Search material relating to another person requires section 153C jurisdiction; reassessment under sections 147/148 cannot stand.

When search material belonging to or relating to another person is found during a section 132 search, the proper jurisdiction is section 153C, not reassessment under sections 147/148. On the facts discussed, the Tribunal followed binding High Court authority and held that the reassessment route adopted by the Assessing Officer could not be sustained. The appellate order deleting the assessment was therefore maintained, and the departmental appeal failed.

---

---

Issues: Whether reassessment under section 147/148 of the Income-tax Act, 1961 was sustainable where, on the facts found, the proper course was to proceed under section 153C after a search under section 132 yielded material relating to another person.

Analysis: The assessee's appeal was not pressed. In the departmental appeal, the decisive question was whether the reassessment and consequential order could survive when the search material relating to the assessee emanated from a search action and the jurisdictional route applicable on those facts was section 153C rather than sections 147/148. The impugned appellate order had followed the binding High Court ruling quashing similar notices and assessments in such circumstances, and the Tribunal found that the same principle applied on the facts before it.

Conclusion: The reassessment under sections 147/148 was held unsustainable and the appellate order deleting the assessment was upheld, resulting in dismissal of the departmental appeal.

Final Conclusion: The assessment could not be sustained on the jurisdiction adopted by the Assessing Officer, and the order setting it aside remained undisturbed.

Ratio Decidendi: Where material belonging to or relating to another person is found in a search, reassessment under sections 147/148 cannot be sustained and the appropriate jurisdiction is under section 153C.

---