TaxTMI 
TaxTMI 
TaxTMI 
2025 (11) TMI 1318
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....nge to the issuance of a notice under Section 153C of the Income Tax Act, 1961 ("the Act" for short) by the respondent authority upon the petitioner for the Assessment Year 2017-18. (3) The facts, as narrated in Special Civil Application No.3736 of 2025, are as follows: (4) The petitioner, by way of the present petition under Article 226 of the Constitution of India, seeks to challenge the impugned notice dated 09.02.2024 issued by the respondent authority under Section 153C of the Act for the Assessment Year 2017-18. Respondent No. 1 issued the impugned notice dated 09.02.2024 under Section 153C of the Act, for the Assessment Year 2017-18, calling upon the petitioner to furnish a return of income. Pursuant to the issuance of the aforesaid notice, the respondent authority supplied copies of the "satisfaction note" recorded on 14.07.2023 by the Assessing Officer of the petitioner, and another "satisfaction note" recorded on 06.06.2023 by the Assessing Officer of the "searched person", for the purpose of invoking jurisdiction under Section 153C of the Act. A perusal of the satisfaction notes reveals that jurisdiction under Section 153C of the Act has been invoked primarily on t....
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....nitwears, [2014] 43 taxmann.com 446 (SC), and the subsequent Circular No. 24/2015 issued by the respondent-department in view of the decision of the Supreme Court in the case of Calcutta Knitwears (supra), and has submitted that the case of the petitioner would be squarely covered in view of the circular and the decision of the Supreme Court. Further, reliance is also placed by learned Senior Advocate Mr. Himani on the decision of this Court in the case of Principal Commissioner of Income-Tax vs. Jitendra H. Modi (HUF), [2018] 92 taxmann.com 510 (Gujarat). (9) In response, the learned Senior Standing Counsel Mr. Patel for respondent No. 2 submitted that the issuance of the impugned notice under Section 153C of the Act is strictly in consonance with the provisions of the Act. It was contended that, subsequent to the Finance Act, 2015, the jurisdictional requirement mandates that the Assessing Officer of a person other than the searched person must be satisfied that the documents seized "pertain to or relate to" such other person. It is contended that in the present case, the WhatsApp chats discovered on the phone of the searched person, Shri Suresh R. Thakkar, coupled with his sw....
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....nd the newly created Faceless Assessment Units. It is contended that albeit, the present case falls outside the purview of the Faceless Scheme, the Department's functioning during this transitional phase was significantly affected by the concurrent operational demands of implementing the new system. (12) Learned Senior Standing Counsel Mr. Patel, in support of his submissions, has placed reliance on the decision of the Punjab and Haryana High Court in the case of Bhupinder Singh Kapur vs. Income-tax Officer, [2025] 175 taxmann.com 689 (Punjab & Haryana), and has submitted that the High Court of Punjab and Haryana has validated the action of the department, though the satisfaction note was recorded almost after a period of 9 months. It is submitted that against the aforesaid decision, SLP (Civil) No. 1352/2025 was also preferred before the Supreme Court, which was dismissed by order dated 24th January, 2025. (13) We have heard the learned advocates appearing for the respective parties at length. The established dates and events from the pleadings are as under : Date Event 15.10.2019 'Search action' was carried out in the case of 'Suresh R. Thakkar'. August, 2021....
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....4 of 2015 [F.NO. 279/MISC./140/2015/ITJ] Section 153C, READ WITH SECTION 158BD OF THE INCOME TAX ACT, 1961 - SEARCH AND SEIZURE - ASSESSMENT OF INCOME IN CASE OF OTHER PERSON -RECORDING OF SATISFACTION NOTE UNDER SECTION 158BD/153C OF THE SAID ACT CIRCULAR NO. 24/2015 [F.NO. 279/MISC./140/2015/ITJ], DATED 31-12-2015 The issue of recording of satisfaction for the purposes of section 158BDI153C has been subject matter of litigation. 2. The Hon'ble Supreme Court in the case of M/s Calcutta Knitwears in its detailed judgment in Civil Appeal No.3958 of2014 dated 12.3.2014(available in NJRS at 2014-LL-0312-51) has laid down that for the purpose of Section 158BD of the Act, recording of a satisfaction note is a prerequisite and the satisfaction note must be prepared by the AO before he transmits the record to the other AO who has jurisdiction over such other person uls 158BD. The Hon'ble Court held that "the satisfaction note could be prepared at any of the following stages: (a) at the time of or along with the initiation of proceedings against the searched person under section 158BC of the Act; or (b) in the course of the assessm....
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....sale, i.e., purchase of land by one Smt.Bharti Dharmesh Gathani, w/o. Dharmesh Gathani, vide sale deed dated 24th July, 2020, for a registered value of Rs. 3,80,00,000/-. Thus, the Assessing Officer of the searched person prepared the satisfaction note on 6th June, 2023, after completion of the assessment in August 2021, i.e., almost after a period of 22 months. We may, at this stage, refer to the decision of the Coordinate Bench of this Court in the case of Jitendra H. Modi (supra), wherein this Court, by placing reliance on the decision of the Supreme Court in the case of Calcutta Knitwears (supra), has held that satisfaction recorded after 09 months could not be said to be immediate action and hence, the Coordinate Bench of this Court set aside the notices issued under Section 158BD of the Act. In the instant case, there has been a delay of 22 months in recording the satisfaction, which runs contrary to the decision in Calcutta Knitwears (supra) as well as provision '(c)' of Circular No. 24/2015 dated 31.12.2015, which uses the expression "immediately after the assessment procedure is completed". (19) Twin reasons are assigned by the respondents in the affidavit in reply for ....