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

आदेश / O R D E R

PER ABY T. VARKEY ABY T. VARKEY, JM: These appeals preferred by the assessee and the Revenue are These appeals preferred by the assessee and the Revenue are These appeals preferred by the assessee and the Revenue are against the order of the against the order of the Learned Commissioner of Income Tax (Appeals) Commissioner of Income Tax (Appeals)- 19, (hereinafter referred to as ‘Ld.CIT(A)‘), Chennai, dated (hereinafter referred to as ‘Ld.CIT(A)‘), Chennai, dated (hereinafter referred to as ‘Ld.CIT(A)‘), Chennai, dated 12.02.2025 & 20.02.2025 for the Assessment Year Assessment Years (hereinafter referred to as ‘AY‘) (hereinafter referred to as ‘AY‘)

Consequently, the case of the assessee was reopened and notice(s) u/s Consequently, the case of the assessee was reopened and notice(s) u/s Consequently, the case of the assessee was reopened and notice(s) u/s 148 of the Act dated 30 148 of the Act dated 30-03-2023 was issued to the assessee for the 2023 was issued to the assessee for the relevant AYs 2013-14 to 2016 14 to 2016-17. The details of the return(s) of income 17. The details of the return(s) of income filed in response to notice u/s 148 of the Act and the subsequent re o notice u/s 148 of the Act and the subsequent re o notice u/s 148 of the Act and the subsequent re- , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt assessment(s) completed by order(s) all dated 15 assessment(s) completed by order(s) all dated 15-03-2024 passed u/s 2024 passed u/s 143(3)/147 of the Act are as 143(3)/147 of the Act are as under: -

Income declared in return Total Income assessed u/s Total Income assessed u/s Asst Year of income u/s 148 143(3)/147 143(3)/147

2013-14 Rs. 31,23,13,310/- Rs.31,12,72,770/- Rs.57,33,60,374/ Rs.57,33,60,374/- 2014-15 Rs.34,93,08,960/- Rs.61,74,24,524/ Rs.61,74,24,524/- 2015-16 Rs.45,46,48,400/- Rs.69,79,90,661/ Rs.69,79,90,661/- 2016-17 Aggrieved by the above order(s), the assessee preferred appeal(s) before Aggrieved by the above order(s), the assessee preferred appeal(s) before Aggrieved by the above order(s), the assessee preferred appeal(s) before the Ld. CIT(A).

3. Before the Ld. CIT(A), the assessee had Before the Ld. CIT(A), the assessee had inter alia challenged the validity of the initiation of reassessment proceedings u/s 147 of the Act validity of the initiation of reassessment proceedings u/s 147 of the Act validity of the initiation of reassessment proceedings u/s 147 of the Act for the impugned AYs 2013 for the impugned AYs 2013-14 to 2016-17 which was allowed by the Ld. 17 which was allowed by the Ld. CIT(A) and accordingly the re CIT(A) and accordingly the re-assessment orders passed u/s 147/143(3) passed u/s 147/143(3) of the Act was quashed. Being aggrieved by the appellate order(s) of the of the Act was quashed. Being aggrieved by the appellate order(s) of the of the Act was quashed. Being aggrieved by the appellate order(s) of the Ld. CIT(A), the Revenue is now in appeal before us. The assessee in their Ld. CIT(A), the Revenue is now in appeal before us. The assessee in their Ld. CIT(A), the Revenue is now in appeal before us. The assessee in their appeal(s) is noted to have assailed the Ld. CIT(A)’s order on other legal appeal(s) is noted to have assailed the Ld. CIT(A)’s order on other legal appeal(s) is noted to have assailed the Ld. CIT(A)’s order on other legal issues and the merits of the addition(s) as well. Since the legal issue he merits of the addition(s) as well. Since the legal issue he merits of the addition(s) as well. Since the legal issue which was adjudicated by the Ld. CIT(A) which was adjudicated by the Ld. CIT(A) strikes at the root of the strikes at the root of the jurisdiction of the AO to have issued notice u/s.148 of the Act jurisdiction of the AO to have issued notice u/s.148 of the Act jurisdiction of the AO to have issued notice u/s.148 of the Act for the impugned AYs 2013-14 to 2016 14 to 2016-17, with the consent of both 17, with the consent of both the parties, we consider it fit to decide this legal issue first. we consider it fit to decide this legal issue first. , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 4 ::

4. We first take up the Revenue’s appeal for AY 2013 We first take up the Revenue’s appeal for AY 2013 We first take up the Revenue’s appeal for AY 2013-14 in ITA No.1163/Chny/2025. It is seen that, before the Ld. CIT(A), the appellant No.1163/Chny/2025. It is seen that, before the Ld. CIT(A), the appellant No.1163/Chny/2025. It is seen that, before the Ld. CIT(A), the appellant had inter alia urged that, the notice issued u/s 148 had inter alia urged that, the notice issued u/s 148 of the Act for AY of the Act for AY 2013-14 dated 30.03.2023 was beyond the time limit prescribed in 14 dated 30.03.2023 was beyond the time limit prescribed in 14 dated 30.03.2023 was beyond the time limit prescribed in proviso to Section 149 of the Act and therefore it contended that the proviso to Section 149 of the Act and therefore it contended that the proviso to Section 149 of the Act and therefore it contended that the impugned notice so issued and all consequent actions deserves to be impugned notice so issued and all consequent actions deserves to be impugned notice so issued and all consequent actions deserves to be declared as null & void. The Ld. C declared as null & void. The Ld. CIT(A) is noted to have allowed this legal IT(A) is noted to have allowed this legal plea raised by the assessee by holding as under: plea raised by the assessee by holding as under:-

“6.3.4 The undersigned has carefully examined the issue under The undersigned has carefully examined the issue under The undersigned has carefully examined the issue under consideration. The primary contention of the appellant is that the notice consideration. The primary contention of the appellant is that the notice consideration. The primary contention of the appellant is that the notice issued u/s 148 of the Act d issued u/s 148 of the Act dated 30.03.2023 for the AY 2013 ated 30.03.2023 for the AY 2013-14 is barred by limitation on account of the provisions of on account of the provisions of clause (b) of sub clause (b) of sub-section (1) of Section 149 of the Act. (1) of Section 149 of the Act. The First Proviso to Section 149 of the Act First Proviso to Section 149 of the Act reads as under:-

“Provided that no notice no notice under section 148 shall be issued at any time in under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before 1st day a case for the relevant assessment year beginning on or before 1 a case for the relevant assessment year beginning on or before 1 of April, 2021, if [a notice under section 148 or section 153A or section of April, 2021, if [a notice under section 148 or section 153A or section of April, 2021, if [a notice under section 148 or section 153A or section 153C could not have been issued at that time on account of be 153C could not have been issued at that time on account of be 153C could not have been issued at that time on account of being beyond the time limit specified under the provisions of clause (b) of sub beyond the time limit specified under the provisions of clause (b) of sub beyond the time limit specified under the provisions of clause (b) of sub- section (1) of this section or section 153A or section 153C, as the case section (1) of this section or section 153A or section 153C, as the case section (1) of this section or section 153A or section 153C, as the case may be], as they stood immediately before the commencement of the may be], as they stood immediately before the commencement of the may be], as they stood immediately before the commencement of the Finance Act, 2021: Finance Act, 2021:

6.3.5 On examinatio On examination of the assessment order it can be seen that n of the assessment order it can be seen that the AO purportedly relying on the provisions of the Act, as amended by the AO purportedly relying on the provisions of the Act, as amended by the AO purportedly relying on the provisions of the Act, as amended by the Finance Act, 2021 has issued a notice u/s 148 of the Act for the AY the Finance Act, 2021 has issued a notice u/s 148 of the Act for the AY the Finance Act, 2021 has issued a notice u/s 148 of the Act for the AY 2013-14. The provisions of the Finance Act 2021 came into effect fr 14. The provisions of the Finance Act 2021 came into effect fr 14. The provisions of the Finance Act 2021 came into effect from 01.04.2021. Pursuant to the amendment the time limit for issuance of 01.04.2021. Pursuant to the amendment the time limit for issuance of 01.04.2021. Pursuant to the amendment the time limit for issuance of notice u/s 148 of the Act in cases where search proceedings are initiated notice u/s 148 of the Act in cases where search proceedings are initiated notice u/s 148 of the Act in cases where search proceedings are initiated under the provisions of section 132 of the Act is governed by the section under the provisions of section 132 of the Act is governed by the section under the provisions of section 132 of the Act is governed by the section 149 of the Act. As discussed supra, 149 of the Act. As discussed supra, the First Proviso to Section 149 of the First Proviso to Section 149 of the Act provides that “no notice u/s 148 of the Act shall be issued at any the Act provides that “no notice u/s 148 of the Act shall be issued at any the Act provides that “no notice u/s 148 of the Act shall be issued at any time in a case for the relevant assessment year beginning on or before time in a case for the relevant assessment year beginning on or before time in a case for the relevant assessment year beginning on or before 1st day of April, 2021, if a notice u/s 148 or section 153A or section 1st day of April, 2021, if a notice u/s 148 or section 153A or section 1st day of April, 2021, if a notice u/s 148 or section 153A or section 153C could not have been issued at that time on account of being C could not have been issued at that time on account of being C could not have been issued at that time on account of being , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt beyond the time limit specified under the provisions of clause (b) of sub beyond the time limit specified under the provisions of clause (b) of sub beyond the time limit specified under the provisions of clause (b) of sub- section (1) of this section or section 153A or section 153C, as the case section (1) of this section or section 153A or section 153C, as the case section (1) of this section or section 153A or section 153C, as the case may be, as they stood immediately before the co may be, as they stood immediately before the commencement of the mmencement of the Finance Act, 2021. Therefore, for the AY 2013 Finance Act, 2021. Therefore, for the AY 2013-14, since the notice under 14, since the notice under section 148 of the Income Tax Act was issued following the search section 148 of the Income Tax Act was issued following the search section 148 of the Income Tax Act was issued following the search proceedings (i.e., on 15.06.2022), the timeline specified under section proceedings (i.e., on 15.06.2022), the timeline specified under section proceedings (i.e., on 15.06.2022), the timeline specified under section 153A of the Act, as it exis 153A of the Act, as it existed prior to 01.04.2021, would clearly apply. ted prior to 01.04.2021, would clearly apply.

6.3.6 It is significant to bring on record the relevant provisions of It is significant to bring on record the relevant provisions of It is significant to bring on record the relevant provisions of section 153A of the Act as it stood prior to 01.04.2021 as under. section 153A of the Act as it stood prior to 01.04.2021 as under. section 153A of the Act as it stood prior to 01.04.2021 as under.

……

6.3.7 While going through the Explanation 1, it can be seen that the While going through the Explanation 1, it can be seen that the While going through the Explanation 1, it can be seen that the “relevant assessment year” shall mean an assessment year preceding “relevant assessment year” shall mean an assessment year preceding “relevant assessment year” shall mean an assessment year preceding the assessment year relevant to the previous year in which search is the assessment year relevant to the previous year in which search is the assessment year relevant to the previous year in which search is conducted or requisition is made which falls beyond six assessment years conducted or requisition is made which falls beyond six assessment years conducted or requisition is made which falls beyond six assessment years but not later than ten assessment years from t but not later than ten assessment years from the end of the assessment he end of the assessment year relevant to the previous year in which search is conducted or year relevant to the previous year in which search is conducted or year relevant to the previous year in which search is conducted or requisition is made. requisition is made.

6.3.8 In the case of the Appellant, the search u/s 132 of the act was In the case of the Appellant, the search u/s 132 of the act was In the case of the Appellant, the search u/s 132 of the act was carried out on 15.06.2022 and the relevant assessment would be AY carried out on 15.06.2022 and the relevant assessment would be AY carried out on 15.06.2022 and the relevant assessment would be AY 2023-24. The ten 24. The ten-assessment year should have been computed from assessment year should have been computed from 31.03.2024 (AY 2023 31.03.2024 (AY 2023-24) with the said date indubitably constituting the 24) with the said date indubitably constituting the end of the assessment year relevant to the previous year of search. end of the assessment year relevant to the previous year of search. end of the assessment year relevant to the previous year of search. Viewed in the light of the above, the time line of Viewed in the light of the above, the time line of ten assessment years ten assessment years would be as under. would be as under.

Computation of the ten Computation of the ten-year Sequence of period as provided u/s 153A period as provided u/s 153A the year of the Act of the Act AY 2023 AY 2023-24 First year AY 2022 AY 2022-23 Second year AY2021 AY2021-22 Third Year AY 2020 AY 2020-21 Fourth Year AY 2019 AY 2019-20 Fifth Year AY 2018 2018-19 Sixth Year AY 2017 AY 2017-18 Seventh Year AY 2016 AY 2016-17 Eight Year AY 2015 AY 2015-16 Ninth Year AY 2014 AY 2014-15 Tenth Year AY 2013 AY 2013-14 Eleventh Year , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 6 ::

6.3.9 Applying this test on the aforesaid precepts, it would be Applying this test on the aforesaid precepts, it would be Applying this test on the aforesaid precepts, it would be manifest that AY 2023 manifest that AY 2023-24 would form the first year of the ten AYs’ and the first year of the ten AYs’ and with the maximum period of ten AYs’ terminating in AY 2014 with the maximum period of ten AYs’ terminating in AY 2014 with the maximum period of ten AYs’ terminating in AY 2014-15. Therefore, the AY 2013 Therefore, the AY 2013-14 is beyond the purview of provisions of the 14 is beyond the purview of provisions of the Act. This view is affirmed by the Hon’ble Madras High Court Act. This view is affirmed by the Hon’ble Madras High Court Act. This view is affirmed by the Hon’ble Madras High Court in the case of AR Saifullah Vs. ACIT Central Vs. ACIT Central -1, Trichy in WP No. (MD)No. 4327 of 1, Trichy in WP No. (MD)No. 4327 of 2021 dated 24.03.2021 2021 dated 24.03.2021 wherein the Madurai bench of the Hon’ble Madurai bench of the Hon’ble Madras High Court Madras High Court has rightly expounded the legal position and the legal has rightly expounded the legal position and the legal position liable to be accorded to the identification of ten asses position liable to be accorded to the identification of ten asses position liable to be accorded to the identification of ten assessment years which are spoken off in section 153A of the Act. years which are spoken off in section 153A of the Act.

6.3.10 Further the Further the Divisional bench of the Hon’ble Delhi High Court in bench of the Hon’ble Delhi High Court in the case of ACIT Vs. Ojjus Medicare Private Limited ACIT Vs. Ojjus Medicare Private Limited and others and others dated 03.04.2024 by relying on the decision of the Hon’ble M by relying on the decision of the Hon’ble Madras High Court adras High Court in the case of AR Saifullah Vs. ACIT Central AR Saifullah Vs. ACIT Central -1, Trichy in WP No. (MD)No. 1, Trichy in WP No. (MD)No. 4327 of 2021 dated 24.03.2021 4327 of 2021 dated 24.03.2021 has made a detailed analysis and has has made a detailed analysis and has set a bench mark on how to compute the ten year block after identifying the on how to compute the ten year block after identifying the on how to compute the ten year block after identifying the relevant assessment as relevant assessment as defined under Explanation 1 to section 153A of defined under Explanation 1 to section 153A of the Act. In the present case, the AO has attempted to re the Act. In the present case, the AO has attempted to re-open for the AY open for the AY 2013-14 which falls beyond ten years from relevant AY 2023 14 which falls beyond ten years from relevant AY 2023 14 which falls beyond ten years from relevant AY 2023-24 from the end of the FY (2022 end of the FY (2022-23) in which the search was conducted on the 23) in which the search was conducted on the assessee (15.06.2022) and therefore lacked jurisdiction to issue notice assessee (15.06.2022) and therefore lacked jurisdiction to issue notice assessee (15.06.2022) and therefore lacked jurisdiction to issue notice u/s 148 of the Act for the AY 2013 u/s 148 of the Act for the AY 2013-14.

6.3.11 The undersigned is the view that the AO should have satisfied The undersigned is the view that the AO should have satisfied The undersigned is the view that the AO should have satisfied himself that he is empowered under the provisions of Section 148 of the himself that he is empowered under the provisions of Section 148 of the himself that he is empowered under the provisions of Section 148 of the Act r.w.s 153A of the Act to assess or reassess the income for ct r.w.s 153A of the Act to assess or reassess the income for ct r.w.s 153A of the Act to assess or reassess the income for 'relevant assessment year or years' assessment year or years' and for this purpose. In such a situation, when and for this purpose. In such a situation, when the AO has no jurisdiction to issue a notice u/s 148 of the Act and a the AO has no jurisdiction to issue a notice u/s 148 of the Act and a the AO has no jurisdiction to issue a notice u/s 148 of the Act and a notice, if at all issued, would be notice, if at all issued, would be void ab initio for patent lack of for patent lack of jurisdiction.

6.3.12 In the case of In the case of Hansraj Gordhandas v. H.H. Dave, Asst. Hansraj Gordhandas v. H.H. Dave, Asst. Collector of Central Excise & Customs, Surat and Ors, AIR 1970 SC 755 Collector of Central Excise & Customs, Surat and Ors, AIR 1970 SC 755 Collector of Central Excise & Customs, Surat and Ors, AIR 1970 SC 755 (1969) 2 SCR 253 (1969) 2 SCR 253 the observations of Lord Watson in Salomon vs. the observations of Lord Watson in Salomon vs. Salomon & Co., (18 Salomon & Co., (1897) AC 22) was referred to with the observations are: 97) AC 22) was referred to with the observations are:

“Intention of the legislature is a common but very slippery phrase, “Intention of the legislature is a common but very slippery phrase, “Intention of the legislature is a common but very slippery phrase, which, popularly understood may signify anything from intention which, popularly understood may signify anything from intention which, popularly understood may signify anything from intention embodied in positive enactment to speculative opinion as to what the embodied in positive enactment to speculative opinion as to what the embodied in positive enactment to speculative opinion as to what the legislature. probably would have meant although there has been an egislature. probably would have meant although there has been an egislature. probably would have meant although there has been an omission to enact it. in a Court of Law or Equity, omission to enact it. in a Court of Law or Equity, what the Legislature what the Legislature intended to be done or not can only be legitimately ascertained from that intended to be done or not can only be legitimately ascertained from that intended to be done or not can only be legitimately ascertained from that which it has chosen to enact which it has chosen to enact, either in express wards or by reasonable express wards or by reasonable and necessary implication.” and necessary implication.”

6.3.13 Applying the above principle, it becomes clear that the Section Applying the above principle, it becomes clear that the Section Applying the above principle, it becomes clear that the Section 148 r.w.s 153A of the Act understood in the proper context makes the 148 r.w.s 153A of the Act understood in the proper context makes the 148 r.w.s 153A of the Act understood in the proper context makes the intention of the Legislature evident. It clearly sets out intention of the Legislature evident. It clearly sets out the conditions the conditions , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt when a notice u/s 148 r.w.s 153A of the Act can be issued for the when a notice u/s 148 r.w.s 153A of the Act can be issued for the when a notice u/s 148 r.w.s 153A of the Act can be issued for the 'relevant assessment year or years'. 'relevant assessment year or years'.

6.3.14 A jurisdictional fact jurisdictional fact is one on existence or non is one on existence or non-existence of which depends assumption or refusal to assume jurisdiction by a cour which depends assumption or refusal to assume jurisdiction by a cour which depends assumption or refusal to assume jurisdiction by a court, tribunal or an authority. In 'Black's Legal Dictionary, it is explained as a tribunal or an authority. In 'Black's Legal Dictionary, it is explained as a tribunal or an authority. In 'Black's Legal Dictionary, it is explained as a fact which must exist before a court can properly assume jurisdiction of a fact which must exist before a court can properly assume jurisdiction of a fact which must exist before a court can properly assume jurisdiction of a particular case. Mistake of fact in relation to jurisdiction particular case. Mistake of fact in relation to jurisdiction is an error of is an error of jurisdictional fact jurisdictional fact. No statutory authority or tribunal can assume tatutory authority or tribunal can assume jurisdiction in respect of subject matter which the statute does not confer jurisdiction in respect of subject matter which the statute does not confer jurisdiction in respect of subject matter which the statute does not confer on it and if by deciding erroneously the fact on which jurisdiction on it and if by deciding erroneously the fact on which jurisdiction on it and if by deciding erroneously the fact on which jurisdiction depends the court or tribunal exercises the jurisdiction, then the ord depends the court or tribunal exercises the jurisdiction, then the ord depends the court or tribunal exercises the jurisdiction, then the order is vitiated.

6.3.15 In 'Halsbury's Laws of England' it has been stated that where In 'Halsbury's Laws of England' it has been stated that where In 'Halsbury's Laws of England' it has been stated that where the jurisdiction of a tribunal is dependent on the existence of a particular the jurisdiction of a tribunal is dependent on the existence of a particular the jurisdiction of a tribunal is dependent on the existence of a particular state of affairs, that state of affairs may be described as preliminary to, state of affairs, that state of affairs may be described as preliminary to, state of affairs, that state of affairs may be described as preliminary to, or collateral to the merits of the issue. If, at the inception of an inquiry he merits of the issue. If, at the inception of an inquiry he merits of the issue. If, at the inception of an inquiry by an inferior tribunal, a challenge is made to its jurisdiction, the by an inferior tribunal, a challenge is made to its jurisdiction, the by an inferior tribunal, a challenge is made to its jurisdiction, the Tribunal has to make up its mind whether to Act or not and can give a Tribunal has to make up its mind whether to Act or not and can give a Tribunal has to make up its mind whether to Act or not and can give a ruling on the preliminary or collateral issue; but that r ruling on the preliminary or collateral issue; but that r ruling on the preliminary or collateral issue; but that ruling is not conclusive.

6.3.16 In the case of In the case of Arun Kumar & Ors. vs. Union of India & Ors. Arun Kumar & Ors. vs. Union of India & Ors. (2006) 205 CTR (SC) 193: (2006) 286 ITR 89 (SC) (2006) 205 CTR (SC) 193: (2006) 286 ITR 89 (SC) it has been held: it has been held:-

"A "jurisdictional fact" is a fact which must exist before a Court, Tribunal "A "jurisdictional fact" is a fact which must exist before a Court, Tribunal "A "jurisdictional fact" is a fact which must exist before a Court, Tribunal or an assumes jurisdi or an assumes jurisdiction over a particular matter. A jurisdictional fact is ction over a particular matter. A jurisdictional fact is one on existence or non one on existence or non-existence of which depends jurisdiction of a existence of which depends jurisdiction of a court, a tribunal or an authority. It is the fact upon which an court, a tribunal or an authority. It is the fact upon which an court, a tribunal or an authority. It is the fact upon which an administrative agency's power to act depends If the jurisdictional administrative agency's power to act depends If the jurisdictional administrative agency's power to act depends If the jurisdictional fact does not exist, the court, authority or officer cannot act. If a Court or does not exist, the court, authority or officer cannot act. If a Court or does not exist, the court, authority or officer cannot act. If a Court or authority wrongly assumes the existence of such fact, the order can be authority wrongly assumes the existence of such fact, the order can be authority wrongly assumes the existence of such fact, the order can be questioned by a writ of certiorari. The underlying principle is that by questioned by a writ of certiorari. The underlying principle is that by questioned by a writ of certiorari. The underlying principle is that by erroneously assuming existence of erroneously assuming existence of such jurisdictional fact, no authority such jurisdictional fact, no authority can confer upon itself jurisdiction which it otherwise does not posses can confer upon itself jurisdiction which it otherwise does not posses can confer upon itself jurisdiction which it otherwise does not posses

6.3.17 The existence of a 'jurisdictional fact' is the The existence of a 'jurisdictional fact' is the sine qua non sine qua non for the exercise of power. In its absence, the power cannot be exercised the exercise of power. In its absence, the power cannot be exercised the exercise of power. In its absence, the power cannot be exercised lawfully. When the jurisdictional fact is established, the AO is empowered ully. When the jurisdictional fact is established, the AO is empowered ully. When the jurisdictional fact is established, the AO is empowered to proceed with the case and make decisions in accordance with the to proceed with the case and make decisions in accordance with the to proceed with the case and make decisions in accordance with the provisions of law. In this context, the provisions of law. In this context, the fulfillment of the preconditions set of the preconditions set forth u/s 148 r.w.s 153A of the Act is co forth u/s 148 r.w.s 153A of the Act is considered a 'jurisdictional fact 'jurisdictional fact.' The AO is required to carefully examine and ascertain whether these The AO is required to carefully examine and ascertain whether these The AO is required to carefully examine and ascertain whether these specific conditions are satisfied before proceeding. Only after deciding on specific conditions are satisfied before proceeding. Only after deciding on specific conditions are satisfied before proceeding. Only after deciding on this issue, and recording a clear finding regarding the presence or this issue, and recording a clear finding regarding the presence or this issue, and recording a clear finding regarding the presence or absence of these conditions, can the AO issue a notice u/s 148 for the these conditions, can the AO issue a notice u/s 148 for the these conditions, can the AO issue a notice u/s 148 for the relevant assessment year. Only upon satisfying this crucial prerequisite relevant assessment year. Only upon satisfying this crucial prerequisite relevant assessment year. Only upon satisfying this crucial prerequisite can the AO lawfully proceed to assess the income of the assessee for the can the AO lawfully proceed to assess the income of the assessee for the can the AO lawfully proceed to assess the income of the assessee for the 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt relevant year, as the presence of the jurisdictio as the presence of the jurisdictional fact is indispensable nal fact is indispensable for validly initiating the assessment process u/s 147 of the Act for validly initiating the assessment process u/s 147 of the Act for validly initiating the assessment process u/s 147 of the Act

6.3.18 Such conclusion of satisfaction must manifest itself in writing. Such conclusion of satisfaction must manifest itself in writing. Such conclusion of satisfaction must manifest itself in writing. The AO issuing the notice must be able to justify himself that his action The AO issuing the notice must be able to justify himself that his action The AO issuing the notice must be able to justify himself that his action is valid because al is valid because all conditions mentioned in the section 148 r.w.s 153A of l conditions mentioned in the section 148 r.w.s 153A of the Act are fulfilled. This is all the more so because the Act are fulfilled. This is all the more so because issuing of a notice issuing of a notice for the 'relevant assessment year or years' 'relevant assessment year or years' is not a ritualistic formality ritualistic formality; rather it sets in motion the process which can cu rather it sets in motion the process which can culminate into imposition lminate into imposition of a civil liability and may even invite criminal prosecution for tax evasion of a civil liability and may even invite criminal prosecution for tax evasion of a civil liability and may even invite criminal prosecution for tax evasion on the assessee. It is the vested right of an assessee to examine on the assessee. It is the vested right of an assessee to examine on the assessee. It is the vested right of an assessee to examine whether the conditions precedent to issue of notice are satisfied or not so whether the conditions precedent to issue of notice are satisfied or not so whether the conditions precedent to issue of notice are satisfied or not so that he may, in a situation where according to his knowledge and belief in a situation where according to his knowledge and belief in a situation where according to his knowledge and belief the condition precedent to issue of notice are not satisfied, challenge the the condition precedent to issue of notice are not satisfied, challenge the the condition precedent to issue of notice are not satisfied, challenge the notice issued before appropriate judicial forum as regards its legal notice issued before appropriate judicial forum as regards its legal notice issued before appropriate judicial forum as regards its legal validity. This is possible only if the satisfaction validity. This is possible only if the satisfaction is properly recorded by is properly recorded by the AO before a notice is issued u/s 148 r.w.s 153A of the Act and the AO before a notice is issued u/s 148 r.w.s 153A of the Act and the AO before a notice is issued u/s 148 r.w.s 153A of the Act and provided to the assessee to enable him to rebut the satisfaction of the provided to the assessee to enable him to rebut the satisfaction of the provided to the assessee to enable him to rebut the satisfaction of the AO.

6.3.19 In the present case, the AO has attempted to re In the present case, the AO has attempted to re In the present case, the AO has attempted to re-open for the AY 2013-14 which fa 14 which falls beyond the time line of 10 year from end of the lls beyond the time line of 10 year from end of the relevant assessment year 2023 relevant assessment year 2023-24 in which the search was conducted on 24 in which the search was conducted on the assessee (15.06.2022). The undersigned is of the view that the AO the assessee (15.06.2022). The undersigned is of the view that the AO the assessee (15.06.2022). The undersigned is of the view that the AO cannot travel beyond a period of ten assessment years to invoke cannot travel beyond a period of ten assessment years to invoke cannot travel beyond a period of ten assessment years to invoke the provisions of section 147 of the Act. Accordingly, all the provisions of section 147 of the Act. Accordingly, all the provisions of section 147 of the Act. Accordingly, all the additional grounds raised by the appellant upon the issue of legality of issuance of raised by the appellant upon the issue of legality of issuance of raised by the appellant upon the issue of legality of issuance of notice u/s 148 of the Act to initiate assessment proceedings u/s 147 of notice u/s 148 of the Act to initiate assessment proceedings u/s 147 of notice u/s 148 of the Act to initiate assessment proceedings u/s 147 of the Act for the AY 2013 the Act for the AY 2013-14 are here by treated as allowed.”

5. Assailing the above action of the Ld. CIT(A), the Ld Assailing the above action of the Ld. CIT(A), the Ld Assailing the above action of the Ld. CIT(A), the Ld. CIT, DR submitted that, the notice issued u/s 148 of the Act dated 30.03.2023 submitted that, the notice issued u/s 148 of the Act dated 30.03.2023 submitted that, the notice issued u/s 148 of the Act dated 30.03.2023 was well within the period of ten (10) assessment years from the end of well within the period of ten (10) assessment years from the end of well within the period of ten (10) assessment years from the end of the relevant AY 2013-14 and, he therefore contended that, the Ld. CIT(A) 14 and, he therefore contended that, the Ld. CIT(A) 14 and, he therefore contended that, the Ld. CIT(A) was unjustified in holding the impugned notice to be barred by limitation. was unjustified in holding the impugned notice to be barred by limitation. was unjustified in holding the impugned notice to be barred by limitation.

According to him, even if the reassessm According to him, even if the reassessment action was to be tested on the ent action was to be tested on the basis of the first proviso to Section 149 of the Act then also the assessee basis of the first proviso to Section 149 of the Act then also the assessee basis of the first proviso to Section 149 of the Act then also the assessee was not entitled to any relief, as the notice was well within the was not entitled to any relief, as the notice was well within the was not entitled to any relief, as the notice was well within the 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt permissible time limit under the provisions of Section 148, 153A etc. as it permissible time limit under the provisions of Section 148, 153A etc. as it permissible time limit under the provisions of Section 148, 153A etc. as it stood prior to introduction of the Finance Act, 2021. od prior to introduction of the Finance Act, 2021.

6. Per contra, the Ld. AR supported the above findings of the Ld. Per contra, the Ld. AR supported the above findings of the Ld. Per contra, the Ld. AR supported the above findings of the Ld. CIT(A) by relying on the judgments rendered by the Hon’ble Delhi High CIT(A) by relying on the judgments rendered by the Hon’ble Delhi High CIT(A) by relying on the judgments rendered by the Hon’ble Delhi High Court in the cases of Court in the cases of KAD Housing Pvt Ltd Vs DCIT (168 KAD Housing Pvt Ltd Vs DCIT (168 taxmann.com 470) and and Dinesh Jindal Vs DCIT (469 ITR 32) Dinesh Jindal Vs DCIT (469 ITR 32).

“1) No notice under section 148 shall be issued for the relevant No notice under section 148 shall be issued for the relevant No notice under section 148 shall be issued for the relevant assessment year, assessment year,—

(a) if three years have elapsed from the end of the relevant assessment if three years have elapsed from the end of the relevant assessment if three years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b); year, unless the case falls under clause (b);

(b)if three years, but not more than ten years, have elapse (b)if three years, but not more than ten years, have elapse (b)if three years, but not more than ten years, have elapsed from the end of the relevant assessment year unless the Assessing Officer has in end of the relevant assessment year unless the Assessing Officer has in end of the relevant assessment year unless the Assessing Officer has in his possession books of account or other documents or evidence which his possession books of account or other documents or evidence which his possession books of account or other documents or evidence which reveal that the income chargeable to tax, represented in the form of reveal that the income chargeable to tax, represented in the form of reveal that the income chargeable to tax, represented in the form of—

(i) an asset;

(ii) expenditure in expenditure in respect of a transaction or in relation to an event or respect of a transaction or in relation to an event or occasion; or (iii)an entry or entries in the books of account, (iii)an entry or entries in the books of account, which has escaped assessment amounts to or is likely to amount which has escaped assessment amounts to or is likely to amount which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more: lakh rupees or more:

Provided that no notice under section 148 Provided that no notice under section 148 shall be issued at any time in shall be issued at any time in a case for the relevant assessment year beginning on or before a case for the relevant assessment year beginning on or before a case for the relevant assessment year beginning on or before 1st day of April, 2021, if of April, 2021, if a notice under section 148 or section 153A or section a notice under section 148 or section 153A or section 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 10 ::

153C could not have been issued at that time on account of being 153C could not have been issued at that time on account of being 153C could not have been issued at that time on account of being beyond the time limit specified under the provisions of clause (b) of sub limit specified under the provisions of clause (b) of sub limit specified under the provisions of clause (b) of sub- section (1) of this section or section 153A or s section (1) of this section or section 153A or section 153C, as the case ection 153C, as the case may be, as they stood immediately before the commencement of the , as they stood immediately before the commencement of the , as they stood immediately before the commencement of the Finance Act, 2021: Finance Act, 2021:

Provided further that the provisions of t Provided further that the provisions of this sub-section shall not apply in section shall not apply in a case, where a notice under section 153A, or section 153C read with a case, where a notice under section 153A, or section 153C read with a case, where a notice under section 153A, or section 153C read with section 153A, is required to be issued in relation to a search initiated section 153A, is required to be issued in relation to a search initiated section 153A, is required to be issued in relation to a search initiated under section 132 or books of account, other documents or any assets under section 132 or books of account, other documents or any assets under section 132 or books of account, other documents or any assets requisitioned under section 132A, on or before the 31st day of March, ned under section 132A, on or before the 31st day of March, ned under section 132A, on or before the 31st day of March, 2021:

Provided also that for the purposes of computing the period of limitation Provided also that for the purposes of computing the period of limitation Provided also that for the purposes of computing the period of limitation as per this section, the time or extended time allowed to the assessee, as per this section, the time or extended time allowed to the assessee, as per this section, the time or extended time allowed to the assessee, as per show-cause notice issued under clause cause notice issued under clause (b) of section 148A or the (b) of section 148A or the period during which the proceeding under section 148A is stayed by an period during which the proceeding under section 148A is stayed by an period during which the proceeding under section 148A is stayed by an order or injunction of any court, shall be excluded: order or injunction of any court, shall be excluded:

Provided also that where immediately after the exclusion of the period Provided also that where immediately after the exclusion of the period Provided also that where immediately after the exclusion of the period referred to in the immediately pre referred to in the immediately preceding proviso, the period of limitation ceding proviso, the period of limitation available to the Assessing Officer for passing an order under clause (d) available to the Assessing Officer for passing an order under clause (d) available to the Assessing Officer for passing an order under clause (d) of section 148A is less than seven days, such remaining period shall be of section 148A is less than seven days, such remaining period shall be of section 148A is less than seven days, such remaining period shall be extended to seven days and the period of limitation under this sub extended to seven days and the period of limitation under this sub extended to seven days and the period of limitation under this sub- section shall be deemed to be extended accordingly. tion shall be deemed to be extended accordingly.

Explanation.—For the purp For the purposes of clause (b) of this sub-section, "asset" ection, "asset" shall include immovable property, being land or building or both, shares shall include immovable property, being land or building or both, shares shall include immovable property, being land or building or both, shares and securities, loans and advances, deposits in bank account. and securities, loans and advances, deposits in bank account. and securities, loans and advances, deposits in bank account.

(1A) Notwithstanding anything contained in sub (1A) Notwithstanding anything contained in sub-section (1), where the section (1), where the income chargeable to tax represented in the form of an asset or income chargeable to tax represented in the form of an asset or income chargeable to tax represented in the form of an asset or expenditure in relation to an event or occasion of the value referred to expenditure in relation to an event or occasion of the value referred to expenditure in relation to an event or occasion of the value referred to in clause (b) of sub in clause (b) of sub-section (1), has escaped the assessment and the e assessment and the investment in such asset or expenditure in relation to such event or investment in such asset or expenditure in relation to such event or investment in such asset or expenditure in relation to such event or occasion has been made or incurred, in more than one previous years occasion has been made or incurred, in more than one previous years occasion has been made or incurred, in more than one previous years relevant to the assessment years within the period referred to in clause relevant to the assessment years within the period referred to in clause relevant to the assessment years within the period referred to in clause (b) of sub-section (1), a section (1), a notice under section 148 shall be issued for notice under section 148 shall be issued for every every every such such such assessment assessment assessment year year year for for for assessment, assessment, assessment, reassessment reassessment reassessment or or or recomputation, as the case may be.] recomputation, as the case may be.]

(2) The provisions of sub (2) The provisions of sub-section (1) as to the issue of notice shall be section (1) as to the issue of notice shall be subject to the provisions of section 151.” subject to the provisions of section 151.”

, 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 11 ::

8. Reading of the above provision reveals that, the AO is ordinarily Reading of the above provision reveals that, the AO is ordinarily Reading of the above provision reveals that, the AO is ordinarily empowered to reopen any relevant assessment year within three (3) empowered to reopen any relevant assessment year within three (3) empowered to reopen any relevant assessment year within three (3) years from the end of the relevant assessment year [Section 149(1)(a)]. years from the end of the relevant assessment year [Section 149(1)(a)]. years from the end of the relevant assessment year [Section 149(1)(a)].

The AO is also entitled to issue notice u/s 148 The AO is also entitled to issue notice u/s 148 of the Act beyond three (3) of the Act beyond three (3) years but not more than ten (10) years from the end of the relevant years but not more than ten (10) years from the end of the relevant years but not more than ten (10) years from the end of the relevant assessment year, but for that, he is required to demonstrate that he has assessment year, but for that, he is required to demonstrate that he has assessment year, but for that, he is required to demonstrate that he has in his possession books of accounts or documents or evidence which in his possession books of accounts or documents or evidence which in his possession books of accounts or documents or evidence which reveal that income represented in form of asset or expenditure or any epresented in form of asset or expenditure or any epresented in form of asset or expenditure or any entry in books of accounts, has escaped assessment, whose likely entry in books of accounts, has escaped assessment, whose likely entry in books of accounts, has escaped assessment, whose likely quantum is Rs.50 lacs or more [Section 149(1)(b)]. We now come to the quantum is Rs.50 lacs or more [Section 149(1)(b)]. We now come to the quantum is Rs.50 lacs or more [Section 149(1)(b)]. We now come to the proviso to Section 149(1)(b) of the Act, which is of utmost relevance t proviso to Section 149(1)(b) of the Act, which is of utmost relevance t proviso to Section 149(1)(b) of the Act, which is of utmost relevance to the present case. The ingredients of the proviso The ingredients of the proviso can be broken down for be broken down for analysis as follows: (i) no notice under section 148 of the new regime can analysis as follows: (i) no notice under section 148 of the new regime can analysis as follows: (i) no notice under section 148 of the new regime can be issued at any time for an assessment year beginning on or before 1 be issued at any time for an assessment year beginning on or before 1 be issued at any time for an assessment year beginning on or before 1 April 2021; (ii) if it is barred at t April 2021; (ii) if it is barred at the time when the notice is sought to be he time when the notice is sought to be issued because of the "time limits specified under the provisions of" "time limits specified under the provisions of" "time limits specified under the provisions of"148, 153A, 153C of the old regime. ld regime. Hence, in terms of the proviso, the powers Hence, in terms of the proviso, the powers of AO is curtailed to issue of AO is curtailed to issue notice under Section 148 of the new regim ection 148 of the new regime for AY 2021-2022 and earlier years earlier years only if the time limit for issuance of such only if the time limit for issuance of such notice continued to exist under section 149(1)(b) notice continued to exist under section 149(1)(b), 153A(1)(b) or 153C , 153A(1)(b) or 153C of the old regime. It is well settled in law that, n It is well settled in law that, notices have to be judged otices have to be judged according to the law existing on the date the notice is issued. existing on the date the notice is issued. existing on the date the notice is issued. Under the 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt new regime, time limit of ten (10) years has been prescribed subject to new regime, time limit of ten (10) years has been prescribed subject to new regime, time limit of ten (10) years has been prescribed subject to fulfillment of conditions laid down in Section 149(1)(b) of the Act. fulfillment of conditions laid down in Section 149(1)(b) of the Act. fulfillment of conditions laid down in Section 149(1)(b) of the Act.

However, the first proviso to Section 149(1)(b) ensures that, However, the first proviso to Section 149(1)(b) ensures that, However, the first proviso to Section 149(1)(b) ensures that, the time limit prescribed in the new regime shall apply prospectively i.e. from AY limit prescribed in the new regime shall apply prospectively i.e. from AY limit prescribed in the new regime shall apply prospectively i.e. from AY 2021-22 and onwards and that, the AYs prior to the introduction of new 22 and onwards and that, the AYs prior to the introduction of new 22 and onwards and that, the AYs prior to the introduction of new regime by Finance Act, 2021 shall continue to be governed by the time regime by Finance Act, 2021 shall continue to be governed by the time regime by Finance Act, 2021 shall continue to be governed by the time limits under the old 148 regime limits under the old 148 regime or Section 153A/153C of the Act [which or Section 153A/153C of the Act [which has since merged and/or be substituted in a single all has since merged and/or be substituted in a single all-encompassed new encompassed new 148/148A regime]. Hence, in order to reopen any AY prior to AY 2021 148/148A regime]. Hence, in order to reopen any AY prior to AY 2021 148/148A regime]. Hence, in order to reopen any AY prior to AY 2021-22, the AO is required to first ascertain as to, whether the relevant AY could the AO is required to first ascertain as to, whether the relevant AY could the AO is required to first ascertain as to, whether the relevant AY could have been reopened in light of the time limit laid down in the old have been reopened in light of the time limit laid down in the old have been reopened in light of the time limit laid down in the old 148/149(1)(b) regime [non 148/149(1)(b) regime [non-search cases] or whether the relevant AY search cases] or whether the relevant AY could have been reopened in terms of the time lines contained in could have been reopened in terms of the time lines contained in could have been reopened in terms of the time lines contained in erstwhile Section 153A(1)(b) or 153C of the Act [search erstwhile Section 153A(1)(b) or 153C of the Act [search erstwhile Section 153A(1)(b) or 153C of the Act [search cases]. If the answer to the aforesaid question is in affirmative viz., the AO can validly answer to the aforesaid question is in affirmative viz., the AO can validly answer to the aforesaid question is in affirmative viz., the AO can validly reopen the relevant assessment year [AY 2021 reopen the relevant assessment year [AY 2021-22 and earlier years] 22 and earlier years] under the old regime at the time of issuance of notice under the new at the time of issuance of notice under the new at the time of issuance of notice under the new regime, that, the AO is legal regime, that, the AO is legally empowered to reopen such relevant ly empowered to reopen such relevant assessment year under the new 148 regime, in terms of proviso to assessment year under the new 148 regime, in terms of proviso to assessment year under the new 148 regime, in terms of proviso to Section 149(1)(b) of the Act. Section 149(1)(b) of the Act. , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 13 ::

9. The above analogy is found to have been expressly laid down by the The above analogy is found to have been expressly laid down by the The above analogy is found to have been expressly laid down by the Hon’ble Supreme Court in the case of Hon’ble Supreme Court in the case of UOI Vs Rajeev Bansal ( nsal (469 ITR 46) while interpreting the provisions of Section 149 of the Act, as while interpreting the provisions of Section 149 of the Act, as while interpreting the provisions of Section 149 of the Act, as amended by the Finance Act, 2021. The Hon’ble Apex Court explained amended by the Finance Act, 2021. The Hon’ble Apex Court explained amended by the Finance Act, 2021. The Hon’ble Apex Court explained that, the first proviso to Section 149(1)(b) requires the determination of he first proviso to Section 149(1)(b) requires the determination of he first proviso to Section 149(1)(b) requires the determination of whether the time limit prescribe whether the time limit prescribed under section 149(1)(b) of the old d under section 149(1)(b) of the old regime continues to exist for the assessment year 2021 regime continues to exist for the assessment year 2021-2022 and before. 2022 and before.

It was accordingly held that, It was accordingly held that, a notice under Section 148 of the new a notice under Section 148 of the new regime cannot be issued regime cannot be issued, if the period of six years[as provided in [as provided in erstwhile 149(1)(b) of the Act] 9(1)(b) of the Act] from the end of the relevant assessment from the end of the relevant assessment year [AY 2021-22 and earlier year(s)] 22 and earlier year(s)] has expired at the time of issuance has expired at the time of issuance of the notice. The Hon’ble Supreme Court thus held that, The Hon’ble Supreme Court thus held that, The Hon’ble Supreme Court thus held that, the new time limit of ten years prescribed under section 149(1)(b limit of ten years prescribed under section 149(1)(b) of the new regime of the new regime applies prospectively. This was explained by the Hon’ble Apex Court by applies prospectively. This was explained by the Hon’ble Apex Court by applies prospectively. This was explained by the Hon’ble Apex Court by way of an illustration, viz., way of an illustration, viz., For example, for the assessment For example, for the assessment year 2012- 2013, the ten year period would have expired on 31 March 2023, while 2013, the ten year period would have expired on 31 March 2023, while 2013, the ten year period would have expired on 31 March 2023, while the six year period expi the six year period expired on 31 March 2019. Without the proviso to red on 31 March 2019. Without the proviso to Section 149(1)(b) of the new regime, the Revenue could have had the Section 149(1)(b) of the new regime, the Revenue could have had the Section 149(1)(b) of the new regime, the Revenue could have had the power to reopen assessments for the year 2012 power to reopen assessments for the year 2012-2013 if the escaped 2013 if the escaped assessment amounted to Rupees fifty lakhs or more. The proviso limits assessment amounted to Rupees fifty lakhs or more. The proviso limits assessment amounted to Rupees fifty lakhs or more. The proviso limits the retrospective operation of Section 149(1)(b) to protect the interests rospective operation of Section 149(1)(b) to protect the interests rospective operation of Section 149(1)(b) to protect the interests of the assesses. , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 14 ::

10. It is also important to bear in mind that, the proviso to Section It is also important to bear in mind that, the proviso to Section It is also important to bear in mind that, the proviso to Section 149(1)(b) of the Act was amended by the Finance Act, 2022 149(1)(b) of the Act was amended by the Finance Act, 2022 149(1)(b) of the Act was amended by the Finance Act, 2022 retrospectively with effect from 01.04.2021, retrospectively with effect from 01.04.2021, to align the timelines to align the timelines contained proviso of Section 149(1)(b) to the earlier time limits for search contained proviso of Section 149(1)(b) to the earlier time limits for search contained proviso of Section 149(1)(b) to the earlier time limits for search related matters, which were earlier governed by 153A/153C of the Act. related matters, which were earlier governed by 153A/153C of the Act. related matters, which were earlier governed by 153A/153C of the Act.

For the sake of clarity, the original proviso to Section 149(1)(b) [as For the sake of clarity, the original proviso to Section 149(1)(b) [as For the sake of clarity, the original proviso to Section 149(1)(b) [as inserted by Finance Act, 2021] and the amended proviso to Section nance Act, 2021] and the amended proviso to Section nance Act, 2021] and the amended proviso to Section 149(1)(b) of the Act, is reproduced below: 149(1)(b) of the Act, is reproduced below:-

First Proviso to Section 149(1)(b) [as inserted by FA 2021] First Proviso to Section 149(1)(b) [as inserted by FA 2021]

Provided that no notice under section 148 shall be issued at any time in Provided that no notice under section 148 shall be issued at any time in Provided that no notice under section 148 shall be issued at any time in a case for the relevant a case for the relevant assessment year beginning on or before 1st day assessment year beginning on or before 1st day of April, 2021, if such notice could not have been issued at that time on of April, 2021, if such notice could not have been issued at that time on of April, 2021, if such notice could not have been issued at that time on account of being beyond the time limit specified under the provisions of account of being beyond the time limit specified under the provisions of account of being beyond the time limit specified under the provisions of clause (b) of sub clause (b) of sub-section (1) of this section, as they stood i section (1) of this section, as they stood immediately before the commencement of the Finance Act, 2021: before the commencement of the Finance Act, 2021:

First Proviso to Section 149(1)(b) [as amended First Proviso to Section 149(1)(b) [as amended by FA 2022 w.r.e.f by FA 2022 w.r.e.f 01.04.2021]

Provided that no notice under section 148 shall be issued at any time in Provided that no notice under section 148 shall be issued at any time in Provided that no notice under section 148 shall be issued at any time in a case for the relevant assessment year begi a case for the relevant assessment year beginning on or before 1st day nning on or before 1st day of April, 2021, if a notice under section 148 or Section 153 of April, 2021, if a notice under section 148 or Section 153 of April, 2021, if a notice under section 148 or Section 153-A or Section 153-C could not have been issued at that time on account of being C could not have been issued at that time on account of being C could not have been issued at that time on account of being beyond the time limit specified under the provisions of clause (b) of sub beyond the time limit specified under the provisions of clause (b) of sub beyond the time limit specified under the provisions of clause (b) of sub- section (1) of this section or Section 153 this section or Section 153-A or Section 153 A or Section 153-C, as the case may be, as they stood immediately before the commencement of case may be, as they stood immediately before the commencement of case may be, as they stood immediately before the commencement of the Finance Act, 2021: the Finance Act, 2021:

11. The Legislature is noted to have explained the above amendment in The Legislature is noted to have explained the above amendment in The Legislature is noted to have explained the above amendment in the Memorandum to Finance Bill, 2022. It w the Memorandum to Finance Bill, 2022. It was inter alia stated that, i as inter alia stated that, in cases where search is initiated under section 132 of the Act orbooks of cases where search is initiated under section 132 of the Act orbooks of cases where search is initiated under section 132 of the Act orbooks of 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt account, other documents or any assets are requisitioned under section account, other documents or any assets are requisitioned under section account, other documents or any assets are requisitioned under section 132Aof the Act, on or after 1st April, 2021, 132Aof the Act, on or after 1st April, 2021, the assessment or assessment or reassessment is now to be to be made under sections 143 or 144 or 147 of the sections 143 or 144 or 147 of the Act after the Finance Act, 2021. Act after the Finance Act, 2021. According to the Legislature, there were According to the Legislature, there were inadvertent drafting errors inadvertent drafting errors in Section 149 and that to align align the provisions with the intent of the section the section, the proviso was amended to provide that, to provide that, no notice under section 148 shall be issued at any time in a case for the under section 148 shall be issued at any time in a case for the under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before 1st day of April, 2021, if assessment year beginning on or before 1st day of April, 2021, if assessment year beginning on or before 1st day of April, 2021, if a notice under section 148 section 148[non-search matters] or section 153A or or section 153A or section 153C[search related matters after 01.04.2021] related matters after 01.04.2021] could not have could not have been issued at that time on account of being beyond the time limit time on account of being beyond the time limit time on account of being beyond the time limit specified under the provisions of specified under the provisions of clause (b) of sub-section (1) of section section (1) of section 149 or section 153A or section 153C, as 149 or section 153A or section 153C, as the case may be, as they the case may be, as they stood immediately before the commencement of the immediately before the commencement of the Finance Act, 2021. Finance Act, 2021.

12. Hence, in light of the judgment of Hon’ble Supreme Court in Hence, in light of the judgment of Hon’ble Supreme Court in Hence, in light of the judgment of Hon’ble Supreme Court in UOI Vs Rajeev Bansal (supra) Vs Rajeev Bansal (supra) and having regard to the above amendment and having regard to the above amendment made by Finance Act, 2022, the position which emerges made by Finance Act, 2022, the position which emerges is that, ordinarily is that, ordinarily the AYs prior to AY 2021 the AYs prior to AY 2021-22 can be reopened under the new 148 regime, 22 can be reopened under the new 148 regime, only if such AY [in non [in non-search matters] was otherwise capable of being was otherwise capable of being reopened under the old regime reopened under the old regime [six years as laid down in erstwhile [six years as laid down in erstwhile Section 149(1)(b)], at the s , at the stage of issuance of notice. However, in cases tage of issuance of notice. However, in cases , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt where search has been conducted on or after 1st April 2021 or where where search has been conducted on or after 1 April 2021 or where document or information has been found & seized in the course of search document or information has been found & seized in the course of search document or information has been found & seized in the course of search which relates to the assessee [third party], the which relates to the assessee [third party], the assessment or assessment or reassessment which was earlier required to be made u/s 153A/153C of which was earlier required to be made u/s 153A/153C of which was earlier required to be made u/s 153A/153C of the Act, is now required to be required to be made under Section 143 or 144 or 147 of Section 143 or 144 or 147 of the Act. The timelines for search related cases qua AYs prior to AY 2021 the Act. The timelines for search related cases qua AYs prior to AY 2021 the Act. The timelines for search related cases qua AYs prior to AY 2021- 22, would be governed by first proviso to Section 1 22, would be governed by first proviso to Section 149(1)(b) of the Act 49(1)(b) of the Act and therefore the notice for reopening the assessment u/s 148 of the Act and therefore the notice for reopening the assessment u/s 148 of the Act and therefore the notice for reopening the assessment u/s 148 of the Act can be issued, only if such AY could have otherwise been validly reopened can be issued, only if such AY could have otherwise been validly reopened can be issued, only if such AY could have otherwise been validly reopened in terms of Section 153A/153C of the Act in terms of Section 153A/153C of the Act [as it stood prior to introduction [as it stood prior to introduction of Finance Act, 2021], at the time of issuance of notice under the new , at the time of issuance of notice under the new , at the time of issuance of notice under the new regime.

13. Having taken note of the legal position of law regarding the Having taken note of the legal position of law regarding the Having taken note of the legal position of law regarding the timelines for reopening of assessment under the new 148 regime, we now timelines for reopening of assessment under the new 148 regime, we now timelines for reopening of assessment under the new 148 regime, we now revert back to the facts of the present case. In the revert back to the facts of the present case. In the present case before present case before us, search upon the assessee was conducted on 15 us, search upon the assessee was conducted on 15 us, search upon the assessee was conducted on 15-06-2022 and therefore in terms of the second proviso to Section 149 of the Act, the therefore in terms of the second proviso to Section 149 of the Act, the therefore in terms of the second proviso to Section 149 of the Act, the income of the assessee is required to be assessed or reassessed in income of the assessee is required to be assessed or reassessed in income of the assessee is required to be assessed or reassessed in accordance with the new 148 regime, accordance with the new 148 regime, as introduced by Finance Act, 2021. as introduced by Finance Act, 2021.

However, as because the relevant AY involved is AY 2013 However, as because the relevant AY involved is AY 2013-14 viz., prior to 14 viz., prior to AY 2021-22; we are required to test the time limit for reopening of the 22; we are required to test the time limit for reopening of the 22; we are required to test the time limit for reopening of the 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt relevant AY 2013-14 on 14 on the tenets of the first proviso to Section first proviso to Section 149(1)(b) of the new regime ) of the new regime, at the stage of issuance of notice under of issuance of notice under section 148 of the new regime section 148 of the new regime i.e. 30.03.2023. Having regard to the legal i.e. 30.03.2023. Having regard to the legal principles as discussed in preceding paragraphs, it is first required to be principles as discussed in preceding paragraphs, it is first required to be principles as discussed in preceding paragraphs, it is first required to be ascertained whether AY 2013 ascertained whether AY 2013-14 could have been reopened under the old en reopened under the old provisions of Section 153A of the Act on the date of issuance of notice i.e. provisions of Section 153A of the Act on the date of issuance of notice i.e. provisions of Section 153A of the Act on the date of issuance of notice i.e. 30.03.2023 and only if the answer is in affirmative that, the AO could 30.03.2023 and only if the answer is in affirmative that, the AO could 30.03.2023 and only if the answer is in affirmative that, the AO could have validly issued notice u/s 148 of the Act under the new regime. For have validly issued notice u/s 148 of the Act under the new regime. For have validly issued notice u/s 148 of the Act under the new regime. For this, let us now have a look at the relevant provisions of Section 153A of us now have a look at the relevant provisions of Section 153A of us now have a look at the relevant provisions of Section 153A of the Act, which reads as under: the Act, which reads as under:-

“Notwithstanding anything contained in section 139, section 147, section Notwithstanding anything contained in section 139, section 147, section Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, in the case of a person52 148, section 149, section 151 and section 153, in the case of a person52 148, section 149, section 151 and section 153, in the case of a person52 where a search is initiated under section 132 or books of account, other search is initiated under section 132 or books of account, other search is initiated under section 132 or books of account, other documents or any assets are requisitioned under section 132A after the documents or any assets are requisitioned under section 132A after the documents or any assets are requisitioned under section 132A after the 31st day of May, 2003 y, 2003 but on or before the 31st day of March, 2021, the but on or before the 31st day of March, 2021, the Assessing Officer shall Assessing Officer shall—

(a) issue notice to suc issue notice to such person requiring him to furnish within such h person requiring him to furnish within such period, as may be specified in the notice, the return of income in respect period, as may be specified in the notice, the return of income in respect period, as may be specified in the notice, the return of income in respect of each assessment year falling of each assessment year falling within six assessment years within six assessment years and for the relevant assessment year or years sessment year or years referred to in clause (b), in referred to in clause (b), in the prescribed form and verified in the prescribed manner and setting forth prescribed form and verified in the prescribed manner and setting forth prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed and the such other particulars as may be prescribed and the provisions of this provisions of this Act shall, so far as may be, apply accordingly as if such return were a so far as may be, apply accordingly as if such return were a so far as may be, apply accordingly as if such return were a return required to be furnished unde return required to be furnished under section 139;

(b) assess or reassess the total income of six assessment years assess or reassess the total income of six assessment years assess or reassess the total income of six assessment years immediately preceding the assessment year relevant to the previous immediately preceding the assessment year relevant to the previous immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition year in which such search is conducted or requisition is made is made and for the relevant assessment year or years evant assessment year or years:

….

, 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 18 ::

Provided also that no notice for assessment or reassessment shall be Provided also that no notice for assessment or reassessment shall be Provided also that no notice for assessment or reassessment shall be issued by the Assessing Officer for the relevant assessment year or issued by the Assessing Officer for the relevant assessment year or issued by the Assessing Officer for the relevant assessment year or years unless—

(a) the Assessing Officer has in his possession books of account or other the Assessing Officer has in his possession books of account or other the Assessing Officer has in his possession books of account or other documents or evidence which r documents or evidence which reveal that the income, represented in the eveal that the income, represented in the form of asset, which has escaped assessment amounts to or is likely to form of asset, which has escaped assessment amounts to or is likely to form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more in the relevant assessment year or amount to fifty lakh rupees or more in the relevant assessment year or amount to fifty lakh rupees or more in the relevant assessment year or in aggregate in the relevant assessment years; in aggregate in the relevant assessment years;

(b) the income referred t the income referred to in clause (a) or part thereof has escaped o in clause (a) or part thereof has escaped assessment for such year or years; and assessment for such year or years; and (c) the search under section 132 is initiated or requisition under section the search under section 132 is initiated or requisition under section the search under section 132 is initiated or requisition under section 132A is made on or after the 1st day of April, 2017. 132A is made on or after the 1st day of April, 2017.

Explanation 1.—For the purposes of this For the purposes of this sub-section, the expression section, the expression "relevant assessment year" shall mean an assessment year preceding "relevant assessment year" shall mean an assessment year preceding "relevant assessment year" shall mean an assessment year preceding the assessment year relevant to the previous year in which search is the assessment year relevant to the previous year in which search is the assessment year relevant to the previous year in which search is conducted or requisition is made which falls beyond six assessment conducted or requisition is made which falls beyond six assessment conducted or requisition is made which falls beyond six assessment years but not later than years but not later than ten assessment years from the end of the ten assessment years from the end of the assessment year relevant to the previous year in which search is assessment year relevant to the previous year in which search is assessment year relevant to the previous year in which search is conducted or requisition is made. conducted or requisition is made.”

14. It is seen that, Section 153A envisages that an assessment to be seen that, Section 153A envisages that an assessment to be seen that, Section 153A envisages that an assessment to be undertaken "in respect of each assessment year "in respect of each assessment year falling within six falling within six assessment years" referred to in clause (b) thereof. Clause (b) of Section referred to in clause (b) thereof. Clause (b) of Section referred to in clause (b) thereof. Clause (b) of Section 153A(1) provides for the identification of the six AYs with reference to the 153A(1) provides for the identification of the six AYs with reference to the 153A(1) provides for the identification of the six AYs with reference to the "previous year in which "previous year in which the search is conducted or requisition is made" the search is conducted or requisition is made".

Hence, the block of six AYs ck of six AYs is to be identified commencing from the AY to be identified commencing from the AY "immediately preceding the assessment year relevant to the previous "immediately preceding the assessment year relevant to the previous "immediately preceding the assessment year relevant to the previous year" in which the search may have been conducted. in which the search may have been conducted. In the present case, In the present case, as the search occurred on 15.06.2022 i.e., between 1st April 2022 to 31 pril 2022 to 31st as the search occurred on 15.06.2022 i.e., between 1 March 2023; FY 2022- -23 relevant to AY 2023-24 would constitute the 24 would constitute the 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt previous year of search and the six AYs as envisaged are those which previous year of search and the six AYs as envisaged are those which previous year of search and the six AYs as envisaged are those which immediately precede the AY so identified with reference to the date of immediately precede the AY so identified with reference to the date of immediately precede the AY so identified with reference to the date of search. Consequently, and recko Consequently, and reckoned backward, the six AYs would be, AYs backward, the six AYs would be, AYs 2022-23, 2021-22, 2020 22, 2020-21, 2019-20, 2018-19 & 2017 19 & 2017-18. It is important to bear in mind that, t important to bear in mind that, the Finance Act, 2017 stretched the he Finance Act, 2017 stretched the search assessment to an additional four AYs sment to an additional four AYs with the introduction of the with the introduction of the concept of "relevant assessment year" "relevant assessment year", which was defined by Explanation which was defined by Explanation 1 to Section 153A(1) as being the period which would fall beyond 1 to Section 153A(1) as being the period which would fall beyond 1 to Section 153A(1) as being the period which would fall beyond "six assessment years but not later than ten assessment years from the end assessment years but not later than ten assessment years from the end assessment years but not later than ten assessment years from the end of the assessment year relevant to the previous year" of the assessment year relevant to the previous year" in which search was n which search was conducted. Accordingly, the ten AYs Accordingly, the ten AYs would have to be computed from the computed from the end of the AY relevant to the FY in which the search end of the AY relevant to the FY in which the search was conducted or was conducted or requisition made [AY 2023 [AY 2023-24, in the present case]. It is seen that, 24, in the present case]. It is seen that, Explanation 1 to Section 15 Explanation 1 to Section 153A(1) requires computation of the 10 requires computation of the 10-year block period from the end of the relevant AY in which search was block period from the end of the relevant AY in which search was block period from the end of the relevant AY in which search was conducted whereas the 6 conducted whereas the 6-year block period for the purposes of Section year block period for the purposes of Section 153A(1)(b) comprises of the six relevant AYs 153A(1)(b) comprises of the six relevant AYs ‘preceding’ ‘preceding’ the year of search. To put it simply, the year of search is considered as year ‘0’ for put it simply, the year of search is considered as year ‘0’ for put it simply, the year of search is considered as year ‘0’ for ascertaining the six AYs to be reopened in terms of Section 153A(1)(b) of ascertaining the six AYs to be reopened in terms of Section 153A(1)(b) of ascertaining the six AYs to be reopened in terms of Section 153A(1)(b) of the Act. However, having regard to the language used in the Act. However, having regard to the language used in Explanation 1 to Explanation 1 to Section 153A(1), since the 10 , since the 10-year block period is to be computed from iod is to be computed from the end of the relevant AY in which search was conducted, the year of the end of the relevant AY in which search was conducted, the year of the end of the relevant AY in which search was conducted, the year of ITA Nos.1163, 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 ITA Nos. 1231, 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt search [AY 2023-24 in present case] is considered to be year ‘1’ and 24 in present case] is considered to be year ‘1’ and 24 in present case] is considered to be year ‘1’ and accordingly the 10-year block period is ascertained. year block period is ascertained. In the context of the In the context of the present case therefore, it is manifest that, AY 2023 erefore, it is manifest that, AY 2023-24 would form the 24 would form the first year of the block of ten AYs and the maximum period of ten AYs' first year of the block of ten AYs and the maximum period of ten AYs' first year of the block of ten AYs and the maximum period of ten AYs' shall terminate in AY 2014 shall terminate in AY 2014-15. We are therefore in agreement with the are therefore in agreement with the Ld. CIT(A)’s computation of Ld. CIT(A)’s computation of ten-year block period in terms o block period in terms of Section 153A of the Act, which for the sake of convenience, is set out herein 153A of the Act, which for the sake of convenience, is set out herein 153A of the Act, which for the sake of convenience, is set out herein- below:-

Computation of the ten Computation of the ten- Sequence of year period as provided year period as provided the year u/s 153A of the Act u/s 153A of the Act AY 2023 AY 2023-24 First year AY 2022 AY 2022-23 Second year AY2021 AY2021-22 Third Year AY 2020 2020-21 Fourth Year AY 2019 AY 2019-20 Fifth Year AY 2018 AY 2018-19 Sixth Year AY 2017 AY 2017-18 Seventh Year AY 2016 AY 2016-17 Eight Year AY 2015 AY 2015-16 Ninth Year AY 2014 AY 2014-15 Tenth Year AY 2013 AY 2013-14 Eleventh Year

15. The above tabulation is found to be supported by the The above tabulation is found to be supported by the The above tabulation is found to be supported by the decision of the jurisdictional Hon’ble Madras High Court in the case of jurisdictional Hon’ble Madras High Court in the case of A.R. Safiullah A.R. Safiullah (WP(MD) No. 4327 of 2021) (WP(MD) No. 4327 of 2021) wherein it was held as follows: wherein it was held as follows:-

“9. Explanation-I is clear as to the manner of computation of the ten I is clear as to the manner of computation of the ten I is clear as to the manner of computation of the ten assessment years. It clearly and firmly fixes the assessment years. It clearly and firmly fixes the starting point. It is the starting point. It is the end of the assessment year relevant to the previous year in which end of the assessment year relevant to the previous year in which end of the assessment year relevant to the previous year in which search is conducted or requisition is made. There cannot be any doubt search is conducted or requisition is made. There cannot be any doubt search is conducted or requisition is made. There cannot be any doubt that since search was made in this case on 10.04.2018, the assessment that since search was made in this case on 10.04.2018, the assessment that since search was made in this case on 10.04.2018, the assessment , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt year is 2019-20. The en 20. The end of the assessment year 2019 d of the assessment year 2019-20 is 31.03.2020. The computation of ten years has to run backwards from 31.03.2020. The computation of ten years has to run backwards from 31.03.2020. The computation of ten years has to run backwards from the said date i.e., 31.03.2020. The first year will of course be the search the said date i.e., 31.03.2020. The first year will of course be the search the said date i.e., 31.03.2020. The first year will of course be the search assessment year itself. In that event, the ten assessment years will be assessment year itself. In that event, the ten assessment years will be assessment year itself. In that event, the ten assessment years will be as follows :

1st Year Year 2019 2019-20 2nd Year Year 2018 2018-19 3rd Year Year 2017 2017-18 4th Year Year 2016 2016-17 5th Year Year 2015 2015-16 6th Year Year 2014 2014-15 7th Year Year 2013 2013-14 8th Year Year 2012 2012-13 9th Year Year 2011 2011-12 10th Year Year 2010 2010-11

The case on hand pertains to AY 2009 The case on hand pertains to AY 2009-10. It is obviously beyond the 10. It is obviously beyond the ten year outer ceiling limit prescribed by the statute. The terminal point is year outer ceiling limit prescribed by the statute. The terminal point is year outer ceiling limit prescribed by the statute. The terminal point is the tenth year calculated from the end of the assessment year relevant the tenth year calculated from the end of the assessment year relevant the tenth year calculated from the end of the assessment year relevant to the previous year in which search is conducted. The long arm of the to the previous year in which search is conducted. The long arm of the to the previous year in which search is conducted. The long arm of the law can go up to this terminal poin law can go up to this terminal point and not one day beyond. When the t and not one day beyond. When the statute is clear and admits of no ambiguity, it has to be strictly statute is clear and admits of no ambiguity, it has to be strictly statute is clear and admits of no ambiguity, it has to be strictly construed and there is no scope for looking to the explanatory notes construed and there is no scope for looking to the explanatory notes construed and there is no scope for looking to the explanatory notes appended to statute or circular issued by the department. appended to statute or circular issued by the department.

10. In the case on hand, th 10. In the case on hand, the statute has prescribed one mode of e statute has prescribed one mode of computing the six years and another mode for computing the ten years. computing the six years and another mode for computing the ten years. computing the six years and another mode for computing the ten years. Section 153A(1)(b) states that the assessing officer shall assess or Section 153A(1)(b) states that the assessing officer shall assess or Section 153A(1)(b) states that the assessing officer shall assess or reassess the total income of six years immediately preceding the reassess the total income of six years immediately preceding the reassess the total income of six years immediately preceding the assessment year assessment year relevant to the previous year in which search is relevant to the previous year in which search is conducted. Applying this yardstick, the conducted. Applying this yardstick, the six years would go up to 2013 six years would go up to 2013- 14. The search assessment year, namely, 2019 14. The search assessment year, namely, 2019-20 has to be excluded. 20 has to be excluded. This is because, the statute talks of the six years preceding the se This is because, the statute talks of the six years preceding the se This is because, the statute talks of the six years preceding the search assessment year. But, while computing the ten assessment years, the assessment year. But, while computing the ten assessment years, the assessment year. But, while computing the ten assessment years, the starting point has to be the end of the search assessment year. In other starting point has to be the end of the search assessment year. In other starting point has to be the end of the search assessment year. In other words, search assessment year has to be including in the latter case. It words, search assessment year has to be including in the latter case. It words, search assessment year has to be including in the latter case. It , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt is not for me to fathom the wisdom of is not for me to fathom the wisdom of the parliament. I cannot assume the parliament. I cannot assume that the amendment introduced by the Finance Act, 2017 intended to that the amendment introduced by the Finance Act, 2017 intended to that the amendment introduced by the Finance Act, 2017 intended to bring in four more years over and above the six years already provided bring in four more years over and above the six years already provided bring in four more years over and above the six years already provided within the scope of the provision. When the law has prescribed a within the scope of the provision. When the law has prescribed a within the scope of the provision. When the law has prescribed a particular length, i particular length, it is not for the court to stretch it. Plasticity is the new t is not for the court to stretch it. Plasticity is the new mantra in neuroscience, thanks to the teachings of Norman Doidge. It mantra in neuroscience, thanks to the teachings of Norman Doidge. It mantra in neuroscience, thanks to the teachings of Norman Doidge. It implies that contrary to settled wisdom, even brain structure can be implies that contrary to settled wisdom, even brain structure can be implies that contrary to settled wisdom, even brain structure can be changed. But not so when it comes to a provision in a taxi changed. But not so when it comes to a provision in a taxi changed. But not so when it comes to a provision in a taxing statute that is free of ambiguity. Such a provision cannot be elastically that is free of ambiguity. Such a provision cannot be elastically that is free of ambiguity. Such a provision cannot be elastically construed.

11. One other contention urged by the standing counsel has to be dealt 11. One other contention urged by the standing counsel has to be dealt 11. One other contention urged by the standing counsel has to be dealt with. It is pointed out that the petitioner has invoked the writ with. It is pointed out that the petitioner has invoked the writ with. It is pointed out that the petitioner has invoked the writ jurisdiction at the notice stage jurisdiction at the notice stage. Since the petitioner has demonstrated . Since the petitioner has demonstrated that the subject assessment year lies beyond the ambit of the provision, that the subject assessment year lies beyond the ambit of the provision, that the subject assessment year lies beyond the ambit of the provision, the respondent has no jurisdiction to issue the impugned notice. Once the respondent has no jurisdiction to issue the impugned notice. Once the respondent has no jurisdiction to issue the impugned notice. Once lack of jurisdiction has been established, the maintainability of the wri lack of jurisdiction has been established, the maintainability of the wri lack of jurisdiction has been established, the maintainability of the writ petition cannot be in doubt." petition cannot be in doubt."

16. Following the above decision (supra), in the present case, as the AY Following the above decision (supra), in the present case, as the AY Following the above decision (supra), in the present case, as the AY relevant to the year of search in AY 2023 relevant to the year of search in AY 2023-24, the period of 24, the period of the ten AYs, when computed from the end of AY 2023 puted from the end of AY 2023-24 would terminate upon AY 24 would terminate upon AY 2014-15, so according to us, AY 2013 ccording to us, AY 2013-14 would clearly fall outside the clearly fall outside the block period of ten AYs and therefore the AO could block period of ten AYs and therefore the AO could not have legally not have legally reopened the same under section 153A(1)(b) read with Explanation (1) to ened the same under section 153A(1)(b) read with Explanation (1) to ened the same under section 153A(1)(b) read with Explanation (1) to fourth proviso of Section 153A of the Act, at the time of fourth proviso of Section 153A of the Act, at the time of issuance of notice issuance of notice u/s 148 of the Act under the new regime i.e. 30.03.2023. Hence, we find u/s 148 of the Act under the new regime i.e. 30.03.2023. Hence, we find u/s 148 of the Act under the new regime i.e. 30.03.2023. Hence, we find that, the Ld. CIT(A) had rightly held that, the AY 2013 that, the Ld. CIT(A) had rightly held that, the AY 2013-14 fell beyond the 14 fell beyond the time line of 10 years from the end of relevant AY 2023 time line of 10 years from the end of relevant AY 2023-24, as prescribed 24, as prescribed in Section 153A of the Act and therefore held that the AO lacked the f the Act and therefore held that the AO lacked the f the Act and therefore held that the AO lacked the jurisdiction to reopen AY 2013 jurisdiction to reopen AY 2013-14 under the new regime, in terms of the 14 under the new regime, in terms of the 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt restrictive covenant set out in first proviso to Section 149(1)(b) of the restrictive covenant set out in first proviso to Section 149(1)(b) of the restrictive covenant set out in first proviso to Section 149(1)(b) of the Act.

17. Our above view is Our above view is noted to be supported by the Hon’ble Delhi High on’ble Delhi High Court in the case of KAD Housing Pvt Ltd KAD Housing Pvt Ltd v. DCIT (supra) DCIT (supra) wherein it was held that, an action of reassessment which comes to be initiated in an action of reassessment which comes to be initiated in an action of reassessment which comes to be initiated in relation to a search undertaken on or after 01 April 2021 would have to relation to a search undertaken on or after 01 April 2021 would have to relation to a search undertaken on or after 01 April 2021 would have to meet the foundational test meet the foundational tests as specified in the first proviso to Section roviso to Section 149(1) of the Act. The Court held that, The Court held that, a reassessment action would thus reassessment action would thus have to not only satisfy the time frames constructed in terms of Section have to not only satisfy the time frames constructed in terms of Section have to not only satisfy the time frames constructed in terms of Section 149, but in a relevant case concerned with a search, also those 149, but in a relevant case concerned with a search, also those 149, but in a relevant case concerned with a search, also those which would be applicable by virtue of the provisions of Section 153A and 153C would be applicable by virtue of the provisions of Section 153A and 153C would be applicable by virtue of the provisions of Section 153A and 153C of the Act. In the decided case, the search was conducted on 11.10.2023 of the Act. In the decided case, the search was conducted on 11.10.2023 of the Act. In the decided case, the search was conducted on 11.10.2023 and the seized material / information relating to the assessee was handed and the seized material / information relating to the assessee was handed and the seized material / information relating to the assessee was handed over on 16.08.2024. Having reg over on 16.08.2024. Having regard to the provisions of Section 153C of ard to the provisions of Section 153C of the Act, the deemed date of search was 16.08.2024, i.e. AY 2025 the Act, the deemed date of search was 16.08.2024, i.e. AY 2025 the Act, the deemed date of search was 16.08.2024, i.e. AY 2025-26. The Hon’ble High Court, having regard to the Hon’ble High Court, having regard to the manner in which the period of manner in which the period of six or ten years is required to be reckoned in respect of reopening of t six or ten years is required to be reckoned in respect of reopening of t six or ten years is required to be reckoned in respect of reopening of the assessment as contemplated contemplated contemplated under under under Section Section Section 153A(1) 153A(1) 153A(1) read read read with with with Explanation (1) to fourth proviso of Section 153A Explanation (1) to fourth proviso of Section 153A of the Act of the Act, held that, the assessment in respect of the AY 2015 assessment in respect of the AY 2015-16 falls beyond the period o 16 falls beyond the period of ten years as stipulated in terms of the first prov ten years as stipulated in terms of the first proviso to Section 149 Section 149(1)(b) , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt read with Section 153C of the Act read with Section 153C of the Act and therefore quashed the notice so and therefore quashed the notice so issued by the AO u/s 148 of the Act under the new regime issued by the AO u/s 148 of the Act under the new regime issued by the AO u/s 148 of the Act under the new regime. The findings of the Hon’ble High Court, which are relevant in the present case, is as of the Hon’ble High Court, which are relevant in the present case, is as of the Hon’ble High Court, which are relevant in the present case, is as under:-

“5. In the present case, the petitioner's assessment is sought to be the present case, the petitioner's assessment is sought to be the present case, the petitioner's assessment is sought to be reopened on the basis of the information available pursuant to a search reopened on the basis of the information available pursuant to a search reopened on the basis of the information available pursuant to a search conducted on 11.10.2023 in respect of Sterling Agro Industries Ltd. conducted on 11.10.2023 in respect of Sterling Agro Industries Ltd. conducted on 11.10.2023 in respect of Sterling Agro Industries Ltd. Apparently, certain information pertaining to the peti Apparently, certain information pertaining to the petitioner was found tioner was found during the course of the said proceedings and, on 16.08.2024, the same during the course of the said proceedings and, on 16.08.2024, the same during the course of the said proceedings and, on 16.08.2024, the same was forwarded to the Assessing Officer (hereafter AO) exercising was forwarded to the Assessing Officer (hereafter AO) exercising was forwarded to the Assessing Officer (hereafter AO) exercising jurisdiction in the case of the assessee. On receipt of the said information, jurisdiction in the case of the assessee. On receipt of the said information, jurisdiction in the case of the assessee. On receipt of the said information, the AO issued a notice da the AO issued a notice dated 17.08.2024 under Section 148A(b) of the ted 17.08.2024 under Section 148A(b) of the Act setting out the information, which according to the AO suggested that Act setting out the information, which according to the AO suggested that Act setting out the information, which according to the AO suggested that the petitioner's income for the relevant AY 2015 the petitioner's income for the relevant AY 2015-16, has escaped 16, has escaped assessment.

….

9. As noted above, the short question to be cons 9. As noted above, the short question to be considered by this Court is idered by this Court is whether the impugned notice has been issued beyond the period of whether the impugned notice has been issued beyond the period of whether the impugned notice has been issued beyond the period of limitation as stipulated under Section 149(1)(b) of the Act. The said issue limitation as stipulated under Section 149(1)(b) of the Act. The said issue limitation as stipulated under Section 149(1)(b) of the Act. The said issue is squarely covered by the earlier decisions of the Co is squarely covered by the earlier decisions of the Co-ordinate Bench of ordinate Bench of this Court in Dine this Court in Dinesh Jindal v. Assistant Commissioner of Income Tax, sh Jindal v. Assistant Commissioner of Income Tax, Central Circle 20, Delhi & Others [2024] 164 taxmann.com 746 (Delhi) as Central Circle 20, Delhi & Others [2024] 164 taxmann.com 746 (Delhi) as Central Circle 20, Delhi & Others [2024] 164 taxmann.com 746 (Delhi) as well as in The Pr. Commissioner of Income Tax well as in The Pr. Commissioner of Income Tax -Central Central-1 v. Ojjus Medicare Pvt. Limited [2024] 161 taxmann.com 160/465 ITR 101 (Delhi Medicare Pvt. Limited [2024] 161 taxmann.com 160/465 ITR 101 (Delhi Medicare Pvt. Limited [2024] 161 taxmann.com 160/465 ITR 101 (Delhi ).

…..

11. In Ojjus Medicare Pvt. Limited (supra), the Court also explained the 11. In Ojjus Medicare Pvt. Limited (supra), the Court also explained the 11. In Ojjus Medicare Pvt. Limited (supra), the Court also explained the manner in which the period of six or ten years is required to be reckoned manner in which the period of six or ten years is required to be reckoned manner in which the period of six or ten years is required to be reckoned in respect of reopening of the assessment for a period prior to six years in respect of reopening of the assessment for a period prior to six years in respect of reopening of the assessment for a period prior to six years and/or before the expiry of and/or before the expiry of ten years from the relevant assessment years ten years from the relevant assessment years as contemplated under Section 153C of the Act. The court held that the as contemplated under Section 153C of the Act. The court held that the as contemplated under Section 153C of the Act. The court held that the 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 25 ::

period of ten years is required to be reckoned from the end of the period of ten years is required to be reckoned from the end of the period of ten years is required to be reckoned from the end of the assessment year relevant to the year in which the notice under Section assessment year relevant to the year in which the notice under Section assessment year relevant to the year in which the notice under Section 148 of the Act is issued. 48 of the Act is issued.

12. The relevant extract of the decision in Ojjus Medicare Pvt. Limited 12. The relevant extract of the decision in Ojjus Medicare Pvt. Limited 12. The relevant extract of the decision in Ojjus Medicare Pvt. Limited (supra) is set out below: (supra) is set out below:-

"D. The First Proviso to Section 153C introduces a legal fiction on the "D. The First Proviso to Section 153C introduces a legal fiction on the "D. The First Proviso to Section 153C introduces a legal fiction on the basis of which the commencement date for computation of the basis of which the commencement date for computation of the basis of which the commencement date for computation of the six year or the ten year block is deemed to be the date of receipt of books of the ten year block is deemed to be the date of receipt of books of the ten year block is deemed to be the date of receipt of books of accounts by the jurisdictional AO. The identification of the starting block accounts by the jurisdictional AO. The identification of the starting block accounts by the jurisdictional AO. The identification of the starting block for the purposes of computation of the six and the ten year period is for the purposes of computation of the six and the ten year period is for the purposes of computation of the six and the ten year period is governed by the First Proviso t governed by the First Proviso to Section 153C, which significantly shifts o Section 153C, which significantly shifts the reference point spoken of in Section 153A(1), while defining the point the reference point spoken of in Section 153A(1), while defining the point the reference point spoken of in Section 153A(1), while defining the point from which the period of the "relevant assessment year" is to be from which the period of the "relevant assessment year" is to be from which the period of the "relevant assessment year" is to be calculated, to the date of receipt of the books of accounts, documents or calculated, to the date of receipt of the books of accounts, documents or calculated, to the date of receipt of the books of accounts, documents or assets seized by the jurisdictional AO of the non searched person. The assets seized by the jurisdictional AO of the non searched person. The assets seized by the jurisdictional AO of the non searched person. The shift of the relevant date in the case of a non shift of the relevant date in the case of a non-searched person being searched person being regulated by the First Proviso of Section 153C(1) is an issue which is no regulated by the First Proviso of Section 153C(1) is an issue which is no regulated by the First Proviso of Section 153C(1) is an issue which is no longer res integra and stands authoritat longer res integra and stands authoritatively settled by virtue of the ively settled by virtue of the decisions of this Court in SSP Aviation and RRJ Securities as well as the decisions of this Court in SSP Aviation and RRJ Securities as well as the decisions of this Court in SSP Aviation and RRJ Securities as well as the decision of the Supreme Court in Jasjit Singh. The aforesaid legal position decision of the Supreme Court in Jasjit Singh. The aforesaid legal position decision of the Supreme Court in Jasjit Singh. The aforesaid legal position also stood reiterated by the Supreme Court in Vikram Sujitkumar Bhatia. also stood reiterated by the Supreme Court in Vikram Sujitkumar Bhatia. also stood reiterated by the Supreme Court in Vikram Sujitkumar Bhatia. The submission of the respondents, therefore, that the block periods submission of the respondents, therefore, that the block periods submission of the respondents, therefore, that the block periods would have to be reckoned with reference to the date of search can would have to be reckoned with reference to the date of search can would have to be reckoned with reference to the date of search can neither be countenanced nor accepted. neither be countenanced nor accepted.

E. The reckoning of the six AYs' would require one to firstly identify the FY E. The reckoning of the six AYs' would require one to firstly identify the FY E. The reckoning of the six AYs' would require one to firstly identify the FY in which the search was undertaken and which would lead to the h the search was undertaken and which would lead to the h the search was undertaken and which would lead to the ascertainment of the AY relevant to the previous year of search. The ascertainment of the AY relevant to the previous year of search. The ascertainment of the AY relevant to the previous year of search. The block of six AYs' would consequently be those which immediately precede block of six AYs' would consequently be those which immediately precede block of six AYs' would consequently be those which immediately precede the AY relevant to the year of search. In the case of a sea the AY relevant to the year of search. In the case of a search assessment rch assessment undertaken in terms of Section 153C, the solitary distinction would be undertaken in terms of Section 153C, the solitary distinction would be undertaken in terms of Section 153C, the solitary distinction would be that the previous year of search would stand substituted by the date or that the previous year of search would stand substituted by the date or that the previous year of search would stand substituted by the date or the year in which the books of accounts or documents and assets seized the year in which the books of accounts or documents and assets seized the year in which the books of accounts or documents and assets seized are handed over to the juri are handed over to the jurisdictional AO as opposed to the year of search sdictional AO as opposed to the year of search which constitutes the basis for an assessment under Section 153A. which constitutes the basis for an assessment under Section 153A. which constitutes the basis for an assessment under Section 153A.

F. While the identification and computation of the six AYs' hinges upon F. While the identification and computation of the six AYs' hinges upon F. While the identification and computation of the six AYs' hinges upon the phrase "immediately preceding the assessment year relevant to the the phrase "immediately preceding the assessment year relevant to the the phrase "immediately preceding the assessment year relevant to the previous year" of search, the ten year period would have to be reckoned revious year" of search, the ten year period would have to be reckoned revious year" of search, the ten year period would have to be reckoned from the 31st day of March of the AY relevant to the year of search. This, from the 31st day of March of the AY relevant to the year of search. This, from the 31st day of March of the AY relevant to the year of search. This, since undisputedly, Explanation 1 of Section 153A requires us to reckon it since undisputedly, Explanation 1 of Section 153A requires us to reckon it since undisputedly, Explanation 1 of Section 153A requires us to reckon it "from the end of the assessment yea "from the end of the assessment year". This distinction would have to r". This distinction would have to necessarily be acknowledged in light of the statute having consciously necessarily be acknowledged in light of the statute having consciously necessarily be acknowledged in light of the statute having consciously , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt adopted the phraseology "immediately preceding" when it be in relation adopted the phraseology "immediately preceding" when it be in relation adopted the phraseology "immediately preceding" when it be in relation to the six year period and employing the expression "from the end of the to the six year period and employing the expression "from the end of the to the six year period and employing the expression "from the end of the assessment year" while speaking of the ten year block." ment year" while speaking of the ten year block."

13. The petitioner has, on the basis of the said decisions, produced a 13. The petitioner has, on the basis of the said decisions, produced a 13. The petitioner has, on the basis of the said decisions, produced a tabular statement, which indicates that the assessment in respect of the tabular statement, which indicates that the assessment in respect of the tabular statement, which indicates that the assessment in respect of the AY 2015-16 falls beyond the period of ten years as stipulated 16 falls beyond the period of ten years as stipulated 16 falls beyond the period of ten years as stipulated under Section 149 read with Section 153C of the Act. It would be apposite to set Section 149 read with Section 153C of the Act. It would be apposite to set Section 149 read with Section 153C of the Act. It would be apposite to set out the said tabular statement, which reads as under: out the said tabular statement, which reads as under:-

Analysis of time-period to issue reassessment notice Date of impugned period to issue reassessment notice Date of impugned period to issue reassessment notice Date of impugned notice under Section 148 notice under Section 148 - 31.08.2024 This chart is prepared in light of s prepared in light of the first proviso of Section 149 of the Act as amended by Finance Act the first proviso of Section 149 of the Act as amended by Finance Act the first proviso of Section 149 of the Act as amended by Finance Act 2021

Relevant Assessment year for Relevant Assessment year for Without prejudice computation of 10 Without prejudice computation of 10 initiating proceedings under Section initiating proceedings under Section years in light of first proviso to years in light of first proviso to 148 of the Act 148 of the Act Section 149 Section 149 2025-26 26 1 2024-25 25 2 2023-24 24 3 2022-23 23 4 2021-22 22 5 2020-21 21 6 2019-20 20 7 2018-19 19 8 2017-18 18 9 2016-17 17 10 10

2015-16 16 11 (beyond terminal point of 10 11 (beyond terminal point of 10 years) years)

14. Mr Chawla, the learned counsel appearing for the Revenue, fairly , the learned counsel appearing for the Revenue, fairly , the learned counsel appearing for the Revenue, fairly states that there is no cavil with the said tabular statement and that the states that there is no cavil with the said tabular statement and that the states that there is no cavil with the said tabular statement and that the issue is covered by the decisions of this Court in Dinesh Jindal (supra) as issue is covered by the decisions of this Court in Dinesh Jindal (supra) as issue is covered by the decisions of this Court in Dinesh Jindal (supra) as 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 27 ::

well as Ojjus Medicare Pvt. Limited (supra). He, well as Ojjus Medicare Pvt. Limited (supra). He, however, submits that however, submits that the Revenue may challenge the same in appropriate proceedings. the Revenue may challenge the same in appropriate proceedings. the Revenue may challenge the same in appropriate proceedings.

15. In view of the above, the impugned notice is set aside. 15. In view of the above, the impugned notice is set aside. 15. In view of the above, the impugned notice is set aside. Consequently, the respondent is restrained from the proceeding with the Consequently, the respondent is restrained from the proceeding with the Consequently, the respondent is restrained from the proceeding with the re-assessment proceedings in respect assessment proceedings in respect of the AY 2015-16.”

18. In the above decision, the Hon’ble High Court is found to have relied In the above decision, the Hon’ble High Court is found to have relied In the above decision, the Hon’ble High Court is found to have relied on their earlier judgment rendered in the case of on their earlier judgment rendered in the case of Dinesh Jindal Dinesh Jindal v. ACIT (supra). The relevant findings rendered in this judgment which are held . The relevant findings rendered in this judgment which are held . The relevant findings rendered in this judgment which are held to be applicable in the facts of the present case before us, is as under: n the facts of the present case before us, is as under: n the facts of the present case before us, is as under:-.

"8. Undisputedly, and in terms of Section 153C(3) of the Act, any search "8. Undisputedly, and in terms of Section 153C(3) of the Act, any search "8. Undisputedly, and in terms of Section 153C(3) of the Act, any search if conducted after 01 April 2021, would cease to be regulated by that if conducted after 01 April 2021, would cease to be regulated by that if conducted after 01 April 2021, would cease to be regulated by that provision. Sub-section (3), in that sense, embodies a s section (3), in that sense, embodies a s section (3), in that sense, embodies a sunset clause insofar as the applicability of Section 153C is concerned. The First insofar as the applicability of Section 153C is concerned. The First insofar as the applicability of Section 153C is concerned. The First Proviso to Section 149(1), however, bids us to go back in a point of Proviso to Section 149(1), however, bids us to go back in a point of Proviso to Section 149(1), however, bids us to go back in a point of time, and to examine whether a reopening would sustain bearing in time, and to examine whether a reopening would sustain bearing in time, and to examine whether a reopening would sustain bearing in mind the timeframes as they stood embod mind the timeframes as they stood embodied in Section 149(1)(b) or ied in Section 149(1)(b) or Section 153A and 153C, as the case may be. The First Proviso Section 153A and 153C, as the case may be. The First Proviso Section 153A and 153C, as the case may be. The First Proviso essentially requires us to undertake that consideration bearing in mind essentially requires us to undertake that consideration bearing in mind essentially requires us to undertake that consideration bearing in mind the timeframes which stood specified in Sections 149, 153A and 153C as the timeframes which stood specified in Sections 149, 153A and 153C as the timeframes which stood specified in Sections 149, 153A and 153C as they stood prior to the they stood prior to the commencement of Finance Act, 2021. commencement of Finance Act, 2021.

9. Thus, an action of reassessment which comes to be initiated in 9. Thus, an action of reassessment which comes to be initiated in 9. Thus, an action of reassessment which comes to be initiated in relation to a search undertaken on or after 01 April 2021 would have to relation to a search undertaken on or after 01 April 2021 would have to relation to a search undertaken on or after 01 April 2021 would have to meet the foundational tests as specified in the First Proviso to Section meet the foundational tests as specified in the First Proviso to Section meet the foundational tests as specified in the First Proviso to Section 149(1). A reassessment action would thus have to not only satisfy the reassessment action would thus have to not only satisfy the reassessment action would thus have to not only satisfy the time frames constructed in terms of Section 149, but in a relevant case time frames constructed in terms of Section 149, but in a relevant case time frames constructed in terms of Section 149, but in a relevant case and which is concerned with a search, also those which would be and which is concerned with a search, also those which would be and which is concerned with a search, also those which would be applicable by virtue of the provisions of Section 153A and applicable by virtue of the provisions of Section 153A and 153C. 153C.

10. Undisputedly, and if the validity of the reassessment were to be 10. Undisputedly, and if the validity of the reassessment were to be 10. Undisputedly, and if the validity of the reassessment were to be tested on the anvil of Section 153C, the petitioner would be entitled to tested on the anvil of Section 153C, the petitioner would be entitled to tested on the anvil of Section 153C, the petitioner would be entitled to succeed for the following reasons. It is an undisputed fact that the succeed for the following reasons. It is an undisputed fact that the succeed for the following reasons. It is an undisputed fact that the proceedings under Section 148 commence proceedings under Section 148 commenced on the basis of the d on the basis of the impugned notice dated 30 March 2023. This date would be of seminal impugned notice dated 30 March 2023. This date would be of seminal impugned notice dated 30 March 2023. This date would be of seminal importance since the period of six AYs' or the "relevant assessment importance since the period of six AYs' or the "relevant assessment importance since the period of six AYs' or the "relevant assessment year" would have to be reckoned from the date when action was year" would have to be reckoned from the date when action was year" would have to be reckoned from the date when action was initiated to reopen the assessment pe initiated to reopen the assessment pertaining to AY 2013-14." 14."

, 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 28 ::

19. We also gainfully refer to the decision of the Hon’ble Delhi High We also gainfully refer to the decision of the Hon’ble Delhi High We also gainfully refer to the decision of the Hon’ble Delhi High Court in Filatex India Ltd. v. Dy. CIT [WP(C) No. 12148 of 2023] Filatex India Ltd. v. Dy. CIT [WP(C) No. 12148 of 2023] Filatex India Ltd. v. Dy. CIT [WP(C) No. 12148 of 2023] which we find is squarely applicable in the given facts of the assessee which we find is squarely applicable in the given facts of the assessee which we find is squarely applicable in the given facts of the assessee before us. In this case, before us. In this case, the search action under Section 132 of the Act action under Section 132 of the Act was conducted on 01.09.2021 was conducted on 01.09.2021 and therefore the assessment year and therefore the assessment year relevant to the year of search was AY 2022 relevant to the year of search was AY 2022-23. Having regard to the 23. Having regard to the first proviso appended to the Section 149(1) of the Act, in addition to proviso appended to the Section 149(1) of the Act, in addition to proviso appended to the Section 149(1) of the Act, in addition to Section 153A(1)(b) and Explanation 1 appended thereto, it was noted that, the Explanation 1 appended thereto, it was noted that, the Explanation 1 appended thereto, it was noted that, the period of ten years from the end of the assessment year in which search period of ten years from the end of the assessment year in which search period of ten years from the end of the assessment year in which search was conducted ended with AY 2013 was conducted ended with AY 2013-14 and therefore the notice issued 14 and therefore the notice issued u/s 148 of the Act dated 13.03.2023 to u/s 148 of the Act dated 13.03.2023 to reopen AY 2012-13 was held to be 13 was held to be barred by limitation in terms of first proviso to Section 149(1)(b) of the barred by limitation in terms of first proviso to Section 149(1)(b) of the barred by limitation in terms of first proviso to Section 149(1)(b) of the Act. The relevant findings of the Hon’ble High Court are as follows: Act. The relevant findings of the Hon’ble High Court are as follows: Act. The relevant findings of the Hon’ble High Court are as follows:-

"3. As is evident from the prima facie observations which came to be "3. As is evident from the prima facie observations which came to be "3. As is evident from the prima facie observations which came to be rendered by us on that occasion, the reassessment which is sought to be by us on that occasion, the reassessment which is sought to be by us on that occasion, the reassessment which is sought to be initiated for Assessment Year ["AY"] 2012 initiated for Assessment Year ["AY"] 2012-13 would not sustain bearing 13 would not sustain bearing in mind the prescription of limitation as contained in Section 149(1)(b) in mind the prescription of limitation as contained in Section 149(1)(b) in mind the prescription of limitation as contained in Section 149(1)(b) of the Income-tax Act 1961 ["Act "] as it stood tax Act 1961 ["Act "] as it stood at the relevant time. at the relevant time.

4. We note that while dealing with a similar question of computation of 4. We note that while dealing with a similar question of computation of 4. We note that while dealing with a similar question of computation of the time limit for the "relevant assessment year " as provided under the time limit for the "relevant assessment year " as provided under the time limit for the "relevant assessment year " as provided under Explanation 1 to Section 153A of the Act, we had in the case of Principal Explanation 1 to Section 153A of the Act, we had in the case of Principal Explanation 1 to Section 153A of the Act, we had in the case of Principal Commissioner of Income Tax Commissioner of Income Tax-Central-1 v. Ojjus Medicare Pvt. Ltd. jjus Medicare Pvt. Ltd. [2024 SCC Online Del 2439] held as follows: [2024 SCC Online Del 2439] held as follows:-

"D. The First Proviso to Section 153C introduces a legal fiction on the "D. The First Proviso to Section 153C introduces a legal fiction on the "D. The First Proviso to Section 153C introduces a legal fiction on the basis of which the commencement date for computation of the six year basis of which the commencement date for computation of the six year basis of which the commencement date for computation of the six year or the ten year block is deemed to be the date or the ten year block is deemed to be the date of receipt of books of of receipt of books of accounts by the jurisdictional AO. The identification of the starting block accounts by the jurisdictional AO. The identification of the starting block accounts by the jurisdictional AO. The identification of the starting block for the purposes of computation of the six and the ten year period is for the purposes of computation of the six and the ten year period is for the purposes of computation of the six and the ten year period is 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt governed by the First Proviso to Section 153C, which significantly shifts governed by the First Proviso to Section 153C, which significantly shifts governed by the First Proviso to Section 153C, which significantly shifts the reference point spoken of in Section 153A(1), while defining the e point spoken of in Section 153A(1), while defining the e point spoken of in Section 153A(1), while defining the point from which the period of the "relevant assessment year" is to be point from which the period of the "relevant assessment year" is to be point from which the period of the "relevant assessment year" is to be calculated, to the date of receipt of the books of accounts, documents or calculated, to the date of receipt of the books of accounts, documents or calculated, to the date of receipt of the books of accounts, documents or assets seized by the jurisdictional AO of the non assets seized by the jurisdictional AO of the non-searched person. The ched person. The shift of the relevant date in the case of a non shift of the relevant date in the case of a non-searched person being searched person being regulated by the First Proviso of Section 153C(1) is an issue which is no regulated by the First Proviso of Section 153C(1) is an issue which is no regulated by the First Proviso of Section 153C(1) is an issue which is no longer res integra and stands authoritatively settled by virtue of the longer res integra and stands authoritatively settled by virtue of the longer res integra and stands authoritatively settled by virtue of the decisions of this Court decisions of this Court in SSP Aviation and RRJ Securities as well as the in SSP Aviation and RRJ Securities as well as the decision of the Supreme Court in Jasjit Singh. The aforesaid legal decision of the Supreme Court in Jasjit Singh. The aforesaid legal decision of the Supreme Court in Jasjit Singh. The aforesaid legal position also stood reiterated by the Supreme Court in Vikram position also stood reiterated by the Supreme Court in Vikram position also stood reiterated by the Supreme Court in Vikram Sujitkumar Bhatia. The submission of the respondents, therefore, that Sujitkumar Bhatia. The submission of the respondents, therefore, that Sujitkumar Bhatia. The submission of the respondents, therefore, that the block periods would have to be reckoned with reference to the date ck periods would have to be reckoned with reference to the date ck periods would have to be reckoned with reference to the date of search can neither be countenanced nor accepted. of search can neither be countenanced nor accepted.

E. The reckoning of the six AYs' would require one to firstly identify the E. The reckoning of the six AYs' would require one to firstly identify the E. The reckoning of the six AYs' would require one to firstly identify the FY in which the search was undertaken and which would lead to the FY in which the search was undertaken and which would lead to the FY in which the search was undertaken and which would lead to the ascertainment of the AY relevant to the previous year of search. The ascertainment of the AY relevant to the previous year of search. The ascertainment of the AY relevant to the previous year of search. The block of six AYs' would consequently be those which immediately block of six AYs' would consequently be those which immediately block of six AYs' would consequently be those which immediately precede the AY relevant to the year of search. In the case of a search precede the AY relevant to the year of search. In the case of a search precede the AY relevant to the year of search. In the case of a search assessment undertaken in terms of Section 153C, the assessment undertaken in terms of Section 153C, the solitary distinction solitary distinction would be that the previous year of search would stand substituted by would be that the previous year of search would stand substituted by would be that the previous year of search would stand substituted by the date or the year in which the books of accounts or documents and the date or the year in which the books of accounts or documents and the date or the year in which the books of accounts or documents and assets seized are handed over to the jurisdictional AO as opposed to the assets seized are handed over to the jurisdictional AO as opposed to the assets seized are handed over to the jurisdictional AO as opposed to the year of search which co year of search which constitutes the basis for an assessment under nstitutes the basis for an assessment under section 153A.

F. While the identification and computation of the six AYs' hinges upon F. While the identification and computation of the six AYs' hinges upon F. While the identification and computation of the six AYs' hinges upon the phrase "immediately preceding the assessment year relevant to the the phrase "immediately preceding the assessment year relevant to the the phrase "immediately preceding the assessment year relevant to the previous year" of search, the ten year period would have previous year" of search, the ten year period would have to be reckoned to be reckoned from the 31st day of March of the AY relevant to the year of search. from the 31st day of March of the AY relevant to the year of search. from the 31st day of March of the AY relevant to the year of search. This, since undisputedly, Explanation 1 of Section 153A requires us to This, since undisputedly, Explanation 1 of Section 153A requires us to This, since undisputedly, Explanation 1 of Section 153A requires us to reckon it "from the end of the assessment year". This distinction would reckon it "from the end of the assessment year". This distinction would reckon it "from the end of the assessment year". This distinction would have to necessarily be ackno have to necessarily be acknowledged in light of the statute having wledged in light of the statute having consciously adopted the phraseology "immediately preceding" when it consciously adopted the phraseology "immediately preceding" when it consciously adopted the phraseology "immediately preceding" when it be in relation to the six year period and employing the expression "from be in relation to the six year period and employing the expression "from be in relation to the six year period and employing the expression "from the end of the assessment year" while speaking of the ten year block." the end of the assessment year" while speaking of the ten year block." the end of the assessment year" while speaking of the ten year block."

20. Following the above, we countenance the Ld. CIT(A)’s order holding Following the above, we countenance the Ld. CIT(A)’s order holding Following the above, we countenance the Ld. CIT(A)’s order holding that the, notice dated 30.0 30.03.2023 issued u/s 148 of the Act for AY 2013 3.2023 issued u/s 148 of the Act for AY 2013- 14 to be ab inito void and to be ab inito void and therefore all consequent actions thereafter viz., therefore all consequent actions thereafter viz., filing of return, issuance of notices, and the passing of impugned filing of return, issuance of notices, and the passing of impugned filing of return, issuance of notices, and the passing of impugned assessment order u/s 147/143(3) dated 15.03.2024 47/143(3) dated 15.03.2024 for AY for AY 203-14 is held to be non-est in the eyes of law and est in the eyes of law and is accordingly quashed. is accordingly quashed. We thus see no reason to interfere with the order of Ld. CIT(A) and accordingly no reason to interfere with the order of Ld. CIT(A) and accordingly no reason to interfere with the order of Ld. CIT(A) and accordingly dismiss the appeal of the Revenue. dismiss the appeal of the Revenue.

21. We now take up the Revenue’s appeal(s) for AYs 2014 We now take up the Revenue’s appeal(s) for AYs 2014 We now take up the Revenue’s appeal(s) for AYs 2014-15 to 2016- 17 which was disposed by the Ld. CIT(A) by way of a common was disposed by the Ld. CIT(A) by way of a common was disposed by the Ld. CIT(A) by way of a common consolidated order. With the consent of both parties, AY 2014 consolidated order. With the consent of both parties, AY 2014 consolidated order. With the consent of both parties, AY 2014-15 is taken as the lead case and our decision in this appeal shall mutatis mutandis as the lead case and our decision in this appeal shall mutatis mutandis as the lead case and our decision in this appeal shall mutatis mutandis apply to the Revenue’s appeal for AYs 2015 apply to the Revenue’s appeal for AYs 2015-16 & 2016-17. It 17. It is observed that, before the Ld. CIT(A), the assessee had contended that, the AO had that, before the Ld. CIT(A), the assessee had contended that, the AO had that, before the Ld. CIT(A), the assessee had contended that, the AO had invalidly initiated reassessment proceedings for AYs 2014 invalidly initiated reassessment proceedings for AYs 2014- -15 to 2016-17 under the new 148 regime, as these notice(s) were barred by limitation. under the new 148 regime, as these notice(s) were barred by limitation. under the new 148 regime, as these notice(s) were barred by limitation.

According to the assessee, According to the assessee, though Section 149(1)(b) of the Act provided though Section 149(1)(b) of the Act provided that, the AO was permitted to reopen the income that, the AO was permitted to reopen the income-tax assessment year for tax assessment year for an assessment year for a period upto ten years from the end of such an assessment year for a period upto ten years from the end of such an assessment year for a period upto ten years from the end of such assessment year, but in view of the embargo laid down in first proviso assessment year, but in view of the embargo laid down in first proviso assessment year, but in view of the embargo laid down in first proviso to 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 31 ::

Section 149(1)(b) of the Act, the AO could not have reopened beyond the Section 149(1)(b) of the Act, the AO could not have reopened beyond the Section 149(1)(b) of the Act, the AO could not have reopened beyond the period of six (6) years, which immediately preceded the year of search period of six (6) years, which immediately preceded the year of search period of six (6) years, which immediately preceded the year of search viz., AY 2023-24, in the present case. It was the appellant’s case that, 24, in the present case. It was the appellant’s case that, 24, in the present case. It was the appellant’s case that, AYs 2014-15 to 2016-17 fell beyond t 17 fell beyond the six-year block period prescribed year block period prescribed in Section 153A(1)(b) of the Act and that in order to go beyond the in Section 153A(1)(b) of the Act and that in order to go beyond the in Section 153A(1)(b) of the Act and that in order to go beyond the ordinary six (6) year period and reopen the ordinary six (6) year period and reopen the ‘relevant assessment year’ ‘relevant assessment year’ as defined in Explanation (1) to Section 153A of the Act, the AO was defined in Explanation (1) to Section 153A of the Act, the AO was defined in Explanation (1) to Section 153A of the Act, the AO was required to demonstrate that the conditions laid down in fourth proviso to demonstrate that the conditions laid down in fourth proviso to demonstrate that the conditions laid down in fourth proviso to Section 153A of the Act was fulfilled, at the stage of issuance of notice Section 153A of the Act was fulfilled, at the stage of issuance of notice Section 153A of the Act was fulfilled, at the stage of issuance of notice under the new 148 regime. The assessee claimed that, the AO was unable under the new 148 regime. The assessee claimed that, the AO was unable under the new 148 regime. The assessee claimed that, the AO was unable to demonstrate that any income represented in fo to demonstrate that any income represented in form of ‘asset’ had rm of ‘asset’ had escaped assessment in AYs 2014 escaped assessment in AYs 2014-15 to 2016-17 and therefore in terms of 17 and therefore in terms of the bar laid down in the first proviso to Section 149(1)(b) of the Act, it the bar laid down in the first proviso to Section 149(1)(b) of the Act, it the bar laid down in the first proviso to Section 149(1)(b) of the Act, it was contended that, the AO could not have legally reopened the was contended that, the AO could not have legally reopened the was contended that, the AO could not have legally reopened the impugned AYs 2014-15 to 2017 15 to 2017-18 under the new 148 regime. It is seen 18 under the new 148 regime. It is seen that, the Ld. CIT(A) after examining the provisions of new 148 regime that, the Ld. CIT(A) after examining the provisions of new 148 regime that, the Ld. CIT(A) after examining the provisions of new 148 regime and the first proviso to Section 149(1)(b) of the Act acceded to this legal and the first proviso to Section 149(1)(b) of the Act acceded to this legal and the first proviso to Section 149(1)(b) of the Act acceded to this legal plea of the assessee and held the notice(s) issued u/s 148 of the Act plea of the assessee and held the notice(s) issued u/s 148 of the Act plea of the assessee and held the notice(s) issued u/s 148 of the Act dated 04-08-2023 for AY 2014 2023 for AY 2014-15 and dated 07-08-2023 for AYs 2015 2023 for AYs 2015-16 to 2016-17 to be barred by limitation. Aggrieved by such order, the 17 to be barred by limitation. Aggrieved by such order, the 17 to be barred by limitation. Aggrieved by such order, the Revenue is in appeal before us. Revenue is in appeal before us. , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 32 ::

22. The Ld. CIT, DR appearing before us, contended that, under The Ld. CIT, DR appearing before us, contended that, under The Ld. CIT, DR appearing before us, contended that, under Section 149(1)(b) of the Act, the Act, the AO was empowered to reopen any assessment AO was empowered to reopen any assessment year for a period exceeding three years but not beyond year for a period exceeding three years but not beyond year for a period exceeding three years but not beyond ten years from the end of such assessment year. According to her, the notice(s) dated the end of such assessment year. According to her, the notice(s) dated the end of such assessment year. According to her, the notice(s) dated 30-03-2023 issued u/s 148 of the Act for AYs 2014 2023 issued u/s 148 of the Act for AYs 2014-15 to 2016 15 to 2016-17 was well within the timeline set out in Section 149(1)(b) of the Act and well within the timeline set out in Section 149(1)(b) of the Act and well within the timeline set out in Section 149(1)(b) of the Act and therefore she submitted that the order of the Ld. CIT(A) holding these therefore she submitted that the order of the Ld. CIT(A) holding these therefore she submitted that the order of the Ld. CIT(A) holding these notice(s) to be barred by limitation was unsustainable. Referring to the notice(s) to be barred by limitation was unsustainable. Referring to the notice(s) to be barred by limitation was unsustainable. Referring to the first proviso to Section 149(1) of the first proviso to Section 149(1) of the Act, she pointed out that, in cases Act, she pointed out that, in cases where an assessee is subjected to search u/s 132 of the Act, the proviso where an assessee is subjected to search u/s 132 of the Act, the proviso where an assessee is subjected to search u/s 132 of the Act, the proviso provides that, the notice under Section 148 of the Act notice under Section 148 of the Act can be can be issued only if such a notice could have could have otherwise be issued under Section Section 153A of the Act at that material time. According to her, in cases of search, prior to the at material time. According to her, in cases of search, prior to the at material time. According to her, in cases of search, prior to the Finance Act, 2021, the Revenue was permitted to reopen up Finance Act, 2021, the Revenue was permitted to reopen up Finance Act, 2021, the Revenue was permitted to reopen up to ten years from the end of the relevant assessment year in which search was from the end of the relevant assessment year in which search was from the end of the relevant assessment year in which search was conducted. She therefore submitted tha conducted. She therefore submitted that, AYs 2014-15 to 2016 15 to 2016-17 fell within the 10 year block period as defined in Explanation (1) to Section within the 10 year block period as defined in Explanation (1) to Section within the 10 year block period as defined in Explanation (1) to Section 153A of the Act and accordingly claimed that the AO had validly reopened 153A of the Act and accordingly claimed that the AO had validly reopened 153A of the Act and accordingly claimed that the AO had validly reopened the assessment under the new 148 regime, in terms of proviso to Section the assessment under the new 148 regime, in terms of proviso to Section the assessment under the new 148 regime, in terms of proviso to Section 149(1)(b) of the Act. , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 33 ::

As held by us above, ordinarily the AYs pri As held by us above, ordinarily the AYs prior to AY 2021 or to AY 2021-22 can be reopened under the new 148 regime, only if such AY reopened under the new 148 regime, only if such AY reopened under the new 148 regime, only if such AY [in non-search matters] was otherwise capable of being reopened under the old regime was otherwise capable of being reopened under the old regime was otherwise capable of being reopened under the old regime [six years as laid down in erstwhile Section 149(1)(b)] [six years as laid down in erstwhile Section 149(1)(b)], at the stage of , at the stage of issuance of notice. How issuance of notice. However, in cases where search has been conducted ever, in cases where search has been conducted on or after 1st April 2021 or where document or information has been April 2021 or where document or information has been April 2021 or where document or information has been found & seized in the course of search which relates to the assessee [third found & seized in the course of search which relates to the assessee [third found & seized in the course of search which relates to the assessee [third party], the assessment or reassessment assessment or reassessment which was earlier require which was earlier required to be made u/s 153A/153C of the Act, made u/s 153A/153C of the Act, is now required to be required to be made under Section 143 or 144 or 147 of the Act. As a consequence, the timelines for Section 143 or 144 or 147 of the Act. As a consequence, the timelines for Section 143 or 144 or 147 of the Act. As a consequence, the timelines for search related cases qua AYs prior to AY 2021 search related cases qua AYs prior to AY 2021-22, would be governed by 22, would be governed by first proviso to Section 149(1)(b) of t first proviso to Section 149(1)(b) of the Act and therefore the notice for he Act and therefore the notice for reopening the assessment u/s 148 of the Act can be issued, only if such reopening the assessment u/s 148 of the Act can be issued, only if such reopening the assessment u/s 148 of the Act can be issued, only if such AY could have otherwise been validly reopened in terms of Section AY could have otherwise been validly reopened in terms of Section AY could have otherwise been validly reopened in terms of Section 153A/153C of the Act 153A/153C of the Act [as it stood prior to introduction of Finance Act, [as it stood prior to introduction of Finance Act, 2021], at the time of issuance of notice under the new regime. the time of issuance of notice under the new regime. the time of issuance of notice under the new regime.

Hence, in our considered view, in order to reopen any assessment year Hence, in our considered view, in order to reopen any assessment year Hence, in our considered view, in order to reopen any assessment year which is beyond the six year block period contemplated in Section which is beyond the six year block period contemplated in Section which is beyond the six year block period contemplated in Section 153A(1)(b) and within the ten year block period from the end of the AY in 153A(1)(b) and within the ten year block period from the end of the AY in 153A(1)(b) and within the ten year block period from the end of the AY in which search was conducted, the AO is r which search was conducted, the AO is required to satisfy the condition equired to satisfy the condition precedent in fourth proviso to Section 153A of the Act and show that, he precedent in fourth proviso to Section 153A of the Act and show that, he precedent in fourth proviso to Section 153A of the Act and show that, he has in his possession books of account or other documents or evidence has in his possession books of account or other documents or evidence has in his possession books of account or other documents or evidence which reveals that the income, represented in the form of that the income, represented in the form of that the income, represented in the form of ‘asset’, which has escaped assessment amounts to or is likely to amount to fifty lakh aped assessment amounts to or is likely to amount to fifty lakh aped assessment amounts to or is likely to amount to fifty lakh rupees or more in the relevant assessment year. As per Explanation (2) to in the relevant assessment year. As per Explanation (2) to in the relevant assessment year. As per Explanation (2) to Section 153A of the Act, Section 153A of the Act, the term "asset" shall include immovable the term "asset" shall include immovable , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt property being land or building or both, shares and property being land or building or both, shares and securities, loans and securities, loans and advances, deposits in bank account. advances, deposits in bank account.

“….13. Thus, the information in the seized materials and other 13. Thus, the information in the seized materials and other 13. Thus, the information in the seized materials and other evidences available with the evidences available with the undersigned, unambiguously evidenced that undersigned, unambiguously evidenced that the assessee had booked bogus old bottle purchase expenses with the the assessee had booked bogus old bottle purchase expenses with the the assessee had booked bogus old bottle purchase expenses with the connivance connivance connivance of of of the the the five five five old old old bottle bottle bottle vendors vendors vendors thereby thereby thereby generating generating generating unaccounted cash which clearly suggests that income represented in the unaccounted cash which clearly suggests that income represented in the unaccounted cash which clearly suggests that income represented in the form of asset has escaped assessment, and exceeds more than Rs. has escaped assessment, and exceeds more than Rs. has escaped assessment, and exceeds more than Rs. 50,00,000 for A.Y 14 50,00,000 for A.Y 14-15. Hence, this case falls under the purview of 15. Hence, this case falls under the purview of section 149(1)(b). In view of the above, there is information and section 149(1)(b). In view of the above, there is information and section 149(1)(b). In view of the above, there is information and evidence which suggests that income represented in the form of asset, evidence which suggests that income represented in the form of asset, evidence which suggests that income represented in the form of asset, has escaped assessment and which exceeds more than Rs. 50,00,000/ as escaped assessment and which exceeds more than Rs. 50,00,000/ as escaped assessment and which exceeds more than Rs. 50,00,000/- and hence, notice u/s 148 is required to be issued in this case. and hence, notice u/s 148 is required to be issued in this case. and hence, notice u/s 148 is required to be issued in this case.”

AO has not pointed out as to how such inflation of expenses resulted in pointed out as to how such inflation of expenses resulted in pointed out as to how such inflation of expenses resulted in acquisition of any ‘asset’. It is observed that, even in the reassessment acquisition of any ‘asset’. It is observed that, even in the reassessment acquisition of any ‘asset’. It is observed that, even in the reassessment order(s) passed u/s 147/143(3) of the Act, the AO has disallowed the order(s) passed u/s 147/143(3) of the Act, the AO has disallowed the order(s) passed u/s 147/143(3) of the Act, the AO has disallowed the expenses debited on account of purchases made from expenses debited on account of purchases made from vendors and he had vendors and he had not brought on record any material to not brought on record any material to establish that such expenses had establish that such expenses had resulted in the acquisition of any asset resulted in the acquisition of any asset by the assessee. We therefore are by the assessee. We therefore are of the considered view that, the condition of the considered view that, the condition stipulated in the fourth proviso stipulated in the fourth proviso to Section 153A(1) of the Act (1) of the Act was not fulfilled by the AO. Hence, in was not fulfilled by the AO. Hence, in absence of there being any income represented in form of ‘asset’ escaping absence of there being any income represented in form of ‘asset’ escaping absence of there being any income represented in form of ‘asset’ escaping tax in the impugned AYs 2014 tax in the impugned AYs 2014-15 to 2016-17, the period of limitation for the period of limitation for issuing a notice under Section 153A of the Act, in the issuing a notice under Section 153A of the Act, in the given facts of this given facts of this case, would necessarily have to be confined to a period of six assessment case, would necessarily have to be confined to a period of six assessment case, would necessarily have to be confined to a period of six assessment years immediately preceding the assessment year relevant to the years immediately preceding the assessment year relevant to the years immediately preceding the assessment year relevant to the previous year in which the search under Section 132 of the Act was previous year in which the search under Section 132 of the Act was previous year in which the search under Section 132 of the Act was conducted. In our opinion there In our opinion therefore, since AYs 2014-15 to 2016 15 to 2016-17 fall beyond the six year block period and the condition precedent in fourth beyond the six year block period and the condition precedent in fourth beyond the six year block period and the condition precedent in fourth proviso to Section 153A is not met, the AO could not have reopened the proviso to Section 153A is not met, the AO could not have reopened the proviso to Section 153A is not met, the AO could not have reopened the impugned AYs in light of the embargo set out in the first proviso to impugned AYs in light of the embargo set out in the first proviso to impugned AYs in light of the embargo set out in the first proviso to Section 149(1)(b) read with Section 153A (1)(b) read with Section 153A of the Act of the Act. We thus countenance the following findings rendered by the Ld. CIT(A) holding the countenance the following findings rendered by the Ld. CIT(A) holding the countenance the following findings rendered by the Ld. CIT(A) holding the AO’s action of initiation of reassessment proceedings u/s 148 of the Act AO’s action of initiation of reassessment proceedings u/s 148 of the Act AO’s action of initiation of reassessment proceedings u/s 148 of the Act , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt for AYs 2014-15 to 2016 15 to 2016-17 to be impermissible in law, by holding as , by holding as under:-

“6.3.18 Now the issue before the under signed is whether the income Now the issue before the under signed is whether the income Now the issue before the under signed is whether the income generated by booking purchase expenses represent asset as per the generated by booking purchase expenses represent asset as per the generated by booking purchase expenses represent asset as per the Explanation 2 to section 153A of the Act. Explanation 2 to section 153A of the Act.

6.3.19 At this juncture, it is appropriate to analyse At this juncture, it is appropriate to analyse the Explanation 2 the Explanation 2 to section 153A of the Act which describes the inclusions in the term to section 153A of the Act which describes the inclusions in the term to section 153A of the Act which describes the inclusions in the term Asset in the Act. The undersigned is of the view that an asset represents Asset in the Act. The undersigned is of the view that an asset represents Asset in the Act. The undersigned is of the view that an asset represents an economic resource, either immovable or movable, having value, such an economic resource, either immovable or movable, having value, such an economic resource, either immovable or movable, having value, such as immovable property vi as immovable property viz., land or building, investment held in shares z., land or building, investment held in shares and securities, loans & advances given and deposits in bank account. and securities, loans & advances given and deposits in bank account. and securities, loans & advances given and deposits in bank account. Whereas, ‘Liability’ includes items such as share capital, reserves, loans Whereas, ‘Liability’ includes items such as share capital, reserves, loans Whereas, ‘Liability’ includes items such as share capital, reserves, loans obtained (secured as well as unsecured) etc. which cannot be obtained (secured as well as unsecured) etc. which cannot be obtained (secured as well as unsecured) etc. which cannot be characterized or classified as ‘Asset’. Therefore, items of ‘expenses’ or racterized or classified as ‘Asset’. Therefore, items of ‘expenses’ or racterized or classified as ‘Asset’. Therefore, items of ‘expenses’ or revenues in form of ‘sales’ / ‘turnover’ does not constitute ‘asset’. revenues in form of ‘sales’ / ‘turnover’ does not constitute ‘asset’. revenues in form of ‘sales’ / ‘turnover’ does not constitute ‘asset’.

6.3.20 The Hon’ble ITAT, Guwahati Bench had an occasion to The Hon’ble ITAT, Guwahati Bench had an occasion to The Hon’ble ITAT, Guwahati Bench had an occasion to examine the issue of “Asset” in the case of examine the issue of “Asset” in the case of ACIT Centra ACIT Central circle-2, Guwahati Vs. Fortune Vanijya Private Limited in Guwahati Vs. Fortune Vanijya Private Limited in Guwahati Vs. Fortune Vanijya Private Limited in dated 10.12.2021 dated 10.12.2021 wherein the Hon’ble ITAT has observed as under. wherein the Hon’ble ITAT has observed as under.

“A reading of the fourth proviso to section 153A of the Act and A reading of the fourth proviso to section 153A of the Act and A reading of the fourth proviso to section 153A of the Act and Explanation (2) to fourth proviso to section 153A of the Act which Explanation (2) to fourth proviso to section 153A of the Act which Explanation (2) to fourth proviso to section 153A of the Act which defines 'Asset for the purpose of fourth proviso to section 153A of the defines 'Asset for the purpose of fourth proviso to section 153A of the defines 'Asset for the purpose of fourth proviso to section 153A of the Act, clarify the intention of the Parliament to permit Act, clarify the intention of the Parliament to permit the AO to enlarge the AO to enlarge the assessment u/s. 153A after search u/s. 132 of the Act beyond six the assessment u/s. 153A after search u/s. 132 of the Act beyond six the assessment u/s. 153A after search u/s. 132 of the Act beyond six assessment years to ten assessment years preceding the searched assessment years to ten assessment years preceding the searched assessment years to ten assessment years preceding the searched assessment year, provided assessment year, provided the AO has in his possession the essential the AO has in his possession the essential jurisdictional fact i.e. "undisclos jurisdictional fact i.e. "undisclosed/unaccounted asset" valued Rs 50 ed/unaccounted asset" valued Rs 50 lakhs or more of the assessee discovered during search pertaining to 7th lakhs or more of the assessee discovered during search pertaining to 7th lakhs or more of the assessee discovered during search pertaining to 7th to 10th Assessment Year preceding the searched assessment year to 10th Assessment Year preceding the searched assessment year to 10th Assessment Year preceding the searched assessment year. Since the Parliament has used the expression 'income in the form of Since the Parliament has used the expression 'income in the form of Since the Parliament has used the expression 'income in the form of asset' and the d asset' and the definition of asset has been spelled out in the fourth efinition of asset has been spelled out in the fourth proviso, this itself necessarily implies the liability/items falling in the left proviso, this itself necessarily implies the liability/items falling in the left proviso, this itself necessarily implies the liability/items falling in the left side of the Balance Sheet stands excluded. For this view of ours, we rely side of the Balance Sheet stands excluded. For this view of ours, we rely side of the Balance Sheet stands excluded. For this view of ours, we rely on the legal Maxim for interpretation " on the legal Maxim for interpretation "Expressio Unius Est Exlcusio o Unius Est Exlcusio Alterius" which principle states that, express mention of one is the " which principle states that, express mention of one is the " which principle states that, express mention of one is the exclusion of other and this maxim has been accepted by the Hon'ble exclusion of other and this maxim has been accepted by the Hon'ble exclusion of other and this maxim has been accepted by the Hon'ble Supreme Court in Supreme Court in GVK Industries Ltd. Vs. ITO [197 Taxman 337] GVK Industries Ltd. Vs. ITO [197 Taxman 337] (Constitution bench of 5 Supreme Cour (Constitution bench of 5 Supreme Court Judges). By express mention of t Judges). By express mention of 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 40 ::

'Assets' and definition given to it specifically, it is implied that the 'Assets' and definition given to it specifically, it is implied that the 'Assets' and definition given to it specifically, it is implied that the Parliament silently excluded the items of 'revenue', 'expenditure' & Parliament silently excluded the items of 'revenue', 'expenditure' & Parliament silently excluded the items of 'revenue', 'expenditure' & 'liabilities' from its jurisdictional fact 'liabilities' from its jurisdictional fact for invoking/assumption/usurpation for invoking/assumption/usurpation of jurisdiction u/s. 153C/153A of the Act for the seventh to tenth jurisdiction u/s. 153C/153A of the Act for the seventh to tenth jurisdiction u/s. 153C/153A of the Act for the seventh to tenth assessment year preceding the searched assessment year assessment year preceding the searched assessment year.”

6.3.21 When When When the the the legislature legislature legislature has has has specified specified specified that that that for for for invoking invoking invoking jurisdiction u/s 148 of the Act, the AO ought to have in his possession jurisdiction u/s 148 of the Act, the AO ought to have in his possession jurisdiction u/s 148 of the Act, the AO ought to have in his possession undisclosed assets of assessee, then the jurisdiction cannot be invoked undisclosed assets of assessee, then the jurisdiction cannot be invoked undisclosed assets of assessee, then the jurisdiction cannot be invoked with the aid of any material which reveal unexplained expen with the aid of any material which reveal unexplained expen with the aid of any material which reveal unexplained expenditure or unexplained cash credits. Reliance is placed the dictum of the Privy unexplained cash credits. Reliance is placed the dictum of the Privy unexplained cash credits. Reliance is placed the dictum of the Privy Council in Nazir Ahmed Vs. King Emperor AIR 1936 PC 253 Nazir Ahmed Vs. King Emperor AIR 1936 PC 253 Nazir Ahmed Vs. King Emperor AIR 1936 PC 253 (followed by Hon. Supreme Court), that “ Hon. Supreme Court), that “when a statute requires a thing to be done when a statute requires a thing to be done in a particular manner, it must be don in a particular manner, it must be done in that manner only.” .”

6.3.22 Therefore, unless the AO has material in possession to prove Therefore, unless the AO has material in possession to prove Therefore, unless the AO has material in possession to prove that the assessee has ‘assets’, which is not disclosed in the books, the that the assessee has ‘assets’, which is not disclosed in the books, the that the assessee has ‘assets’, which is not disclosed in the books, the income cannot be said to have escaped assessment for the purpose of income cannot be said to have escaped assessment for the purpose of income cannot be said to have escaped assessment for the purpose of section 153A. Here, the section 153A. Here, the statute specifically mentioned “ Asset “ shall statute specifically mentioned “ Asset “ shall include a) Immovable Property being land and building or both Immovable Property being land and building or both b) Shares & Securities Shares & Securities c) Loans and Advances Loans and Advances d) Deposits in Bank accounts Deposits in Bank accounts

Hence, the re-opening beyond a period of six years can be made only if, opening beyond a period of six years can be made only if, opening beyond a period of six years can be made only if, where AO possess books of accounts, documents or evidence which where AO possess books of accounts, documents or evidence which where AO possess books of accounts, documents or evidence which reveals that ‘assets’ are found to be undisclosed or unaccounted as reveals that ‘assets’ are found to be undisclosed or unaccounted as reveals that ‘assets’ are found to be undisclosed or unaccounted as specified supra, in the regular books of account maintained by the specified supra, in the regular books of account maintained by the specified supra, in the regular books of account maintained by the assessee, resulting in escapement of income. assessee, resulting in escapement of income.

6.3.23 The facts of the case are squarely covered by the decision facts of the case are squarely covered by the decision facts of the case are squarely covered by the decision rendered by the Hon’ble Gauhati Bench of ITAT in the case of rendered by the Hon’ble Gauhati Bench of ITAT in the case of rendered by the Hon’ble Gauhati Bench of ITAT in the case of Goldstone Cements Ltd, Meghalaya in IT Nos. 126 to 131/Gau/2020 dated Cements Ltd, Meghalaya in IT Nos. 126 to 131/Gau/2020 dated Cements Ltd, Meghalaya in IT Nos. 126 to 131/Gau/2020 dated 10.12.2021 wherein it was held that the undisclosed asset exceeding a wherein it was held that the undisclosed asset exceeding a wherein it was held that the undisclosed asset exceeding a value of Rs. 50 Lakhs unearthed at the time of search should be clearly value of Rs. 50 Lakhs unearthed at the time of search should be clearly value of Rs. 50 Lakhs unearthed at the time of search should be clearly identifiable. The Hon'ble Bench has observed in para 8.22 of its order identifiable. The Hon'ble Bench has observed in para 8.22 of its order identifiable. The Hon'ble Bench has observed in para 8.22 of its order that :

"8.22. From our discussion (supra) it is clear that, only if any of "8.22. From our discussion (supra) it is clear that, only if any of "8.22. From our discussion (supra) it is clear that, only if any of specified 'asset/s' as defined in Expl specified 'asset/s' as defined in Explanation (2) is unearthed during the anation (2) is unearthed during the 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt course of search and the acquisition of such an asset' being unexplained course of search and the acquisition of such an asset' being unexplained course of search and the acquisition of such an asset' being unexplained or undisclosed, which is valued Rs 50 Lakhs or more, that the AO can be or undisclosed, which is valued Rs 50 Lakhs or more, that the AO can be or undisclosed, which is valued Rs 50 Lakhs or more, that the AO can be said to be in possession of the jurisdictional fact to initiate proceedings said to be in possession of the jurisdictional fact to initiate proceedings said to be in possession of the jurisdictional fact to initiate proceedings u/s 153A for 7th- -10th AY (AY 2011-12, in the instant case).” 12, in the instant case).”

6.3.24 The above finding of the Hon’ble Tribunal was ratified by the The above finding of the Hon’ble Tribunal was ratified by the The above finding of the Hon’ble Tribunal was ratified by the Hon’ble Gauhati High Court in Hon’ble Gauhati High Court in ITA/7/2022 on 29 September, 2023 ITA/7/2022 on 29 September, 2023 on further appeal by the Revenue u/s 260A of the Act in the ca further appeal by the Revenue u/s 260A of the Act in the ca further appeal by the Revenue u/s 260A of the Act in the case of CIT V. Goldstone Cements Ltd Goldstone Cements Ltd. It was emphasized that an expenditure, It was emphasized that an expenditure, irrespective of its character, does not fall within the definition of ‘asset’ irrespective of its character, does not fall within the definition of ‘asset’ irrespective of its character, does not fall within the definition of ‘asset’ defined in Explanation 2 to S.153A and therefore the Jurisdiction defined in Explanation 2 to S.153A and therefore the Jurisdiction defined in Explanation 2 to S.153A and therefore the Jurisdiction assumed by the AO is unsustainable assumed by the AO is unsustainable .

6.3.25 It is appropriate to bring on record that the AO in the It is appropriate to bring on record that the AO in the It is appropriate to bring on record that the AO in the assessment order (s) passed for the years under consideration has assessment order (s) passed for the years under consideration has assessment order (s) passed for the years under consideration has contemplated disallowance(s) disallowance(s) of bogus expenses booked by the of bogus expenses booked by the assessee and has added the same to the returned income in the assessee and has added the same to the returned income in the assessee and has added the same to the returned income in the respective assessment years rather than making addition on the basis of spective assessment years rather than making addition on the basis of spective assessment years rather than making addition on the basis of any un disclosed asset found during the course of search . any un disclosed asset found during the course of search .

6.3.26 In addition, the AO in the assessment order(s) has not In addition, the AO in the assessment order(s) has not In addition, the AO in the assessment order(s) has not categorically made any addition(s) / disallowance(s) while compu categorically made any addition(s) / disallowance(s) while compu categorically made any addition(s) / disallowance(s) while computing the assessed income of the appellant for the years under consideration. the assessed income of the appellant for the years under consideration. the assessed income of the appellant for the years under consideration. The AO has only restricted the assessed income in the order(s) passed The AO has only restricted the assessed income in the order(s) passed The AO has only restricted the assessed income in the order(s) passed u/s 147 of the Act to the income determined by vide order(s) passed u/s 147 of the Act to the income determined by vide order(s) passed u/s 147 of the Act to the income determined by vide order(s) passed u/s 153C of the Act. Therefore, the unde u/s 153C of the Act. Therefore, the undersigned is of the view that the rsigned is of the view that the income generated by booking purchase expenses can at any stretch of income generated by booking purchase expenses can at any stretch of income generated by booking purchase expenses can at any stretch of imagination be treated as an asset to invoke the provisions of section imagination be treated as an asset to invoke the provisions of section imagination be treated as an asset to invoke the provisions of section 147 of the Act

6.3.27 Further Further, it is appropriate to rely upon the decision of the , it is appropriate to rely upon the decision of the Hon’ble High Court of Bombay in the case of n’ble High Court of Bombay in the case of Ashok Commercial Ashok Commercial enterprises Vs. ACIT in [2023] 154 taxmann.com 144 (Bombay) enterprises Vs. ACIT in [2023] 154 taxmann.com 144 (Bombay) enterprises Vs. ACIT in [2023] 154 taxmann.com 144 (Bombay) wherein the Hon’ble high Court held that “ the Hon’ble high Court held that “A plain reading of section 153A(1)(b) A plain reading of section 153A(1)(b) shows that Commissioner having jurisdiction under the sai shows that Commissioner having jurisdiction under the sai shows that Commissioner having jurisdiction under the said section is empowered to assess or reassess the total income of six years empowered to assess or reassess the total income of six years empowered to assess or reassess the total income of six years immediately preceding the assessment year relevant to the previous immediately preceding the assessment year relevant to the previous immediately preceding the assessment year relevant to the previous year in which the search was conducted and for the relevant assessment year in which the search was conducted and for the relevant assessment year in which the search was conducted and for the relevant assessment year or years. Explanation 1 below section year or years. Explanation 1 below section 153A of the Act defines the 153A of the Act defines the expression relevant assessment. In order to make an assessment for expression relevant assessment. In order to make an assessment for expression relevant assessment. In order to make an assessment for assessment year which falls beyond six assessment years but not later assessment year which falls beyond six assessment years but not later assessment year which falls beyond six assessment years but not later than ten assessment years from the end of the assessment year than ten assessment years from the end of the assessment year than ten assessment years from the end of the assessment year relevant to the previous year relevant to the previous year, in which the search was conducted, the , in which the search was conducted, the 4th proviso to section 153(A)(1) sets out certain further conditions 4th proviso to section 153(A)(1) sets out certain further conditions 4th proviso to section 153(A)(1) sets out certain further conditions which are required to be fulfilled before a notice can be issued for the which are required to be fulfilled before a notice can be issued for the which are required to be fulfilled before a notice can be issued for the 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt relevant assessment years. Clause (a) of the4th proviso requires that relevant assessment years. Clause (a) of the4th proviso requires that relevant assessment years. Clause (a) of the4th proviso requires that the Assessing Officer must have in his possession books, documents or Assessing Officer must have in his possession books, documents or Assessing Officer must have in his possession books, documents or evidence which reveal reveal that income represented in the form of an that income represented in the form of an asset which has escaped assessment amounts to or is likely to amount to which has escaped assessment amounts to or is likely to amount to which has escaped assessment amounts to or is likely to amount to rupees fifty lakhs rupees fifty lakhs or more. Explanation 2 to section 153A(1) sets out an 153A(1) sets out an expanded definition of the word "asset" for the purposes of the 4th expanded definition of the word "asset" for the purposes of the 4th expanded definition of the word "asset" for the purposes of the 4th proviso.

6.3.28 Besides, the jurisdictional tribunal in the case of Besides, the jurisdictional tribunal in the case of Besides, the jurisdictional tribunal in the case of M/s. KAG India Private Limited Vs. DCIT Central circle India Private Limited Vs. DCIT Central circle-2(1), Chennai in Chennai in No.669/Chny/2023 dated 10.07.2024 by relying upon the decision by relying upon the decision of the decision of Hon’ble Guwahati High Court in the case of of the decision of Hon’ble Guwahati High Court in the case of of the decision of Hon’ble Guwahati High Court in the case of Goldstone Cements Ltd. (ITA No.10 of 2022 & ors. Dated 29 Cements Ltd. (ITA No.10 of 2022 & ors. Dated 29-09-2023) 2023) held that “it is quite clear the impugned AY fall beyond 6 years from relevant is quite clear the impugned AY fall beyond 6 years from relevant is quite clear the impugned AY fall beyond 6 years from relevant assessment year (AY 2021 ssessment year (AY 2021-22) from the end of the previous year (2020 22) from the end of the previous year (2020- 21) in which the search was conducted on the assessee (26 21) in which the search was conducted on the assessee (26 21) in which the search was conducted on the assessee (26-02-2021). In such a situation, the Ld. AO would be subjected to further conditions In such a situation, the Ld. AO would be subjected to further conditions In such a situation, the Ld. AO would be subjected to further conditions as stipulated in fourth proviso to Sec.153A(1). as stipulated in fourth proviso to Sec.153A(1). These conditions are (a) These conditions are (a) that certain income has escaped assessment; (b) the fact of income that certain income has escaped assessment; (b) the fact of income that certain income has escaped assessment; (b) the fact of income escaping assessment is evident from the books of accounts, other escaping assessment is evident from the books of accounts, other escaping assessment is evident from the books of accounts, other documents or evidences found in the course of search which are in the documents or evidences found in the course of search which are in the documents or evidences found in the course of search which are in the possession of the assessing possession of the assessing officer; (c) that the escaped income pertains officer; (c) that the escaped income pertains to the relevant assessment year or years; (d) that the income escaping to the relevant assessment year or years; (d) that the income escaping to the relevant assessment year or years; (d) that the income escaping assessment is represented by undisclosed specified asset; (e) that the assessment is represented by undisclosed specified asset; (e) that the assessment is represented by undisclosed specified asset; (e) that the undisclosed specified asset was acquired with the income of the rele undisclosed specified asset was acquired with the income of the rele undisclosed specified asset was acquired with the income of the relevant assessment year or years; (f) that the quantum of income escaping assessment year or years; (f) that the quantum of income escaping assessment year or years; (f) that the quantum of income escaping assessment is Rs.50 Lacs or more in the aggregate for the relevant assessment is Rs.50 Lacs or more in the aggregate for the relevant assessment is Rs.50 Lacs or more in the aggregate for the relevant assessment years. One of the prime condition is that income should be assessment years. One of the prime condition is that income should be assessment years. One of the prime condition is that income should be represented in the form of asset which has escap represented in the form of asset which has escaped assessment. As per ed assessment. As per Explanation-2, asset includes immovable property being land and 2, asset includes immovable property being land and 2, asset includes immovable property being land and building or both, share and securities, loans and advances, deposits in building or both, share and securities, loans and advances, deposits in building or both, share and securities, loans and advances, deposits in bank accounts.

6.3.29 In the present case of the appellant company, on examination In the present case of the appellant company, on examination In the present case of the appellant company, on examination of the assessment order(s) reveals that the AO has not cited or provided ent order(s) reveals that the AO has not cited or provided ent order(s) reveals that the AO has not cited or provided any documents or evidence to support the initiation of proceedings u/s any documents or evidence to support the initiation of proceedings u/s any documents or evidence to support the initiation of proceedings u/s 148 of the Act (which is governed by Section 153A of the Act). 148 of the Act (which is governed by Section 153A of the Act). 148 of the Act (which is governed by Section 153A of the Act). Specifically, there is no reference to information indicating t Specifically, there is no reference to information indicating t Specifically, there is no reference to information indicating that income, in the form of an asset, has escaped assessment and amounts to or is in the form of an asset, has escaped assessment and amounts to or is in the form of an asset, has escaped assessment and amounts to or is likely to exceed fifty lakh rupees, either in the relevant assessment year likely to exceed fifty lakh rupees, either in the relevant assessment year likely to exceed fifty lakh rupees, either in the relevant assessment year or cumulatively across the assessment years in question. or cumulatively across the assessment years in question.”

, 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 43 ::

“8. A plain reading of the first proviso to Section 149(1) of the Act 8. A plain reading of the first proviso to Section 149(1) of the Act 8. A plain reading of the first proviso to Section 149(1) of the Act indicates that the issuance of a notice under Section 148 of the Act is indicates that the issuance of a notice under Section 148 of the Act is indicates that the issuance of a notice under Section 148 of the Act is proscribed if a notice under Sections 148, 153A or 153C of the Act could proscribed if a notice under Sections 148, 153A or 153C of the Act could proscribed if a notice under Sections 148, 153A or 153C of the Act could not have been issued at that time on account of the time limit specified issued at that time on account of the time limit specified issued at that time on account of the time limit specified under Clause (b) of Section 149(1) of the Act, or under Section 153A or under Clause (b) of Section 149(1) of the Act, or under Section 153A or under Clause (b) of Section 149(1) of the Act, or under Section 153A or Section 153C, as in force at that time. Section 153C, as in force at that time.

, 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 45 ::

"49. The first proviso to Section 149(1)(b) requires the determination "49. The first proviso to Section 149(1)(b) requires the determination "49. The first proviso to Section 149(1)(b) requires the determination of whether the time limit prescribed under section 149 of whether the time limit prescribed under section 149 of whether the time limit prescribed under section 149(1)(b) of the old regime continues to exist for the assessment year 2021 old regime continues to exist for the assessment year 2021 old regime continues to exist for the assessment year 2021-2022 and before. Resultantly, a notice under Section 148 of the new regime before. Resultantly, a notice under Section 148 of the new regime before. Resultantly, a notice under Section 148 of the new regime cannot be issued if the period of six years from the end of the cannot be issued if the period of six years from the end of the cannot be issued if the period of six years from the end of the relevant assessment year has expired at the relevant assessment year has expired at the time of issuance of the time of issuance of the notice. This also ensures that the new time limit of ten years notice. This also ensures that the new time limit of ten years notice. This also ensures that the new time limit of ten years prescribed under section 149(1)(b) of the new regime applies prescribed under section 149(1)(b) of the new regime applies prescribed under section 149(1)(b) of the new regime applies prospectively. For example, for the assessment year 2012 prospectively. For example, for the assessment year 2012 prospectively. For example, for the assessment year 2012-2013, the ten year period would have expired on 31 ten year period would have expired on 31 March 2023, while the six March 2023, while the six year period expired on 31 March 2019. Without the proviso to Section year period expired on 31 March 2019. Without the proviso to Section year period expired on 31 March 2019. Without the proviso to Section 149(1)(b) of the new regime, the Revenue could have had the power 149(1)(b) of the new regime, the Revenue could have had the power 149(1)(b) of the new regime, the Revenue could have had the power to reopen assessments for the year 2012 to reopen assessments for the year 2012-2013 if the escaped 2013 if the escaped assessment amounted to Rupees fifty assessment amounted to Rupees fifty lakhs or more. The proviso lakhs or more. The proviso limits the retrospective operation of Section149(1)(b) to protect the limits the retrospective operation of Section149(1)(b) to protect the limits the retrospective operation of Section149(1)(b) to protect the interests of the assesses. interests of the assesses.

(i) for the assessment years 2013 (i) for the assessment years 2013-2014 and 2014-2015, the six year 2015, the six year period expires on 31 March 2020 and 31 March 2021 respectively; period expires on 31 March 2020 and 31 March 2021 respectively; period expires on 31 March 2020 and 31 March 2021 respectively; and (ii) for the assessment years 2016 (ii) for the assessment years 2016-2017 and 2017-2018, the three 2018, the three year period expires on 31 March 2020 and 31 March 2021 eriod expires on 31 March 2020 and 31 March 2021 eriod expires on 31 March 2020 and 31 March 2021 respectively."

, 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 47 ::

"2.1 Information: "2.1 Information:-

In the case, the search proceedings and post In the case, the search proceedings and post-search investigations of search investigations of Idemia India and other gr Idemia India and other group entities revealed that these entities are oup entities revealed that these entities are engaged in massive profit shifting outside India. It has been engaged in massive profit shifting outside India. It has been engaged in massive profit shifting outside India. It has been unearthed that Idemia India and its group entities have deployed unearthed that Idemia India and its group entities have deployed unearthed that Idemia India and its group entities have deployed various mechanisms through which it is shifting profit to their various mechanisms through which it is shifting profit to their various mechanisms through which it is shifting profit to their Associated Enterpri Associated Enterprises (AEs) especially Idemia France SAS and ses (AEs) especially Idemia France SAS and Idemia Germany GmBH. Idemia Germany GmBH.

Investigation have revealed various tax Investigation have revealed various tax-avoiding arrangements avoiding arrangements operated by the group entities like export sales made to AEs at very operated by the group entities like export sales made to AEs at very operated by the group entities like export sales made to AEs at very low markup, import purchases made from AEs at unjustified mar low markup, import purchases made from AEs at unjustified mar low markup, import purchases made from AEs at unjustified markup, management fees paid to AEs without any actual services received, management fees paid to AEs without any actual services received, management fees paid to AEs without any actual services received, Purchase of RAW materials from AEs, R&D services provided to AEs at Purchase of RAW materials from AEs, R&D services provided to AEs at Purchase of RAW materials from AEs, R&D services provided to AEs at low mark-up, transaction with Non up, transaction with Non- Filers etc. A summary of the Filers etc. A summary of the modus operandi is as under: modus operandi is as under:

A. Expenses Debit to Non A. Expenses Debit to Non- Filers:

It was observed that Smart Chip Pvt Ltd had undertaken various It was observed that Smart Chip Pvt Ltd had undertaken various It was observed that Smart Chip Pvt Ltd had undertaken various transactions in the nature of contract, rent, professional charges with transactions in the nature of contract, rent, professional charges with transactions in the nature of contract, rent, professional charges with various parties who have not either never filed the ITR or not filed in various parties who have not either never filed the ITR or not filed in various parties who have not either never filed the ITR or not filed in the year in which transaction occurred. the year in which transaction occurred. The details of transactions are The details of transactions are tabulated below: tabulated below:

*** *** *** , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 48 ::

In this regard, summons notices were issued to the above non In this regard, summons notices were issued to the above non In this regard, summons notices were issued to the above non-filers to verify the genuineness of the transactions by investigation wing. to verify the genuineness of the transactions by investigation wing. to verify the genuineness of the transactions by investigation wing. However, no response has been received from the parties ti However, no response has been received from the parties ti However, no response has been received from the parties till date. In the absence of any compliance by the party and in view of the fact the absence of any compliance by the party and in view of the fact the absence of any compliance by the party and in view of the fact that above parties are non that above parties are non-filer till date, the genuineness of filer till date, the genuineness of contract/rent payments made by Smart Chip could not be verified. contract/rent payments made by Smart Chip could not be verified. contract/rent payments made by Smart Chip could not be verified.

In view of the above, assessee e above, assessee's income aggregating ?4,46,21,363/ ng ?4,46,21,363/- has escaped assessment by way of various transactions during the FY has escaped assessment by way of various transactions during the FY has escaped assessment by way of various transactions during the FY 2015-16 to FY 2020 16 to FY 2020-21 in the nature of contract, rent, professional 21 in the nature of contract, rent, professional charges with various parties who have not either never filed the ITR charges with various parties who have not either never filed the ITR charges with various parties who have not either never filed the ITR or not filed in the year in which or not filed in the year in which transaction. Hence the genuineness transaction. Hence the genuineness of expenses of ?4,46,21,363/ of expenses of ?4,46,21,363/- with non-filers from FY 2015 filers from FY 2015-16 to 2020-21 needs to be verified. 21 needs to be verified.

B. DISALLOWANCE OF PERSONAL EXPENSES B. DISALLOWANCE OF PERSONAL EXPENSES

It is noticed that during the course of search proceedings, some It is noticed that during the course of search proceedings, some It is noticed that during the course of search proceedings, some incriminating evidences incriminating evidences were seized from the premises of Mr. were seized from the premises of Mr. Matthew David Foxton (34, Jor Bagh, New Delhi Matthew David Foxton (34, Jor Bagh, New Delhi-110003) annexurized 110003) annexurized as Annexure A as Annexure A-2 in Premise TDR-9, wherein some instances of 9, wherein some instances of personal expenses of the key persons of Smart Chip Pvt. Ltd. were personal expenses of the key persons of Smart Chip Pvt. Ltd. were personal expenses of the key persons of Smart Chip Pvt. Ltd. were claimed in the books of ac claimed in the books of accounts of Smart Chip.

The incriminating evidences found are discussed as under: The incriminating evidences found are discussed as under: The incriminating evidences found are discussed as under:

On perusal of the above, it can be noted that gold items worth On perusal of the above, it can be noted that gold items worth On perusal of the above, it can be noted that gold items worth Rs.2,42,646/were being purchased in FY 2015 Rs.2,42,646/were being purchased in FY 2015-16. Further, it con 16. Further, it con be noticed that Smart Chip has been regularly incurring expenses for the noticed that Smart Chip has been regularly incurring expenses for the noticed that Smart Chip has been regularly incurring expenses for the personal benefit of directors and key managerial personnel for personal benefit of directors and key managerial personnel for personal benefit of directors and key managerial personnel for example purchase of iPhones, Sarees, Purfume, Hotel bills, credit example purchase of iPhones, Sarees, Purfume, Hotel bills, credit example purchase of iPhones, Sarees, Purfume, Hotel bills, credit card payments, etc. Further, it has also been observe card payments, etc. Further, it has also been observe card payments, etc. Further, it has also been observed that the company is also regularly incurring expenses for alcohols for officers, company is also regularly incurring expenses for alcohols for officers, company is also regularly incurring expenses for alcohols for officers, IPL tickets for bank officials, travel bills of government officers for IPL tickets for bank officials, travel bills of government officers for IPL tickets for bank officials, travel bills of government officers for availing favours from them. These expenses incurred to illegally availing favours from them. These expenses incurred to illegally availing favours from them. These expenses incurred to illegally obtain undue favours are in infracti obtain undue favours are in infraction of law and cannot be allowed on of law and cannot be allowed as deduction. Furthermore, such personal expenses cannot also be as deduction. Furthermore, such personal expenses cannot also be as deduction. Furthermore, such personal expenses cannot also be said to have been incurred wholly and exclusively for the purpose of said to have been incurred wholly and exclusively for the purpose of said to have been incurred wholly and exclusively for the purpose of business and needs to be examined. business and needs to be examined.

C. Disallowance of expenses paid to VIHAAN INFRASYSTEMS C. Disallowance of expenses paid to VIHAAN INFRASYSTEMS C. Disallowance of expenses paid to VIHAAN INFRASYSTEMS LTD.

It is noticed that some incriminating evidences were seized from the It is noticed that some incriminating evidences were seized from the It is noticed that some incriminating evidences were seized from the premises of Mr. Matthew David Foxton (34, Jor Bagh, New Delhi premises of Mr. Matthew David Foxton (34, Jor Bagh, New Delhi premises of Mr. Matthew David Foxton (34, Jor Bagh, New Delhi- , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 49 ::

110003) annexurized as A 110003) annexurized as A-2 in Premise TDR-9, wherein some 9, wherein some instances of unduly routing of money to Vihaan Infrasystems L instances of unduly routing of money to Vihaan Infrasystems L instances of unduly routing of money to Vihaan Infrasystems Ltd. in the garb of contractual manpower services and other support services the garb of contractual manpower services and other support services the garb of contractual manpower services and other support services and the said expense cost was being claimed in the books of the and the said expense cost was being claimed in the books of the and the said expense cost was being claimed in the books of the Smart Chip. The extracts of incriminating evidences as found during Smart Chip. The extracts of incriminating evidences as found during Smart Chip. The extracts of incriminating evidences as found during the course of search are discussed as under: the course of search are discussed as under:

On perusal of the above observations as noted from the Memo of perusal of the above observations as noted from the Memo of perusal of the above observations as noted from the Memo of KPMG Paris seized during the course of search, Vihaan Infrasystems KPMG Paris seized during the course of search, Vihaan Infrasystems KPMG Paris seized during the course of search, Vihaan Infrasystems Ltd. provided significant manpower services to Smart Chip along with Ltd. provided significant manpower services to Smart Chip along with Ltd. provided significant manpower services to Smart Chip along with other support services such as data management, training, IT other support services such as data management, training, IT other support services such as data management, training, IT services, business support rent etc. In this regard, the details of services, business support rent etc. In this regard, the details of services, business support rent etc. In this regard, the details of expenses incurred and paid by Smart Chip to Vihaan Infrasystems expenses incurred and paid by Smart Chip to Vihaan Infrasystems expenses incurred and paid by Smart Chip to Vihaan Infrasystems Ltd. in FY 2015 Ltd. in FY 2015-16 relevant to AY 2016-17 amounting to 17 amounting to Rs.8,70,00,000 / Rs.8,70,00,000 /-.

Various incriminating facts were noted from perus Various incriminating facts were noted from perusal of the seized al of the seized memo which raised significant doubts over the genuineness of the memo which raised significant doubts over the genuineness of the memo which raised significant doubts over the genuineness of the payments made by Smart Chip to Vihaan Infrasystems Ltd.: payments made by Smart Chip to Vihaan Infrasystems Ltd.: payments made by Smart Chip to Vihaan Infrasystems Ltd.:

■ Smart Chip is the major contributor to the total Smart Chip is the major contributor to the total revenue of Vihaan Infrasystems Ltd. and in some financial years, revenue of Vihaan Infrasystems Ltd. and in some financial years, revenue of Vihaan Infrasystems Ltd. and in some financial years, the expenses paid by Smart Chip to Vihaan Infrasystems Ltd. even expenses paid by Smart Chip to Vihaan Infrasystems Ltd. even expenses paid by Smart Chip to Vihaan Infrasystems Ltd. even exceeded the total revenue of Vihaan Infrasystems Ltd.; exceeded the total revenue of Vihaan Infrasystems Ltd.;

■ Mr. Sanjeev Shriya, his family members and Mr. Alok Mr. Sanjeev Shriya, his family members and Mr. Alok Mukherjee were shareholders and key managerial persons of Vihaan Mukherjee were shareholders and key managerial persons of Vihaan Mukherjee were shareholders and key managerial persons of Vihaan Infrasystems Lt Infrasystems Ltd. in the past years and can be said to have d. in the past years and can be said to have significant influence over the affairs of Vihaan Infrasystems Ltd. and significant influence over the affairs of Vihaan Infrasystems Ltd. and significant influence over the affairs of Vihaan Infrasystems Ltd. and thus, it can be observed that Vihaan Infrasystems Ltd. was used to thus, it can be observed that Vihaan Infrasystems Ltd. was used to thus, it can be observed that Vihaan Infrasystems Ltd. was used to book non-genuine expenses in the books of Smart Chip and divert genuine expenses in the books of Smart Chip and divert genuine expenses in the books of Smart Chip and divert money for the benefit of specific persons; the benefit of specific persons;

■ Common address, website of Vihaan Infrasystems Ltd. Common address, website of Vihaan Infrasystems Ltd. and Smart Chip and other group companies; and Smart Chip and other group companies;

■ Vihaan Infrasystems Ltd. presented as a group Vihaan Infrasystems Ltd. presented as a group company / related company of Idemia Group entities; company / related company of Idemia Group entities;

■ Mr. Sanjeev Kumar Jain, holding substantial shares in n, holding substantial shares in Vihaan Infrasystems Ltd., was the former employee of Smart Chip Vihaan Infrasystems Ltd., was the former employee of Smart Chip Vihaan Infrasystems Ltd., was the former employee of Smart Chip and having close relationship/connivance with Mr. Sanjeev Shriya; and having close relationship/connivance with Mr. Sanjeev Shriya; and having close relationship/connivance with Mr. Sanjeev Shriya;

■ The fees charged by Vihaan Infrasystems Ltd. was The fees charged by Vihaan Infrasystems Ltd. was much higher as compared to other contract much higher as compared to other contractual manpower company; ual manpower company; , 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 50 ::

■ No proper documentation and proof of service existed No proper documentation and proof of service existed in respect of expense transactions with Vihaan Infrasystems Ltd. in respect of expense transactions with Vihaan Infrasystems Ltd. in respect of expense transactions with Vihaan Infrasystems Ltd.

■ Discrepancies in employee's attendance record found Discrepancies in employee's attendance record found which further establishes the non which further establishes the non-receipt of any actual se receipt of any actual services and non-genuineness of the transaction with Vihaan lnfrasystems Ltd. genuineness of the transaction with Vihaan lnfrasystems Ltd. genuineness of the transaction with Vihaan lnfrasystems Ltd.

Further, the above observations in the seized Memo were also Further, the above observations in the seized Memo were also Further, the above observations in the seized Memo were also corroborated with detailed analysis in the Memo including list of corroborated with detailed analysis in the Memo including list of corroborated with detailed analysis in the Memo including list of shareholders as on 31.03.2016, Sanjeev Kumar Jain pro shareholders as on 31.03.2016, Sanjeev Kumar Jain pro shareholders as on 31.03.2016, Sanjeev Kumar Jain profile, extracts of Memorandum of Association of Vihaan Infrasystems Ltd. signed in of Memorandum of Association of Vihaan Infrasystems Ltd. signed in of Memorandum of Association of Vihaan Infrasystems Ltd. signed in 2004, Archived version of Vihaan Infrasystems Ltd. website, Linkedln 2004, Archived version of Vihaan Infrasystems Ltd. website, Linkedln 2004, Archived version of Vihaan Infrasystems Ltd. website, Linkedln profile of Vihaan Infrasystems Ltd., consent form signed by Smart profile of Vihaan Infrasystems Ltd., consent form signed by Smart profile of Vihaan Infrasystems Ltd., consent form signed by Smart Chip's landlord providing permission to Chip's landlord providing permission to Vihaan Infrasystems Ltd. to Vihaan Infrasystems Ltd. to use their office space and Vihan noted as related party, links of use their office space and Vihan noted as related party, links of use their office space and Vihan noted as related party, links of Vihaan Infrasystems Ltd. with Aadharshila and Smart Chip, related Vihaan Infrasystems Ltd. with Aadharshila and Smart Chip, related Vihaan Infrasystems Ltd. with Aadharshila and Smart Chip, related party disclosures in the other companies of Mr. Sanjeev Shriya party disclosures in the other companies of Mr. Sanjeev Shriya party disclosures in the other companies of Mr. Sanjeev Shriya (Goldrock Investment) showing Vi (Goldrock Investment) showing Vihaan Infrasystems Ltd. as related haan Infrasystems Ltd. as related party in its Annual report for FY 20 16 party in its Annual report for FY 20 16-17, domain name verification 17, domain name verification of Vihaan Infrasystems Ltd. wherein Smart Chip shown as registrant of Vihaan Infrasystems Ltd. wherein Smart Chip shown as registrant of Vihaan Infrasystems Ltd. wherein Smart Chip shown as registrant organization, proofs that Smart Chip's address noted as address of organization, proofs that Smart Chip's address noted as address of organization, proofs that Smart Chip's address noted as address of Vihaan Infrasystems Vihaan Infrasystems Ltd. on Government's website, MCA etc, analysis Ltd. on Government's website, MCA etc, analysis of invoices raised by Vihaan Infrasystems Ltd., physical verification of of invoices raised by Vihaan Infrasystems Ltd., physical verification of of invoices raised by Vihaan Infrasystems Ltd., physical verification of premises of Vihaan lnfrasystems Ltd., and various other analysis. premises of Vihaan lnfrasystems Ltd., and various other analysis. premises of Vihaan lnfrasystems Ltd., and various other analysis.

All the above incriminating evidences clearly showed that Vihaan All the above incriminating evidences clearly showed that Vihaan All the above incriminating evidences clearly showed that Vihaan Infrasystems Ltd. was merely a conduit entity which was used to rasystems Ltd. was merely a conduit entity which was used to rasystems Ltd. was merely a conduit entity which was used to unduly transfer money from Smart Chip and book non unduly transfer money from Smart Chip and book non unduly transfer money from Smart Chip and book non-genuine expenses in the books of Smart Chip. The evidences establishes that expenses in the books of Smart Chip. The evidences establishes that expenses in the books of Smart Chip. The evidences establishes that no genuine services were provided by Vihaan Infrasystems Ltd. to no genuine services were provided by Vihaan Infrasystems Ltd. to no genuine services were provided by Vihaan Infrasystems Ltd. to Smart Chip. This finding is in fact based on the internal report rt Chip. This finding is in fact based on the internal report rt Chip. This finding is in fact based on the internal report prepared by Idemia Group with the help of KPMG Paris. Hence, the prepared by Idemia Group with the help of KPMG Paris. Hence, the prepared by Idemia Group with the help of KPMG Paris. Hence, the payments made by Smart Chip to Vihaan Infrasystems Ltd. are found payments made by Smart Chip to Vihaan Infrasystems Ltd. are found payments made by Smart Chip to Vihaan Infrasystems Ltd. are found to be non-genuine and nowhere wholly and exclusively related to genuine and nowhere wholly and exclusively related to genuine and nowhere wholly and exclusively related to the business of the Smart Chip. business of the Smart Chip.

Thus, in view of the above, it is clearly corroborated that Smart Chip Thus, in view of the above, it is clearly corroborated that Smart Chip Thus, in view of the above, it is clearly corroborated that Smart Chip has been regularly making payments to Vihaan Infrasystems Limited has been regularly making payments to Vihaan Infrasystems Limited has been regularly making payments to Vihaan Infrasystems Limited without any actual receipt of any services and thus, claim of expenses without any actual receipt of any services and thus, claim of expenses without any actual receipt of any services and thus, claim of expenses of Rs.8,70,00,0 of Rs.8,70,00,000/-cannot be said to be wholly and exclusively cannot be said to be wholly and exclusively incurred for the purpose of business during the FY 20 15 incurred for the purpose of business during the FY 20 15 incurred for the purpose of business during the FY 20 15-16 relevant to AY 2016-17 and treated as escaped asses 17 and treated as escaped assessment and needs to be sment and needs to be examined.

, 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 51 ::

As discussed above, assesse's income of Rs.9.21 Crores by way of As discussed above, assesse's income of Rs.9.21 Crores by way of As discussed above, assesse's income of Rs.9.21 Crores by way of expenses debited to non expenses debited to non -filers and personal expenses & payment filers and personal expenses & payment made to Vihaan Infrasystems Limited for F.Y. 2015 made to Vihaan Infrasystems Limited for F.Y. 2015-16 relevant to 16 relevant to A.Y. 2016-17 in the head of business expenses has escaped 17 in the head of business expenses has escaped 17 in the head of business expenses has escaped assessment and needs to be examined. sment and needs to be examined.

2. Evidently, warran 2. Evidently, warrant was issued in the name of the assessee and the t was issued in the name of the assessee and the case of the assessee was covered under Search u/s 132 ofthe Inco case of the assessee was covered under Search u/s 132 ofthe Inco case of the assessee was covered under Search u/s 132 ofthe Income Tax Act 1961 on 21.03.2023. Tax Act 1961 on 21.03.2023.

, 1256, 1257 & 1259/Chny/2025 1163, 1256, 1257 & 1259/Chny/2025 & 1232, 1234 & 1236/Chny/2025 1232, 1234 & 1236/Chny/2025 (AYs 2013 s 2013-14 to 2016-17) Southern Agrifurane Industries Pvt. Ltd. M/s. Southern Agrifurane Industries Pvt :: 52 ::

Order pronounced on the 21st day of November, 2025 Order pronounced on the 25, in Chennai.