TaxTMI 
TaxTMI 
2026 (7) TMI 1714
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....,08,670/-. A search and seizure operation under section 132 of the Act was conducted on 03.01.2019 in the cases of Sri T. Vijayakumar, Shri C. R. Manohar and others. In connection with the same, a search was also conducted at the residential premises of Shri Sanjeev Sudeep. During the search proceedings, incriminating evidence relating to the assessee was found and seized. On analysis, the seized material was found to pertain to, and contain information relating to, the assessee. Based on the information and satisfaction received from the Assessing Officer of the searched person, and after recording satisfaction in the assessee's order sheet, a notice dated 06.12.2021 under section 153C of the Act was issued. The assessee filed his return in response to the said notice. Thereafter, in accordance with the provisions of the Act, notice under section 143(2) was issued on 17.10.2022. The assessment under section 153C was completed by determining the assessee's total income at Rs. 15,80,904/-, as against the returned income of Rs. 7,08,674/-, resulting in an addition of Rs. 8,72,230/-. 3. Similarly, assessments for A.Ys. 2014-15 to 2019-20 were completed under section 153C of the Inc....
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....h Prism Cements provided for only a small monthly amount and did not justify receipt of such substantial sums. The assessee also failed to produce supporting documents for the expenses claimed under section 57 during the appellate proceedings. The learned CIT(A) agreed with the Assessing Officer's findings and confirmed the additions of Rs. 9,16,673/- Rs. 16,34,911/- Rs. 14,30,793/- and Rs. 19,47,586/- for A.Ys. 2013-14, 2014-15, 2015-16 and 2016-17 respectively. The learned CIT(A) also confirmed additions under section 69 of the Act. During assessment proceedings, the Assessing Officer found total credits, including cash deposits, in the assessee's bank accounts amounting to Rs. 35,00,000/- and Rs. 3,66,01,597/- for F.Ys. 2014-15 and 2015-16 respectively. The assessee was asked to furnish details of these credits but failed to explain their source. As the assessee also did not provide the required bank details and corresponding sources during appellate proceedings, the learned CIT(A) confirmed additions of Rs. 35,00,000/- and Rs. 3,66,01,597/-for A.Ys. 2015-16 and 2016-17 respectively under section 69. Accordingly, the assessee's appeals for A.Ys. 2013-14 to 2016-17 were dismissed....
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....DYCIT [2025] 181 taxmann.com 786 [ Chennai] and other similar cases. He submitted that these decisions have followed the principle laid down by the Hon'ble Supreme Court in CIT v. Jasjit Singh [2023] 155 taxmann.com 155 [SC] and held that, for an "other person" under section 153C, the relevant date is the date on which the Assessing Officer having jurisdiction over such person receives the seized material and records satisfaction. Accordingly, he contended that the assessee's case is squarely covered by these decisions and that the notice issued under section 153C is without jurisdiction. 10. The Ld. DR has submitted as below: - 1. At the outset, it is submitted that section 153C, as amended by the Finance Act, 2017 with effect from 01.04.2017, reads as under: "Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that- (a) any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, belongs to; or (b) any books of account or documents seized or requisitioned, pertains or pertains to, or any information contai....
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....ase of the other person. The ratio of the said decision cannot be extended beyond the issue which arose for consideration before the Court, especially under the circumstances post the amendment under Finance Act, 2017 as mentioned above. 5. It is further submitted that, after the amendment by the Finance Act, 2017, section 153C specifically refers to six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made. Therefore, the statutory focus is on the previous year in which the search is conducted and not on the subsequent administrative act of transmission of seized material or recording of satisfaction by the Assessing Officer of the other person. 6. The assessee has also relied upon the decision of the Hon'ble Madras High Court in Harigovind v. Assistant Commissioner of Income Tax (Non-Corporate) [2025] 180 taxmann.com 197 (Madras). However, a plain reading of the judgment would show that the Hon'ble High Court has followed the ratio laid down in Jasjit Singh while considering the effect of receipt of seized documents by the Assessing Officer of the other person. It is s....
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....aterial from one Assessing Officer to another becomes purely notional. Once the seized material came into custody of the common jurisdictional Assessing Officer, there was constructive receipt of such material by the Assessing Officer having jurisdiction over the appellant. Therefore, the date of recording of satisfaction note cannot be equated with or substituted for the date of receipt of seized material. 10. Reliance is also placed on the decision in Super Malls (P.) Ltd. vs. Principal Commissioner of Income Tax, 8 New Delhi [2020] 115 taxmann.com 105 (SC) wherein it has been recognized that where the Assessing Officer of the searched person and the other person is the same, insistence on a separate act of transmission or handing over of documents would amount to a meaningless procedural ritual. The substantive requirement of law stands satisfied once the common Assessing Officer is in possession of the seized material. The subsequent recording of the satisfaction note is only a procedural step for assumption of jurisdiction under section 153C and does not alter the fact of receipt of seized material by the jurisdictional Assessing Officer. 11. In view of the a....
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....tion 153C(1), which is central to the present controversy, deems the reference in the second proviso to section 153A(1) to the date of initiation of search under section 132, or requisition under section 132A, to mean the date on which the books of account, documents or assets seized or requisitioned are received by the Assessing Officer having jurisdiction over such other person. Thirdly, section 153C (3), inserted by the Finance Act, 2021 with effect from 01.04.2021, provides that nothing contained in section 153C shall apply to a search initiated under section 132 or requisition made under section 132A on or after 01.04.2021. A corresponding sunset provision was also inserted in section 153A (4) of the Act. Further, After the Finance Act, 2021, the legislative scheme is that searches initiated up to 31.03.2021 continue to be governed by sections 153A to 153D, whereas searches initiated on or after 01.04.2021 fall under the substituted reassessment regime in sections 147, 148 and 148A, with the search treated as deemed information suggesting escapement of income. The dividing line is therefore the date of initiation of the search. The assessee's argument is that, for an "other pe....
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....1 taxmann.com 160 (Delhi)/ [2024] 465 ITR 101 (Delhi) [03-04-2024], has also explained the mechanics of computing the block with reference to the deemed year of search. 15. Thus, the application of this deeming provision to the sunset clause in section 153C (3) is supported by a recent and consistent line of decisions accepting the assessee's contention. In Harigovind v. ACIT (Non-Corporate), 2025 LiveLaw (Mad) 492 [2025] 180 taxmann.com 197 (Madras)/[2026] 308 Taxman 188 (Madras)/[2026] 485 ITR 509 (Madras)[28-10-2025], the Madras High Court held that there cannot be two different dates of initiation of search and that, where the deemed date qua the other person, namely the date of receipt of material, falls after 01.04.2021, section 153C(3) makes section 153C inapplicable, even if the search on the third party was conducted before the cut-off date. 16. The decision in Shri Harigovind & Another v. Assistant Commissioner of Income Tax & Others, W.P. Nos. 23014 of 2023 and connected matters, decided by the Madras High Court, [2025] 180 taxmann.com 197 (Madras)/ [2026] 308 Taxman 188 (Madras)/ [2026] 485 ITR 509 (Madras) [28-10-2025], is directly applicable. In that case, a sea....