bearing on 2018-19 to 2020
Tax Act, 1961 not 10. According to the a of the Act, the date of h had to be reckoned as u/s 153C of the Act, for be reopened and also ascertaining the 'releva
CIT(A) had countenance
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 9 ::

action note was drawn out by the ets/documents found in the cou e other person" (third party i.e. t
021. The relevant extract of the sa
24-06-2021 for AY 2014-15 is extra ent from the seized materials that M tries Pvt. Ltd. has inflated their expenses of empty bottles from M/s Crystal bottles.
ses is Rs.4,41,70,464/- for the F.Y 2017-1
70,130/- for the F.Y 2018-19 and Rs. 2,95
(up to 4.8.2019).
d materials were handed over to the un perusal of the seized material I am satis contain information that relate to the a ane Industries Pvt. Ltd. and the informatio n the determination of total income for th
-21. Hence, in accordance with the provisi tice u/s 153C is issued for AY 2014-15. assessee, by virtue of first proviso t handover of documents to their AO i the date of search for the purpose r determining the six assessment ye to compute the ten (10) year b ant assessment year'. It is observe ed this plea of the assessee, after

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
e AO satisfying urse of search the assessee in atisfaction note cted below;
M/s Southern by means of The amount
18 (From July
,16,955/- for dersigned on sfied that the ssessee, M/s n therein has he A.Ys. from on of income to section 153C
.e. 18-06-2021
of assessment ars which could lock period for ed that the Ld.
considering the amendment made to S holding as under:-
6.6.6
The co materials were ha same should be assessment years the sake of clarity

“Provided that in initiation of the s section 132A in t shall be construe account of docum
Officer having jur

Date of Sea
AY: 2
202
202
201
201
201
201
201
201

Section 153C of the Act by Finance ontention of the appellant is that, since anded over to the juri ictional AO on 18. taken as the date of search in compu s as per the proviso to section 153C(1) of y the said proviso is reproduced here as un case of such other person, the reference t earch under section 132 or making of requ the second proviso to [sub-section (1) of]
ed as reference to the date of receiving ments or assets seized or requisitioned by t ri iction over such other person:]”
ndersigned is of the view that the conte with the provision(s) of the Act. therefore se of the appellant can be taken as 18.06
ch the juri ictional AO received the seize date of 18.06.2021 is construed as the da ue of notice requires to be computed as un
AY
Sequence of the year rch 18.06.2021
022 – 23
Search Assessment Year
21 – 22
1st Year
20 – 21
2nd Year
19 – 20
3rd Year
18 – 19
4th Year
17 – 18
5th Year
16 – 17
6th Year
15 – 16
7th Year
14 – 15
8th Year the above computation, the AY 2015-1
nth and eight year. When the years under seventh and eight year being beyond the , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
e Act, 2017, by e the seized
06.2021, the uting the six the Act . For der.
to the date of uisition under section 153A the books of the Assessing ention of the e, the date of 6.2021 being ed materials.
ate of search, der.
r
6 & 2014-15
consideration period of six assessment year
Section 153A of t
11. Having considered submissions, it is noted of Shri
Bondalap
No.1044/Chny/2023
following the decision o
Vs Ojjus Medicare considering the amendm that, the first proviso to from date of initiation seized material to the A the date of satisfaction point for reckoning the follows:-
“12. Reading of t the year) along w which is spoken o is to be calculate requisition, stand documents or as searched person
Hon'ble Delhi Hi
(supra), wherein
" As discussed the Act, a ref proviso to Sec handing over
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 11 ::

s, the conditions prescribed under the 4t the Act should be complied with…”
d the above findings of the Ld. CIT(A d that the coordinate Bench at Chen pati
Shivaji
Rao
Vs
DC has examined this particular issue of Hon'ble Delhi High Court in the (P) Ltd (supra), which was ment by Finance Act, 2017, this Tri o Section 153C of the Act shifts the of search, to the date of hand-ov
AO of the non-searched person (or in note) and the said date shall be c six AYs'. The relevant findings are the main provision of Section 153C (as it with the first proviso reveals that, the ref of, in section 153A(1) from which the perio ed, and which stipulates it to be the date ds shifted to the date of receipt of books ssets seized or requisitioned by the AO
. For this, we gainfully refer to the dec gh Court in the case of CIT v. RRJ Se the Hon'ble Delhi High Court held as under d hereinbefore, in terms of proviso to Sec ference to the date of the search under ction 153A of the Act has to be construed a of assets/documents belonging to the Ass

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
th proviso to A) and the rival nnai in the case
IT in ITA e in detail and, case of Pr.CIT rendered after ibunal had held e relevant date ver of books of n its absence to commencement noted to be as stood during ference point od of six AYs'
of search or s of account, of the non- cision of the ecurities Ltd.
r:
ction 153C of r the second as the dateof sessee (being the person oth to assess the s
153C(1) of th
153A of the Ac be construed a It would follow reassessments also have to b of assets/docu be the date of Act, i.e., 8th S in respect of beyond the p reference to t searched perso assessment y assessment ye was conducted accepted, it w assessments i which the sea other person, searched pers reopened wou because the d other than the the date of th scheme of Sec receipt of asse than one sear rationale appe the AO of th assets/docume assets/docume person come i
AO of the sear not belong to t the person oth the seized as provisions of contention tha and AY 2004- and the AO
Assessee's inco
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 12 ::

her than the one searched) to the AO havin said Assessee. Further proceedings, by virt he Act, would have to be in accordance ct and the reference to the date of search w as the reference to the date of recording of w that the six assessment years for which a s could be made under Section 153C of t e construed with reference to the date of uments to the AO of the Assessee. In this c the recording of satisfaction under Section September, 2010. In this view, the assess assessment years 2003-04 and 2004-0
period of six assessment years as re he date of recording of satisfaction by th on. It is contended by the Revenue that the years would be the assessment years ear relevant to the previous year in whic d. If this interpretation as canvassed by th ould mean that whereas in case of a pers n relation to six previous years preceding arch takes place can be reopened but in who is not searched but his assets are sei son, the period for which the assessmen ld be much beyond the period of six yea ate of handing over of assets/documents e searched person, to the AO would be s he search. This, in our view, would be co ction 153C(1) of the Act, which construes ets and documents by the AO of the Ass ched) as the date of the search on the A ars to be that whereas in the case of a sea he searched person assumes possessio ents on search of the Assessee; ents belonging to a person other than nto possession of the AO of that person o rched person is satisfied that the assets/d the searched person. Thus, the date on wh her than the one searched assumes the p ssets would be the relevant date for Section 153A of the Act. We, therefore t in any view of the matter, assessment fo
05 were outside the scope of Section 153
had no juri iction to make an assess ome for that year."

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ng juri iction tue of Section with Section would have to f satisfaction.
assessments/
he Act would handing over case, it would n 153C of the sments made
05 would be eckoned with he AO of the e relevant six prior to the ch the search he Revenue is son searched, g the year in case of any ized from the nts could be rs. This is so of a person, ubsequent to ntrary to the s the date of sessee (other
Assessee. The arched person on of seized the seized a searched only after the documents do hich the AO of possession of applying the e, accept the r AY 2003-04
3C of the Act ment of the 13. It is noted th has affirmed the -
"8. In SSP Av follows:--"14. conducted on valuable asset in whose case case, the Ass
153C, which person, i.e., an the books of a the other pers over the valu
Assessing
Off
Thereafter, th person has to order to asses manner conte question may section 153A i question of pe the searched proceedings fo within the peri of initiation of section 132A.
Puri Group of C case of the ot herein, such d documents or having juri ic person, the qu of assessment examined with 9. It is eviden
Parliamentary the question o which the six y returns were t searched and 153-C was ena
153(c)(1)] is c
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 13 ::

hat the Hon'ble Supreme Court in Jasjit S above view with the following significant o viation (supra) the High Court inter alia
Now there can be a situation when durin one person under section 132, some d s or books of account belonging to some o e the search is not conducted, may be fo essing Officer has to first be satisfied u provides for the assessment of income ny other person who is not covered by the ccount or other valuable article or docume on (person other than the one searched). H able article or books of account or docu ficer having juri iction over the ot e Assessing Officer having juri iction ov proceed against him and issue notice to t ss or reassess the income of such other p emplated by the provisions of section arise as to the applicability of the secon n the case of the other person, in order to ending proceedings which have to abate. I person, the date with reference to or assessment or reassessment of any asse iod of the six assessment years shall abate the search under section 132 or the requ
For instance, in the present case, with refe
Companies, such date will be 5.1.2009.Ho her person, which in the present case is t ate will be the date of receiving the books assets seized or requisition by the Asse ction over such other person. In the case uestion of pendency and abatement of the t or reassessment to the six assessment h reference to such date."
nt on a plain interpretation of section 153C intent to enact the proviso was to cater n of abatement but also with regard to th year period was to be reckoned, in respect to be filed by the third party(whose prem in respect of whom the specific provision u acted. The revenue argued that the provis confined in its application to the question of , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
Singh (supra) observations:
reasoned as ng the search documents or other person, und. In such under section of any other e search, that nt belongs to He shall hand ument to the ther person.
ver the other hat person in person in the,
153A.Now a nd proviso to examine the n the case of o which the essment year e, is the date uisition under erence to the wever, in the the petitioner of account or essing Officer of the other e proceedings years will be C(1) that the not merely to he date from t of which the mises are not under section so [to section f abatement.

rt is of the opinion that the revenue's and without merit. It is quite plausible tha retation which SSP Aviation adopted, the A - of the search party, under section 132
to forward the papers and materials belo o the concerned A.O. In that event if the te back" as is sought to be contended by f the seizure), the prejudice caused to the drawn into proceedings as it were unwitt ave no concern with it at all), is dis-propo e papers are in fact assigned under section our years, the third party assessee's prej uld have to virtually preserve the records ch is not the requirement in law. Such di uences cannot be attributed to Parliament.
reading of section 153-C supports the i urt adopts."
note that, the above proposition that, in er Section 153C, the starting point is ordain books of account or documents or asset ituting the point from which the precedin sessment year" is to be computed stands reme Court in Vikram Sujitkumar Bhatia (s tions are noted to be as follows:- per the proviso to section 153C as inserted nd the effect of the said proviso is that n wherein any reference made to the date eemed to be a reference made to the da cer of the non-searched person receives cuments or assets seized etc. Thus, in the the search under section 132 was initiated o section 153C w.e.f.01.06.2015, the book or assets were seized by the Assessing O person only on 25.04.2017, which is subse therefore, when the notice under sectio
05.2018, the provision of the law existin amended section 153C shall be applicable.
xt, we may also gainfully refer to the follo elhi High Court in the case of Pr.CIT Vs Oj herein it was held as under:-

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
argument is t without the A.O. seized of - would take onging to the e date would the revenue, e third party, tingly (and in ortionate. For n 153-C after judice is writ s for at latest sastrous and On the other interpretation the case of ned to be the ts seized and g six AYs' or reiterated by supra) whose vide Finance it creates a e of initiation ate when the the books of present case, d prior to the ks of account
Officer of the equent to the on 153C was g as on that "
wing findings jjus Medicare

"80. The afore the identificati or the "releva contention of t to be reckoned be countenanc addressed con have held to th of commencem
"relevant asses documents, as 16. Before us, amendment by Fi only relevant for reassessment pro
Act and that it ca block of six AYs the decisions cit amendment. We the Revenue as t the Act that, the abatement of ass which the block o line of argument
High Court in th
(165 taxmann.co by observing as f
"14. It become to 01 April 20
"in respect of years" referred provided for t
"previous yea made". The bl the AY "imme previous year"
Finance Act, 2
four AYs' with year" and whic being the peri not later than year relevant t
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 15 ::

esaid discussion thus renders a determinati on of the starting post from which the bloc nt assessment year" would have to be ca the respondents that the said block period d with reference to the date of search thu ced nor possibly accepted. That submissi trary to a long and consistent line of prec he contrary and which unequivocally accep ment for the purposes of identifying th ssment year" to be etched from the date of ssets or things to the AO of the non-searche the Revenue has urged that, subseq inance Act, 2017, the first proviso to Sectio the purposes of abatement of pending as oceedings, which is mentioned in Section 15
annot be viewed as the reference point fro is to be computed. According to Ld. CIT D ted by the assessee were of no relevanc however are unable to countenance this there is no such indication contained in Sec first proviso is only concerned with abatem sessments and that it does not regulate t of six AYs is to be computed. We find that, t was raised by the Revenue before the H e case of Pr. CIT Vs Karina Airlines Inte om 421) which was repelled by the Hon'ble follows:- es pertinent to recall that Section 153A, as 017, envisaged a search assessment being f each assessment year falling within six d to in clause (b) thereof. Clause (b) of Sec he identification of the six AYs' with refe r in which the search is conducted or ock of six AYs' were to be identified comm diately preceding the assessment year re
" in which the search may have been con
2017 stretched the search assessment to the introduction of the concept of "relevan ch was defined by Explanation 1 to Sectio od which would fall beyond "six assessme ten assessment years from the end of the to the previous year" in which search was , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ve quietus to ck of six AYs'
lculated. The s would have s can neither ion is clearly edents which pted the point e six or the f handover of ed party.
uent to the on 153C(1) is ssessment or 53A(1) of the om which the DR therefore, ce, post this argument of ction 153C of ment or non- he date from this identical
Hon'ble Delhi ernational Ltd e High Court, it stood prior g undertaken x assessment ction 153A(1) erence to the requisition is mencing from levant to the nducted. The an additional t assessment n 153A(1) as ent years but e assessment conducted. A block period of the case of a s
15. The const contemporane
Finance Act, 2
hypothetically of a searched amendments i placed by Mr.
153A and 15
available to b block of ten AY
.......
17. The First recognized as abatement, wh
(1) of the Act, period or the "
entity is conc consistently fo
Court in Comm
Online SC 126
reproduced he
…..
18. Insofar as while it is true respondent ass the former, sa the case of th
15 May 2019. 19. In order underlying the AO of the non aspects in min would get tri searched entit relate to a pe search. In suc to transmit the ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 16 ::

f ten AYs' consequently became liable to a search post the enactment of Finance Act, 2
titution of a block of ten AYs' in Sectio ously added and introduced in Section 2017, an assessment triggered by a searc extend to a block period of ten years bot as well as a non-searched entity. In our ntroduced in Section 153C, and on which Mann, were essentially intended to place b
3C at par and for both statutory prov e invoked for the purposes of assessmen
Ys'.
Proviso to Section 153C (1) has been s not being concerned merely with th hich is spoken of in the Second Proviso to , but also to regulate the date from which "relevant assessment year" insofar as the n cerned, is to be reckoned. This positio ollowed not just by this Court but also by missioner of Income Tax 14 v. Jasjit Singh
65. The relevant paragraphs of the said rein below: - the present appeal is concerned, on facts e that AO of the searched person as well a sessee was the same, undisputedly while i atisfaction was recorded on 29 March 201
e respondent assessee drew up a Satisfac r to appreciate the essential legislativ e handover of material and formation of o n-searched entity, we would have to bear nd. We firstly take note of the fact that S ggered firstly upon the Assessing Auth y identifying documents or material which erson other than the entity which was ch a contingency, that Assessing Authority e relevant material to the AO of the "other

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
assessment in 2017. on 153A was 153C. Post ch could thus h in the case r opinion, the reliance was both Sections visions being nt covering a consistently he aspect of Section 153A h the six-year non-searched on has been the Supreme h [2023] SCC decision are s we find that as that of the n the case of 19, the AO in ction Note on ve objective pinion by the the following
Section 153C hority of the are found to subjected to y is obligated person". The AO of the non material so rec an impact "on person..". This requiring the A books of acco the determina material and d to be independ initiated again person" is sati impact "on th person", the m
20. It thus be under Section provision and motion. In ou transmission o opinion wheth initiated. It is to enable the A assessment is Thus, even in searched party opinion that determination and the heart
21. A harmoni its Proviso lead common, the the date when to such other p not have bee course of the the date when searched entit the bedrock fo
17. As far as the by Single Judge
R.K.M.Powergen
Hon'ble Single Ju
Agency (supra) a ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 17 ::

-searched entity is thereafter required to s ceived and evaluate whether the same is l n the determination of the total income o s becomes evident from the plain text of S
AO of the non-searched party being "satis unt or documents or assets seized have ation of total income of such other pe documents unearthed in the course of the dently evaluated before a reassessment ex st a non-searched person. Unless the AO o sfied that the material so gathered is likel he determination of the total income of mere receipt of documents would not suffice ecomes apparent that it is the satisfactio n 153C which constitutes the cornerst the primary ingredient for Section 153C b ur considered opinion, the actual or ph of documents is merely a step in aid of er an assessment under Section 153C is in that sense merely a machinery provision
AO of the non-searched person to examine liable to be commenced under Section 153
a case where the AO of the searched a y be one and the same, it would be the for the material is likely to "have a bea of the total income.." which would consti of Section 153C.
ous interpretation of the main part of Sect d us to hold that in cases where the juri commencement point would have to be n the satisfaction is formed by the said AO person. In our considered view, even thoug en an actual exchange of material unea search between two separate authorities, the AO records its satisfaction with respec y which would be of seminal importance a r commencement of action under Section 1
e reliance placed by Revenue on the decis
Bench of Hon'ble Madras High Court in (P) Ltd (supra) is concerned, it is not udge while disagreeing with the view take as well as RRJ Securities (supra) didn't tak

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
scrutinize the likely to have of such other
Section 153C sfied that the a bearing on erson..". The search have ercise can be of that "other ly to have an f such other e.
on arrived at tone of that being set into ysical act of formation of s liable to be n put in place e whether an 3C of the Act.
and the non- rmation of an aring on the tute the core ion 153C and ictional AO is construed as with respect gh there may rthed in the , it would be ct to the non- nd constitute
153C.
sion rendered the case of ted that the en in Sarwar ke cognizance of the fact that decision in the affirmed by the holding as under:
"9. It is eviden
Parliamentary the question o which the six y returns were t searched and 153-C was ena
153(c)(1)] is abatement."
18. Moreover, ac propounded by t explained by way conducted in FY searched person assessment year
FYs 2008-09 to 2
the AO would be manner i.e. with search i.e. 31st D a finality in its as incriminating mat of handover of Revenue, for the be saved by the the time limit fo proviso to Sectio computed from t books of account for computing the the original date open FYs 2008-0
date of handing
Revenue would s
Going by this log searched person unwittingly is hig scenario, there w non-searched pe person, whose as ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 18 ::

the aforesaid decisions were rendered f case of SSP Aviation (supra) which has Hon'ble Supreme Court in Jasjit Singh
:- nt on a plain interpretation of Section 153
intent to enact the proviso was to cater n of abatement but also with regard to th year period was to be reckoned, in respect to be filed by the third party (whose prem in respect of whom the specific provision u acted. The revenue argued that the provis confined in its application to the ccording to us, the interpretation being s the Revenue is incongruous. This incongr y of illustration. Say, a search u/s 132 of 2017-18. In such a scenario, the assess can be reopened for the preceding six AYs i.e. further 4 AYs, aggregating to 10-yea
2016-17. Further, in terms of Section 153
required to complete the assessment in a hin twenty one months from the end of December 2019. The searched person will ssessments by 31.12.2019. Now if there is terial pertaining to a non-searched person books of accounts is FY 2023-24, then purposes of issue of notice u/s 153C of th first proviso to Section 153C of the Act. F or completion of assessment shall be sa on 153B as the period of twenty-one mon he end of the year of search viz., year of ts, which would be 31st December 2025. H e six year block period and 'relevant asses of search shall be relevant and the Reve
09 to 2016-17 in FY 2022-23 as well. Lik over of books of accounts is further still be at liberty to reopen FYs 2008-09
gic of the Revenue, the prejudice caused
, who would be drawn into proceedings hly dis- proportionate to the searched pers would be a Sword of Damocles hanging ove erson (for no fault of his) and unlike t ssessment shall be completed in a time bo

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
following the s since been h (supra) by C(1) that the not merely to he date from t of which the mises are not under Section so [to Section question of sought to be ruity may be f the Act was sment of the and relevant ar block viz.,
3B of the Act, a time bound the year of therefore get some seized and the year according to e Act, it shall Further, even aved by first nths shall be f handover of However only ssment year', enue can re- kewise, if the delayed, the to 2016-17. to the non- s as it were son. In such a r head of any the searched ound manner, the non-searched virtually for ete consequence can the matter the lin
19. Moreover, we
High Court is not amendment by F shifts the releva requisition made documents and a in its absence to commencement p findings of the H applicable in the "7. .....On 18
to have been Companies6 .
notice purport submit a true a 12. The afores
December 202
produce accou thereto. A fol thereafter iss respondents th communication
Section 144 of 03 March 2023
its response on 8. In order to it apposite to e by the AO of t
17 February 20
........
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 19 ::

d person would be required to preserve ernity. According to us, such disastrous not be the intent of the Legislature and in ne of argument taken by the Revenue is rej e note that, the Hon'ble Delhi High Court i
Medicare (P) Ltd (supra) at Paras 51 to 84
re statutory framework of Section 153C of to the amendment by Finance Act, 2
y the Finance Act, 2021 and the relevant ding the decisions of Sarwar Agency Pvt. L
P) Ltd. (supra) relied upon by the Revenue ted to have accordingly concluded that, e
Finance Act, 2017, the first proviso to s ant date from the date of initiation of e, to the date of hand-over of books o assets seized to the AO of the non-searche the date of satisfaction note) and the said point for reckoning the six or the ten AYs'.
on'ble Delhi High Court, in this regard, w present case, is noted to be as follows:-
October 2019, a search and seizure opera n carried out in respect of the Alank
On 22 March 2022, the petitioner was s ing to be under Section 153C of the Act r and correct return of its total income for AY said notice was followed by a communicat
22 under Section 142(1) requiring the unts and documents as per the annexu low-up notice under Section 142(1) of sued on 01 February 2023. It is alle hat since the petitioner did not respond to ns, they were constrained to issue n f the Act and which were dated 22 Februa
3. In response to the aforesaid, the petition n 15 March 2023. appreciate the challenge which stands rais extract the Satisfaction Note which came to the writ petitioner. The Satisfaction Note w
022 is extracted herein below:

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
the records s and harsh n that view of jected.
n the case of has in detail f the Act from 017 and its decisions on Ltd. (supra) &
. The Hon'ble even post the section 153C search or a f account or ed person (or date shall be The relevant hich is found tion is stated kit Group of served with a requiring it to Y 2011- tion dated 22
petitioner to re appended the Act was eged by the the aforesaid otices under ary 2023 and ner submitted sed, we deem o be recorded which is dated

Computat period as ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 20 ::

esent batch, List I pertains to writ petition otes recorded or section 153C notices iss
April 2021 to 31 March 2022. Undispute tion 153C, and which has been consistent y the commencement point for reckoning t s the relevant date from the date of initiat on made to the date of receipt of books o nd assets seized by the juri ictional AO on. Consequently, the block of six or ten ckoned bearing the aforesaid date in mind atch of writ petitions, the date of actual explicitly mentioned in a majority of the w sels for respective sides had addressed assumption that it would be the date of iss ote by the AO of the non-searched perso vailability of such a note, the date of iss notices which would be pertinent for the pu o section 153C.
, therefore, that the handover of materia the search and pertaining to the non-sea een 01 April 2021 to 31 March 2022, the nstitute FY 2021-22 as being the prev e purposes of the non-searched entity. As relevant AY would become AY 2022-23. nstitute the starting point for the purposes which are spoken of in section 153C. The be those which immediately precede the AY to the previous year of search. It would th it would be the six AYs' immediately p h could have formed the basis for initiat
153C. Consequently, and reckoned backw would be:- tion of the six-year block s provided under section 153C of the Act
No. of years
2021 – 22
1st Year
2020 – 21
2nd Year
2019 – 20
3rd Year
2018 – 19
4th Year
2017 – 18
5th Year
2016 – 17
6th Year

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
s which have sued between dly, the First ly recognized the six or the tion of search of account or of the non- n AYs' would
. Although in handing over writ petitions, submissions suance of the on and in the suance of the urposes of the l gathered in rched person e same would ious year of s a necessary
AY 2022-23
of identifying e six AYs' are Y so identified hus lead us to preceding AY tion of action ward, the six

Consequently, preceding AYs terminate at A 20. The Hon'ble concluded with th
"D. The First P basis of which year or the te books of acco starting block year period is significantly sh while defining assessment ye books of acco
AO of the non case of a non- section 153C(1
authoritatively
Aviation and R
Court in Jasjit by the Suprem of the respond be reckoned w countenanced
E. The reckon the FY in whic the ascertainm
The block of si precede the AY assessment u distinction wo substituted by documents and as opposed to assessment un
21. Following the the books of acc was to be constr to Section 153C o
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 21 ::

AY 2021-22 would become the first s' and would as per the table set out
AY 2016-17."
e Delhi High Court is further noted to he following observations:-
Proviso to section 153C introduces a legal f h the commencement date for computatio en year block is deemed to be the date unts by the juri ictional AO. The identifi for the purposes of computation of the six governed by the First Proviso to section hifts the reference point spoken of in sect g the point from which the period of t ear" is to be calculated, to the date of r unts, documents or assets seized by the -searched person. The shift of the relevan searched person being regulated by the Fi
1) is an issue which is no longer res integr y settled by virtue of the decisions of this RRJ Securities as well as the decision of Singh. The aforesaid legal position also sto me Court in Vikram Sujitkumar Bhatia. Th dents, therefore, that the block periods w with reference to the date of search ca nor accepted.
ing of the six AYs' would require one to f ch the search was undertaken and which w ment of the AY relevant to the previous ye ix AYs' would consequently be those which Y relevant to the year of search. In the cas undertaken in terms of section 153C, uld be that the previous year of search the date or the year in which the books o d assets seized are handed over to the juri o the year of search which constitutes the nder section 153A."
e decisions (supra), we hold that the date count/documents/assets from the AO of ued as the date of search, in terms of the of the Act................”

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
of the six hereinabove have finally fiction on the on of the six of receipt of cation of the x and the ten
153C, which tion 153A(1), the "relevant eceipt of the juri ictional nt date in the rst Proviso of ra and stands
Court in SSP the Supreme ood reiterated e submission would have to n neither be firstly identify would lead to ear of search.
h immediately se of a search the solitary would stand of accounts or i ictional AO e basis for an e of receiving the assessee e first proviso

ove, we therefore hold that, in t f hand-over of seized material to construed as the deemed date
-year period which could be reopen case, as noted earlier, the date of r ents/ assets was 18-06-2021 ( six AYs 2016-17 to 2021-22 co u/s 153C of the Act. However, on 153A of the Act, the AO was also ssessment year’ which cannot go b d of the AY relevant to the FY in wh isition made. In the context of the 2022-23 shall be deemed to be the -23 would form the first year of th mum period of ten AYs' terminating
, AYs 2014-15 & 2015-16 though ut was within the period of ten yea on 153A of the Act.
he next issue to be adjudicated is w ential condition precedent set out
A of the Act, prior to reopening the a , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
the given facts the AO of the of search for ned u/s 153C of receipt of books
(AY 2022-23).
uld have been , by virtue of o empowered to eyond ten AYs'
hich the search e present case, e year of search he block of ten in AY 2013-14. fell outside the ars, in terms of whether the AO in the fourth assessments for AYs 2014-15 & 2015-16
of six assessment year have a look at the law proviso of Section 153A
2017 with effect from 0
issue notices u/s 153A in terms of Explanation i.e. assessment years b assessment year prece
10th AY's preceding th essential conditions sp
153A of the Act i.e., fou a bearing on the controv
"Provided also th issued by the A years unless--
(a) the Assessing documents or evi form of asset, wh amount to fifty la in aggregate in th
(b) the income r assessment for su
(c) the search un
132A is made on ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 23 ::

6 u/s 153C of the Act, which fell bey rs. In order to adjudicate this lega relevant to this issue. It is noted t
A of the Act which was inserted by t
1.04.2017, enabled an AO of a sear of the Act for “relevant assessment
1 of the fourth proviso to Section 1
beyond the six (6) assessment year eding the searched assessment ye he searched AY), provided the AO pecified therein. The relevant port urth proviso to Section 153A of the versy in hand, is being reproduced b hat no notice for assessment or reassessm ssessing Officer for the relevant assessm g Officer has in his possession books of acc dence which reveal that the income, repre hich has escaped assessment amounts to akh rupees or more in the relevant assess he relevant assessment years; referred to in clause (a) or part thereof uch year or years; and nder section 132 is initiated or requisition u or after the 1st day of April, 2017. , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
yond the period al issue, let us that, the fourth he Finance Act, rched person to t year or years‟
153A of the Act s till tenth (10) ear (i.e. 7th to O satisfies the tion of Section Act, which has below:- ment shall be ment year or ount or other esented in the or is likely to ment year or has escaped under section Explanation 2. F include immovab securities, loans a 14. From a reading o the Act, it can be seen enlarging the power of Act from seventh to ten notice u/s 153A/153C o satisfied. The express reassessment shall be is relevant AY/AY's has appended to it. Theref section 153A bars the the assessment or reas his possession evidence in the form of asset valu
So, the AO, in order to 7th to 10th AY precedin income represented in which has escaped asse present/or in possessi juri iction u/s. 153A extended AYs'. We find
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 24 ::

For the purposes of the fourth proviso, le property being land or building or both and advances, deposits in bank account."
of the aforesaid fourth proviso to S that the expression used by the Pa the AO to extend the juri iction u nth AY is, first of all, prohibiting the of the Act, unless the condition prece sion used is "no notice for a ssued by the AO for the relevant AY been explained by the aid of fore, it is noteworthy that the fou
AO to issue notice u/s. 153A/153C ssessment of the 7th - 10th AY's u e/material which revealed that incom ued Rs. 50 lakhs or more has escape o assume juri iction for the exten g the searched year, should have in the form of "asset‟ valued Rs. 50
essment, which is the "juri ictiona on of AO will only enable the A r.w. 153C of the Act to issue no that the Ld. CIT(A) had examined

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
"asset" shall h, shares and Section 153A of arliament, while u/s 153A of the AO to issue the edent therein is assessment or Y/AY's"; and the Explanation 1, urth proviso to C of the Act for nless he has in me represented ed assessment.
nded period i.e.
n his possession
Lakhs or more l fact‟, which if AO to assume otice for these the satisfaction note recorded by the AO in the facts of the prese assessments for AYs 20
be bad in law for want
CIT(A) taken note of by “6.6.10
At this the Hon’ble High enterprises Vs. AC the Hon’ble high shows that Comm empowered to a immediately prec year in which the year or years. Ex expression releva assessment year than ten assess relevant to the p
4th proviso to s which are require relevant assessm the Assessing Off evidence which r which has escap rupees fifty lakhs expanded definit proviso.
6.6.11
Further
India Private Lim
ITA No.669/Chny of the decision of Cements Ltd. (ITA is quite clear th assessment year
21) in which the In such a situatio as stipulated in f
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 25 ::

O and found that this juri ictional f ent case and hence, the action of AO
014-15 & 2015-16 u/s 153C of the A t of juri iction. The relevant findi us is as follows:- juncture, it is appropriate to rely upon th h Court of Bombay in the case of Ashok
CIT in [2023] 154 taxmann.com 144 (Bom
Court held that “A plain reading of section missioner having juri iction under the sa assess or reassess the total income o ceding the assessment year relevant to e search was conducted and for the relevan xplanation 1 below section 153A of the Ac ant assessment. In order to make an ass which falls beyond six assessment years sment years from the end of the asse previous year, in which the search was co section 153(A)(1) sets out certain furthe ed to be fulfilled before a notice can be is ment years. Clause (a) of the4th proviso fficer must have in his possession books, d reveal that income represented in the form ed assessment amounts to or is likely t s or more. Explanation 2 to section 153A(1
tion of the word "asset" for the purpose r, the juri ictional tribunal in the case mited Vs. DCIT Central circle-2(1), Chenna y/2023 dated 10.07.2024 by relying upon f Hon’ble Guwahati High Court in the case
A No.10 of 2022 & Ors. Dated 29-09-2023) he impugned AY fall beyond 6 years fr
(AY 2021-22) from the end of the previous search was conducted on the assessee (2
on, the Ld. AO would be subjected to furth fourth proviso to Sec.153A(1). These condi

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
fact was absent
O reopening the Act was held to ings of the Ld.
he decision of k Commercial bay) wherein n 153A(1)(b) aid section is of six years the previous t assessment ct defines the sessment for but not later essment year onducted, the er conditions ssued for the requires that documents or m of an asset to amount to ) sets out an s of the 4th of M/s. KAG ai in ITA No.
the decision of Goldstone
) held that “it rom relevant s year (2020-
26-02-2021).
her conditions itions are (a) that certain inco escaping assessm documents or evi possession of the to the relevant as assessment is re undisclosed speci assessment year assessment is Rs assessment years represented in th
Explanation-2, a building or both, bank accounts.
6.6.12
Further
Circle-2, Guwaha
21/Gau/2021 dat satisfaction note
“We find that eve by the AO prior does not reveal/
escaped assessm satisfaction note now be added to satisfaction note.
the satisfaction n undisclosed/unac establish the e juri iction in ter
Section 153C of The satisfaction examined only as notice.”
6.6.13
and he
“It is imperative extended period]
seized material, possession qua t more. If this ess not get the autho for 7th to 10th AY
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 26 ::

ome has escaped assessment; (b) the fa ment is evident from the books of acc idences found in the course of search whi e assessing officer; (c) that the escaped inc ssessment year or years; (d) that the inco epresented by undisclosed specified asset; ified asset was acquired with the income of r or years; (f) that the quantum of inco s.50 Lacs or more in the aggregate for s. One of the prime condition is that incom he form of asset which has escaped assess asset includes immovable property bein share and securities, loans and advances r, the Hon’ble ITAT Guwahati Bench in the ati Vs, Fortune Vanijya Private Limited ted 10.12.2021 has observed upon the as under.
en the contents of the satisfaction note (sup to issuance of the notice u/s 153C dated
/point out the 'undisclosed/unaccounted ent in the relevant AY. It is to be kept in m is to be examined on a standalone basis.
the satisfaction note, nor anything be dele
It is for the AO to disclose and open his m note as to which seized material revealed ccounted asset valued Rs.50 lacs or mo existence of juri ictional fact for ass rms of the fourth proviso to Section 153
the Act for reopening the assessment for note cannot now be supplemented but s they were recorded by the AO prior to the ld that e that before issuance of notice u/s 15
], the AO sets out his objective satisfact the details of the specified/undisclosed a the assessee for AY 2011-12 valued Rs.
ential requirement of law is not satisfied, ority of law to invoke the juri iction u/s 15
Y. For this, we rely upon the dictum of the , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ct of income counts, other ich are in the come pertains ome escaping
(e) that the f the relevant ome escaping the relevant me should be sment. As per ng land and s, deposits in case of ACIT, in ITA No.
recording of pra) recorded
05-12-2019, asset' which mind that the Nothing can eted from the mind through d existence of re, so as to suming valid
3A read with 7th-10th AY.
t it is to be e issue of the 53C [for the tion from the assets in his
50 lakhs or the AO does
53A of the Act
Privy Council in Nazir Ahmed been accepted an a statute requires done in that man language of the issuance of notic possession of the present case. The possession the ju issued notice u/s notice, as done in in the foregoing,
2019 was issued without satisfyin issuance of notice
6.6.14
Therefo that the assessee income cannot be section 153A. H include a) Immovable Pro b) Shares & Secu c) Loans and Adv d) Deposits in Ba
Hence, the re-ope where AO posse reveals that ‘ass specified supra, assessee, resultin
6.6.15
The fac rendered by the Goldstone Cemen dated 10.12.202
exceeding a valu should be clearly
8.22 of its order t
"8.22. From our specified 'asset/s
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 27 ::

Vs. King Emperor AIR 1936 PC 253(whi nd later followed by Hon'ble Supreme Cour s a thing to be done in a particular manne nner or not at all. As discussed at Para 13
fourth proviso to section 153A of the A ce can be resorted to by the AO only a e juri ictional fact, which is found to be a erefore, according to us, the AO only after uri ictional fact could have assumed jur s. 153C of the Act or else he could not n this case. For the reasons elaborately dis we thus hold that the notice u/s. 153C d by the AO for AY 2011-12 without authori ng the essential juri ictional fact, and e u/s. 153C of the Act is held to be bad in la ore, unless the AO has material in possess e has ‘assets’, which is not disclosed in th e said to have escaped assessment for th ere, the statute specifically mentioned operty being land and building or both urities vances ank accounts ening beyond a period of six years can be ess books of accounts, documents or evi sets’ are found to be undisclosed or una in the regular books of account mainta ng in escapement of income.
cts of the case are squarely covered by e Hon’ble Guwahati Bench of ITAT in nts Ltd, Meghalaya in IT Nos. 126 to 1
21 wherein it was held that the undis ue of Rs. 50 Lakhs unearthed at the tim y identifiable. The Hon'ble Bench has obse that :
r discussion (supra) it is clear that, on s' as defined in Explanation (2) is unearthe

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ich has since rt), that when er, it must be 3 (supra), the ct show that after he is in absent in the having in his ri iction and have issued scussed by us dated 05-12- ity of law and d hence the aw.
sion to prove he books, the he purpose of “Asset’ shall made only if, idence which accounted as ained by the the decision the case of 31/Gau/2020
sclosed asset me of search erved in para nly if any of ed during the course of search a or undisclosed, w said to be in pos u/s 153A for 7th-
6.6.16
The ab
Hon’ble Guwahat further appeal by Goldstone Ceme emphasized that fall within the def therefore the Juri
6.6.17
A juri which depends as tribunal or an aut fact which must e a particular case.
juri ictional fac juri iction in re confer on it and i depends the cour vitiated.
6.6.18
In 'Hals the juri iction of state of affairs, t or collateral to th by an inferior t
Tribunal has to m ruling on the pr conclusive.
6.6.19
In the (2006) 205 CTR (
"A "juri ictional or an assumes ju is one on existen court, a tribuna administrative ag does not exist, th authority wrongly questioned by a ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 28 ::

and the acquisition of such an ‘asset' being which is valued Rs 50 Lakhs or more, that th ssession of the juri ictional fact to initiate
-10th AY (AY 2011-12, in the instant case).
ove finding of the Hon’ble Tribunal was ra i High Court in ITA/7/2022 on 29 Septem y the Revenue u/s 260A of the Act in the c ents Ltd wherein it has been held t an expenditure, irrespective of its charac finition of ‘asset’ defined in Explanation 2 to i iction assumed by the AO is unsustainab dictional fact is one on existence or non ssumption or refusal to assume juri ictio thority. In 'Black's Legal Dictionary, it is ex exist before a court can properly assume j
. Mistake of fact in relation to juri iction ct. No statutory authority or tribunal espect of subject matter which the statu if by deciding erroneously the fact on whic rt or tribunal exercises the juri iction, then sbury's Laws of England' it has been state f a tribunal is dependent on the existence o hat state of affairs may be described as pr he merits of the issue. If, at the inception ribunal, a challenge is made to its juri make up its mind whether to Act or not an reliminary or collateral issue; but that case of Arun Kumar & Ors. vs. Union of (SC) 193: (2006) 286 ITR 89 (SC) it has be fact" is a fact which must exist before a Co uri iction over a particular matter. A juris nce or non-existence of which depends jur al or an authority. It is the fact upo gency's power to act depends If the juris he court, authority or officer cannot act.
y assumes the existence of such fact, the writ of certiorari. The underlying princip

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
g unexplained he AO can be e proceedings
”
atified by the ber, 2023 on ase of CIT V.
that “It was ter, does not o S.153A and ble” .
-existence of n by a court, xplained as a juri iction of is an error of can assume ute does not ch juri iction n the order is ed that where of a particular reliminary to, of an inquiry i iction, the nd can give a ruling is not India & Ors.
een held:- ourt, Tribunal ictional fact ri iction of a on which an ictional fact
If a Court or order can be ple is that by erroneously assu can confer upon i
6.6.20
The ex the exercise of p lawfully. When empowered to pr with the provisi preconditions set
'juri ictional fac ascertain wheth proceeding. Only finding regarding
AO issue a notice satisfying this cru the income of the juri ictional fact process u/s 153C
6.6.21
In the order(s) reveals n asset found or se on 06.08.2019
consideration. Fu the appellant’s pr
15.06.2022. Du premises, no inc alleged escapeme lakh rupees or m assessment proc making addition( materials seized as well as the ma
Group of concer initiation of proce
16 by the AO is n
15. We find that, w existence of income rep satisfaction note record decision of this Tribuna
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 29 ::

ming existence of such juri ictional fact, itself juri iction which it otherwise does no istence of a 'juri ictional fact' is the sine power. In its absence, the power cannot the juri ictional fact is established, roceed with the case and make decisions i ons of law. In this context, the fulfilm t forth u/s 153C r.w.s 153A of the Act is ct.' The AO is required to carefully e her these specific conditions are sati y after deciding on this issue, and recor the presence or absence of these condit e u/s 153C for the relevant assessment yea ucial prerequisite can the AO lawfully proce e assessee for the relevant year, as the pre t is indispensable for validly initiating the C of the Act present case of the appellant company, the no information suggesting that income in th eized during the course of search at M/s SN has escaped assessment for the y rthermore, it is also significant to bring o remises were subjected to search u/s 132
uring the course of the search at the app criminating materials were uncovered to ent of income in the form of an “asset” of v ore for the AY(s) 2014-15 & 2015-16, eve ceeding (s) u/s 153C of the Act was c
(s) & disallowances on the basis of the during the course of search at the appella aterials seized during the course of search rns. Therefore, in the absence of such eedings u/s 153C of the Act for AYs 2014-1
not legally sustainable.”
while holding that the ‘juri ictio presented in the form of ‘asset’, wa ed by the AO, the Ld. CIT(A) had r al at Guwahati in the case of ACI

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
no authority ot posses e qua non for be exercised the AO is n accordance ment of the considered a examine and sfied before rding a clear ions, can the ar. Only upon eed to assess esence of the e assessment e assessment he form of an NJ Distilleries years under n record that of the Act on pellant’s own indicate the value of fifty en though the completed by incriminating nt’s premises h at M/s. SNJ findings, the 15 and 2015- onal fact’ viz., s absent in the rightly relied on IT Vs Fortune

Vanijya Pvt Ltd (sup similar to the present c supra] the AO had seize the premises of third ledgers, the AO recorde determination of total assessment year) and t fourth proviso to Sec assessment u/s 153C/1
were advanced in the r income. On appeal, Trib defined in Explanation precedent set out in fo to be met prior to issu held that the contents o were neither incriminat represented in form o therefore in absence of u/s 153C and the con findings taken note of b
"On a reading of Explanation 2 to ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 30 ::

pra) wherein the facts involved ar ase. In the decided case, [Fortune ed regular books and ledgers of the person (searched person) and refe d his satisfaction note that, it had a income of the assessee for the 7t therefore reopened the same u/s 1
tion 153A of the Act. The AO
43(3) wherein the bank credits out regular books of accounts was add bunal explained the meaning of the (2) to Section 153A of the Act and urth proviso to Section 153A, whic uance of notice u/s 153C of the Ac of seized material viz., regular boo ing in nature nor in any manner re of 'asset' which had escaped as f this 'juri ictional fact' quashed th nsequent order passed by the AO y Tribunal are as follows:- the fourth proviso to Section 153A of the A it which defines 'Asset', we find consider

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
re noted to be Vanijya Pvt Ltd e assessee from erring to these bearing on the th AY (relevant
153C read with completed the t of which loans ded to the total term 'asset' as d the condition ch was required ct. The Tribunal ks of accounts, evealed income ssessment and he notice issued
O. The relevant
Act along with rable merit in the contention of u/s 153A of the A year, the AO sho existence/possess
50 lakhs or more
153A qua the ass without which the these extended A the AO can valid validly assume j notice. In other more which were assessment year year is the juris possession of the personal knowled to be spelled ou
2011-12 discover
153C/153A of the escaped income f the 'fact in issue'
not have in his from invoking/iss
10th AY precedin
19. Having held
Dudhwewala that 'undisclosed asse other items of i etc. A reading o
Explanation (2) defines 'Asset' fo
Act, clarify the in the assessment u assessment year assessment year juri ictional fact lakhs or more of to 10th Assessm
Since the Parliam asset' and the d proviso, this itsel side of the Balanc on the legal Ma
Alterius" which p
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 31 ::

f Shri Dudhwewala that in order to invok
Act for the seventh to tenth AY preceding ould have in his possession the juri icti sion of undisclosed/unaccounted assets v as defined in Explanation 2 to fourth provi sessee qua the 7th to 10th AY un-earthed e AO cannot issue notice u/s 153A/153C o
AY's. It is only when there exists this juris dly reopen those extended AYs; and then uri iction and then only he is empowe words, unaccounted asset valued at Rs.
e discovered during search qua the asses
(7th 10th years) preceding the searched ictional fact; and if the juri ictional fa e AO, [and possession means physical po dge of the existence of the undisclosed asse ut in clear terms (not vaguely) qua asse red during search.] then he can assume jur e Act and issue notice to assess the asses for these assessment year's (7th to 10th y
' or 'adjudicatory fact'. On the other hand possession the juri ictional fact, then he suance of notice u/s 153C/153A of the Act g the search.
d so, let us examine the next argum t, the Parliament by specifying the juri ic et' valued Rs. 50 Lakhs or more, has implie ncome viz., liabilities/credit, unexplained of the fourth proviso to section 153A of to fourth proviso to section 153A of th or the purpose of fourth proviso to section ntention of the Parliament to permit the A u/s. 153A after search u/s. 132 of the Ac rs to ten assessment years preceding t
, provided the AO has in his possession t i.e. "undisclosed/unaccounted asset" v the assessee discovered during search pert ment Year preceding the searched asses ment has used the expression 'income in definition of asset has been spelled out i f necessarily implies the liability/items falli ce Sheet stands excluded. For this view of axim for interpretation "Expressio Unius principle states that, express mention o

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ke juri iction the searched onal fact i.e.
valued at Rs.
iso of Section from search, of the Act for ictional fact only AO can ered to issue
50 lakhs or ssee qua the d assessment act is in the ossession; or et which need essee qua AY ri iction u/s.
ssment of the year) which is if the AO did e is debarred t for the 7th- ment of Shri ctional fact as edly excluded expenditure the Act and he Act which n 153A of the AO to enlarge ct beyond six the searched the essential valued Rs 50
taining to 7th ssment year.
the form of in the fourth ing in the left ours, we rely
Est Exlcusio f one is the exclusion of othe
Supreme Court
(Constitution ben
'Assets' and def
Parliament silent
'liabilities' from it of juri iction u/
assessment year
20. It is a rudime and "credit" de resource, either immovable prope securities, loans &
other hand, 'Liab loans obtained ( characterized or revenues in form

P
Liabi
Share Capi
Curr
21. The above vi appended to the fourth proviso to shares and secur
Hence, where se assessee owns a has been gathere advances outsid unaccounted inve do not form part accounts having pertaining to the possession this ju the fourth proviso
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 32 ::

er and this maxim has been accepted by in GVK Industries Ltd. Vs. ITO [197 T nch of 5 Supreme Court Judges). By expres inition given to it specifically, it is impl tly excluded the items of 'revenue', 'ex ts juri ictional fact for invoking/assumptio
/s. 153C/153A of the Act for the seve preceding the searched assessment year entary accounting concept, that "debit" de notes "liability". An asset represents a immovable or movable, having valu erty viz., land or building, investment held i
& advances given and deposits in bank acc bility' includes items such as share capit secured as well as unsecured) etc. whic classified as 'Asset'. Similarly, items of '
of 'sales' / 'turnover' does not constitute 'a Profit and Loss Account
Particulars (Debit)
Particulars (Cre
Revenue
Revenue

Balance Sheet ilities (Credit)
Liabilities (C tal/ Reserves/Loan/
rent Liabilities
Immoveable Prope
Advances/ Shares/
ew of ours get bolstered from reading of E fourth proviso, which defines 'asset', for th o Section 153A, to include i) immovable rities , iii) loans and advances & iv) Dep earch action u/s 132 of the Act reveals n undisclosed immovable property, or (ii ed which shows that the assessee had gi e the regular books or (iii) search h estments held by assessee in shares & sec of regular books of accounts or (iv) if und deposits, have been found in the cours
7th-10th AY preceding the search; then uri ictional fact, the AO may assume juris o to Section 153A of the Act for the releva

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
y the Hon'ble
Taxman 337]
ss mention of lied that the xpenditure' &
on/usurpation nth to tenth notes "asset"
an economic ue, such as in shares and count. On the tal, reserves, ch cannot be 'expenses' or asset'.
edit)
Credit) erty/ Loans &
Bank Balance
Explanation 2
he purpose of property, ii) posit in bank.
that, (i) the ) information iven loans or has revealed urities, which isclosed bank se of search, having in his iction under nt seventh to tenth assessment the most importa to be undisclose maintained by the which otherwise search, resulting
22. It is to be ke securities' has t
'investment held in their cognate s more general is Hence, the term discovery of an found disclosed in is unexplained an 10th AY precedi proceeds receive investments. To proceeds/ credit of discovery of suggest discover bring it within the for invoking juri 23. Hence, from of the Act can be that he has in h undisclosed asset which is valued foundational, fund
27. In the presen
AO had referred identification mar the fourth provis however does no which was discov that, the AO him ledger and ban liquidated its inve
The Ld. AR, Shri print outs from maintained in c therein formed p
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 33 ::

t year preceding the searched assessment ant aspect is that, these 'assets' must have ed or unaccounted, in the regular books e assessee, and discovered during the cour would not have seen the light of the day in escapement of income.
ept in mind that, the term 'investment held to be considered with the term 'asset in shares & securities' and 'asset' are to b sense, as it takes their colour from each ot restricted to a sense analogous to the m 'investment held in shares & securit
'asset' in the form shares or securities, n the books of accounts or whose source o nd is thus found to have escaped assessme ng the search. It does not suggest or ed by an assessee upon sale of regu say, if any credits in a regular bank acco etc. is found to be unexplained, then it m undisclosed 'income' / 'cash credit' but ry of an undisclosed 'asset' by the Reven e teeth of the fourth proviso to Section 15
diction u/s 153A for the extended period.
the above discussion, it is thus clear that e invoked only if the AO comes to a positiv his possession documents or information t of the assessee qua the assessment year
Rs. 50 lakhs or more. This, in our ju damental or juri ictional fact. ......
nt case, perusal of the satisfaction note sho d to Pages 61 to 69 of seized mate rk SST-01 for assuming juri iction u/s 15
so to Section 153A of the Act. The satis ot reveal the 'asset' which escaped asse vered from the aforementioned seized mate mself has observed that these pages com k ledger which evidenced that the a estments in shares and proceeds were rece i Dudhwewala, has shown us that these the regular books of accounts of t computerised system and all the entrie art of regular books of accounts. We find

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
year. Hence, e been found s of account rse of search, y but for the d in shares &
t'. The term e understood ther, i.e., the less general.
ties' denotes which is not of acquisition nt in the 7th- r include the ular/disclosed unt, like sale may be a case it does not nue so as to 3A of the Act
Section 153A ve conclusion revealing an (7th to 10th) dgment is a ows that, the erial bearing
53C read with sfaction note essment, and erial. We find mprise journal ssessee had eived in bank.
ledgers were the assessee s mentioned ourselves in agreement with neither incrimina represented in fo
28. It is also not mentioned in the acquisition was assessment. Rath on the total 'inco of the Act, which in the fourth assertion/averme possession the ju issue notice u/s invoke/assess 7 t and the AO cann by stating/substi that before issua
AO sets out his details of the sp assessee for AY 2
requirement of la law to invoke the this, we rely upo
King Emperor AIR followed by Hon'
thing to be done or not at all. As d proviso to section resorted to by th fact, which is f according to us juri ictional fact
153C of the Act o case. For the rea thus hold that the AO for AY 2011- essential juri ict of the Act is held
16. It is noted that th upheld by the Hon'ble
72, by observing as follo
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 34 ::

him, that the contents of these seized m ting in nature nor did it in any manner re rm of 'asset' which had escaped assessmen t the AO's case that these investments in e seized material, were unaccounted or th unexplained so as to constitute 'ass her the AO stated that these documents ha ome' of the assessee for assuming juri ict clearly does not meet the essential conditi proviso to Section 153A of the Act.
ent/admission, it is clear that AO did not uri ictional fact [on or prior 05.12.2019] t s. 153C of the Act. The extended ju th - 10th AY is conferred on the AO by aut ot confer to himself the juri iction in a ca tuting the specific juri ictional fact. It ance of notice u/s 153C [for the extended objective satisfaction from the seized m pecified/undisclosed assets in his possess
2011-12 valued Rs. 50 lakhs or more. If aw is not satisfied, the AO does not get the e juri iction u/s 153A of the Act for 7th to on the dictum of the Privy Council in Nazi
R 1936 PC 253(which has since been accep
'ble Supreme Court), that when a statut in a particular manner, it must be done in discussed at Para 13 (supra), the language n 153A of the Act show that issuance of n e AO only after he is in possession of the found to be absent in the present cas
, the AO only after having in his po could have assumed juri iction and issue or else he could not have issued notice, as asons elaborately discussed by us in the f e notice u/s. 153C dated 05-12-2019 was 12 without authority of law and without s tional fact, and hence the issuance of noti to be bad in law."
he above decision of this Tribunal
Gauhati High Court which is repor ows:-

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
material were eveal income nt.
shares found heir source of set' escaping ave a bearing tion u/s 153C on precedent
. From this t have in his to invoke and uri iction to thority of law asual manner is imperative d period], the material, the sion qua the this essential e authority of 10th AY. For ir Ahmed Vs.
pted and later te requires a that manner of the fourth notice can be juri ictional se. Therefore ossession the ed notice u/s.
s done in this foregoing, we issued by the satisfying the ice u/s. 153C has since been rted in 459 ITR

"16. From the specifically objec assessment for A AO to give det assessment. The undisclosed/unac in his possession
AY 2011-12. Th question as to hi in his possession as Rs. 50 lacs a (7th to 10th year state clearly as t the 4th proviso o assumption of ju assessee for asse
....
19. As a consequ not have in his
2019) to invoke a assessee. The ex conferred on the himself the juri specific juri ictio u/s 153C (for t satisfaction fro specified/undisclo
2011-12 valued a law is not satisfie the juri iction u repetition, it is pe sale transactions accounts and the aforementioned a been appositely c
ITAT that it cann escaped assessm
17. In light of the rat to the facts involved in the satisfaction note (su
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 35 ::

rival contentions, we note that, the a cted to the AO's action of reopening t
AY 2011-12 u/s 153C of the Act and had r tails of the purported 'assets' which h e AO however did not provide the de counted assets of the assessee, which he before the issuance of notice u/s 153C o e AO was however duty bound to dec s juri iction, and record finding as to wh
, details of any undisclosed/unaccounted a nd more, qua the assessee qua the asse r) preceding the searched assessment year, to how the case of assessee was being b f section 153A read with explanation 2. On uri iction, the AO could have proceeded essment of escaped/undisclosed assets.
uence, we have no hesitation in holding tha charge, any "Juri ictional fact "(on or p and issue notice u/s 153C of the Act to th xtended juri iction to invoke/assess 7th t
AO by authority of law and the AO cann diction in a casual manner by stating/sub onal fact. It is imperative that before issua the extended period) the AO sets out m the seized material, the deta osed assets in possession qua the asse at Rs. 50 lacs or more. If this essential re ed, the AO does not get the authority of l u/s 153A of the Act for 7th to 10th AY. A ertinent to mention that the assessee had s and liquidation of shares in his regu e liquidation of shares were received in ba assets cannot be termed as undisclosed a concluded in the concurrent decisions of t not be held that the allegedly undisclosed ent."
tio decidendi laid down above, we n the present case. We have carefully upra) recorded by the AO, prior to , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
assessee had he unabated requested the had escaped etails of the e claims were of the Act for cide the said ether he had assets valued essment year
, and thereby rought under nly upon valid d against the at the AO did rior to 5-12- e respondent to 10th AY is not confer to bstituting the ance of notice his objective ils of the essee for AY equirement of aw to invoke
At the cost of disclosed the lar books of ank. Thus the assets. It has the CITA and d assets have now revert back y gone through issuance of the notice u/s 153C dated 2
16. It is noted that, the ‘undisclosed/unaccounte relevant AYs 2014-15 &
added to the satisfac satisfaction note. Read mentioned the specific searched person (M/s C quantified any income, which had escaped ass whisper of any unacco from the aforementione the AO had quantified
Crystal Bottles in AYs 2
be bogus. Having caref there is no mention of which had escaped asse
DR was unable to poi unearthed in the cours income represented in thus countenance the expressed his satisfact
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 36 ::

24-06-2021 for the relevant AYs 20
e satisfaction note does not reveal o ed asset’ which had escaped asse
& 2015-16. As held in the basis and ction note, nor anything be dele ing of the note shows that, the A seized material found from the p
Crystal Bottles) which related to th leave alone income represented in sessment in AYs 2014-15 & 2015-1
unted or undisclosed asset which ed seized material, in the satisfactio the purchases made by the asse
018-19 & 2019-20 and alleged thes fully examined the satisfaction note any item of income represented in essment. Even at the time of hearin nt out to us the relevant materi se of search basis which the AO s the form of asset had escaped a Ld. CIT(A)’s findings that the AO ion that any income represented

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
014-15 & 2015- or point out the essment in the nothing can be eted from the AO has neither premises of the e assessee nor form of ‘asset’,
16. There is no was unearthed n note. Rather, essee from M/s se purchases to e, we find that n form of asset ng, the Ld. CIT, al or evidence stated that the ssessment. We
O had nowhere in the form of 'asset' had escaped a therefore we are in agre fact' as prescribed unde found to be absent and 153C r.w.s 153A of the a consequence, we uph have legally proceeded
2015-16 u/s 153C of t u/s 153C/143(3) of the initio void and bad in quashed. Hence, the g accordingly dismissed.
18. We now take up t their grounds is against note recorded by the AO absence of correlation and the impugned AYs
Ld. CIT(A) [AY 2016-17
“6.3.8
The un the appellant an issue. On examin core contention o proceedings u/s material for the ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 37 ::

assessment qua AYs 2014-15 &
eement with the Ld. CIT(A) that, th er the fourth proviso to Section 153
d the AO is noted to have usurped
Act on wrong assumption of juri hold the Ld. CIT(A)’s order that, th further with the reassessment for he Act. Accordingly, the impugned
Act for AYs 2014-15 & 2015-16 ar n law for want of juri iction an grounds raised by the Revenue o the next legal challenge assailed by t the Ld. CIT(A)’s action of holding
O for AYs 2014-15 to 2017-18 to be between the existence of incrimin
2014-15 to 2017-18. The relevant
] taken note of by us, is as follows:- ndersigned has carefully examined the iss nd the detailed submission made to subs nation of the above submission, it can be s of the appellant is that the AO has initiated
153C of the Act without there being any e AY(s) 2016-17 & 2017-18. As evi

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
2015-16 and e 'juri ictional
3A of the Act is juri iction u/s ictional fact. As e AO could not AYs 2014-15 &
orders passed e held to be ab nd is therefore n this issue is the Revenue in the satisfaction e invalid, due to nating material findings of the - sue raised by stantiate this seen that the d assessment incriminating ident in the assessment order of Bogus old bott
6.3.9
On exa the AO has clea
Southern Agrifura means of bogus p the AY(s) 2018-1
satisfaction note( here as under.
AY 2016-1
Thus it is e
Agrifurane means of bottles. The the F.Y 201
2018-19 an 4.8.2019).
The above on 18.06.20
that the se assessee, M information income for accordance
153C is issu
AY 2017-1
Thus it is e
Agrifurane I of bogus pu amount of b
18 (From J
Rs. 2,95,16
The above on 18.06.20
that the se assessee, M information income for ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 38 ::

r(s) passed the AO contemplated the additi le purchases for both the years under cons amination of the satisfaction note, it can arly brought out from the seized materia ane Industries Pvt Ltd has inflated their purchase of empty bottles from M/s. Cryst
19 & 2019-20 & 2020-21. The relevant e
(s) prepared for AY 2016-17 & 2017-18
7
evident from the seized materials that M
Industries Pvt. Ltd. has inflated their bogus purchase of empty bottles from e amount of bogus purchases is Rs.4,41,
17-18 (From July 2017), Rs. 5,69,70,130/
nd Rs. 2,95,16,955/- for the F.Y. 201
seized materials were handed over to the 021. On perusal of the seized material I eized materials contain information that M/s Southern Agrifurane Industries Pvt.
therein has got a bearing on the determin r the A.Ys. from 2018-19 to 2020-21
with the provision of income Tax Act, 196
ued for AY 2016-17. 8
evident from the seized materials that M
Industries Pvt ltd. has inflated their expens urchase of empty bottles from M/s Crystal bogus purchases is Rs. 4,41,70,464/- for t uly 2017), Rs. 5,69,70,130/- for the F.Y
,955/- for the F.Y. 2019-20 (up to 4.8.201
seized materials were handed over to the 021. On perusal of the seized material I eized materials contain information that M/s. Southern Agrifurane Industries Pvt therein has got a bearing on the determin r the A.Ys. from 2018-19 to 2020-21

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ion in respect ideration.
be seen that als that M/s.
expenses by tal bottles for extract of the is appended
M/s Southern expenses by M/s Crystal
,70,464/- for /- for the F.Y
9-20 (up to e undersigned am satisfied relate to the Ltd. and the nation of total
1. Hence, in 61 notice u/s M/s. Southern ses by means
Bottles. The the F.Y 2017-
2018-19 and 9) e undersigned am satisfied relate to the ltd. and the nation of total
1. Hence, in accordance
153C is issu

with the provision of Income Tax act, 196
ued for AY 2017-18. he above, one can very well infer that th terial to initiate assessment proceedings
Y(s) 2016-17 & 2017-18. he issue before the undersigned is wheth assessment proceedings u/s 153C of the & 2017-18 without there being any outset, the proceedings u/s 153C of the rly explained in the Act. For the sake o n of Act is reproduced as under:-
(Notwithstanding anything contained in ction 148, section 149, section 151 and sing Officer is satisfied that - bullion, Jewellery or other valuable art ioned, “belongs to, or account or documents, seized or requisitio any information contained therein, relates t han the person referred to in section 153
t or documents or assets, seized or requis to the Assessing Officer having juri ictio and that Assessing Officer shall proceed n and issue notice and assess or reassess t in accordance with the provisions of sectio r is satisfied that the books of account or d requisitioned have a bearing on the dete of such other person for the relevant asse to in sub-section (1) of section 153A):
n reading of provision u/s 153C makes i imperative condition needs to be satisfied notice u/s 153C of the Act. This pre-condit undisclosed/unexplained asset or incrimin st the appellant, as a result of search.
satisfaction by the AO of the person searc ts or incriminating document found as a res to the appellant, for relevant assessment ye action is to be recorded by the AO for for issuance of notice u/s 153C.

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
61 notice u/s ere exists no u/s 153C of her the AO is e Act for the incriminating
Act are very of clarity, the section 139, section 153, ticle or thing ned, pertains to,”
3A, then, the sitioned shall on over such against each the income of on 153A, that documents or ermination of essment year t abundantly d by the AO, tion includes:
nating seized hed that, the sult of search ear.
the relevant

above three conditions are to be satisfied sly as per provisions of section 153C of t y of the pre-conditions mentioned here in u/s 153C of the Act legally unsustainable s of the case of the appellant company, th he incriminating material seized relates to AY 2018-19 onward only. Hence, the dition for issue of notice 153C of the Act is on’ble Apex Court in the case of PCIT al Education Society (2017) 397 ITR 344 ( etween issue of notice u/s 153C and the s a result of search must exist. The Hon’bl he order has observed that one of the dent to the issue of a notice u/s 153C of th
Jewellery or other- valuable article or t nt or document must be seized or requisit ent year for issue of notice u/s 153C of the servation of the Hon’ble Apex Court in pa here in above is reproduced below:
itted this additional ground by giving a re nal issue taken up on the basis of facts al efore, could be raised. In this behalf, it w as per the provisions of Section 153C aterial which was seized had to per rs in question and it is an undisputed f ch were seized did not establish any , with these four Assessment Years.
er Section 153C of the Act is essential for vision, it becomes a juri ictional fact.
logical and valid, having regard to the the Act. Para 9 of the order of the ITAT rev d through the Satisfaction Note and the m herein was culled out and it showed th sment Year 2004-05 or thereafter. After ta ara 9 of the order, the position that emerge ara 10. It was specifically recorded that th could not point out to the contrary. It is fo as also given its imprimatur to the afores
That apart, learned senior counsel appea ued that notice in respect of Assessment Ye s even time barred.”
of the instant case are squarely covered by entioned here-in-above.

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
cumulatively the Act. Non- above, would or invalid. In he AO himself the FY 2017- e imperative not satisfied.
T-3, Pune Vs
(SC) has held incriminating e Apex Court juri ictional he Act is that hing” or any ioned for the e Act.”
ara 18 of the eason that it lready on the was noted by of the Act, rtain to the fact that the y co-relation,
Since this r assessment
We find this provisions of veals that the material which at the same aking note of es there from he counsel for or this reason said approach aring for the ears 2000-01
y the ratio of 6.4.6
Furthe the case of Inde under-
“As regards the documents must assessments are Court in Commis
Education Societ essential require
Securities (2016)
Vs ACIT [2017] 3
assumption of Ju settled must be i assessments are 6.4.7
At this observation of th
Circle-1, Trichy V dated 31.05.2024
the case of Sinh
(SC) has held tha
“In the light of (supra), and havi invoke juri ictio the requirement assumption of the 2014-15 is held
CIT(A), which imp dismissed. And si
CIT(A) on the leg on to merits are a 6.4.8
Further commodities Lim the issue of assu as under.
“The juri ictiona received is likely years or years w thereafter procee
The power to un those years to w
Absent any mate total income for a ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 41 ::

er, the Hon’ble Delhi High Court in para 3
ex Security Pvt. Ltd [86 taxmann.com 8
section Juri ictional requirement viz, tha be incriminating and must relate to the A sought to be reopened, the decision of ssioner of Income Tax-III, Pune Vs. Sinhg ty (Supra) settles the issue and holds th ement. The decision of this Court in CI
) 380 ITR 612 (Del) and ARN Infrastructu
394 ITR 569 (Del) also held that in order ri iction under section 153C of the Act th incriminating and must relate to each of th sought to be reopened.”
4 by relying the decision of the Hon’ble A hgad Technical Education Society (2017) at the binding judicial precedent of Hon'ble ing found that 'Satisfaction Note' prepared n u/s 153C of the Act for AY 2014-15 doe of law as stipulated u/s. 153C of the A e juri iction u/s 153C of the Act for asses to be bad in the eyes of law as rightly he pugned action is confirmed and Revenue A ince we have concurred with the impugned gal issue (supra), the other grounds raised academic and doesn't deserve adjudication r, the Hon’ble Delhi High Court in the case ited Vs ITO [2024]161 taxmann.com 485
mption of juri iction u/s 153C of the Act al AO would have to firstly be satisfied that y to have a bearing on or impact the tot which may form part of the block of six or ed to place the assessee on notice under S ndertake such an assessment would stand which the material may relate or is likely erial that may either cast a doubt on the a particular year or years, the AO would no , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
1 has held in 84 (Del)] as at the seized
A. Ys. whose the Supreme gad Technical his to be an CIT-7 Vs RRJ ure India Ltd.
to justify the he documents he AYs whose n record the ACIT Central
7/Chny/2023
Apex Court in 397 ITR 344
e Apex Court by the AD to es not satisfy
Act, the very ssment of AY eld by the Ld
Appeal stands d action of Ld d by Revenue
”
e of Saksham
(Delhi) upon has observed t the material tal income of r ten AYs and Section 153C.
d confined to to influence.
estimation of ot be justified in invoking its p consequent to su liable to be issu proceedings and r
6.4.9
Further that “the invocation incriminating ma
Notes also fail to and pertaining to determination of abated or reopen have erroneously material is recov requisition made, all the six AYs' ye to the search yea of Explanation unsustainable an precedents notice
6.4.10
Further decision of the commodities Lim merits. The find taxmann.com 185
“Section 153C, r
Search and seiz material) Assessm that section 153
juri ictional Asse for those Assessm and undisclosed
Officer is satisfi determination of reopening or ass could possibly fo that since in ins
Assessment Years or obtained and s how material disc was likely to "hav which was sough notices, in such c
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 42 ::

powers conferred by Section 153C. It wo uch satisfaction being reached that a not ued and thus resulting in the abatemen reopening of concluded assessments”
r the Hon’ble High Court in the said case of Section 153C in respect of AYs' fo terial had been gathered or obtained. The record any reasons as to how the materia o a particular AY is likely to "have a be the total income" for the year which is ned in terms of the impugned notices. The y proceeded on the assumption that the vered in the course of a search or on th
, they become empowered in law to assess ears immediately preceding the assessmen ar or the "relevant assessment year" as def
1 of Section 153A. The said approac nd contrary to the consistent line str ed above.”
r, the SLP filed by the revenue agains
Hon’ble Delhi High Court in the case ited was dismissed, both on the ground dings of the Hon’ble Apex Court vide
5(SC) [24.01.2025] is as under.
read with section 153A, of the Income-ta ure. Assessment of any other person ( ment year 2015-16 High Court by impugne
C would apply only to such Assessment essing Officer is satisfied and has incrimina ment Years and which may be concerned w income High Court also held that unle ied that material gathered could poten f total income, it would be unjustified in sessing all over again all ten Assessmen rm part of block of ten years High Court stant case section 153C was invoked in s for which no incriminating material had b satisfaction notes also failed to record any r covered and pertaining to a particular Asse ve a bearing on determination of total inco ht to be abated or reopened in terms circumstances, proceedings initiated under , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ould only be tice would be t of pending has observed or which no e Satisfaction al discovered earing on the sought to be e respondents moment any he basis of a s or reassess t correlatable fined in terms ch is clearly ruck by the st the above of Saksham of delay and e [2025]171
ax Act, 1961
(Incriminating ed order held
Years where ating material with disclosed ess Assessing tially impact mechanically nt Years that t further held n respect of een gathered reasons as to essment Year ome" for year of impugned section 153C would not sustain
SLP filed by reve dismissed - Held,
SLP dismissed ag
[2024] 161 taxm
4]
1. Heard the le petitioners - Reve
2. There is a gro
Special Leave Pe the petitioners- R
3. Even otherwis order passed by t
4. The Special Le of delay as well a 5. Pending applica

n and impugned notice was to be quashe enue against impugned order of High Cou yes [Para 4] [In favour of assessee]”
gainst Saksham Commodities Ltd V. Incom mann.com 485 (Delhi) / [2024] 464 ITR 1
arned Additional Solicitor General appea enue.
oss delay of 162 and 145 days respectively etitions which has not been satisfactorily
Revenue se, we see no reason to interfere with th the High Court.
eave Petitions are, accordingly, dismissed o as merits.
ations, if any, shall also stand disposed of.
as per the detailed discussions made su ce(s) relied upon, it is a settled law tha t is ab- initiovoid in absence of incrimin he plain reading of language of section 153
ial pronouncement cited here-in-above, it i er to reopen the assessment of other pers e assessment year earlier to the year of s exist between the existence of incrimina essment year(s). The AO cannot indiscrimin
153C of the Act for having found incrimina
). In the instance case, admittedly, the ord the satisfaction note about the exist aterial relation to the AY(s) 2016-17 &
atisfaction note, the AO has admitted the terial relating to the AY(s) 2018-19, 2019
ore, the undersigned is of the considered v n initiating assessment proceedings u/s 15
16-17 & 2017-18 without there being any g to the AY(s) 2016-17 & 2017-18. Th juri iction u/s 153C of the act based action is not legally correct. A juri ictiona on-existence of which depends assumption on by a court, tribunal or an authority. In '
explained as a fact which must exist before juri iction of a particular case. Mistak

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ed - Whether urt was to be me Tax Officer
(Delhi) [para aring for the y in filing the explained by he impugned on the ground upra and the t notices u/s nating seized
3C of the Act is abundantly on u/s. 153C search, direct ting material nately initiate ating material
AO has not tence of any 2017-18. As existence of 9-20 & 2020- view that the 3C of the Act incriminating herefore, the d upon such al fact is one n or refusal to 'Black's Legal e a court can ke of fact in relation to juri authority or tribu which the statute the fact on which juri iction, then
6.4.13
In 'Hals the juri iction of state of affairs, t or collateral to th by an inferior t
Tribunal has to m ruling on the pr conclusive.
6.4.14
In the (2006) 205 CTR (
"A "juri ictional or an assumes ju is one on existen court, a tribuna administrative ag does not exist, th authority wrongly questioned by a erroneously assu can confer upon i
6.4.15
The ex the exercise of p lawfully. When empowered to pr with the provisi preconditions set
'juri ictional fac ascertain wheth proceeding. Only finding regarding
AO issue a notice satisfying this cru the income of the juri ictional fact process u/s 153C
6.4.16
In the order(s) reveals incriminating mat
SNJ Distilleries o
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 44 ::

diction is an error of juri ictional fact.
nal can assume juri iction in respect of su e does not confer on it and if by deciding h juri iction depends the court or tribunal the order is vitiated.
sbury's Laws of England' it has been state f a tribunal is dependent on the existence o hat state of affairs may be described as pr he merits of the issue. If, at the inception ribunal, a challenge is made to its juri make up its mind whether to Act or not an reliminary or collateral issue; but that case of Arun Kumar & Ors. vs. Union of (SC) 193: (2006) 286 ITR 89 (SC) it has be fact" is a fact which must exist before a Co uri iction over a particular matter. A juris nce or non-existence of which depends jur al or an authority. It is the fact upo gency's power to act depends If the juris he court, authority or officer cannot act.
y assumes the existence of such fact, the writ of certiorari. The underlying princip ming existence of such juri ictional fact, itself juri iction which it otherwise does no istence of a 'juri ictional fact' is the sine power. In its absence, the power cannot the juri ictional fact is established, roceed with the case and make decisions i ons of law. In this context, the fulfilm t forth u/s 153C r.w.s 153A of the Act is ct.' The AO is required to carefully e her these specific conditions are sati y after deciding on this issue, and recor the presence or absence of these condit e u/s 153C for the relevant assessment yea ucial prerequisite can the AO lawfully proce e assessee for the relevant year, as the pre t is indispensable for validly initiating the C of the Act present case of the appellant company, the that no information suggesting the terial found or seized during the course of s on 06.08.2019 has escaped assessment f

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
No statutory ubject matter g erroneously exercises the ed that where of a particular reliminary to, of an inquiry i iction, the nd can give a ruling is not India & Ors.
een held:- ourt, Tribunal ictional fact ri iction of a on which an ictional fact
If a Court or order can be ple is that by no authority ot posses e qua non for be exercised the AO is n accordance ment of the considered a examine and sfied before rding a clear ions, can the ar. Only upon eed to assess esence of the e assessment e assessment existence of search at M/s for the years under considerati that the appellan
Act on 15.06.20
initiation of proce
18 by the AO is n u/s 143(3) r.w.s
2017-18 is void upon the issue of 19. Before we adjudi rendered by the Ld. CIT necessary to take note that Section 153A/153C
2003 w.e.f. 01.06.200
assessment contained in procedure for making as of assessment u/s 153A to all other methods o each scheme has its di be strictly adhered to.
"Assessment in case of for assessment in case requisition under sect department. Section 1
completion of assessme the Act bears the head
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 45 ::

on. Furthermore, it is also significant to br nt’s premises were subjected to search u/
22. Therefore, in the absence of such eedings u/s 153C of the Act for AYs 2016-1
not legally sustainable. Accordingly, the ord
153C of the Act dated 28.03.2023 for AYs ab-initio and all the grounds raised by t f defective satisfaction are hereby treated a cate the issue as to whether the T(A) are sustainable in law or not, i of the legislation of Section 153C
C of the Act was introduced by th
03. It replaced the provisions rel n Chapter XIV-B and introduced an ssessment u/s. 153A/153C of the Ac
A/153C is available to the departm of assessments, revisions and reas stinct set of conditions and stipulat
The sub-heading of Section 153A f Search or requisition" which is a sp of an assessee against whom sear tion 132A of the Act is carried
153B of the Act prescribes the ent u/s 153A and 153C of the Act. S ding "Assessment of income of any , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ing on record
/s 132 of the findings, the 17 and 2017- der(s) passed
2016-17 and the appellant as allowed.”
above findings t would first be itself. We note he Finance Act, lating to block altogether new ct. The Scheme ment in addition ssessments and tions that must
A of the Act is pecial provision rch u/s. 132 or d out by the time limit for Section 153C of y other person"

which is a special prov other person" (third requisition u/s. 132A conditions precedents a the Act; and Section 15
if necessary for assessm
20. Section 153A of t
‘searched person’ and S assessment of income o not searched by the D
Act, provided the AO is (a)any money, bullio requisitioned, belongs
(b)any books of acc pertain to, or any inf the person referred to 21. So, from a readin case of ‘searched perso preceding the year of se is bound to call upon s the six preceding AYs.
132 of the Act, if it is valuable articles or thin
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 46 ::

vision in respect of assessment of i party) against whom no search of the Act was carried out, pr are satisfied as envisaged under S
53D of the Act is the provision regar ment in case of search or requisition he Act is a special provision for ass
Section 153C of the Act is a specia of 'any other person' which is a thir epartment but will be assessed u/
satisfied that —
on, jewellery or other valuable article or s to; or count or documents, seized or requisitio formation contained therein, relates to a o in Section 153A.
ng of Section 153A of the Act, it is on’, the AO is mandated to issue no earch in as much as once a person such an assessee to furnish returns
However, where during the course found that any money, bullion, jew gs seized or requisitioned belongs t

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
income of "any h u/s. 132 or rovided certain
Section 153C of rding approvals
.
sessment of the al provision for rd party who is /s. 153A of the r thing, seized or oned, pertains or person other than s noted that in otice for six AYs is searched, he s of income for e of search u/s wellery or other to or any books of account or docume information contained t u/s. 153A of the Act [i.
the AO of the ‘searched money, bullion, jewelle requisitioned belongs to documents seized or re relates to the ‘other pe first prepare a satisfa material of the ‘other pe the AO of the ‘searched which belongs/pertains/
juri iction over such ‘o shall record his satisf belongs/relates/pertains determination of the tot is a special provision ag the department, the sa
Section 153C has to be 22. It is judicially se would constitute a juris
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 47 ::

ents seized or requisitioned perta herein relates to "other than the pe
.e a third party, in this case the 'a d person’ has to first record his satis ery or other valuable articles or th o the ‘other person’ or that any book equisitioned or any information con erson’, then the AO of the ‘searche ction note to that effect, segreg erson’ from that of the ‘searched pe d person’ has to hand over the re
/relates to the ‘other person’ to other person’ and then the AO of the faction that, the relevant incrimin s to the ‘other person’ which has a tal income of such ‘other person’. A gainst an assessee who has not bee afeguard stipulated by the provision scrupulously followed.
ttled that the recording of this sa ictional fact, in the absence of w

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ains to or any erson" searched assessee'], then faction that the hings seized or ks of account or ntained therein ed person’ shall ate the seized erson’, and then levant material the AO having e ‘other person’
nating material bearing on the As Section 153C en searched by ns contained in atisfaction note which no notice u/s 153C of the Act c exercise stipulated by t
Section 153A would ord are subjected to search
/asset are found in the s books/documents is fou the third party would
Section 153C of the A prescribed in Section scrupulously followed. I before proceeding aga cannot be done in a ca should be based upon c
132(4A)(i) of the Act cl
‘books of accounts’ or ‘
any person in the cours
/material belongs to presumption as to the course of search u/s. 13
by Section 292C(1)(i) person from whom the whenever an asset/do
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 48 ::

can be validly issued. The rationa the Legislature is because, the spec dinarily be triggered only against th h u/s. 132 of the Act. However, if searched premises which belong to und which pertain to /relate to a th be subject to assessment/re-asse
Act. In order to do so, the condi
153C of the Act by the statu
It has to be kept in mind that sat inst ‘other person’ who has not sual manner. The satisfaction of As cogent material. The reason for it early stipulates that when inter alia document’ is found in the possessio se of a search, it may be presumed such person (the ‘searched asset, books of accounts, etc. fou
32 or survey u/s. 133A of the Act is of the Act which provides that it said assets/documents was found. I ocument is found from a person

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ale behind this cial provision of he persons who f any valuables a third party or hird party, then essment as per ition precedent ute has to be tisfaction of AO been searched ssessing Officer is that, Section a any ‘asset’ or on or control of that such asset person’). The und during the s also governed belongs to the In other words, who is being searched, the normal belongs to that person presumption and com asset/document in fact
‘other person’. There m unearthed during searc at the satisfaction that ‘searched person’ but t take the place of 'satisfa by various Courts.
23. At this juncture, made by the Hon’ble ju
Vishnu Ventures Pvt follows:
“77. The ingredie
(i) Satisfaction of section 153A not or thing/books seized/requisition relates to, a third
(ii) Recording of s
(iii)Handing over having juri ictio
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 49 ::

presumption is that the said a n. It is for the Assessing Officer me to a conclusion or 'satisfact t belongs/pertains/relates to some must be some cogent material availa h with the Assessing Officer before the seized asset/document does no to ‘other person’. Surmise and con action' and the same interpretation we gainfully refer to the followin ri ictional Madras High Court in th t. Ltd. vs DCIT (460 ITR 438
nts of Section 153 C are:
f the Assessing Officer who is Assessing O tice that money/bullion/jewellery/other va of account or documents (incriminatin ned belongs to/pertain to or any informatio d party.
satisfaction as above.
of the incriminating material to the Asse n over the third party.

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
asset/document to rebut that tion' that the body else viz., able which was he/she arrives ot belong to the njecture cannot has been given ng observations he case of Agni
8)which are as Officer of the luable article g materials) on contained, essing Officer

(iv) Recording of that the incrimin total income of th
(v) Upon conditio above, notices b party in accordan
78. In my consi object, intention
153C. Section 15
set evidently a n condition precede the conduct of a under Section 13
it is incumbent u searched entity in 79. Section 153C prior to issuance
(i) Recording of entities that some
(ii) Recording of that the incrimina the total income o
80. Notice unde confront satisfact there is, in my between the prov
The contention
Assessing Officer for all the years c thus rejected.
81. To clarify, it receiving Assessi reflects a clear f bearing on dete assessment years to the previous y that such notice w
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 50 ::

satisfaction by the Assessing Officer of th nating material has a bearing on the dete he third party.
n of recording of the satisfaction of bot be issued to assess/reassess the income nce with the procedure stipulated under Sec idered view, there is a vital distinction as well as the express judge of Section 53A addresses the searched entity and th notch higher for this reason. There is no ent under Section 153A to the issuance o search under Section 132 or making of 2A. Upon the occurrence of one of the afor pon the office to issue notice under Sectio n line with the procedure stipulated.
C however requires the satisfaction of tw of notice:
satisfaction by the Assessing Officer of t e of the incriminating materials relate to a satisfaction by the Assessing Officer of th ating materials have a bearing on the dete of that third party.
r Section 153C would have to be issue tion of both conditions as aforesaid. To considered opinion, a clear and marke visions of Section 153A and 153C.
of the revenue that a mandate is ca r of the third party to issue notice under S comprising the block, mechanically and aut t is only where the satisfaction note reco ng Officer, i.e., the Assessing Officer of th finding that the incriminating material re ermination of total income of the third s immediately preceding the assessment y ear in which search is conducted or requisi would have to be issued for all the years.

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
he third party ermination of th officers as of the third ction 153A.
between the ns 153A and he procedure discretion or f notice save a requisition resaid events, n 153Ato the wo conditions the searched third party.
he third party ermination of ed only upon this extent, ed distinction st upon the Section 153C tomatically, is orded by the he third party ceived has a party for 6
year relevant tion is made,

from the provision that the receiving ass mind to the materials received and ascert to which the incriminating material relat mination/ascertainment is complete that th t would open qua those particular years.
not be an automated function unconne sis and ascertainment by an assessing offic ction of Section 153A and 153C is conscio apply different yardsticks to an entity sea h yardstick being more exacting in the ess of assessment is demanding and an as tice, is bound by the stringent procedure u the process.
rds, a Damocles sword appears over the he issuance of every notice which is laid of the proceedings; The sword cannot be in e statutory condition is satisfied. That is alyse and compartmentalise the incrimina ve at a categoric determination as to the y material relates and issue notices only for state these are some situations/issue whe nd the nature of the issue itself might nee before such year-wise determination is officer would be well within his right to sta detail the difficulties that present themselv at stage. This would reflect application of view, would serve as sufficient complian on.”
(empha ted that, in a case to which Section searched person has to come to terial handed over to him is likely to e determination of the total income e there is absence of material fo d person’ which is "having a be , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
essing officer tain precisely es. It is only e flood gates
The issuance ected to this cer.
usly different arched and a case of the ssessee, once nder the Act, e head of an to rest only nvoked lightly to state, an ating material year to which those years.
en the spread ed more, and possible. In te the nature ves in precise mind and, in nce with the asis supplied)
153C of the Act o a prima facie o implicate and e" of the ‘other ound from the earing on the determination of the tot of a juri ictional fact, w
153C of the Act. This is because if the same is i then it would result in a 153C of the Act even th to the ‘other person’ or the impugned AYs. In excerpts of the decisi
Technical Education took note of the Hon'bl view which is as under:—
"6. The tribunal h to be pertaining relation documen words, the tribun issue of notice co information in p circumstances tha the impugned or Officer is empow income of six ass year relevant to t therefore the sat enough, is errone stand of the reve be found in parag pertain to assess assumed, that th information are s that they were ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 52 ::

tal income", it would constitute the which is a pre-condition to assume s a vital stipulation which is to be gnored or is treated in a casual or fa assessments coming to be reopened ough there is no material which rela is not having ‘any bearing on his to this regard, we gainfully refer to on of the Hon'ble Supreme cou
Society's case (supra), wherein e High Court's findings while confir
—
has found that incriminating material seize to all six assessment years did not estab nt-wise with the assessment year in quest nal concluded that the present matter indic ould be on the basis that there is specific possession of the Assessing Officer. It at the tribunal found and as indicated in pa rder that the revenue's assertion that th ered under the statute to assess or reass sessment years immediately preceding the the previous year in which such search is co tisfaction which is recorded in the satisfa eous. Therefore, the notice cannot be uph enue cannot be accepted. The reasons, th graph 9 and 10 of the impugned order. If sment year 2004-05 or thereafter then he documents seized or incriminating ma specific and to all assessment years. The t concluded assessments. They could not , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
non-fulfillment juri iction u/s met by the AO arcical manner, d under Section ates to/pertains otal income’ for o the following rt in Sinhgad their Lordship rming Tribunals ed and stated blish any co- tion. In other cates that the incriminating is in these aragraph 8 of he Assessing sess the total e assessment onducted and action note is held and such herefor are to certain items it cannot be aterial giving ribunal found t have been disturbed. The do unaccounted tran the four assessm found that it will overall approach all the discoveries to be taken into note was very
Assessing Officer which specific inc hidden informatio assessee. In the in the note is no cash and jewelle agricultural prope utilised to acquir
With regard to c granting admissio is absolutely noth education is impa granted to the t obtained in XIIth and cash comp sanctioned fees a there cannot be a 9. We are of the as perverse and these appeals r accordingly dismi
25. And the aforesaid by the Hon'ble Supreme
"18. The ITAT pe was a juri iction record and, there the ITAT that a incriminating ma
Assessment Year documents whic document-wise, requirement unde
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 53 ::

ocuments in question are neither incriminat nsactions of the assessee. They also did ent years. It is in these circumstances tha not be possible to uphold the stand of the in matters of concealment by the group a s of the search on Shri Navale and it conce account while forming the satisfaction. Th closely examined and the reasons assig were found to be silent about the assess criminating information or unaccounted or on was discovered or seized by the reven circumstances, the general satisfaction and ot enough. The tribunal has found that w ery, the explanation of the assessee was erties and derived agricultural income. Tha re jewellery that was belonging to him an ash and stated to be recovered from the ons, we do not find that any inquiries were hing to indicate as to in which educational arted and institution-wise. Whether the ad echnical courses merit-wise or on the ba h standard HSC exam. If any fee structure ponent is therefore collected over and are matters which ought to have been g a general or vague satisfaction as is relied u opinion that the tribunal's conclusion cann given the above-noted factual backgrou raises any substantial question of law ssed. No costs."
d finding of Hon'ble High Court has e Court as under:- rmitted this additional ground by giving a r nal issue taken up on the basis of facts al efore, could be raised. In this behalf, it w as per the provisions of section 153C aterial which was seized had to per rs in question and it is an undisputed f ch were seized did not establish any with these four
Assessment
Years.
er section 153C of the Act is essential for , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ting ones nor not relate to t the tribunal revenue that assessee and rns, will have e satisfaction gned by the sment year in r undisclosed nue from the d as recorded with regard to that he had t income was nd his family.
students for made. There courses, the dmissions are asis of marks e is approved d above the one into and upon.
not be termed und. None of w. They are s been affirmed reason that it ready on the was noted by of the Act, rtain to the fact that the co-relation,
Since this r assessment under that prov reasoning to be section 153C of t
ITAT had scanned was disclosed th belongs to Assess the material in pa is discussed in pa the Department c the High Court h of the Tribunal.
respondent, argu and 2001-02 was 19. We, thus, fin to be raised and Order of the High without any blem notice in respect time barred. How necessary to ente
26. It is thus apparen material reaches the de empowered to initiate evident from a plain tex commencement point, seized or requisitioned proceeding to issue not searched entity in acco of action under Section satisfied that the book
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 54 ::

ision, it becomes a juri ictional fact. W logical and valid, having regard to the the Act. Para 9 of the order of the ITAT rev d through the Satisfaction Note and the m herein was culled out and it showed th sment Year 2004-05 or thereafter. After ta ara 9 of the order, the position that emerg ara 10. It was specifically recorded that th could not point out to the contrary. It is fo as also given its imprimatur to the afores
That apart, learned senior counsel appea ed that notice in respect of Assessment Ye s even time barred.
d that the ITAT rightly permitted this addi correctly dealt with the same ground on m h Court affirming this view of the Tribunal mish. Before us, it was argued by the res t of the Assessment Years 2000-01 and wever, in view of our aforementioned findi er into this controversy.”
(empha nt that only when the transmitted d sk of the AO of the ‘other person’ th action under Section 153C of th xtual reading of the provision which being the handing over of docum d to the AO of the "other person tice to assess or reassess the incom rdance with Section 153A. Howeve
153C is significantly premised upo ks of account or documents and as , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
We find this provisions of veals that the material which at the same aking note of ges therefrom e counsel for or this reason said approach aring for the ears 2000-01
tional ground merits as well.
is, therefore, spondent that 2001-02 was ngs, it is not asis supplied) documents and hat he becomes he Act. This is h speaks of the ments or assets n" and in turn me of the non- er, the initiation n the AO being ssets seized or requisitioned having a b such other person. Th expression "if, that As necessarily follow that clearly not intended to material by the juri ic of action under Section note that the materia determination of the tot contemporaneous recor material to the assesse live nexus ascertained contained information r total income. This in ou constitutes a juri ictio that the initiation of act on a formation of satis material handed over a ‘other person’ and is li income" which would b reassessment.
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 55 ::

bearing on the determination of the is is manifest from the provision ssessing Officer is satisfied". It w the issuance of a notice under S o be an inevitable consequence to ctional AO and that the AO before c
153C is also obliged to record a va al so received would have a b tal income of such other person. Th rding of satisfaction by the AO link ee. The satisfaction note should de upon examination of the seized elating to the assessee which has a ur considered view is an aspect of s nal fact. This leads us to the inevit tion u/s 153C of the Act would have sfaction by the AO of the ‘other p and received pursuant to a search ikely to influence the "determinatio e of relevancy for the purposes of , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
total income of employing the would therefore
Section 153C is the receipt of commencement alid satisfaction earing on the ere has to be a king the seized emonstrate the material which a bearing on its significance and able conclusion e to be founded erson’ that the relates to such on of the total assessment or 27. We in this regard law recognizes between
Section 153C enables a reassess the six AYs'
sanctions and confers placed in its hands for u of that power, the ques circumstances of a part power. Ultimately, Sect articles seized in the co potential to impact or h unless the AO is objecti pertains to the ‘othe determination of total reopening or assessing
28. In this context, w the Hon’ble Delhi High
(380 ITR 612) wherei thing may have been re
‘other person’ would no has to ‘necessarily’ be ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 56 ::

bear in mind the well settled distin n the existence of power and the ex and empowers the juri ictional A or the ‘relevant assessment year’
an authority upon the AO to exer up to a maximum of ten AYs. Despit stion which would remain is whethe icular case warrant or justify the inv tion 153C is concerned with books, ourse of a search and which are fou have a bearing on an assessment.
vely satisfied that the material gath er person’ and could potentiall income, it would be unjustified i all the AYs in question.
, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ction which the xercise thereof.
O to assess or ’. The Act thus rcise the power te the conferral er the facts and vocation of that , documents or und to have the Therefore, and hered relates or y impact the n mechanically ations made by Securities Ltd se an article or which belongs to e ‘other person’
ss the material obtained is shown to h income. The Court laid reflective of undisclosed portion of the judgment
“33. The record s the Assessing Of belongs to the as arises is whether taking further st respect of the concluded and in In our view, the material now ava nexus with those of assessing the Merely because a is seized from the the Act does not are necessarily t view, the conclud and solely for th which has no bea preceding the se persons.
….
36. The decision that the Assessin every case, wher
Assessing Officer could possibly re the Assessing O handed over to documents/assets assessee for the be warranted in the Assessing Of during search o assessee before c
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 57 ::

have a bearing on the determinati stress on the existence of materia d income being of vital importance t is as follows:- slip belongs to the assessee and, therefore, fficer of the searched persons recording th ssessee cannot be faulted. However, the q r the Assessing Officer of the assessee wa teps for reassessing the income of the assessment years for which the assess respect of which the seized document had e same would be clearly impermissible a ailable with the Assessing Officer, admitt assessments and was wholly irrelevant for e income of the assessee for the years a valuable article or document belonging to e possession of a person searched under s mean that the concluded assessments of o be reopened under section 153C of the ded assessments cannot be interfered with e reason that a document belonging to t aring on the assessments of the assessee arch, was seized from the possession of in SSP Aviation (supra) cannot be underst g Officer has the juri iction to make a rea re seized assets or documents are handed r. The question whether the documents/a eflect any undisclosed income has to be c
Officer after examining the seized asset o him. It is only in cases where s could possibly reflect any undisclosed in relevant assessment years, that further e respect of those years. Whilst, it is not n fficer to be satisfied that the assets/docum of another person reflect undisclosed in commencing an enquiry under section 153

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
on of the total al that may be e. The relevant the action of hat the same question then as justified in assessee in sments were d no bearing.
as the seized edly, had no r the purpose in question.
o an assessee ection 132 of the assessee e Act. In our mechanically the assessee, for the years the searched tood to mean assessment in d over to the assets seized considered by ts/documents the seized ncome of the enquiry would necessary for ments seized ncome of an 3C of the Act, it would be impe apparent that the income of the ass
29. We also refer to case of Abhisar Bui unequivocal terms that be justified in seeking t same position would pre
Here too, the AO is m material gathered in consequently those ass of the Act. The additio that may have been une of material requisition enduring connect betw that may be ultimately reinforce the requireme link to the estimation reinforces our view that the AO records his o material pertaining to o and which may be conce
Absent any material qu
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 58 ::

ermissible for him to commence such en e documents/assets in question have no be sessee for the relevant assessment years.”
the decision of the Hon’ble Suprem ldwell (supra) wherein it has absent incriminating material, the to assess or reassess completed ass evail in context of Section 153C of t mandated to firstly identify the AYs the course of the search may essments would face the spectre o ns here too would have to be bas earthed in the course of the search ed. The statute thus creates a een the material discovered and t y made. All the above discussed j ent of incriminating material having of income for a particular AY in t notice u/s 153C can be validly iss objective satisfaction that he has r relating to the ‘other person’ for th erned with their disclosed and undis ua the ‘other person’ that may eithe

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
nquiry if it is earing on the me Court in the been held in e AO would not sessments. The the Act as well.
s' to which the relate to and of Section 153C sed on material or on the basis persistent and the assessment udgments thus an ineradicable as much as it sued only when s incriminating he relevant AYs sclosed income.
er cast a doubt on the estimation of to would not be justified in the Act. It would only that a notice u/s 153C o
30. It also has to be validity of the satisfa juri iction u/s 153C o recorded by the AO as read into his ‘satisfactio improve upon the satis jurisprudence available recorded/ satisfaction d u/s. 147 of the Act.
reopening the reassessm
Neither anything can b can be deleted from th
Court in the case of Hin
Taxman 479/268 ITR that the reasons are re
AO. No substitution or d those reasons. No infer
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 59 ::

otal income for a particular year or n invoking its powers conferred by S be consequent to such satisfaction of the Act would be liable to be issue kept in mind that, when the chal action note basis which the AO of the Act, we have to examine t it stands and no new words can on note’ nor can the Revenue now faction note. For this, we draw stre e in the context of examination o drawn by the AO for re-opening t
It is settled law that reasons as ment are to be examined on a 'stan e added to the reasons so recorde e reasons so recorded. The Hon'ble ndustan Lever Ltd. v. R.B. Wadka
R 332 inter alia, held "it is needle equired to be read as they were re deletion is permissible. No addition c rence can be allowed to be drawn

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
r years, the AO
Section 153C of being reached ed.
lenge is to the O has usurped the satisfaction be imported or supplement or ength from the of the reasons the assessment s recorded for nd-alone' basis.
ed nor anything e Bombay High ar [2004] 137
ess to mention ecorded by the can be made to on the basis of reasons not recorded by Lordships added that "th should not keep the ass link between the concl view, this ratio decidend force to the satisfaction to issue notice under se
31. Having regard to we now revert back to earlier, search action w
2019 and in connection under Section 153C of to submit their return(s
It is noted that, the iss note(s) drawn up by th bearing on the legal ch satisfaction note(s) rec material bearing on the below:

ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 60 ::

y him. He has to speak through the he reason recorded should be self e sessee guessing for reasons. Reason lusion and the evidence…..". In di of the Hon'ble High court is applic note prepared by the AO for assum ection 153C of the Act.
the above laid down well settled l the facts involved in the case befor was conducted upon M/s Crystal Bot n & subsequent thereto, the AO is the Act dated 24-06-2021 requirin s) of income inter alia for AYs 2014- suance of the notice was preceded he AO and since the same would h hallenge raised before us, the relev corded for AYs 2014-15 to 2017-18
e issue impugned before us, is rep

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
reasons." Their explanatory and ns provided the our considered cable with equal ming juri iction egal principles, re us. As noted ttles on 06-08- ssued notice(s) g the assessee
-15 to 2017-18. by satisfaction have a material vant portion of 8, which has a produced herein

AY 2014-15
…Thus it is evi
Agrifurane Indust bogus purchase o of bogus purchas
2017), Rs. 5,69,7
the F.Y. 2019-20
The above seized
18.06.2021. On seized materials
Southern Agrifura got a bearing on 2018-19 to 2020
Tax Act, 1961 not AY 2015-16
…Thus it is evid
Agrifurane Indust bogus purchase o of bogus purchas
2017), Rs. 5,69,7
the F.Y. 2019-20
The above seized
18.06.2021. On seized materials
Southern Agrifura got a bearing on 2018-19 to 2020
Tax act, 1961 not AY 2016-17
…Thus it is evi
Agrifurane Indust bogus purchase o of bogus purchas
2017), Rs. 5,69,7
the F.Y. 2019-20
The above seized
18.06.2021. On seized materials
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 61 ::

dent from the seized materials that M tries Pvt. Ltd. has inflated their expenses of empty bottles from M/s Crystal bottles.
ses is Rs.4,41,70,464/- for the F.Y 2017-1
70,130/- for the F.Y 2018-19 and Rs. 2,95
(up to 4.8.2019).
d materials were handed over to the un perusal of the seized material I am satis contain information that relate to the a ane Industries Pvt. Ltd. and the informatio n the determination of total income for th
-21. Hence, in accordance with the provisi tice u/s 153C is issued for AY 2014-15. dent from the seized materials that M/
tries Pvt ltd. has inflated their expenses of empty bottles from M/s Crystal Bottles.
ses is Rs. 4,41,70,464/- for the F.Y 2017-1
70,130/- for the F.Y 2018-19 and Rs. 2,95
(up to 4.8.2019) d materials were handed over to the un perusal of the seized material I am satis contain information that relate to the as ane Industries Pvt ltd. and the information n the determination of total income for th
-21. Hence, in accordance with the provisi tice u/s 153C is issued for AY 2015-16. dent from the seized materials that M tries Pvt. Ltd. has inflated their expenses of empty bottles from M/s Crystal bottles.
ses is Rs.4,41,70,464/- for the F.Y 2017-1
70,130/- for the F.Y 2018-19 and Rs. 2,95
(up to 4.8.2019).
d materials were handed over to the un perusal of the seized material I am satis contain information that relate to the a , 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
M/s Southern by means of The amount
18 (From July
,16,955/- for dersigned on sfied that the ssessee, M/s n therein has he A.Ys. from on of income
/s. Southern by means of The amount
18 (From July
5,16,955/- for dersigned on sfied that the ssessee, M/s.
n therein has he A.Ys. from on of Income
M/s Southern by means of The amount
18 (From July
5,16,955/- for dersigned on sfied that the ssessee, M/s

Southern Agrifura got a bearing on 2018-19 to 2020
Tax Act, 1961 not AY 2017-18
…Thus it is evid
Agrifurane Indust bogus purchase o of bogus purchas
2017), Rs. 5,69,7
the F.Y. 2019-2
provision of inco
2017-18. 32. Perusal of the essentially a common s
2017-18 in as much as same. It is seen that, material contained infor booking bogus purchase by the AO is categorical him contained informat nowhere referred to exis to AYs 2014-15 to 2017
total income for these
CIT(A) that the satisfac incriminating material r
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 62 ::

ane Industries Pvt. Ltd. and the informatio n the determination of total income for th
-21. Hence, in accordance with the provisi tice u/s 153C is issued for AY 2016-17. dent from the seized materials that M/
tries Pvt ltd. has inflated their expenses of empty bottles from M/s Crystal Bottles.
ses is Rs. 4,41,70,464/- for the F.Y 2017-1
70,130/- for the F.Y 2018-19 and Rs. 2,95
0 (up to 4.8.2019). Hence, in accordan ome Tax Act, 1961 notice u/s 153C is is above satisfaction note(s) shows satisfaction note recorded for the A the contents of the satisfaction not the AO has expressly observed th rmation that the assessee had inflate es in FYs 2017-18 to 2019-20. The r l to the extent that the seized mate ion only for FYs 2017-18 to 2019-2
stence of any seized material relatin
7-18 which would have any bearing unabated AYs. We therefore agre ction note itself did not speak of ex eceived from the AO of the searche

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
n therein has he A.Ys. from on of income
/s. Southern by means of The amount
18 (From July
5,16,955/- for nce with the ssued for AY s that it was AYs 2014-15 to e was verbatim hat, the seized ed expenses by recording made rial received by 20. The AO has ng or pertaining g on assessee’s ee with the Ld.
xistence of any ed person which would have enabled the proceedings u/s 153C o
33. The essential j juri iction u/s 153C of searched person must ‘r assessee qua the partic
The existence of this jur be existence of materia being sought to be reo required to be demonst
In our considered opinio its existence in a casu through his ‘satisfaction seized from the premise not only pertains to or r also has a bearing on h reopened u/s 153C of satisfaction note are to words can be importe amplify their reasons la facie evident that, ther
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 63 ::

e AO of the assessee to validly initia f the Act for the AY(s) 2014-15 to 2
juri ictional requirement for a the Act is that, the relevant seized relate to’ or ‘pertain to’ the ‘other p cular year which is being sought to ri ictional fact is of vital importanc l relating or pertaining to the unaba opened u/s 153C of the Act and su rated through the satisfaction recor on, the AO cannot overlook the sam al manner. It is imperative for th n note’ and identify the specific mat e of the ‘searched person’, which ac relates to the ‘other person’ viz., the is total income for such relevant ye f the Act. As held earlier, the co be examined on a stand-alone bas d into the same nor can the Re ater on. From the given facts before re is no case made out by the AO

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
ate assessment
2017-18. assumption of material of the person’ viz., the o be reopened.
ce. There has to ted AY which is uch existence is rded by the AO.
me or deal with e AO to speak erial which was ccording to him e assessee, but ar sought to be ontents of the sis and no new venue seek to e us, it is prima in his recorded satisfaction that he ha
‘books of accounts’ w contained any informa assessee, for the releva
34. The Ld. AR also 142(1) of the Act for t even in these requisiti seized material which r
CIT, DR, on the other referred to in the notice of which was placed bef note that, the AO had re invoices vis-a-vis filling premises of M/s Crysta contained any informati
2014-15 to 2017-18 wh seized material is found
When confronted with also unable to point ou any incriminating eviden bearing on their total in ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 64 ::

d in his possession any ‘asset’ or which related or pertained to th ation which ‘related to’ or ‘pert nt AYs 2014-15 to 2017-18 in quest invited our attention to the notice these AYs 2014-15 to 2017-18 an on(s) there was no whisper of ex related to these AYs impugned befo hand, relied upon the seized mate e issued u/s 142(1) of the Act for AY fore us. Having examined the afore eferred to certain loose sheets conta status, excel sheets, ledger etc. s al Bottles. It is seen that, none of ion which pertained to or related to hich are impugned before us. The co d to relate to the period July 2017 t this contemporaneous fact, the Ld ut any particular seized material w nce or information concerning the a ncome for the impugned AYs 2014-

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
r ‘document’ or e assessee or tained to’ the tion.
e(s) issued u/s nd showed that xistence of any ore us. The Ld.
erial which was Y 2018-19, copy esaid notice, we aining details of seized from the these material any of the AYs ontents of these o August 2019. d. CIT, DR was which contained assessee having
15 to 2017-18. Hence, we find that th incriminating material q the impugned AYs 2014
the Ld. CIT(A) had ri juri iction to reassess
153C of the Act.
35. Respectfully follow the case of CIT v. Sinh
Abhisar Buildwell (su the order of the Ld. C section 153C of the Act material found in the assessee having a bea
2014-15 to 2017-18. notice(s) u/s. 153C of t had rightly quashed th thus dismiss these grou
36. In view of our abo
2014-15 to 2017-18 are the assessee has becom
ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 65 ::

here was complete absence of ex qua the ‘other person’ [assessee, in 4-15 to 2017-18. In our considered ightly held that, the AO had inv the total income of AYs 2014-15 t wing the decisions of the Hon’ble Su hgad Technical Education Societ upra), and for the above reasons, w
CIT(A) and hold that, the action of t was ab initio void as there was n course of search which related/pe ring on their total income for the Therefore, the impugned action o he Act is null in the eyes of law and he assessment order(s) impugned nds of the Revenue.
ove findings, all the appeals of the R e dismissed. As a consequence the me academic in nature and is there

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
xistence of any n this case] for view therefore, validly usurped to 2017-18 u/s upreme Court in ty (supra) and we countenance f AO to invoke no incriminating ertained to the impugned AYs of AO to issue d the Ld. CIT(A) before us. We
Revenue for AYs appeal filed by efore dismissed as infructuous and all q the addition(s) are left o
37. In the result, bo assessee are dismissed.

Order pronounced (अिमताभ शुा)
(AMITABH SHUK
लेखा सद$य/ACCOUNTANT
चे&नई/Chennai,
'दनांक/Dated: 21st Novem
TLN
आदेश क ितिल)प अ*े)षत/Co
1. अपीलाथ/Appellant
2.  थ/Respondent
3. आयकरआयु /CIT, Chenn
4. िवभागीयितिनिध/DR
5. गाड%फाईल/GF

ITA Nos.1254, 1255, 1258
ITA Nos.1233, 1235, 123
(AYs 2
M/s. Southern Agrifurane
:: 66 ::

questions raised on the points of law open.
oth the appeals filed by the Rev
.
d on the 21st day of November, 202
KLA)
T MEMBER (एबी टी.
(ABY T. VA
&याियक सद$य/JUD mber, 2025. opy to:
nai / Madurai / Salem / Coimbatore.

, 1260/Chny/2025 &
37, 1238/Chny/2025
2014-15 to 2017-18) e Industries Pvt. Ltd.
w and merits of venue and the 5, in Chennai.
-
वक
)
ARKEY)
ICIAL MEMBER