Belated satisfaction note under section 153C can vitiate jurisdiction when recorded after completion of the searched person's assessment.

Valid assumption of jurisdiction under section 153C depends on recording the requisite satisfaction within the permissible time after completion of the searched person's assessment. The note states that where satisfaction notes for both the searched person and the assessee are recorded only after the searched person's assessment has concluded, and beyond the period reflected in the governing legal position and CBDT circular, the jurisdictional precondition is not met. On that basis, belated satisfaction vitiates the initiation of proceedings and the assessment is treated as invalid.

---

---

Issues: (i) Whether the proceedings under section 153C were vitiated because the satisfaction notes were recorded after conclusion of the assessment of the searched person and beyond the permissible time.

Analysis: The appeal turned on the validity of the assumption of jurisdiction under section 153C. The satisfaction notes in the case of the searched person and in the case of the assessee were both recorded after the assessment of the searched person had already been concluded. The order relied on the principle that satisfaction must be recorded within a reasonable time and not beyond four months from completion of the searched person's assessment, as reflected in the governing legal position and the CBDT circular. On these facts, the jurisdictional requirement was held to be unmet.

Conclusion: The challenge to jurisdiction succeeded and the proceedings under section 153C were held to be invalid, in favour of the assessee.

Final Conclusion: The assessment was annulled because the statutory precondition for valid initiation under section 153C was not satisfied.

Ratio Decidendi: For a valid assumption of jurisdiction under section 153C, the requisite satisfaction must be recorded within the permissible time after completion of the searched person's assessment; a belated satisfaction note vitiates the proceedings.

---