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| The Tax Publishers2020 TaxPub(DT) 0419 (Del-Trib) INCOME TAX ACT, 1961
Section 147
In the reasons recorded for reopening of assessment there was no mention of any application of mind or any independent inquiry or any link between any tangible material and formation of reasons to believe that income chargeable to tax had escaped assessment. AO was not having even material before him, at the time of initiation of proceedings, on the basis of which investigation wing sent his report, as admitted by AO himself. Accordingly, reopening was based on non-application of mind much less independent application of mind but was a case of borrowed satisfaction and was, therefore, set aside.
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Reassessment - Reason to believe - Borrowed satisfaction from Investigation Wing -
AO received information from investigation wing as to assessee having received accommodation entry of Rs. 38 lakhs. Accordingly, AO reopened assessment and made addition. Assessee challenged this on the ground of non-application of mind by AO.Held: In the reasons recorded for reopening of assessment there was no mention of any application of mind or any independent inquiry or any link between any tangible material and formation of reasons to believe that income chargeable to tax had escaped assessment. AO was not having even material before him, at the time of initiation of proceedings, on the basis of which investigation wing sent his report, as admitted by AO himself. Accordingly, reopening was based on non-application of mind much less independent application of mind out but was a case of borrowed satisfaction and was, therefore, set aside.
Supported by:ACIT v. Dhariya Construction Co. (2011) 198 Taxman 202 (SC) : 2010 TaxPub(DT) 1530 (SC), Pr. CIT v. RMG Plyvinyl (I) Ltd. (2017) 83 taxmann.com 348 (Delhi) : 2017 TaxPub(DT) 2034 (Del-HC), (2017) 395 ITR 677 (Del.) : 2017 TaxPub(DT) 1791 (Del-HC) Pr. CIT v. Meenakshi Overseas (P) Ltd.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2008-09
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