Section 153C initiation after 01.04.2021 barred; satisfaction note dated later made the assessments invalid and void ab initio.

Section 153C proceedings against a person other than the searched person depend on when seized material is received or the satisfaction note is recorded for that person. Where the satisfaction note was recorded on 20.10.2021, after 01.04.2021, the amended bar in section 153C(3) applied and the assessments could not be sustained under section 153C. The Tribunal followed the view that the first proviso to section 153C(1) fixes the relevant date for initiation against the other person, and initiation after the cut-off date renders such proceedings unavailable. The assessments were therefore held invalid, void ab initio, and quashed.

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Issues: Whether the assessments framed under section 143(3) read with section 153C of the Income-tax Act, 1961 for assessment years 2013-14 and 2014-15 were valid when the satisfaction note for the other person was recorded after 01.04.2021, thereby attracting the amended bar under section 153C(3).

Analysis: The assessment for a person other than the searched person proceeds on the basis of the date on which the seized material is received or the satisfaction note is recorded for that person. On the facts, the satisfaction note was recorded on 20.10.2021, which was after 01.04.2021. In view of the amended section 153C(3), proceedings under section 153C are not available where the search-related initiation for the other person is on or after 01.04.2021, and the assessment cannot be sustained under section 153C. The Tribunal followed the binding interpretation that the first proviso to section 153C(1) governs the relevant date for the other person and that initiation after the cut-off date bars section 153C proceedings.

Conclusion: The assessments under section 143(3) read with section 153C were held to be invalid, void ab initio, and quashed, while the remaining grounds were left open as academic.

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