The satisfaction note points to material for one year, but notices under s.153C have come for the whole block of six. Can they stand?
No. Section 153C confers a power; it does not compel its use across the block. Before issuing a notice the Assessing Officer must identify the assessment year or years to which the seized material relates or which it is likely to affect, and must be satisfied that it is likely to bear on the total income of those years. The proceedings are confined to those years. Where the material speaks to one year, notices for the remaining years of the block are unsustainable, and if the Revenue says a document is incriminating for several years the satisfaction note must record reasons for saying so.
Decided by the High Court (Yashwant Varma J and Purushaindra Kumar Kaurav J) on 2024-04-09, reported as W.P.(C) 1459/2024 with CM APPL. 6031/2024 and connected writ petitions (Delhi High Court); 2024 SCC OnLine Del 2551; (2024) 464 ITR 1. It bears on section 153C, section 153A, section 132 of the Income Tax Act 1961, in Search, Survey & Block Assessment matters.
This is the decision practitioners cite for year-wise satisfaction under s.153C, and it is the answer to the commonest departmental practice of all: one document is found, and notices issue for every year in the block. It is a Division Bench judgment on a batch of writ petitions, it has been applied repeatedly by the Delhi High Court since, and the Revenue's special leave petitions against it are reported to have been dismissed.
Binding within that High Court's jurisdiction. Persuasive elsewhere.
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A batch of writ petitions, led by W.P.(C) 1459/2024, was heard together. Each petitioner was a person other than the person searched, and each challenged notices issued to it under s.153C. The petitioners' satisfaction notes, notice dates and assessment years were set out in a chart extracted in the judgment, the years quashed running from 2013-14 to 2020-21. The common complaint was that although the material identified in the satisfaction note answered to a particular assessment year, notices had been issued across the whole block of assessment years that could form part of the s.153A block, and that the notes disclosed no satisfaction that the material had any bearing on the other years. The Revenue's stand, as the Court summarised it, was that once the material is handed over to the Assessing Officer of the other person, abatement and assessment of the entire block follow. The exact number of connected petitions was not pinned down on retrieval; reports of the batch differ, and it is not stated here.
The writ petitions were allowed and the impugned notices were quashed insofar as they pertained to assessment years 2013-14 to 2020-21 as set out in the chart in the judgment; W.P.(C) Nos. 3007/2023 and 3019/2023 were dismissed. On the law, the incriminating material spoken of in s.153C must be identified with respect to the assessment year to which it relates, or which it is likely to impact, before proceedings under s.153C are initiated (para 67). The jurisdictional Assessing Officer must first be satisfied that the material received is likely to have a bearing on or impact the total income of the year or years in question and only then place the assessee on notice; the power to assess is confined to those years to which the material may relate or which it is likely to influence, and absent material casting doubt on the estimation of total income for a particular year the officer is not justified in invoking s.153C at all (para 68). The Conclusions are at paras 63 to 68 and the operative directions at paras 69 to 73.
Under the heading 'Incriminating Material - Cascading Effect?' (paras 48 to 62) the Court reasoned that the existence of the power to assess the block of six or ten assessment years is merely enabling and not a statutory compulsion or an inevitable consequence, as the Revenue had contended. It read Abhisar Buildwell as conclusive that absent incriminating material the officer is not justified in assessing or reassessing completed assessments, and held that the same position governs assessments that abate on the issue of a s.153C notice: there too the officer must first identify the assessment years to which the material gathered in the search may relate, and only those assessments face abatement, the statute creating 'a persistent and enduring connect between the material discovered and the assessment that may be ultimately made' (para 54). Examining the satisfaction notes before it, the Court found that the officers had proceeded on the premise that the moment incriminating material is unearthed for a particular assessment year they have jurisdiction to invoke s.153C for all the years that could form part of the block, and held that understanding to be 'clearly erroneous and unsustainable' (para 61). It accepted that material may hypothetically be incriminating for more than one year, but held that even then the officer must record reasons in support of that conclusion, so that the satisfaction note evidences a formation of opinion that the material is likely to be incriminating for more than a single assessment year (para 62). The Conclusions follow at paras 63 to 68, ending with the requirement that the material be identified year-wise before initiation (para 67) and with the sequence the jurisdictional officer must follow before placing the assessee on notice (para 68).
On an overall consideration of the aforesaid, we come to the firm conclusion that the 'incriminating material' which is spoken of would have to be identified with respect to the AY to which it relates or may be likely to impact before the initiation of proceedings under Section 153C of the Act.
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Handle my notice → Ask a CA on WhatsAppNo. Section 153C confers a power; it does not compel its use across the block. Before issuing a notice the Assessing Officer must identify the assessment year or years to which the seized material relates or which it is likely to affect, and must be satisfied that it is likely to bear on the total income of those years. The proceedings are confined to those years. Where the material speaks to one year, notices for the remaining years of the block are unsustainable, and if the Revenue says a document is incriminating for several years the satisfaction note must record reasons for saying so. This was decided by the High Court (Yashwant Varma J and Purushaindra Kumar Kaurav J) and bears on section 153C, section 153A, section 132 of the Income Tax Act 1961. It is reported as W.P.(C) 1459/2024 with CM APPL. 6031/2024 and connected writ petitions (Delhi High Court); 2024 SCC OnLine Del 2551; (2024) 464 ITR 1. This is the decision practitioners cite for year-wise satisfaction under s.153C, and it is the answer to the commonest departmental practice of all: one document is found, and notices issue for every year in the block. It is a Division Bench judgment on a batch of writ petitions, it has been applied repeatedly by the Delhi High Court since, and the Revenue's special leave petitions against it are reported to have been dismissed. If it applies to you, the first step is this: Tabulate the satisfaction note against the notices. For each item of seized material write down the financial year the transaction falls in and the assessment year it answers to; then set that against the assessment years actually named in the notices.
A batch of writ petitions, led by W.P.(C) 1459/2024, was heard together. Each petitioner was a person other than the person searched, and each challenged notices issued to it under s.153C. The petitioners' satisfaction notes, notice dates and assessment years were set out in a chart extracted in the judgment, the years quashed running from 2013-14 to 2020-21. The common complaint was that although the material identified in the satisfaction note answered to a particular assessment year, notices had been issued across the whole block of assessment years that could form part of the s.153A block, and that the notes disclosed no satisfaction that the material had any bearing on the other years. The Revenue's stand, as the Court summarised it, was that once the material is handed over to the Assessing Officer of the other person, abatement and assessment of the entire block follow. The exact number of connected petitions was not pinned down on retrieval; reports of the batch differ, and it is not stated here. The matter was decided on 2024-04-09 by the High Court (Yashwant Varma J and Purushaindra Kumar Kaurav J). On those facts the High Court held as follows. The writ petitions were allowed and the impugned notices were quashed insofar as they pertained to assessment years 2013-14 to 2020-21 as set out in the chart in the judgment; W.P.(C) Nos. 3007/2023 and 3019/2023 were dismissed. On the law, the incriminating material spoken of in s.153C must be identified with respect to the assessment year to which it relates, or which it is likely to impact, before proceedings under s.153C are initiated (para 67). The jurisdictional Assessing Officer must first be satisfied that the material received is likely to have a bearing on or impact the total income of the year or years in question and only then place the assessee on notice; the power to assess is confined to those years to which the material may relate or which it is likely to influence, and absent material casting doubt on the estimation of total income for a particular year the officer is not justified in invoking s.153C at all (para 68). The Conclusions are at paras 63 to 68 and the operative directions at paras 69 to 73.
Under the heading 'Incriminating Material - Cascading Effect?' (paras 48 to 62) the Court reasoned that the existence of the power to assess the block of six or ten assessment years is merely enabling and not a statutory compulsion or an inevitable consequence, as the Revenue had contended. It read Abhisar Buildwell as conclusive that absent incriminating material the officer is not justified in assessing or reassessing completed assessments, and held that the same position governs assessments that abate on the issue of a s.153C notice: there too the officer must first identify the assessment years to which the material gathered in the search may relate, and only those assessments face abatement, the statute creating 'a persistent and enduring connect between the material discovered and the assessment that may be ultimately made' (para 54). Examining the satisfaction notes before it, the Court found that the officers had proceeded on the premise that the moment incriminating material is unearthed for a particular assessment year they have jurisdiction to invoke s.153C for all the years that could form part of the block, and held that understanding to be 'clearly erroneous and unsustainable' (para 61). It accepted that material may hypothetically be incriminating for more than one year, but held that even then the officer must record reasons in support of that conclusion, so that the satisfaction note evidences a formation of opinion that the material is likely to be incriminating for more than a single assessment year (para 62). The Conclusions follow at paras 63 to 68, ending with the requirement that the material be identified year-wise before initiation (para 67) and with the sequence the jurisdictional officer must follow before placing the assessee on notice (para 68). In the words reproduced by the source cited on this page: "On an overall consideration of the aforesaid, we come to the firm conclusion that the 'incriminating material' which is spoken of would have to be identified with respect to the AY to which it relates or may be likely to impact before the initiation of proceedings under Section 153C of the Act." The decision followed or applied PCIT v. Abhisar Buildwell (P) Ltd. (Supreme Court) — applied, at para 54.
It was decided by the High Court on 2024-04-09 and is reported as W.P.(C) 1459/2024 with CM APPL. 6031/2024 and connected writ petitions (Delhi High Court); 2024 SCC OnLine Del 2551; (2024) 464 ITR 1. Binding within that High Court's jurisdiction. Persuasive elsewhere. A High Court decision binds the assessing officer, the Commissioner (Appeals) and the Income Tax Appellate Tribunal within that state, and is persuasive elsewhere. If your assessment is in a different jurisdiction, check whether your own High Court has taken the same view before relying on it. On section 153C, section 153A, section 132, the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the taxpayer. The writ petitions were allowed and the impugned notices were quashed insofar as they pertained to assessment years 2013-14 to 2020-21 as set out in the chart in the judgment; W.P.(C) Nos. 3007/2023 and 3019/2023 were dismissed. On the law, the incriminating material spoken of in s.153C must be identified with respect to the assessment year to which it relates, or which it is likely to impact, before proceedings under s.153C are initiated (para 67). The jurisdictional Assessing Officer must first be satisfied that the material received is likely to have a bearing on or impact the total income of the year or years in question and only then place the assessee on notice; the power to assess is confined to those years to which the material may relate or which it is likely to influence, and absent material casting doubt on the estimation of total income for a particular year the officer is not justified in invoking s.153C at all (para 68). The Conclusions are at paras 63 to 68 and the operative directions at paras 69 to 73. It arises in Search, Survey & Block Assessment matters, on section 153C, section 153A, section 132 of the Income Tax Act 1961, and was decided by Yashwant Varma J and Purushaindra Kumar Kaurav J. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. For every year in the notices with nothing against it in the note, take the point that the jurisdiction under s.153C was never triggered for that year. Para 68 requires the satisfaction about the particular year to precede the notice, not to be supplied afterwards. Do not accept the argument that once material is handed over the whole block of six or ten years abates as an automatic statutory consequence. The Court held the existence of the power is enabling, not a compulsion. If the Revenue says one document is incriminating for several years, hold it to para 62: the note must record reasons showing that the material is likely to be incriminating for more than a single assessment year. Take it as a jurisdictional objection at the assessment stage, on the record. For the years that do survive, argue the merits on Abhisar Buildwell.
Still good law. Applied by the Delhi High Court since, including in Neeraj Bharadwaj v. ACIT (14 July 2025), which is in this library and reproduces paras 48 to 62 of this judgment. The Revenue's special leave petitions are reported to have been dismissed - ITO v. Saksham Commodities Ltd. (2025) 304 Taxman 515 (SC), with ACIT v. Chander Parkash Gupta (2025) 304 Taxman 607 (SC) and ACIT v. Satyapal Arya (2025) 304 Taxman 179 (SC) - on delay and on merits. That dismissal is recorded here on the strength of an itatonline digest page only; the Supreme Court's own orders were not retrieved and the citations were not verified against the Court's record. No decision doubting or overruling the judgment was located. Date scope: s.153A(1) by its closing limb, and s.153C by its sub-section (3), reach no search initiated on or after 1 April 2021, but this entry is not spent by that — a search initiated between 1 April 2021 and 31 August 2024 is, by force of s.152(3), a reassessment under ss.147 to 151 as they stood immediately before the Finance (No. 2) Act 2024, and the first proviso to s.149(1) in that frozen form bars a s.148 notice for any assessment year beginning on or before 1 April 2021 which could not have been reached within the time limits of s.153A or s.153C as they stood before the Finance Act 2021, so the reckoning of the block of assessment years worked out here is imported into that middle window and continues to decide those cases and must not be treated as spent; only a search initiated on or after 1 September 2024, which falls under the substituted Chapter XIV-B, is outside it. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
The judgment runs to 89 pages and could not be retrieved end to end: the Indian Kanoon page and the Delhi High Court file both truncated on fetch, the first at about para 3 and the second at about para 30. What is recorded here rests on (a) the judgment's own index, which gives the sections as Introduction 1-3, Broad Factual Matrix 4-6, Submissions Advanced by the Petitioners 7-32, Stand of the Respondents 33-36, Distinction Between Section 153A and Section 153C 37-47, Incriminating Material - Cascading Effect? 48-62, Conclusions 63-68 and Operative Directions 69-73; (b) the text of paras 54, 61, 62, 67 and 68 and of the operative disposal, retrieved verbatim from the Indian Kanoon copy of this judgment; and (c) the extract of paras 63 to 68 reproduced in two later Delhi High Court orders of the same Bench, which fixes the numbering of the conclusions. The paragraphs of the submissions and of the s.153A/s.153C discussion were not read, and the facts of the individual petitioners were not read beyond the chart. Do not cite anything from this entry that is not attributed to a paragraph number here. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The writ petitions were allowed and the impugned notices were quashed insofar as they pertained to assessment years 2013-14 to 2020-21 as set out in the chart in the judgment; W.P.(C) Nos. 3007/2023 and 3019/2023 were dismissed. On the law, the incriminating material spoken of in s.153C must be identified with respect to the assessment year to which it relates, or which it is likely to impact, before proceedings under s.153C are initiated (para 67). The jurisdictional Assessing Officer must first be satisfied that the material received is likely to have a bearing on or impact the total income of the year or years in question and only then place the assessee on notice; the power to assess is confined to those years to which the material may relate or which it is likely to influence, and absent material casting doubt on the estimation of total income for a particular year the officer is not justified in invoking s.153C at all (para 68). The Conclusions are at paras 63 to 68 and the operative directions at paras 69 to 73.
TaxSphere, “Saksham Commodities Ltd v ITO”, https://taxnotice.vittsphere.com/caselaw/case/saksham-commodities-v-ito-year-wise-satisfaction/ (validity last checked 2026-09-06)
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A search was made on someone else and my papers were found. From which date are my six years counted - the search, or when my Assessing Officer got the papers?
The seized documents say nothing about the years being assessed. Can s.153C still be used for them?
The search was before June 2015 but the notice came later. Which version of s.153C applies?
The document seized is a letter our client wrote to the person searched. Does it belong to our client for s.153C?
