The Income Tax Appellate Tribunal, Delhi Bench ‘E’, adjudicated a batch of appeals filed by the assessee against the common order dated 28.01.2025 passed by the Commissioner of Income Tax (Appeals)-30, New Delhi, for Assessment Years 2018-19, 2019-20 and 2020-21.

The assessments were framed by the Assessing Officer under Section 153C of the Income-tax Act, 1961. The primary contention raised by the assessee was that the Assessing Officer who framed the assessments had failed to record the mandatory satisfaction note as required under law. It was argued that in the absence of such satisfaction, the assumption of jurisdiction under Section 153C itself was invalid. Reliance was placed on the decision of the Hon’ble Delhi High Court in Saksham Commodities Ltd. & Ors. and the decision of the ITAT Delhi in Sri Anil Chowdhary.

The Revenue contended that the same Assessing Officer had jurisdiction over both the searched person and the other person and, therefore, recording of a separate satisfaction note was not required. Reliance was placed on the judgments of the Hon’ble Supreme Court in Super Malls Pvt. Ltd. and the Hon’ble Delhi High Court in Ganpati Fincap Services Pvt. Ltd.

Upon examination of the records, the Tribunal noted that at the time of recording the satisfaction, the Assessing Officer of the searched person and the Assessing Officer of the assessee were not the same. The satisfaction had been recorded by the Assessing Officer of the searched person and thereafter the seized material was handed over to the jurisdictional Assessing Officer of the assessee. Subsequently, the jurisdiction was transferred under Section 127. The Tribunal held that, in such circumstances, the Assessing Officer who framed the assessment under Section 153C was mandatorily required to record a satisfaction note, which had not been done.

The Tribunal further held that the judgments relied upon by the Revenue were not applicable to the facts of the present case. Following the binding ratio laid down by the Hon’ble Delhi High Court in Saksham Commodities Ltd. & Ors., the Tribunal held that the assessments framed under Section 153C without recording the requisite satisfaction note were invalid in law.

Accordingly, the Tribunal quashed the assessment orders for all the assessment years under consideration. Since the assessments were quashed on the jurisdictional issue itself, the remaining grounds were not adjudicated. The appeals filed by the assessee were partly allowed.

Link to download the Order

https://mytaxexpert.co.in/uploads/1766570148_1766469824S8QMvq1TO.pdf