Block Period Of Six AYs For Purpose Of Sec 153C Has To Be Reckoned From Date Of Receipt Of Documents By AO: Delhi ITAT

Section 153C of Income tax Act empowers the Assessing Officer of the person searched to handover the money, gold, jewellery, or other relevant articles/things or books of account or documents belonging to the other person to the Assessing Officer of that other person and the Assessing Officer of that other person.

The Bench of Challa Nagendra Prasad (Judicial Member) and Brajesh Kumar Singh (Accountant Member) observed that “the date of recording of the satisfaction will be the deemed date for the possession of the seized documents, which is 30.06.2022 in the present case and the date of search and six years period would be reckoned from this date”.

Facts of the case:

The assessee, an individual, had filed her return, pursuant to which a search & seizure action was carried out in case of Hans Group/Praveen Jain/Janco Limited and the close associates with whom the assessee had entered into unaccounted cash transactions. According to AO, certain documents/digital evidences in from of clone data of Praveen Kumar Jain's mobile were seized, where the AO found evidence of receipt of unaccounted cash of Rs.94 lakhs and payment of commission of Rs.2.50 lakhs in respect of sale of a property situated at Delhi. The AO therefore determined total income at Rs.1,60,17,760/- after making an addition of Rs.94,00,000/- towards undisclosed sales consideration and Rs.2.50 lakhs as unexplained expenditure.

Observations of the Tribunal:

The Bench emphasized over the settled position that in respect of assessment proceedings u/s 153C, block period of six assessment years has to be reckoned from the date of receipt of the documents by the AO.

For assessment proceedings u/s 153C, the period of six years immediately preceding the assessment year relevant for the previous year, in which search was conducted has to be reckoned from the date of receipt of the documents by the AO of the assessee, added the bench.

From perusal of the satisfaction note recorded by AO, the Bench noted that the clone data of Pravin Kumar Jain's Mobile belongs to the assessee, which has bearing on the determination of total income of assessee for the relevant assessment years referred to in u/s 153A(1).

Referring to the Coordinate Bench in case of Jasjit Singh, the Bench reiterated that the date of receiving of the seized documents would become the date of search and six years period would be reckoned from this date.

Therefore, the Bench found merit in the submission of assessee that the assessment year relevant for previous year in which search was conducted in the case of the assessee will be AY 2023-24 and the six assessment years immediately preceding the assessment year relevant for the previous year in which search was conducted for initiating proceeding u/s 153C will be AY 2018-19 to 2022-23.

Hence, the ITAT allowed Assessee's appeal and quashed the assessment passed u/s 143(3).

Counsel for Appellant/ Assessee: Ved Jain & Aman Garg

Counsel for Respondent/ Revenue: Prakashnath Barnwal

Case Title: Akansha Gupta verses ACIT

Case Number: ITA No.3074/DEL/2023

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