2018 (4) TMI 1287 - HC - Income Tax

Reopening of assessment - non application of mind by AO - information received from the DIT (Investigation) - Held that:- No information received from the DIT (Investigation) about a particular entity, entering into suspicious transactions. Material is not further linked by any reason to come to the conclusion that the Assessee has indulged in any activity which could give rise to reason to believe on the part of the AO that income chargeable to tax has escaped Assessment. This reason that the recorded reasons even does not indicate the amount which according to the Assessing Officer, has escaped Assessment. This is an evidence of a fishing enquiry and not a reasonable belief that income chargeable to tax has escaped assessment.

The reasons clearly shows that the Assessing Officer has not applied his mind to the information received by him from the DDIT (Inv.). The Assessing Officer has merely issued a reopening notice on the basis of intimation regarding reopening notice from the DDIT (Inv.) This is clearly in breach of the settled position in law that reopening notice has to be issued by the Assessing Office on his own satisfaction and not on borrowed satisfaction.

The view taken by the impugned order of the Tribunal cannot be found fault with. This view of the Tribunal is in accordance with the settled position in law.