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2017 (8) TMI 27 - ITAT DELHIReopening of assessment - no valid recourse to service of notice by affixture - non independent use of mind by AO - approval/sanction of Joint CIT prior to recording of reasons - Held that:- There is no evidence or indication in the report of the Inspector that he had personal knowledge of the present place of business of the assessee and therefore, he was in a position to identity the same. From the affixture report, it is clearly discernible that no independent witness or person was present during the course of affixture who could be said a person who could identify the place of business of the assessee at the time of affixture of notice. Therefore, we hold that neither the procedure laid down under Order V. Rule 17 CPC had been followed nor that laid down under order V rules 19 and 20 had been adhered to. Neither before taking recourse to service by affixture, the Assessing Officer or the concerned officer had recorded the findings to justify the service by this mode nor afterwards called for the affidavit or certificate of service by affixture from the Serving Officer i.e. ITO and Process Server Shri Alam Singh. In view of the above, it is clear that there was no valid service of notice u/s 148 of the Act by way of affixture also. Therefore, we hold that reassessment proceedings resulting into reassessment order dated 30.12.2010 are bad in law. A.O himself noted in the reasons that “satisfaction of the ACIT, Range VIII, New Delhi has been obtained on 22.3.2010 to issue notice u/s 148 of the Act” which makes it clear that approval/sanction of Joint CIT, Range VIII, New Delhi was obtained prior to recording of reasons and thus we have no hesitation to hold that the A.O recorded reasons subsequently and sanction/approval u/s 151 of the Act was obtained by the ITO prior to recording of reasons. Therefore, we are unable to understand that on which material and reasons the JCIT, Range VIII gave approval/sanction for issuance of notice u/s 148 of the Act and initiation of reassessment proceedings. Thus, we hold that sanction/approval u/s 151 of the Act was given by the sanctioning authority without seeing the reasons and record and without application of mind, in a mechanical manner, which also vitiates the reassessment proceedings and consequent reassessment order. Therefore, we hold that the same are bad in law and not sustainable. A.O, except stating the source of information and taking the total of ₹ 2.67 crore from the information of Investigation Wing has not even seen or referred to the assessment record of the assessee for A.Y 2003-04 and has not applied his mind to the so called list of alleged accommodation entries. This is a case of clear non application of mind by the A.O at the time of initiation of reassessment proceedings and recording of reasons on 22.3.2010. To sum up, in the instant appeal, the main contention of the assessee is that the A.O issued the notice u/s 148 of the Act mechanically simply on the basis of information alleged to have been received from the Investigation Wing without application of mind - Decided in favour of assessee.
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