Landcraft Developers Private Limited v. Assistant Commissioner Of Income Tax, Central Circle 27 Delhi & Anr

$~104*INTHEHIGHCOURTOFDELHIATNEWDELHI %Date of Decision: 05.05.2025 +W.P.(C) 3781/2025&CM APPL. 17662/2025 LANDCRAFT DEVELOPERS PRIVATE LIMITED.....PetitionerThrough:Mr. Sumit Lalchandani, Advocate.versus ASSISTANT COMMISSIONER OF INCOME TAX, CENTRALCIRCLE 27 DELHI & ANR......RespondentsThrough:Mr.ShlokChandra,Sr.StandingCounsel with Ms. Naincy Jain, Jr.SC,Ms. Madhavi Shukla, Jr. SC & Mr.Ujjwal Jain, Advocate. CORAM:HON'BLE MR. JUSTICE VIBHU BAKHRUHON'BLE MR. JUSTICE TEJAS KARIA VIBHU BAKHRU, J.(Oral) 1.The Petitioner has filed the present petition impugning a notice dated19.12.2023 [impugned notice] issued under Section 153C of the Income TaxAct, 1961 [the Act] in respect of Assessment Year 2016-17. ThePetitioner states that the proceedings pursuant to the impugned notice dated19.12.2023 is barred by limitation, as no assessment order can now be passed,as the time period stipulated for passing an assessment order, has elapsed. ThePetitioner’s challenge rests on Section 153B of the Act, which stipulates thatan assessment order pursuant to a notice under Section 153C is required to bepassed within a period of twelve months from the end of the financial year in which the said notice was issued. The Petitioner claims that since the saidperiod has elapsed, the Revenue is required to be restrained from proceedingfurther with the impugned notice. 2.The notice in the present petition was issued on 26.03.2025, and theRevenue was granted time to file a reply, if any, within a period of two weeksfrom the date of the said order. However, no such reply has been furnished. 3.The learned counsel appearing for the Revenue also sought further timeon 01.05.2025, which was granted in the present petition and accordingly, thepetition has been listed today. 4.Briefly stated the relevant facts necessary to address the controversyinvolved in the present petition are as follows: 4.1.The Petitioner filed its return of income for AY 2016-17 on 17.10.2016,declaring a total income of ₹46,80,870/-. On 18.10.2019, search and seizure operation was conducted under Section 132 of the Act in respect of entitiesbelonging to the Alankit Group. It is alleged that during the course of search,certain assets/documents were found which belonged to the Petitioner orcontained information relating to the Petitioner. 5.The Assessing Officer ,exercising jurisdiction over the searchedentities, recorded a satisfaction note on 22.06.2022. The relevant extract ofthe satisfaction note is set out below: “PROFORMA FOR RECORDING OF SATISFACTION ABOUTSEIZED ASSETS BELONGING TO PERSON OTHER THAN THEPERSON SEARCHED (To be filled by the Assessing Officer of searched person) Signature Not Verified *Copy of relevant Panchnama shall be integral part of satisfaction note. In view of the above, I am satisfied that these documents also containinformation which relates to above referred 'other person' and have abearing on the determination of its total income. Accordingly, thesedocuments are handed over to the AO of other person, for necessaryaction in the case of the above referred 'other person' under section153C of the I.T. Act 1961 for the relevant assessment years as per theseized documents.” [emphasis added] “PROFORMA FOR RECORDING OF SATISFACTION ABOUTSEIZED ASSETS BELONGING TO PERSON OTHER THAN THEPERSON SEARCHED (To be filled by the Assessing Officer of searched person) Signature Not Verified *Copy of relevant Panchnama shall be integral part of satisfaction note. In view of the above, I am satisfied that these documents also containinformation which relates to above referred 'other person' and have abearing on the determination of its total income. Accordingly, thesedocuments are handed over to the AO of other person, for necessaryaction in the case of the above referred 'other person' under section153C of the I.T. Act 1961 for the relevant assessment years as per theseized documents.” [emphasis added] 6.The note clearly records that the documents and information relating tothe Petitioner had been handed over to the AO having jurisdiction over thecase of the Petitioner is correct. It is apparent from the aforesaid note that thedocuments in question were handed over to the AO of the Petitioner on22.06.2022. Thus, the period of limitation, as stipulated under Section 153Bof the Act, for passing an assessment order is to be reckoned from the saiddate. As noted above, in terms of Section 153B of the Act, the AO wasrequired to pass an assessment order within a period of twelve months fromthe end of the financial year in which the documents were received, that is,from the end of the financial year 2022-23. Therefore, the last date forcompletion of the assessment was 31.03.2024, which has since passed. 7.The present petition was listed on 26.03.2025, and admittedly, no orderof assessment has been passed as of the date of filing of the petition.8.In view of the above, the present petition is allowed and the proceedingscommenced pursuant to the impugned notice are set aside. It is also clarified that, in the event, any assessment order has been passed after filing of thispetition in respect of AY 2016-17 pursuant to the impugned notice, the samewould also stand quashed. 9.The petition is allowed in the aforesaid terms. VIBHU BAKHRU, J MAY 5, 2025/ ‘A’ TEJAS KARIA, J Click here to check corrigendum, if any