Garnet Veneer And Decors Limited vs Deputy Commissioner Of Income Tax

PER ANUBHAV SHARMA, JUDICIAL MEMBER:

This appeal preferred by the assessee against the order dated 24.07.2025 of Ld. Commissioner of Income Tax (Appeals)-25, New Delhi (hereinafter referred to as the First Appellate Authority or ‘the ld. FAA’ for short) in DIN & Order No: ITBA/APL/M/250/2025-26/1078851588(1) arising out of the assessment order dated 13.03.2024 u/s 153C of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by DCIT, Central Circle-28, New Delhi, for AY: 2019-20.

At the time of hearing, it was pointed out that there is a delay of 42 days in filing of the appeal before this Tribunal and in regard to which ld. Counsel has brought on record an application for condonation of delay and considering the reasons cited therein and as the delay is not of substantial period the same is condoned and the appeal is admitted for hearing.

Then, ld. Counsel has drawn our attention to notice u/s 153C of the Act dated 14.03.2023 available at page No. 221 of the paper book by which ld. AO has assumed jurisdiction. Further, copy of assessment order has been placed on record in the case of searched person Alok Kumar Agarwal for AY: 201011 which shows that assessment u/s 153A of the Act was concluded on 24.05.2022. At page no. 103 copy of satisfaction note dated 24.06.2022 for AY; 2014-15 to AY; 2020-21, recorded by the AO of searched person has been provided and at page No 104 copy of satisfaction note dated 07.02.203 recorded for initiating proceedings u/s 153C recorded by AO of the assesse has been provided. Admittedly, the case of assesse u/s 153C is an outcome of a search carried on 18.10.2019 in Alankit Group of Cases.

These facts at one hand reflect that in regard to search conducted on 18.10.2019 the satisfaction note in case of assesse was recorded on 24.06.2022 by the AO of searched person and this dates falls beyond 01.04.2026, therefore, provisions of Section 153(3) of the Act come in application and assessment could not have been conducted u/s 153C but may have been u/s 147 of the Act. Reliance is placed on Hon'ble Madras High court decision in the case of Harigovind v. ACIT reported in [2025] 180 taxmann.com 197 (Madras) as followed by co-ordinate benches in Rajendra Kumar in ITA No.4811/Del/2025 and Geetanjali Bhayana,Delhi vs Dcit Central Circle-32 Delhi, New Delhi decide on 27 January, 2026 vide ITA No.2227, 2228 & 2252/Del/2025

At the same time, when assessment in case of search person was completed on 24.05.2022 subsequently, on 24.06.2022 satisfaction note by the AO of searched person was recorded and the satisfaction note of the AO of the assesse as non searched person was recorded on 07.02.2023 there is apparent delay in assumption of jurisdiction and same is fatal. Reliance is placed on the decision of Hon’ble Delhi High Court in CIT Vs. Bharat Bhushan Jain vide ITA No. 648/2009 order dated 08.01.2015 wherein relying that decision of Hon’ble Supreme Court in CIT Vs. Calcuta Knitwears, Ludhiana reported in 362 ITR 673 (SC) such delay has been found to be of the nature vitiating the assumption of jurisdiction and passing of assessment order.

As a consequence of the aforesaid discussion, ground No. 2 is sustained. The appeal is allowed and the impugned assessment order is quashed.