Nitin Gupta HUF vs ACIT

“7 .2 The s ubmission filed by t he appellant has been perused and taken i nto consider ati on while adj udicating the gr ounds of appeal in the s ubs equent pa ras of thi s order.

Findings / Decision:

8.

I have exami ned the submissions of t he app ellant, the facts emanating from recor d as well as t he C ourt judgements in the matt er relie d upon by the appellant . It is seen from the assess ment order that pursuant to a searc h and seiz ure operation c arried out on Alankit group [s tat ed to be a congl omerat e of several gro up co mpani es with dive rsified activities], Shri Alok K umar Agarwal, hi s son S hri A nkit Agarwal, Al ankit Assi gnments L td. a nd Alankit Ltd . and close ass ociates on 18.10.2 019, incrimi nating evidenc es revealing a net work of accommodation entri es i nvolvi ng routi ng of unacc ounted cash through various compani es owne d/controlled by Shri Alok Kumar Agarwal were found. Incriminati ng evide nces in the name of the appellant wer e also found, in whos e case pr oceedings u/s 153C of the Act were ther efor e commenced. In vi ew of the aforesaid, notice u/s 153C of the Act was issued on 29.06.2022 to the appellant. In res ponse, the appellant filed R etur n of Inc ome (Rol) on 29.07.2022 declaring total i nc ome of Rs. 4 ,55,000/-. Assessment order was subsequently pass ed by the AO on 31.03.2024 determini ng the income of the appellant fo r the year at Rs. 8 ,35,680/- against t he returned income. Against this impugned assessm ent order, the appellant filed appeal on 07.04.2024 raisi ng as many as 25 (twe nty-five) gr ounds of appeal, invoki ng both l egal issues as well as issues on the merits of the a dditions made and some ge neral grounds. It woul d be i n t he fitness of thi ngs t o ex ami ne the legal issues rai sed by the appellant at the outset as they go to t he r oot of the mat ter .

9.

In gr ounds no. 1 and 2 of appe al raised as well as written s ubmission fi led (s upra), the appel lant has raised a specific legal ground c ontendi ng t hat the notice issued u/s 153C o f the Act for the year and the assessment order pass ed u/s 153C is time-barre d by limitation and henc e invalid and bad i n law a nd wi thout j urisdicti on and that the j urisdictional requir ement as co ntemplated under t he fourth proviso to Secti on 153A(1) of the Act is not satisfi ed. It has placed reliance on the provi sio ns of section 153C r ead wit h s ec tion I53A of the Act , whe rein it is stated that i n c ases whe re the escaped i ncome i s less tha n Rs. 50 Lakhs, the notice under section 153C of the Act can be iss ued for up to 6 assess ment years pr ece ding the assessment year relevant t o the previ ous year in whic h search is ca rried out or requis ition is made, ther eb y res ul ti ng i n ass essment/reassessment of total inc ome for 7 years in total u/s 153C of the Act. In the j udgement in the cas e of PCIT v. Ojj us Medicare (P.) Ltd. (2024) 465 ITR 101 (Del ) delivered on 3rd Apr il, 2024 and r elied upon by the appellant , the H on’ble Delhi Hi gh Court clarified t he date of search i n t he case of the per son other tha n s earched person as per a legal fiction und er t he first proviso to s ecti on 153C of the Act . Henc e, the appellant contended that in the instant cas e under c onsider at ion (A Y 2016- 17), the proceedi ngs wer e barred by limitation. It state d that t he judgment render ed by the Ho n’bl e Del hi High C ourt i n the c as e of Ojjus Medicare and other connected m atters, as wel l as the instant appe al in its case ar e arising fr om the common search c onducted on the Alankit group on 18.10.2019. To reitera te, i n the instant appeal, the appell ant i n its submission (supra) has placed relia nce on the follo wi ng judgements of the Ho n’bl e Courts:

- Pri ncipal Com miss ioner of Income-tax (C entral -1) v. Ojjus Medicar e (P.) Ltd r eport ed in [2024] 465 ITR 101 (Del hi );

- CIT Vs. Jasjit Si ngh 458 I TR 437(SC)

- Judgme nts of the Hon’ble Del hi High Cour t in Writ petitions filed i n vari ous cas es arising out of the Alankit group search, as liste d by the a ppellant in par a 14 of its s ubmission (s upra).

10.

I ha ve c onsid er ed the aforesaid s ubmi ssions mad e by the appel lant. It is seen tha t in the present appeal, the appellant has contended that the i nc ome which i s alleged to have escape d assess ment for the “releva nt ass ess ment ye ar” or the a ggregate amount in the “r elevant assessment years” does not exc eed Rs. 50 l akhs, i. e., the prescribed limit, thereby not fulfilling the t hres hold requirement as prescribe d by the Fourt h Proviso to Secti on 153 A of the Act , a nd acco rdi ngly notic e issued bey ond a peri od of six years is unsustai nabl e in la w. In fact, this issue has been considered by the Hon1 ble jurisdictio nal Hi gh Cour t in the above -r eferred case of Pri ncipal Commissi oner of Income-tax (Ce ntral -1 ) v. Ojjus Medicare (P.) Lt d report ed i n ¡2024] 465ITR 101 (Delhi ). The gr ounds of appeal raised by the appella nt and the judicial positi on on the facts of the cas e have be en carefully per used. The position of the stat ute has been clear i n s o far as the amount of income that has escaped assessment for whic h the r eopeni ng can be done for the ‘relevant assessment years ’, i.e. beyo nd six year s and up to ten years, is co ncerned. In the i nsta nt c ase, t here ar e two issues arisi ng by virtue of these pr esent gr ounds of appeal, summarized bel ow:

i)

Relating t o the da te of rec koni ng for calculati ng si x AYs back wards that can be thrown open for assessment /reass essment after s earch/handi ng over of seized material to t he AO of the non-searche d person; and

ii) Relating to whe ther t he assessment /reass essment can be carried out in the instant case bei ng beyond six years but withi n t en years of the dat e of searc h/handi ng over of s eiz ed docume nts /material to the A O of the non-searched enti ty.

11.

In this r egard, it woul d be in the fitness of t hi ngs to exami ne the provi sions o f the Act u/s 153 A of t he Act, reproduc ed as under, in res pect of the time li mit for issua nce of notice;

‘153A.[(1 )] Notwithstandi ng a nythi ng co ntained in sec ti on 139, sec tion 147, secti on 148, sec tion 149, sec ti on 151 a nd sectio n 153, in the case of a person1-0- where a search is initiated under section 132 or books of account, other docume nts or any assets are requisitioned under s ecti on 132A after t he 31st day o f May, 2003 —[but on or bef ore the 31st day o f March, 2021], the Ass essi ng Officer shall—

a. issue notice to such pe rson r equir i ng him to furnis h withi n s uch peri od, as may be speci fied in t he notice, the return of i nco me i n respect of eac h assessment year falli ng withi n six assess ment years [and for the rel evant assessment y ear or year s] r eferred t o i n clause (b), i n the prescribed form and ver ifi ed in the prescribed manner and s etti ng fort h such ot her particular s as may be pr escribed and the provisions of this Act shal l, s o far as may b e, appl y acco rdi ngly as if such return were a ret urn required to be furnished under section 139;

b. as s e ss o r r eass ess t h e t ot a l in c om e o f s ix as s es s m e nt ye ar s im m ed i at e ly p r ec ed in g t h e as s e ss m e nt y ea r r el e va n t to t he p r e v i ous y ea r i n w h ic h s uc h s ea rc h is c o nd uct e d o r r eq ui s i t io n i s m ad e 1 2 [a n d fo r t he r el e va nt a ss es s m ent ye ar o r y ea rs ].

Provided t hat the Assessi ng Officer shall assess or reassess t he t otal income i n respect of each ass essme nt year falli ng wit hi n s uch six ass essme nt years [and f or the relevant asses sment year or years]:

Provided furthe r that assessment or re ass ess ment, if any, relati ng to any ass ess ment ye ar falling withi n the period of six a ss essme nt yea rs [and for the releva nt assessment year or years] r eferre d to in this [sub-sec ti on] p endi ng on the date of ini tiation of the search under sec tion 1 32 or maki ng of requisition under sec ti on 132A, as t he cas e may be, shall abate:

[Provide d also that t he Central Government may by rules made by it and published i n t he Official Gazette (exc ept in cas es wher e any assessment or reassessme nt has abated under the sec ond provis o] specify t he class or class es of cas es in which the Assessi ng Officer s hall not be required to issue notice for assessi ng or reassessi ng t he t otal incom e for six ass essment years immediat ely preceding t he assessment y ear rel evant to the previous year in which searc h is co nducted or requisition is made [and for the relevant ass essme nt year or years]:]

[Provide d also t hat no noti ce for assessment or reassess ment shal l be issued by the Assessi ng Offic er for the r elevant assess ment y ear or years unl ess—

(a)

t he Ass essi ng Offi cer has i n his pos sessi on books of account or other docume nts or evidence which reveal that the i ncome, r epres ented in the for m of asset, which has escaped asses sment amounts to or is likely t o a mount to fifty lakh rupees or more i n t he rel evant assessment year or i n aggr egate i n t he rel evant assessment years.

(b)

t he inc o m e r ef e rr e d to in c la us e ( a) o r pa rt t h e re o f has es c ap ed a s s es s m e nt fo r s uc h y ea r or y ea rs ; a nd

(c)

t he s e a r ch u nd e r s ec t io n 1 32 is init ia t ed o r r eq ui s i t io n u nd e r s ec t io n 1 3 2 A is m ad e o n o r a ft e r t he 1 st da y of Ap ril , 2 01 7 .

Explanati on 1. —For the purposes of this sub-secti on, the expression "relevant ass essment y ear" shall mean an ass essm ent year pr ecedi ng the assessment ye ar rel eva nt to t he previous year in which search is conducted or requisition is made which falls beyond six assessment years but not later tha n t en ass essme nt years fr om the end of the ass essment year rel evant to the previous yea r in whi c h search is c oncl uded or requisition is made.

Explanati on 2. – For t he purposes of the fourt h proviso, “ass et ” s hall include immovable propert y being land or bui lding or both, shares and securiti es; l oans and advances , deposits in bank account.]”

12.

The provisions of the s ec tion are further expl ained stati ng that the AO shall assess or reass ess the tot al income of six assessme nt years i mm ediately pr ece ding the assessment year relevant t o the previ ous year in whic h such s earch is conducted ‘and the r el evant assessment years. ’ The pr ovisions of t he above se ct ion are to be read in tand em with secti on 153C of the Act i n res pect of assessment in the case o f a no n-searched person.

13.

The issue, i.e. what wo ul d be t he co mmencement poi nt for the purposes of comp utatio n of t he six yea r bloc k and how the si x year bl ock will be computed is no more res I ntegra . I n fact , as mentio ned earlier , this issue has bee n considered by t he j urisdictio nal Hi gh C ourt i n the case of Ojjus Medicare (P.) Ltd . In the aforesaid judgment , with res pect to what would be the commenceme nt point for t he purpos es of comput ati on of the si x and ten year bl ock, the Hon’ble High C ourt afte r discussi ng t he statutor y provisions and vari ous j udicial prono uncements has held as under:

“F. IDENTIFICATION OF TH E CO MMENCEMENT POINT FOR THE PUR POS ES OF COMPUTA TION OF THE SIX AN D TEN

YEAR BLOCK

75.

The Firs t Proviso to sec tio n 15 3C signi fica ntly shifts the ref erenc e point whic h is spoken of i n s ecti on 153A(1 ) whil e defi ni ng t he poi nt from whic h the peri od o f six AYs' is to be calculated, and which s tipulat es it to be the dat e of s earc h or r equi sition, to t he dat e of receipt o f bo oks of acco unt, doc uments or assets seiz ed or requisitioned by the jur isdictional AO of the non- searched person. The Pro viso, thus by virt ue of a deeming l egal ficti o n, shifts the comm encement point fro m the date of initiation of searc h or maki ng of requisition to the dat e of receipt of books, documents or asse ts by the j urisdictional AO of t he non-searched person. The shift of the relevant date in the case of a. non-searched person thus bei ng governed and regulated by the Firs t Pr oviso of sec tion 153C(1 ) i s, howev er, an i ssue which is no l onge r res Inte gra

...

...

80.

The aforesaid discussi on thus r enders a det ermi native qui et us t o the identification of the starl ing post f rom whic h the block of six AYs' or the "r elevant assessment year " woul d have to be cal culat ed. T he contention of the respondents that the sai d bl ock peri ods woul d, have to be r eck oned wit h reference to the date o f searc h t hus can neither be count enanc ed nor possibly accepted. That submission is clearl y addressed co ntrary to a long and consistent line of precedents whi ch hav e held to the co ntrary and whic h uneq uiv ocally accepted the poi nt o f commenc eme nt for t he purposes of ide ntify ing the six or t he "rele vant ass essment year" to be etched from t he dat e of hando ver of docume nts , ass ets or things to the A O of the non-searched party. ...

84.

As would be evi dent from the abo ve, alt hough t he decisi ons i n Sarwar A gency and RRJ S ecurities we re cited, t he le arne d Judge chose to obs erve that t he section 153C(1 ) Pr oviso would only be liable to be construed as rel eva nt for t he purposes of a bateme nt. We find ours elves unable t o s ust ai n that line of reasoni ng since both Sarwar Agency as well as RRJ S ec urities have struck a line which is in c onsona nce with the vi ew taken in SSP Aviation and whic h has si nce co me to be af firmed by the S upreme Court in Jasjit Singh. In any case, t he law as enunciated in RKM Powerge n woul d not sustain beari ng i n mi nd the express enunciatio n of the legal position by the Supreme Court as is manifest from a readi ng of paragraph 9 of Jasjit Singh.

85.

That then takes us to the pri ncipal questi on of identifying the poi nt of ori gi n for the pur poses of computa tion of the six A Ys' and the "releva nt ass essme nt ye ar" as defi ned by s ecti on J53A. As is manifest from a plain rea di ng of s ecti on 153C, the six AYs ' are ordained to he t hos e which i mmediately pr ecede the A Y rel eva nt to the previous year in whic h the s earch may have been conduc ted or req uisition made. The bl ock of six AYs' woul d thus have t o be identified be ari ng i n mi nd the AY pertai ning to the FY in which the search had been conduc ted o r requisi tion made. The a foresaid AY would thus constitut e the ancho r point for the purposes of identificati o n of the si x AYs'. The stat ute envisage s a similar process to be adopted for the pur poses of computa tion of the "relevant assess ment year" and whe re applicabl e c ons tructs a bl oc k of ten AYs '. The signi ficant difference between the two howe ver is that while the six AYs ' hi nge upon the phras e "immediately pr ecedi ng" the AY pert ai ni ng to t he search year, the te n AYs' are liable to be computed or rec koned from t he end of the AY rel evant to the year of search. In our considered opi ni on, the petitioners have correctly identified t he aforesaid distinc ti on as bei ng c rucial and determi native for the pur poses of reckoni ng t he six and the ten AY bl ock perio d.

“. .B . Both S ecti ons 153A and 153C embod y non-obstant e claus es and are i n ex press t erms ordai ne d, to override Secti ons 139, 147 to 149, 151 and 153 of the Act. By virt ue of the 2017 Amendi ng Act, si gni ficant amendments came to b e i ntroduced i n Sectio n 1 53A. These i ncl uded, inte r alia, t he searc h assessment block bei ng enlarged, to te n A Ys c ons equent to the addition of t he stipulation of "r elevant assessment, year ", which was de fined to mean those year s which would fal l beyond, the six-year block perio d but not later than te n AYs'. The bl ock period fo r searc h ass essment thus c ame to be e nlarged to stretch up to t en AYs'. T he 2017 Amending Act als o put i n place certai n prereq uisite co nditions which would, have to inevi tably be s hown t o be sati sfied b efore the s earc h assessment c ould, stretch to the "r elevant ass essment ye ar". The prec onditions incl ude the presc ripti on of income having escaped ass essment and represented in the form of an asset amounti ng to or "likely to amount to" INR 50 lakhs or more i n the "relevant assessment year" or in aggregate i n t he "r el evant assessment years".

C. S ec tion 153C, o n the ot her hand, pertai ns to the non-searc hed entity and t o whom any material, books o f acco unts, or documents m ay have been s eized and fo und to bel ong to o r pertai n to a. pers on other than the searc hed person. As in t he case of Secti on 153A, Section I53C was also t o apply to all searc hes t hat may have be en undertake n bet ween the peri od . 01 June 2003 to 31 March 2021. I n terms of that provision, the A O stands similarly empowered t o undertake and. initiate an assess ment in res pect of a no n-searched entity for the six AYs' as well as for "t he r elevant assessment year ". The A Ys \ w hich woul d co nsequently be thrown open for assessme nt or reass essme nt under Section 153C follo ws lines pari mat eria wi th S ection 153A.

D. The First Proviso t o Section 153C i ntrod uces a l egal fiction bas ed on which the commencement dat e for computa tion of t he six y ear or the ten year bloc k i s dee med to be t he dat e of rec eipt of bo oks of accounts by the j urisdicti onal AO. The identifi cation of the s tarti ng bloc k for the pur poses of comp utatio n o f the six and the te n ye ar period is gover ned by the First Pr oviso to Sect ion 153C, whic h si gnifica ntly shi fts the r eference point, spoken of i n S ection J53A(l ), while defi ni ng the poi nt fro m whic h the peri od of the "r el evant assess ment y ear" i s to be calc ulat ed, to the date of recei pt of the bo oks of acco unts, docum ents or assets seiz ed by the j urisdictio nal AO of the non-s earc hed per son. The s hift of the rel evant dat e i n the c ase of a non-searched person bei ng regulated by t he First P roviso of Section 153C(1) is an Iss ue which is no l onger res i ntegra and s tands authoritatively settled by virtue of the deci si ons of t his Court i n SSP Aviation and RRJ z Securities as well as the decision of the Supreme C ourt in Jasjit Si ngh. T he afor esaid le gal position also stood reiter ated by the S upreme Cour t in Vikram S ujit kumar Bhatia. The submission of t he res pondents, therefore, t hat the blo ck periods woul d hav e to be rec ko ned wi th r efe rence t o t he date of search can neit her be c ount enanc ed nor acc epted.

E. The rec koni ng of t he six A Ys’ woul d r equi r e one t o firstly identify the FY i n which t he searc h was undertaken and which wo uld lead, to the ascertai nment of the AY rel evant t o t he previous year of searc h. The block of six AYs ’ would cons equently be t hose which imme diately precede the A Y r elevant to t he year o f search. In the c ase of a search assessment undert aken in t erms of Sect ion 153C, the solitary distinction wo uld be that the pr evi ous ye ar of searc h wo uld stand s ubstituted by the date or the ye ar i n whic h the boo ks o f accounts or documents a nd assets seized are handed over to the j urisdicti onal A O as opposed, t o t he y ear of s earch whic h constitutes t he basis for an asses sment under Section 153A...

In t he afores aid judgement, on the issue of t he t hres hold of income havi ng escaped assess ment, t he Hon’ble C ourt also held as below:

G. Ins ofar as the thres holds put in place by vir tue of the Fourth Proviso to Section 153A are c oncer ned and the argument of the writ petitioners of the conditi on o f INR 50 lakhs bei ng an unwavering preconditi on, we find ours elves unable to s us tai n t hat s ubmissio n, beari ng in mind t he i ndubitable f act that proc eedi ngs for s earch assessment commenc e upon the issuance of a notice a nd the AO a t that stage havi ng really not had the occasion t o undertake a. d etailed or i n depth exami natio n of (he evidence collect ed or come to a definitive opi nio n wit h res pect t o the t otal income which may have escaped assessment . Since t he comput ati on and assessment of income that i s likely to have escaped ass essme nt would at this stage be pr ovisional, it would be inc orr ect t o strik e down i nitia tion of acti on o n a mere ex faci e ex ami nation of the Satisfaction Note. We also i n t his regard bear i n mind the Fourth Proviso usi ng the expre ssi on "amounts t o or is likely t o amount". The usage of the phrase "li kely to" is indicative of t he L egislature being consci ous of the provisional c haracter of the opi nion that the AO may have formed at that sta ge.

H. Ho wever, and at the same time, even if t he identified asset at t hat stage b e quantifi ed as l ess t han INR 50 lakhs, t he AO mus t for reasons to be duly rec orde d, b e of the opi nion t hat the ultimate computation of escaped i ncome is likely t o exc eed INR 50 lakhs. The af ores aid satisfaction would have to be based on an assessment of the material ga thered a nd the potentiality of the same bei ng indicative of the escape d ass essment exceedi ng INR 50 lakhs. The fo rmation of opi nion i n this res pect would have to be based not on mere ipse dixit but reflective o f a fair assess ment o f the quantum of i ncome likely t o have es caped assess ment as disti nct fr om mere spec ulati on and conjec ture.

I. We furt her hol d that since the prec ondition ofI NR 50 lakhs or more co nsti tutes a sine qua non for i nitiati ng action for the exte nded ten year bloc k, the afores aid satisfacti on and t he reasons i n s upport there of would hav e t o borne out fr om the Satisfaction Not e itself We ar e also of the opini on t hat the precondition ofINR 50 lakhs i s not liable to be vi ewe d as being the qualifyi ng criteria fo r each "rel eva nt assessm ent year" that ma y be thrown open and that the said condition would stand sa tisfied if the escaped income cumul atively or in the aggregate me ets the mi nimum benchma rk of INR 50 lak hs.

J..... ...

K

L. The l egi slative intent of tho se pr ovisions having retroactive appli cation is clearly evidenc ed from t he stat ue declari ng t hat they would apply t o all searches conduc ted bet ween 3.1 May 2003 to 31 March 2021, a nd the Fourt h Proviso i n unambiguous t erms ext endi ng t he applicability of those provisi ons to all searc hes conducted post 01 April 2017 and S ections 153A and 15 3C supers edi ng the provisions for reassessme nt, otherwis e appeari ng i n the Act. ...

14.

As re ferred to i n t he above j udgement itself and as cited by t he appell ant in appeal , the position of l aw wit h ref erence t o date of r eckoni ng for calculati ng six AYs fo r reo peni ng post-s earch has also been, laid down by the Ho n’bl e Supreme Court i n t he case of CIT v. Jasjit Si ngh [2023] 458 ITR 437 (SC) and the Ho n’ble D el hi Hi gh C ourt in the case of CIT v. RRJ Securities Ltd [2016j 380 ITR 612 (Del hi). The relevant extracts of t he decisions of the Ho n’bl e S upr eme Cour t and the Hon’bl e j urisdictional High Court are rep roduced bel ow:

In Jasjit Si ngh (supr a), the Hon’bl e Supreme Co urt observed as under:

‘9. It is evident on a plain i nterpr etati on of S ecti on 15 3C(1 ) that the Parliamentar y intent to enac t the proviso was t o c ater not me rely to t he q ue stion of a batem ent but also with regard to the date from whic h t he six year perio d was t o be r eckoned, in respect of whic h the ret urns wer e t o be filed by the thir d party (whos e premises are not searched a nd i n respe ct of whom the specific pr ovision unde r Section 153-C was enac ted). The revenue argued t hat t he proviso (t o S ection 153(c)(1)] is confined in its applica tion to the question of a batem ent.

10.

This Court is of the opi ni on that the revenue’s argument is i nsubsta ntial and wit hout merit. It i s quite plausible tha t without t he ki nd of int erpretation which SSP Aviati on ad opted, the A.O. seized of the materi als -of the sea rch party, under Se ction 132 would take his own tim e to forward the papers and mate rials belongi ng to the thi rd par ty, to the conc erned A.O. In that ev ent i f the date would virtually "rel ate back" as is sought t o be contended by t he revenue, (to the dal e of t he seizure), the prej udice ca used to the third par ty , who wo ul d be drawn i nt o proceedi ngs as it were unwit ti ngly (and in many cases have no co ncern with it at all), is di s-prop orti onate. For i nstance, if the papers are i n fact assigned under Secti on 153-C af ter a period o f four ye ars , the third party as sessee’s prej udice is wr it large as it woul d have t o virtually pres erve the r ecords for at latest 10 years which is no t t he re quirement i n law. Such disastr ous and harsh consequenc es cannot be attributed to Parliament. O n the other hand, a plain readi ng of Secti on 153-C s upports the i nte rpretation which this Court adopts... ’

‘24. As discussed he reinbefore, i n terms of pr oviso to Secti on 153C of t he Act, a refer ence t o the date of t he searc h under the second provis o to Secti on 153A of t he Act has to be construed as the dat e of handing over of assets /doc uments belongi ng to the Assessee (bei ng t he person other than t he one searched) to the AO having jurisdictio n to assess the said Assesse e. Furt her proc eedi ngs, by virtue of Secti on 153C(1) of the Act, woul d have to be in acc or dance wit h secti on 153A of t he

15.

The period of six assessme nt years as per the decisi on of the Hon’ble jurisdicti onal High C ourt of Del hi thus means six years prior to the assessment year in whic h t he seized mat erial was handed over to t he AO of the ‘other ’ (non-searc hed) person/satisfaction not e for proc eedi ngs u/s 153C was rec orded by the c onc erned AO. As seen from copies of documents in paper book filed in appeal, the satisfactio n not e was rec orded by the AO of the sear ched pers on on 10.05.2022 and by the AO o f the appellant on 24.0 6.2022 and the notice u/s 153C was issued on 29.06.2022, i.e. i n t he F.Y. 2022-23 rel eva nt t o AY 2023-24. Therefore, by t his yards ti ck, six y ears per iod as refe rred to i n secti on 153C(1 ) of the Act would be from AY 2017-18 to 2023-24, with AYs 2 016-17, 2015-16 a nd 2014-15 being the ‘relevant assessment yea rs.’

16.

To ascertai n whether the income esca ping assessment i n the rel evant ass essm ent year or the aggr egate of the assessment years am ounted to or was likely t o a mount to Rs. 50 Lakhs or more, the copi es of the satisfacti on notes r ecorded, as sub mitted by the appellant, were p erus ed. R el evant porti ons of the sam e are reproduced below:

17.

Thus, followi ng t he ratio of decision of the Hon’ble jurisdictio nal Hi gh Co urt i n the ca se of Ojj us Medi car e (s upra), the satisfactio n notes i n the i nstant cas e do not show t hat t he i ncome , repres ented in t he for m of asset whic h has escap ed assess ment , amo unts to or is likely t o amo unt to Rs . 50 Lakhs or more i n ^ e ‘r el evant assessment yea r’ or in aggrega te i n the ‘r elevant assessment yea rs’ i n the cas e of t he appellant under consideratio n.

18.

Thus, the condition spelt out i n t he statute and as inte rpret ed by the Hon’ble Courts for permitting reo peni ng beyond six years was not fulfilled i n t he i nstant case. The case of t he impugned A.Y 2016-17 falls bey ond the pe riod of six years precedi ng t he ass essment year rel evant to t he previo us year i n which the satisfa ction not es were drawn / notice u/s 153C was issued. T he perio d of six y ears that could be re opened by the AO thus te rmi nates with the AY 2017-18. The contenti o n of the appellant there for e bears merit.

19.

Relyi ng o n the above-me ntioned case la ws and res pectfully followi ng the j udgment of t he Hon’bl e jurisdictio nal High Court i n the cas e of Ojj us Medicare (P. ) Ltd (s upra), it is seen that A.Y . 2016-17 is not c overed withi n si x AYs as pe r sectio n 153C of the Act and the condition/s for assessi ng it as part of the r elevant assessment year /s was not existent. The notice issue d fo r the i nstant ass essment y ear would thus fall beyond the ambit of six A Ys ' as pr ovided under sectio n 153C read with section 153 A, and henc e t he impugned ass ess ment order dated 31.03.2024 passed u/s 153C of the Act for the ins tant AY i n pursuance of such notice woul d not survive, havi ng no le gs to stand, a nd is t hus annul l ed.

20.

As it is held that the Assessi ng Offi cer did not hav e the jurisdiction t o assess the a ppellant’s cas e fo r the A.Y 2016-17, ther efor e, all the other grounds raised by the appellant are re ndered ac ademic i n nature, and henc e not required to be adj udicated upon. There is henc e no adj udication on merits i n t hi s case. ”