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2023 (7) TMI 1254 - AT - Income TaxReopening of assessment u/s 147 - unexplained cash credit which was not disclosed in the financial statement filed by the assessee - distinction between a belief and suspicion of escapement of income - HELD THAT:- In the present case, the mere information of cash deposit, we hold, could not by itself have lead to formation of belief of escapement of income. The decision in the case of Mariyam Ismail [2016 (8) TMI 1472 - ITAT AHMEDABAD] and Bir Bahadur Sijwal [2015 (2) TMI 60 - ITAT DELHI] being rendered in identical backdrop of facts holding cash deposits being insufficient information to lead to belief of escapement of income, the said decisions squarely apply to the present case. As per the reasons recorded, the assessee had filed his return of income for Asst. Year 2010-11 and 2011-12. AO formed belief of escapement of income for the said two years. In his reason recorded, the AO has not even mentioned the income which the assessee had returned to tax in these years. We fail to understand that without taking note of the quantum of income returned to tax, how could the AO have formed belief of escapement of income to the extent of cash found deposited in the bank account of the assessee. In the circumstances, the return of income disclosed sufficient income returned to tax so as to justify cash deposited in the bank account of the assessee, there could not have been any possibility of formation of belief of escapement of income. Even as per the reasons recorded, the reopening was resorted to by the AO to verify source of cash deposited. It is settled law that reopening cannot be resorted to make fishing and roving inquiries and for verification purpose. For the above reasons, therefore, we hold that the reasons recorded for reopening of the case of the assessee were not sufficient to form belief of escapement of income and jurisdiction assumed by the AO, therefore, to frame assessment under section 147 of the Act was bad in law. The order passed, as a consequence, in all three appeals by the AO, is held to be invalidly passed and accordingly set aside. Jurisdiction assumed by the AO to reopen the case of the assessee in all the years impugned before us, was invalid. Assessment orders passed for all the years are accordingly set aside. Decided in favour of assessee.
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