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Judgment
Per Satbeer Singh Godara, Judicial Member:
These twin assessees M/s Bhar tiya International Ltd. and M/s Avni Polymers Pvt. Ltd. have filed their respective three appeals i.e. ITA Nos. 5413, 5414 & 5415/Del/2025 for Assessment Years 2018-19 & 2019-20, arising against the CIT(A)-23, Delhi’s DIN & order Nos. ITBA/APL/S/250/2025-26/1078363618(1), 1078449587(1) & 1078450327(1) dated 10.07.2025 & 14.07.2025, in proceedings u/s 153C of the Income Tax Act, 1961 (in short “the Act”), respectively.
Heard bo th these assessees as well as the department at length. Case files perused.
It transpires dur ing the course of hearing at the outset that both these assessee’s raise their first and foremost legal ground/argument challenging validity of the three impugned section 153C r.w.s. 143(3) assessments itself for want of a proper satisfaction recorded by the learned Assessing O fficer. We make it clear that there is no dispute betwe en the parties that the learned departmental authorities had infact carrie d out the relevant section 132 search in que stion in relation to M/s K.K. Spun Group cases on 23.03.2021. There is further no denial to the fact that the learned assessing authority(ies) there after recorded the ir identical section 153C satisfactio n that the corresponding documentar y evidence found/seized during the course of the above search infact “belonged to” both these assessees so as to proceed against them.
It is at this stage that the learned counsel vehemently submits that going by the statutory amendment in section 153C(1) of the Act vide Finance Act 2015 w.e.f. 01.06.2015, no such document could be held as “belonging” to a third party whereas the Revenue seeks to justify the same on the ground that it is not the grammatical expressions used in section 153C satisfaction but overall facts and circumstances which ought to be considered whilst deciding the instant legal issue.
We have given our thoughtful consideration to the assessee’s and the Revenue’s re spective vehement submissions. We find no reason to sustain the impugned assessments in light of the tribunal’s earlier order in Narender Nath Vs. DCIT, ITA No. 4990/Del/2025 decided on 08.01.2026; reading as under:
“3.We advert to the assessee’s fir st and forem ost substantive ground/legal arguments herein that both the learned lower authorities have erre d in law and on facts in framing the impugned section 153C r.w.s. 143(3) assessment date d 30.03.2024; in fur the rance to the searche d party’s Assessing Officer’s satisfaction dated 25.03.2023 and his assessing author ity o n the very date, as the case may be, which has be en wrongly upheld in the lowe r appellate discussion.
4.That being the case, learned CIT-DR veheme ntly argues that the impugned twin satisfactions here in had been proper ly recorded by the Asse ssing Office r(s); be it that of the searched assessee or appellant third party herein. Her case accordingly is that we ought to uphold the same in very terms.
5.We have given our thoughtful conside ration to both the party’s foregoing rival pleadings. There is har dly any dispute that the learned departm ental authorities had carried o ut the impugned search o n 23.03.2021 in M/s KK Spun Gro up. And that the said searched party’s le arned Assessing Office r recorde d his section 153C satisfaction date d 25.02.2023 for proceeding against assessee/appellant be fore us. The said learne d Assessing Office r appears to have reco rded that the corresponding seized document dur ing the course of search “belonged to” the assessee/appe llant who happens to be the thir d par ty u/s 153C of the Act.
6.Faced with this situation, the Revenue could o nce again not dispute that section 153C(1)(a) stipulates the catego ry of the seized material as “any money, bullion, jewelle ry .. ...”w hich could be held as be longing to a third pe rson and such documents etc. could only be treated as pe rtaining to or in formatio n therein as relating to such a pe rson. Meaning thereby that the learned Assessing Officer has not prope rly recorde d his satisfaction that the impugned seiz ed documents either pertained to o r r elated to the assessee which form s a conditio ned precedent be fore pr oceedings him/third person. This tribunal’s rece nt decision in Prashant Premchand Bafana Vs. ACIT IT (SS)A No. 119 & 120/Pun/2022 decided on 08.04.2025 has already settled the ve ry issue in the assessee’s favour and against the department. We thus co nclude in this back dro p that the impugne d assess ment dated 30 .03.2024dese rves to be quashed since based on an imp roper section 153C satisfaction. Order ed accordingly.”
We adopt judicial consistency to quash all these three impugned section 153C assessments in very terms for want of any exception pinpointed at the Revenue’s behest in law or on facts, as the case may be. Ordered accor dingly.
All other remaining pleadings between the parties stand rendered academic.
These twin assessees three appeals ITA No. 5413, 5414 & 5415/Del/2025 are allowed. A copy of this common order be place d in the respective case files.