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| The Tax Publishers2021 TaxPub(DT) 3007 (Jp-Trib) INCOME TAX ACT, 1961
Section 147
Information received was neither verified nor subjected to any independent examination by AO and while recording reasons, there was no transaction specific valid material available with AO to form his belief with regard to escapement of income by assessee. Accordingly, reopening of assessment based on borrowed satisfaction of Investigating Agency could not be sustained as valid and, therefore, consequent reassessment was quashed.
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Reassessment - Reopening based on investigation report - No independent application of mind by AO -
AO received information from investigation wing as to assessee having incurred expenditure towards executing contract works met out of undisclosed sources of income. Accordingly, AO reopened assessment and made addition. Assessee challenged this. Held: Information received was neither verified nor subjected to any independent examination by AO and while recording reasons, there was no transaction specific valid material available with AO to form his belief with regard to escapement of income by assessee. Accordingly, reopening of assessment based on borrowed satisfaction of Investigating Agency could not be sustained as valid and, therefore, consequent reassessment was quashed.
Relied:CIT v. Jet Airways (I) Ltd. (2011) 331 ITR 236 (Bom-HC) : 2011 TaxPub(DT) 218 (Bom-HC), CITx v. Ram Singh (2008) 306 ITR 343 (Raj-HC) : 2008 TaxPub(DT) 2035 (Raj-HC), CIT v. Dr. Devender Gupta (2008) 174 Taxman 438 (Raj.) : 2008 TaxPub(DT) 2231 (Raj-HC), Ranbaxy Lab. Ltd. v. CIT (2011) 336 ITR 136 (Del-HC) : 2011 TaxPub(DT) 1457 (Del-HC), CIT v. Atlas Cycle Industries (1989) 180 ITR 319 (P&H-HC) : 1989 TaxPub(DT) 1149 (P&H-HC) and Oriental Bank of Commerce v. Addl. CIT (2014) 49 taxmann.com 485 (Del-HC) : 2014 TaxPub(DT) 3944 (Del-HC).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2011-12
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