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Judgment
PER ANUBHAV SHARMA, JM:
This appeal is preferred by the Assessee against the order dated 18.09.2025 of the Ld. Commissioner of Income Tax (Appeals)-3, Noida (hereinafter referred to as the First Appellate Authority or ‘the ld. FAA’ for short) in Appeal No: CIT (A), Noida-3/10025/2013-14 arising out of the assessment order dated 18.03.2024 u/s 153C of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by DCIT, Central Circle, Ghaziabad for AY: 2012-13.
Heard and perused the record. Assesse is a company and its return was subject of assessment u/s 153C of the Act on the basis of search and seizure operations in the M/s Alankit Group on 18.10.2019 and thereupon the impugned addition of Rs.75,00,000/- was made u/s 68 of the Act on account of alleged receipt of loan from entry operator companies of M/s Alankit Group of cases. Further an addition of Rs.2,25,000/- u/s 69C as alleged commission @ 3% of made and the same has been sustained by ld. CIT(A) for which assessee’s in appeal.
We find that on behalf of assesse at page 92 of the paper book copy of satisfaction note dated 21.08.2023 is made available. Ld. Counsel has submitted that this satisfaction note is not recorded in accordance with law and a consolidated satisfaction note for AY: 2014-15 to 2020-21 has been recorded on the basis of ledger account which shows that in AY: 2014-15 only that there was a debit entry and in subsequent AY: 2015-16, 2016-17 and 2017-18 there was only credit entries in the ledger account. It was submitted that thus except for AY; 2014-15 there was no allegation of any incriminating material being available for other years still a consolidated satisfaction note has been recorded.
Ld. DR has however defended the same by submitting that it is merely a procedural defect.
After giving thoughtful consideration to the material on record we are of the considered view that what assessing officer alleges to be incriminating material is merely a regular books of account in the form of ledger entry and what is incriminating in that has not at all been discussed in the satisfaction note. It is now settled that satisfaction note is required to be recorded u/s 153C of the Act for each assessment year and a consolidated satisfaction note if not recorded for each assessment year vitiates the entire proceedings. More so, in case like present when what is alleged to be incriminating material is merely a copy of ledger account. Thus, relying the aforesaid proposition of law settled by Hon’ble Delhi High Court in the case of Saksham Commodities Ltd. v. ITO [2024] 161 taxmann.com 485 (Delhi), we are inclined to hold that the assumption of jurisdiction was vitiated and thus, all subsequent proceedings including issuing of notice and concluding assessment proceeding are liable to be quashed.
Accordingly, the ground No. 1 is sustained and remaining ground become academic in nature. The appeal is allowed and the impugned assessment order is quashed.