Section 153C jurisdiction depends on valid satisfaction and seized-material nexus; time-bar and invalid initiation led to quashing.

Section 153C proceedings must be founded on a recorded satisfaction note based on seized material that objectively links the other person to incriminating income; a mechanical note without such nexus fails the jurisdictional test, so the assessments for AYs 2009-10 to 2012-13 were quashed. Limitation for section 153C is computed from the date satisfaction is recorded, and where that date falls beyond the permissible six-year block, the assessment is time-barred; on that basis, AY 2008-09 was beyond limitation and could not be sustained.

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Issues: (i) Whether the assessment for AY 2008-09 under section 153C was barred by limitation because the satisfaction note was recorded beyond the permissible six-year block; (ii) Whether the assessments for AYs 2009-10 to 2012-13 were invalid for want of proper and valid satisfaction under section 153C.

Issue (i): Whether the assessment for AY 2008-09 under section 153C was barred by limitation because the satisfaction note was recorded beyond the permissible six-year block.

Analysis: The relevant trigger for section 153C proceedings was the recording of satisfaction on 23.09.2014. On that basis, the permissible six-year period had to be computed backwards from the year in which satisfaction was recorded. AY 2008-09 fell outside that block. The assessment for that year was therefore beyond the statutory time limit.

Conclusion: The assessment for AY 2008-09 was barred by limitation and could not be sustained.

Issue (ii): Whether the assessments for AYs 2009-10 to 2012-13 were invalid for want of proper and valid satisfaction under section 153C.

Analysis: Section 153C requires recorded satisfaction based on seized material that belongs to or relates to the other person and has incriminating value. The satisfaction note in the present case was found to be mechanical and unsupported by adequate linkage between the seized diary and any undisclosed income. The jurisdictional requirement of objective and valid satisfaction was not fulfilled.

Conclusion: The assessments for AYs 2009-10 to 2012-13 were held to be without jurisdiction and liable to be quashed.

Final Conclusion: The entire batch of appeals was allowed, and the assessments under section 153C were set aside on jurisdictional grounds.

Ratio Decidendi: For section 153C proceedings, limitation runs from the date of recorded satisfaction, and the assumption of jurisdiction is valid only when the satisfaction note is based on seized material that objectively links the other person to incriminating income.

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