JUDGMENT judgment of court was delivered by S. Ravindra Bhat J.-These appeals under section 260A of Income-tax Act, 1961 (hereafter "the Act") impugn order dated April 4, 2008 of Income-tax Appellate Tribunal (hereafter "the ITAT") in case of respondent- assessee No. 1 (in IT(SS)A No. 216/Del/2006 and CO. No. 408/Del/2007 for block period from April 1, 1990, to August 20, 2000) and order dated April 17, 2009 of Income-tax Appellate Tribunal in case of respondent- assessee No. 2 (in IT(SS)A No. 84/Del/ 2007 for block period April 1, 1990, to August 3, 2000). question of law urged before this court is whether Income-tax Appellate Tribunal was correct in holding that notice must be issued by Assessing Officer ("the AO" in short) within reasonable period of time in relation to assessment proceedings under sections 158BC and 158BD of Act. facts which give rise to present appeal are that respondentassessees are individuals. On August 3, 2000, search was conducted under section 132 of Act at business premises of M/s. Friends Portfolio Pvt. Ltd. and at residential premises of its director, Shri Manoj Aggarwal. During search and course of investigation and assessment proceedings before Deputy Commissioner of Income-tax (hereafter "the DCIT"), Central Circle-3, New Delhi, it was found that that Sh. Manoj Aggarwal provided bogus accommodation entries to various individuals. beneficiaries included present respondent-assessees who received accommodation entries in lieu of cash. assessment under section 158BC of M/s. Friends Portfolio Ltd. was completed on August 29, 2002. Assessing Officer, after considering materials, recorded to his satisfaction and issued letter to respective Assessing Officer's of respective assessees Nos. 1 and 2. Thereafter, case of assessees was taken up for scrutiny as per provisions of section 158BD and statutory notices under section 143(2) and section 142(1) were issued and served upon them. relevant dates in present appeals are as follows: Sudhir Assessee Renu Verma Dhingra IT(SS) No. IT(SS)A No. Present appeals arising from 216/Del/2006 84/Del/2007 Date of Search of M/s. Friends 3-8-2000 3-8-2000 Portfolio Ltd. Date of completion of 29-8-2002 29-8-2002 assessment Recording of satisfaction by Assessing Officer of 13-2-2003 13-2-2003 aforementioned company Date of issue of notice by Assessing Officer of relevant 10-7-2003 18-7-2003 assessee Assessment order 28-7-2005 31-8-2005 Undisclosed income of 1,16,36,360 12,50,981 assessee (so assessed) Date of order of CIT(A) 7-7-2006 4-10-2006 Date of order of ITAT 4-4-2008 17-4-2009 Relevant facts: Assessee No. 1 On July 10, 2003, Assessing Officer of assessee No. 1 issued notice under section 158BC read with section 158BD of Act to assessee No. 1 in present appeal. On August 21, 2003, assessee No. 1 filed return declaring undisclosed income at "nil" for block period. Subsequently, after discussing case with assessee No. 1, Assessing Officer framed block assessment at undisclosed income of Rs. 1,16,36,360 after making additions on account of unaccounted cash received/paid under cover of bogus transactions of purchase/sale of shares. Aggrieved, assessee No. 1 preferred appeal before Commissioner of Income-tax (Appeals) ("the CIT(A)") who by order dated July 7, 2006, deleted all amounts brought to tax made by Assessing Officer. Revenue appealed this order of Commissioner of Incometax (Appeals) order before Income-tax Appellate Tribunal. Simultaneously, assessee No. 1 filed cross-objection urging ground that order passed by Assessing Officer was bad and liable to be quashed as same was barred by limitation. Relevant portions of orders of assessment order, order of Commissioner of Income-tax (Appeals) and Income-tax Appellate Tribunal in case of assessee No. 1 have been reproduced as under: Assessing Officer's order dated July 28, 2005, inter alia, held that: "10.... Assessed at total undisclosed income of Rs. 1,16,36,360 charge tax at 60 per cent. and interest under section 158BFA(1) of Income-tax Act. As it is apparent from order that assessee was in possession of undisclosed income, which was detected as result of search and seizure proceedings, therefore, penalty proceedings under section 158BFA(2) have been initiated, separately..." relevant portion of Commissioner of Income-tax (Appeals) order is as follows: "... All these go to prove that not even iota of evidence has been brought out on record to prove that transaction of capital gain was bogus and that amount of Rs. 76,00,000 and Rs. 40,12,000 for purchase and sale of shares is hereby deleted. Similarly, addition of Rs. 24,360 made by Assessing Officer on surmises, treating payment of brokerage and service tax on purchase and sale of shares as unaccounted cash without bringing any evidence on record is also hereby deleted. As result appeal is allowed." Income-tax Appellate Tribunal considered merits of Revenue's appeal as well as assessee's cross-objections, i.e., CO No. 408/ Del/2007. ground raised by assessee in his cross-objection was on issue of assessment proceeding being time barred. Apart from satisfaction being recorded by Assessing Officer on February 13, 2000, it was urged in cross-objection that that notice under section 158BD was issued by assessee's Assessing Officer on July 10, 2003. assessee argued that this notice was unsustainable because satisfaction was recorded belatedly and that impugned notice under section 158BD was illegal because satisfaction recorded by Assessing Officer of M/s. Friends Portfolio was on February 13, 2003, notice under section 158BD was issued only on July 10, 2003. Income-tax Appellate Tribunal held that satisfaction was recorded belatedly and that notice was consequently bad. assessee had relied on judgment of Gujarat High Court in Khandubhai Vasanji Desai v. Deputy CIT [1999] 236 ITR 73 (Guj), where it was reasoned that period of 60 days may be considered reasonable for issue of notice from date of satisfaction recorded by Assessing Officer of searched persons. Income-tax Appellate Tribunal's impugned order held that: "6.... In present case, satisfaction was recorded by Assessing Officer of M/s. Friends Portfolio Pvt. Ltd. on February 13, 2003, whereas notice under section 158BD was issued by Assessing Officer of present assessee after almost five months and, hence, following Tribunal judgment rendered in case of Shri Radhey Mohan Bansal (supra), we hold that there was no effective notice to assessee within reasonable period and, hence, assessment requires to be vacated. We order accordingly. 7. In result, cross-objection of assessee is allowed. 8. In view of fact that block assessment is vacated, appeal of Revenue does not survive and same is dismissed." Relevant facts: assessee No. 2 In light of searches conducted of M/s. Friends Portfolio Ltd. and premises of Sh. Manoj Aggarwal and recording of satisfaction of Assessing Officer therein, proceedings under section 158BD were initiated against assessee No. 2 and notice for same was issued on July 18, 2003. Assessee No. 2 aggrieved with assessment order dated August 31, 2005, filed appeal before learned Commissioner of Income-tax (Appeals) which by order dated October 4, 2006, dismissed appeal. Aggrieved with order, assessee appealed to Income-tax Appellate Tribunal which by its impugned order dated April 17, 2009, set aside Commissioner of Income-tax (Appeals) order. relevant portions of assessment order, order of Commissioner of Income-tax (Appeals) and order of Income-tax Appellate Tribunal in case of assessee No. 2 has been reproduced as under: assessment order dated August 31, 2005, inter alia, held that: "With remarks made as above, total undisclosed income for block period is assessed at Rs. 15,28,570. Penalty under section 158BFA is being initiated separately. Assessed at Rs. 15,28,570. Charge interest under section 158BFA for late filing of return in Form 2B. Issue demand notice and challan." order of Commissioner of Income-tax (Appeals) dated October 4, 2006, inter alia, held that: "2.1... perusal of assessment order also shows that provisions of section 158BD were invoked on basis of specific information received from Deputy Commissioner of Income-tax, Central-III, New Delhi. It is satisfaction of Assessing Officer of person searched under section 132 which is important for initiating proceedings under section 158BD. As held by Gujarat High Court, requirement for taking action under section 158BD is only prima facie satisfaction of Assessing Officer that in search operation there is material to show undisclosed income of person, other than one against whom search was conducted (251 ITR 608). Hence, argument of appellant that jurisdiction under section 158BD had been invoked without any satisfaction on behalf of Assessing Officer is not correct. appeal on these grounds, therefore, fails... In result, appeal is dismissed." relevant portion of order of Income-tax Appellate Tribunal dated April 17, 2009, is as follows: "2. We have considered rival submissions. It is noticed that it has been clearly held by Special Bench of this Tribunal in case of Bishen Chand referred to supra that notice under section 158BD has to be issued before completion of assessment in case of person searched. It has also been held that satisfaction is to be record[ed] in file of person searched in regard to evidence in respect of undisclosed income held to be belonging to third party. It is notice[d] that in present case notice under section 158BD had been issued much after completion of assessment in case of Manoj Aggarwal. Revenue has also not been able to produce any evidence to show that satisfaction for initiation of proceedings under section 158BD in case of their assessee has been recorded in file of either Shri Manoj Aggarwal or M/s. Friends Portfolio. In these circumstances, on both grounds respectfully following decision of Special Bench in case of Bishan Chand Mukesh Kumar assessment as completed under section 158BD stands quashed." decision in CIT v. Radhey Shyam Bansal [2011] 337 ITR 217 (Delhi) dealt with batch of cases decided by impugned common order of Income-tax Appellate Tribunal and upheld latter's order. That common judgment of this court was carried in appeal by special leave to Supreme Court, which decided all appeals and other cases, on question of law as to reasonableness of time limit within which notice under section 158BD was to be issued. Supreme Court, in its judgment reported as CIT v. Calcutta Knitwears [2014] 362 ITR 673 (SC), inter alia, recorded as follows (page 691): "In result, we hold that for purpose of section 158BD of Act satisfaction note is sine qua non and must be prepared by Assessing Officer before he transmits records to other Assessing Officer who has jurisdiction over such other person. satisfaction note could be prepared at either of following stages: (a) at time of or along with initiation of proceedings against searched person under section 158BC of Act; (b) along with assessment proceedings under section 158BC of Act; and (c) immediately after assessment proceeding's are completed under section 158BC of Act of searched person We are informed by Shri Santosh Krishan, who is appearing in seven of appeals that assessing officer had not recorded satisfaction note as required under section 158BD of Act, therefore, Tribunal and High Court were justified in setting aside orders of assessment and orders passed by first appellate authority. We do not intend to examine aforesaid contention canvassed by learned counsel since we are remanding matters to High Court for consideration of individual cases herein in light of observations made by us on scope and possible interpretation of section 158BD of Act." Revenue argues that applying above principles, it is clear that satisfaction note recorded on February 13, 2003, in present case, was not delayed. It was submitted that Calcutta Knitwears is decisive in that outer period of two years meant for completion of searched person's assessment is inconclusive of time period for issuance of notice to third party and that test of proximity indicated by Supreme Court is flexible in that notice under section 158BD is not conditional upon simultaneous completion of searched individual or concerned assessment. Counsel for respondent- assessee did not dispute that satisfaction note issued in this case met with requirements of law, as to adequacy or sufficiency of reasons recorded in "satisfaction note". It was, however, urged that in addition to delay in recording satisfaction note, delay in issuing notice was also fatal to block assessment proceedings drawn against assessees in this case. To this end, counsel relied on Gujarat High Court ruling in Khandubhai Vasanji Desai v. Deputy CIT [1999] 236 ITR 73 (Guj), relevant portion of which has been reproduced as under (page 96): "Once satisfaction under section 158BD is reached by Assessing Officer, there would be no valid reason for him to delay issuance of notice which ought to be issued soon after satisfaction is reached and if Assessing Officer is different, he ought to immediately transmit relevant material to Assessing Officer, having jurisdiction to enable him to proceed against such other person by issuing notice under section 158BC requiring him to file return. Since satisfaction that any undisclosed income belongs to any person other than one with respect to whom search was made or books of account, documents or assets requisitioned, may, in many cases be reached after Assessing Officer starts proceedings under section 158BC against person with respect to whom search was made, shift of commencement point of limitation to date of notice, which could be issued to such other person only after it comes to light leading to satisfaction of Assessing Officer that any undisclosed income belongs to him, was fully justified and it was germane to object of making block assessment of undisclosed income of such other person who is now known as person to whom that undisclosed income belongs. Assessing Officer, once he reaches requisite satisfaction, it bound to act swiftly to proceed against such other person as soon as may be in reasonable time. speed and despatch with which he should act is writ large on connected provisions of section 132(9A) of Act under which authorised officer who has no jurisdiction over person referred to in clause (a), (b) or (c) of sub-section (1) of section 132 has to hand over books of account, documents and assets seized to Income-tax Officer having jurisdiction over such person within 15 days of such seizure and Assessing Officer is required to serve notice to such person under section 158BC requiring him to furnish return in prescribed Form 2B and to complete block assessment in one year from end of month in which last authorisation for search or requisition was executed. Thus, apprehension that notice can be issued under section 158BD read with section 158BC by Assessing Officer in case of such'other person' at any time is ill-founded. There is no lifting of limitation period for making assessment order which is one year and starting point of limitation in cases falling under section 158BD by very nature of things can be fixed only after Assessing Officer is satisfied that any undisclosed income belongs to such other person and in cases where Assessing Officer is different after relevant material is transmitted to him. As soon as Assessing Officer having jurisdiction receives material in respect of other person, he is in same position as Assessing Officer who forwarded it to him and is expected to immediately proceed to issue notice to that other person who falls in his jurisdiction. This extra time for computing limitation is warranted by fact that requisite satisfaction about any undisclosed income belonging to such other person may be reached after commencement of assessment proceedings against raided person and consideration of evidence forwarded by authorised officer and information that may be available to Assessing Officer and transmitted to other Assessing Officer in cases where other person falls in jurisdiction of that other Assessing Officer which will necessarily take some time... If in any particular case notice is unduly delayed, then that is matter in which validity of that notice can be considered but that surely will not invalidate statutory provision which does not warrant any delay once satisfaction is reached and enjoins duty upon Assessing Officer to immediately proceed against such other person under provisions of Chapter XIV-B." In Calcutta Knitwears, (supra), Supreme Court, inter alia, recorded as follows (apart from its conclusions in paragraph 44 quoted above (page 691 of 362 ITR): "42. Further, section 158BE(2)(b) only provides for period of limitation for completion of block assessment under section 158BD in case of person other than searched person as two years from end of month in which notice under this Chapter was served on such other person in respect of search carried on after January 1, 1997. said section does neither provides for nor imposes any restrictions or conditions on period of limitation for preparation satisfaction note under section 158BD and consequent issuance of notice to other person. In lead case, Assessing Officer had prepared satisfaction note on July 15, 2005 though assessment proceedings in case of searched person, namely, S. K. Bhatia were completed on March 30, 2005. As we have already noticed, Tribunal and High Court are of opinion that since satisfaction note was prepared after proceedings were completed by Assessing Officer under section 158BC of Act which is contrary to provisions of section 158BD read with section 158BE(2)(b) and, therefore, have dismissed case of Revenue. In our considered opinion, reasoning of learned judges of High Court is contrary to plain and simple language employed by Legislature under section 158BD of Act which clearly provides adequate flexibility to Assessing Officer for recording satisfaction note after completion of proceedings in respect of searched person under section 158BC. Further, interpretation placed by courts below by reading into plain language of section 158BE(2)(b) such as to extend period of limitation to recording of satisfaction note would run counter to avowed object of introduction of Chapter to provide for cost effective, efficient and expeditious completion of search assessments and avoiding or reducing long drawn proceedings." Earlier, in judgment date on which notice was issued to third party under section 158BD in that case was recorded (page 680 of 362 ITR) : "The jurisdictional assessing authority for respondent-assessee had issued show-cause notice under section 158BD for block period April 1, 1996, to February 5, 2003, dated February 10, 2006, to assessee, inter alia, directing assessee to show cause as to why should proceedings under section 158BC not be completed." application of Calcutta Knitwears was subject matter of recently decided case, i.e., CIT v. V. K. Narang HUF (I. T. A. No. 1064 of 2009, decided on January 8, 2015) [2015] 372 ITR 333 (Delhi) where it was observed that (page 336): "Having regard to decision in Manish Maheshwari v. Asst. CIT [2007] 289 ITR 341 (SC) this court is of opinion that satisfaction note in present case meets with requirements of law. So far as question of delay is concerned, court is of opinion that in facts and circumstances of present case, it cannot be held that there was any delay in recording satisfaction note. assessment of searched person was completed on December 31, 2001. satisfaction note was recorded on May 30, 2002, i.e., just about five months after date of completion of searched person. Notice was issued on June 3, 2002, immediately after satisfaction note was recorded to present assessee. Having regard to declaration of law made by Supreme Court which specified three possible points in time when notice under section 158BD can be issued to third party/assessee, on basis of material found on premises of searched person, period of five months spent by Assessing Officer of searched person in finalizing satisfaction note, can be said to have been proximate to assessment proceedings. We also recollect decision of this court in CIT v. Raghubir Singh Garg (I. T. A. No. 1420 of 2010, decided on August 27, 2014) [2015] 4 ITR-OL 256 (Delhi). In that case, search took place on August 29, 2002, and satisfaction note was recorded on January 16, 2003, i.e., within period of four-and-half months. court was of opinion that satisfaction note could be upheld. Following said decision it is held that there was no delay in issuance of notice under section 158BD in facts of case." In light of aforementioned position of law this court finds that delay of 5 months in issuing of notice by Assessing Officer in present appeals cannot be unreasonable. Accordingly, impugned orders of Income-tax Appellate Tribunal dated April 4, 2008, and April 17, 2009, is set aside on this aspect. satisfaction note is held to be validly issued and within reasonable time. In light of above observations of Supreme Court in Calcutta Knitwears, particularly contextual facts discussed (i.e., completion of searched party's assessment on March 31, 2005, satisfaction note under section 158BD issued on July 15, 2005, and notice issued on February 10, 2006) it cannot be said that delay in issuing notice (although satisfaction note was recorded within reasonable time) was fatal to block assessment against present assessee. court notices that Income-tax Appellate Tribunal by its order dated April 4, 2008, in CIT v. Sudhir Dhingra has not dealt with merits of Revenue's contentions with regards to challenge to order of learned Commissioner of Income-tax (Appeals). This is especially reflected from reading of judgment which has solely proceeded on question of delay in issuance of notice under section 158BD. In same vein court also finds that order of Income-tax Appellate Tribunal dated April 17, 2009, in Renu Verma v. CIT has also been decided on similar issue of delay. In these circumstances, these two appeals are, accordingly, remitted to Income-tax Appellate Tribunal to decide their respective contentions on merits, on facts of case, and as to correctness or otherwise of additions made by Assessing Officer of present assessees. Considering that satisfaction note and notice were issued in 2003, Income-tax Appellate Tribunal shall consider and decide these appeals expeditiously. rights and contentions of parties shall not be prejudiced. appeals are partly allowed in above terms. *** Commissioner of Income-tax v. Sudhir Dhingra