Monetary threshold for search based assessments requires reasoned Satisfaction Note; absence invalidates notice for that assessment year.

Validity of a search-origin notice depends on temporal and threshold preconditions: a notice cannot extend to an assessment year beyond the six preceding years, and initiation under the proviso requires a recorded satisfaction in the Satisfaction Note that escaped income cumulatively amounts to or is likely to amount to the monetary threshold; that satisfaction must be supported by reasons based on a fair assessment of material and not conjecture. The impugned notice for the earlier assessment year was quashed for failing both the temporal limit and the reasoned satisfaction requirement, with liberty to reinitiate if proper reasons are recorded.

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Issues: Whether the notice dated 17 January 2023 issued under Section 153C of the Income-tax Act, 1961 in respect of Assessment Year 2014-15 is invalid on the ground that (i) it falls outside the six preceding assessment years; and (ii) the Fourth Proviso to Section 153A (Rs. 50 lakhs threshold) has not been satisfied or recorded by the assessing officer.

Analysis: The notice under Section 153C is dated 17 January 2023 and on its face the relevant assessment year (AY 2014-15) falls beyond the six preceding assessment years permitted under Section 153C. The Satisfaction Note recorded by the assessing officer of the searched person (dated 24 June 2022) quantifies identified income as less than Rs. 50 lakhs and does not record a satisfaction that the escaped income for the relevant assessment year is likely to exceed Rs. 50 lakhs cumulatively. The Court applied the principles in Principal Commissioner of Income Tax Central - 1 v. Ojjus Medicare Pvt. Ltd., holding that while the AO's opinion at the initiation stage may be provisional and may be formed on available material, the Fourth Proviso's precondition (amounts to or is likely to amount to Rs. 50 lakhs) must be reflected by reasons borne out in the Satisfaction Note. The AO's satisfaction must be based on a fair assessment of the material indicating that escaped income is likely to meet the Rs. 50 lakhs benchmark and not on mere conjecture.

Conclusion: The writ petition is allowed and the impugned notice dated 17 January 2023 issued under Section 153C of the Income-tax Act, 1961 is quashed insofar as it relates to Assessment Year 2014-15. The assessing officer is at liberty to reconsider and, if satisfied with reasons recorded that escaped income is likely to exceed Rs. 50 lakhs, to initiate proceedings afresh in accordance with law.

Ratio Decidendi: For initiation of proceedings under Section 153C read with the Fourth Proviso to Section 153A of the Income-tax Act, 1961 the assessing officer must record a satisfaction supported by reasons in the Satisfaction Note that the escaped income cumulatively "amounts to or is likely to amount to" Rs. 50 lakhs; the satisfaction must be based on a fair assessment of material and may consider cumulative escaped income across relevant assessment years.

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