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Income Tax Appellate Tribunal, DELHI BENCH ‘B’: NEW DELHI
(Assessment Year: 2012-13) DCIT, Central Circle 06, vs. Visionary Infraprojects Private Ltd., 16A, 5th Floor, New B K Market, New Delhi. Shakespeare Sarani, Kolkata – 700 071 (West Bengal). (PAN :AADCV7798L) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri Mayank Patawari, Advocate REVENUE BY : Shri Sanjeev Kaushal, CIT DR Date of Hearing : 21.08.2025 Date of Order : 07.11.2025 O R D E R
PER S.RIFAUR RAHMAN,AM:
This appeal is filed by the Revenue against the order of ld. Commissioner of Income-tax Appeals-24, New Delhi [hereinafter referred to as ‘ld. CIT (A)] dated 31.07.2024 for Assessment Year 2012-13.
At the outset, ld. AR of the assessee submitted that assessee has taken an additional ground/legal ground before the ld. CIT (A), “That the ld. Assessing Officer has erred in law in issuing notice u/s 153C of the Income- tax Act, 1961 (for short ‘the Act’) for the year under consideration as it is beyond the block of six years, hence, making such issuance beyond jurisdiction.” He submitted that after going through the detailed submissions of the ld. AR before the ld. CIT (A), ld. CIT (A) allowed the additional ground and quash the assessment and accordingly deleted the addition by passing a reasoned order which may be upheld.
On the other hand, ld. DR of the Revenue submitted that ld. CIT(A) was not justified in holding that block periods for assessment u/s 153C have to be calculated from the date of receipt of the books of accounts, documents or assets seized, by the jurisdictional AO of the non-searched person and not from the date of initiation of search by relying on First Proviso to Section 153C, even when this Proviso specifically deals only with the abatement of proceedings (as referred to second proviso of Section 153A) and does not deal with the calculation of block periods. He further submitted that the ld. CIT (A) was not justified in quashing the assessment order u/s 153C on the grounds that the amended provision w.e.f. 01.04.2017 are not relevant in this case when the satisfaction was recorded on 20.09.2018 and by the time the amendment to the section 153 C was already into effect (01.04.2017), which clarified that the relevant assessment years have to be calculated according to the date of search. Further he submitted that the Ld. CITCA) was not justified in holding that block periods for assessment u/s 153C have to be calculated from the date of receipt of the books of accounts, documents or AO of the non-searched person, even when the position of law is clarified after the amendment introduced by Finance Act, 2017, that the block period of 6 AYs and 10 AYs as mentioned inv Section 153C and Section 153A have same meaning and have to be calculated from the assessment year relevant to the previous year in which search is conducted. Accordingly, he pleaded that the Ld. CIT(A) was not justified in ignoring that the implementation provisions have to be interpreted in consonance with the charging provision and there cannot be any anomalous situation created by the interpretation of the implementation provision and the provisions u/s 153A and 153C of the Act have to be construed in such a harmonious way that there will not be any different sets of 6 years for reopening of the assessments in case of the person searched and the other person.
Considered the rival submissions and material placed on record. We have gone through the order of ld. CIT (A) in detail and find that the ld. CIT (A) has passed a reasoned and well-speaking order while deciding the legal issue in favour of the assessee. We find that after relying on various judgments of Hon’ble Delhi High Court and Hon’ble Supreme Court, ld. CIT (A), ld. CIT (A) held that AY 2012-13 is not covered within six block AYs in section 153C of the Act and allowed the additional ground of appeal. For the sake of brevity, we reproduce the relevant findings of ld. CIT (A) as under :-
“Findings/ Determination are as hereinafter- 4.1 I have considered the material on record including written submission of the AR of the appellant filed in course of appellate proceedings. I have also perused the assessment order u/s 153C r.w.s. 143(3) of the Act passed by the Assessing Officer. In the present appeal the appellant has raised following grounds of appeal and additional ground of appeal. 4.1.1 In Additional Ground of appeal, the appellant has contended that the Assessing Officer has erred in law in issuing notice u/s 153C of the Act for the year under consideration as it is beyond the block of six years, hence, making such issuance beyond jurisdiction. 4.1.2 The brief facts of the case are that search and seizure operation u/s 132 of the I T Act, was carried out on Ashish Begwani Group on 22.10.2016. During the course of search various documents related to ‘accommodation entry’ were seized. From the assessment order, it was observed that the satisfaction in terms of section 153C was recorded on 20.09.2018 by the Assessing Officer of searched party and on 20.09.2018 by the Assessing Officer of appellant and notice u/s 153C was issued on 24.09.2018. However, the Assessing Officer observed “Further, consequent to search action u/s 132 in Ashish Begwani Group on 22.10.2016, as per provisions of section 153C of the Act, satisfaction by the AO of the searched person (Ashish Begwani) was recorded on 20.09.2018 and seized material was handed over to the AO of M/s Visionary Infraprojects Private Limited, the assessee. After perusing the information mail able on record and documents/ Information received from the AO of searched person, satisfaction was recorded on 20.09.2018 on part of the AO of M/s Visionary Infraprojects Private Limited (the assessee).Thereafter, notice under section 153C of the Act, was issued on 24.09,2018 and was duly served.” 4.1.3 The Appellant submitted that the period of six assessment years as per the decision of Jurisdictional High Court of Delhi mean six years prior to the AY in which the satisfaction note u/s 153C was recorded by the concerned Assessing Officer. The satisfaction note in the instant case was recorded by the Assessing Officer on 20.09.2018 i.e. in the F.Y. 2018-19 relevant to AY 2019-20 therefore six years period as referred in Sec 153C(1) should have been from AY 2013-14 to 2018-19. The appellant has relied on the judgment of Hon’ble High Court of Delhi in the case of CIT vs. M/s RRJ Securities Pvt. Ltd and judgment of Hon’ble Supreme Court in the case of CIT vs. Jasjit Singh. 4.1.4 The submission of the appellant and the judicial position on the facts of the case have been carefully perused. The appellant submitted that the position of law has been very clearly laid down by Hon’ble High Court of Delhi in the case of CIT vs. RRJ Securities and Hon’ble Supreme Court in the case of CIT vs Jasjit Singh. In these cases, Hon’ble Courts has held that the six-year period as referred in section 153C(1) shall be computed with reference to the date of recording of the satisfaction as date of search which is 20.09.2018 i.e., AY 2019-20. The relevant Hon’ble Supreme Court and the Jurisdictional High Court are reproduced below for ready reference:
1. In Jasjit Singh (supra), the Hon’ble Supreme Court held as under: ‘'8. In SSP Aviation (supra) the High Court inter alia reasoned as follows:- "14. Now there can be a situation when during the search conducted on one person under Section 132, some documents or valuable assets or books of account belonging to some other person, in whose case the search is not conducted, may be found. In such case, the Assessing Officer has to first be satisfied under Section 153C. which provides for the assessment of income of any other person, i.e., any other person who is not covered by the search, that the books of account or other valuable article or document belongs to the other person (person other than the one searched). He shall hand over the valuable article or books of account or document to the Assessing Officer having jurisdiction over the other person. Thereafter, the Assessing Officer having jurisdiction over the other person has to proceed against him and issue notice to that person in order to assess or reassess the income of such other person in the, manner contemplated by the provisions of Section 153A. Now a question may arise as to the applicability of the second proviso to Section 153A in the case of the other person, in order to examine thequestion of pending proceedings which have to abate. In the case of the searchedperson, the date with reference to which the proceedings for assessment or reassessment of any assessment year within the period of the six assessment yearsshall abate, is the date of initiation, of the search under Section 132 or the requisition under Section 132A. For instance, in the present case, with reference to the Puri Group of Companies, such date will he 5.1.2009. However, in the case of the other person, which in the present case is the petitioner herein, such date will be the date, of receiving the books of account or documents or assets seized or requisition by the Assessing Officer hewing jurisdiction over such other person. In the case of the other person, the question of pendency and abatement of the proceedings of assessment or reassessment to the six assessment years will be examined with reference to such date. " It is evident on a plain interpretation of Section 153C(1) that the 9. Parliamentary intent to enact the proviso was to cater not merely to the question of abatement but also with regard to the date from which the six year period was to be reckoned, in respect of which the returns were to be filed by the third party (whose premises are not searched and in respect of whom the specific provision under Section 153-C was enacted. The revenue argued that the proviso (to Section 153(c)(1)] is confined in ils application to the question of abatement. This Court is of the opinion that the revenue's argument is 10. insubstantial and without merit. It is quite plausible that without the kind of interpretation which SSP Aviation adopted, the A.O. seized of the materials - of the search party, under section 132 - would take his own time to forward the papers and materials belonging to the third party, to the A.O. In that event if the date would virtually "relate back " as is sought to be contended by the revenue, (to the date of the seizure), the prejudice caused to the third party, who would be drawn into proceedings as it were unwittingly (and in many cases have no concern with it at all), is dis-proportionate. For instance, if the papers are in fact assigned under Section 153-C after a period of four years, the third party assessee’s prejudice is writ large as it would have to virtually preserve the records for at latest 10 years which is not the requirement in law. Such disastrous and harsh consequences cannot be attributed to Parliament. On the other hand, a plain reading of section 153-C supports the interpretation which this Court adopts. For the foregoing reasons, the Court finds no merit in these 11. appeals; they are accordingly dismissed, without order on costs. ” In RRJ Securities (Supra), the Hon’ble Delhi High Court held as under: 2. "
As discussed hereinbefore, in terms of proviso to Section I53C of the Act, a reference to the date of the search under the second proviso to Section 153A of the Act has to be construed as the date of handing over of assets/documents belonging to the Assessee (being the person other than the one searched) to the AO having jurisdiction to assess the said Assessee. Further proceedings, by virtue of Section 153C(1) of the Act,would have to be in accordance with Section 153A of the Act and the reference to the date of search would have to be construed as the reference, to the date of recording of satisfaction. Il would follow that the six assessment years for which assessments/reassessments could be made under Section I53C of the Act would also have to be construed with reference to the date of handing over of assets/documents to the AO of the Assessee. In this case, it would be the date of the recording of satisfaction under Section 153C of the Act, i.e., 8th September, 2010. In this view, the assessments made in respect of assessment years 2003-04 and 2004-03 would be beyond the period of six assessment years as reckoned with reference to the date of recording of satisfaction by the AO of the searched person. 11 is contended by the Revenue that the relevant six assessment years would be the assessment years prior to the assessment year relevant, to the previous year in which the search was conducted. If this interpretation as canvassed by the Revenue is accepted, it would mean that whereas in case of a person searched, assessments in relation to six previous years preceding the year in which the search takes place can be reopened hut in case of any other person, who is not searched but his assets are seized from the searched person, the period for which the assessments could be reopened would be much beyond the period of six years. This is so because the date of handing over of assets/documents of a person, other than the searched person, to the AO would be subsequent to the date of the search. This, in our view, would be contrary to the scheme of Section 153C(1) of the Act. which construes the date of receipt of assets and documents by the AO of the Assessee (other than one searched) as the date of the search on the Assessee. The rationale appears to be that whereas in the case of a AO of the searched, person assumes possession of seized assets/documents on search of the Assessee; the seized assets/documents belonging to a person other than a searched person come into possession of the AO of that person only after the AO of the searched person is satisfied that the assets/documents do not belong to the searched person. Thus, the date on which the AO of the person other than the one searched assumes the possession of the seized assets would be the relevant date for applying the provisions of Section 153A of the Act. We, therefore, accept the contention that in any view of the matter, assessment for AY 2003-04 and AY 2004-05 were outside the scope of Section 153C of the Act and the AO had no jurisdiction to make an assessment of the Assessee's income for that year. ” In this case the search was carried out on 22.10.2016 which is prior to the 4.1.5 amendment of section 153C(1) which is w.e.f. 01.04.2017. Relying on the judgment of Hon'ble Delhi High Court in the case of RRJ Securities (Supra) and Hon’ble Supreme Court in the case of CIT vs. Jasjit Singh, I hold that A.Y. 2012- 13 is not covered within six block AYs in section 153C of the Act and the Additional Ground of appeal is allowed. Accordingly, the addition made by the AO is deleted.”
5. Accordingly, we are inclined to uphold the well-speaking and reasoned order passed by the ld. CIT (A) and, therefore, the appeal filed by the Revenue is dismissed.
6. In the result, the appeal filed by the Revenue is dismissed. Order pronounced in the open court on this 7th day of November, 2025.