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2014 (11) TMI 215 - AT - Income TaxReopening of assessment u/s 147/148 – Whether the only requirements before issue of a notice u/s 148 are that the AO should have reason to believe that income had escaped assessment and the same was fully met – Held that:- From the reading of the copy of the reasons recorded by the AO for issuance of notice u/s 148 of the Act, there is no mention of date therein - the details given are only with regard to name of the bank and its branch, address of the beneficiary, instrument no., date of transaction and amount is mentioned but in the operative part of the reasons recorded, there is no mention of the nature of transaction, much less to establish that the impugned transactions were in the nature of accommodation entries in the garb of gift - the AO proceeded to record reason to believe as required for issuance of notice u/s 148 of the Act in a mechanical manner only after mentioning detailed reason from Investigation Wing of the Department in a CD Form without applying its independent mind and even without mentioning the date of recording of reason to believe that the income has escaped assessment. In the main part of reason to believe, there is no mentioning of nature of transaction to establish and fortify the fact that the transactions were in the nature of accommodation entries - there is no mentioning of date and it can safely be presumed that the AO had not examined the assessment record of the assessee which was processed u/s 143(1)(a) of the Act on 15.3.2005 for forming a belief that the income of the assessee had escaped assessment - CIT(A) rightly was of the view that there was no material on record to show that the AO had applied her independent mind in forming a belief which may result in the required reason to believe as per provisions of section 147 and 148 of the Act - the CIT(A) was right in following the ratio of the decision CIT vs Sun Engineering Works Pvt. Ltd. [1992 (9) TMI 1 - SUPREME Court] - the CIT(A) was justified and reasonable in quashing the notice u/s 148 of the Act and entire reassessment proceedings – Decided against revenue.
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