GEETANJALI BHAYANA,DELHI vs. DCIT CENTRAL CIRCLE-32 DELHI, NEW DELHI

ITA 2252/DEL/2025Status: DisposedITAT Delhi27 January 2026AY 2020-2129 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal allowed the assessee's appeals. On the primary issue concerning the validity of Section 153C proceedings, the Tribunal, following the Delhi High Court's decision in Saksham Commodities (supra), held that the satisfaction note recorded by the AO was invalid. The AO had failed to record satisfaction that the entries in the seized diary "pertained to the assessee" and "have the bearing on the determination of the income of the assessee." Consequently, the proceedings initiated under Section 153C were quashed. The Tribunal noted that the same diary and common satisfaction note were used for all three assessment years. Since the legal grounds were allowed, the remaining grounds required no adjudication. The operative direction was to quash the proceedings under Section 153C and allow the appeals.

What were the facts?

The assessee, Smt. Geetanjali Bhayana, filed appeals against orders of the CIT(A) for Assessment Years (AYs) 2018-19, 2019-20, and 2020-21. These orders confirmed assessment orders passed under Section 153C read with Section 143(3) of the Income Tax Act, 1961. The assessments were initiated following a search and seizure operation on the Shri Kuldeep Bishnoi Group on July 23, 2019, where incriminating material related to the assessee was found. The Assessing Officer (AO) recorded satisfaction on December 3, 2021, and issued notices under Section 153C on December 6, 2021. For AY 2018-19, the AO assessed income at INR 58,29,693, making an addition of INR 48,41,900 as GP on alleged undisclosed sales of INR 1,38,34,000. The CIT(A) dismissed the assessee's appeals.

What were the issues?

1. Whether the proceedings initiated under Section 153C of the Act are legally sustainable, given the alleged lack of incriminating material pertaining to the assessee found during the search on a third party, and whether the satisfaction note recorded by the AO was valid, as argued by the assessee citing PCIT v. Abhisar Buildwell (P.) Ltd. and CIT v. Harjeev Aggarwal. The assessee contended that the addition was based on a 'dumb document' (diary notings) without corroborative material and that the AO wrongly shifted the burden of proof. The assessee also argued that separate satisfaction notes were not prepared for each AY, rendering the proceedings void ab initio, citing DCIT vs. Sunil Kumar Sharma. The revenue did not record any specific arguments in the judgment. 2. Whether the addition made by estimating 35% gross profit on alleged cash transactions is arbitrary and legally untenable, as argued by the assessee, who contended that Section 28 can only apply to declared GP and that tax liability cannot be based on hypothetical income, referencing CIT v. Shoorji Vallabhdas & Co. The revenue did not record any specific arguments in the judgment.

Which sections of the Income-tax Act were involved?

Section 153C,Section 143(3),Section 250,Section 132(4),Section 292C,Section 132(4A),Section 68,Section 28

AI-generated summary — verify with the full judgment below

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

Before: SHRI ANUBHAV SHARMA & SHRI MANISH AGARWAL

For Appellant: Ms. Meenal Goyal, Adv
For Respondent: Ms. Pooja Swaroop, CIT DR
Hearing: 19.01.2026Pronounced: 27.01.2026

The captioned appeals are filed by assessee against the separate

orders, all are dated 10.03.2025 passed by Ld. Commissioner of Income Tax (A)-30, New Delhi [“Ld. CIT(A)”] u/s 250 of the Income

Tax Act, 1961 [“the Act”] arising out of assessment orders, all are dated 30.03.2023 passed u/s 153C r.w.s. 143(3) of the Act pertaining to Assessment Years 2018-19, 2019-20 & 2020-21 respectively. The details of the orders of ld. CIT(A) are tabulated as under:

S. No. ITA No. A.Y. CIT(A) Appeal No. 1. 2227 /Del/2025| 2018-19 | 30/10356/2017-18 2. 2228/Del/2025

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 153C

All 9,619 judgments and leading authorities on Section 153C →

Recent GST High Court judgments

Search GST case law →