Delhi HC: Section 153C Applies Without Entity Relationship

The Delhi High Court in the case Shiv Parkash Bansal v. Deputy Commissioner of Income Tax Central Circle-14 Delhi And Ors. observed and has held that the statutory scheme of Section 153A and Section 153C of the Income Tax Act, 1961 does not envisage the discovery of a connection or interrelationship between the searched and the non-searched entity.

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The section 153A of the Income Tax Act, 1961 deals with the procedure for assessment which may be set in motion in respect of an entity searched under Section 132 of the Act.

The Assessing Officer, AO of the searched person is statutorily enabled to issue notice to the searched entity requiring him to furnish return of income for the six AYs immediately preceding the AY relevant to the previous year in which such search was conducted.

On the other hand, the section 153C of the Income Tax Act, 1961 relates to the contingency where the search may lead to the unearthing of money or other valuable articles which belong to a person other than the one referred to in Section 153A (non-searched entity).

The Division bench comprising of Justice Yashwant Varma and Justice Harish Vaidyanathan Shankar was hearing the present matter.