Shivli Agarwal and Sharpi Agarwal Recording of Satisfaction under Section 153 C

The appeals arose from assessments framed under Section 153C against Shivli Agarwal and Sharpi Agarwal following a search conducted in the “Alankit Group” cases. 

The assessees challenged the validity of the proceedings primarily on jurisdictional grounds by contending that the mandatory statutory conditions for invoking Section 153C were absent.

The Tribunal examined the satisfaction note recorded by the Assessing Officer and found that although reference had been made to seized documents and information allegedly related to the assessees, the satisfaction note nowhere expressly stated that the seized material had a “bearing on the determination of total income” of the other person, as specifically required under Section 153C.

Relying upon the Delhi High Court’s landmark decision in Saksham Commodities Ltd. and a coordinate bench ruling in Mukesh Chandra Agarwal, the Tribunal held that recording of valid satisfaction is a foundational jurisdictional requirement and not a mere procedural formality. 

Since the satisfaction note failed to satisfy statutory standards, the Tribunal quashed the assessments themselves without entering into the merits of additions.