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2021 (3) TMI 353 - AT - Income TaxReopening of assessment u/s 147 - unexplained cash credit u/s 68 - reopening of the assessment was solely on the basis of AIR information - HELD THAT:- There is no independent application of mind by the AO to form the reason to believe that there is escapement of income. The AO has not made any independent inquiry to find out the veracity of the AIR information that in fact so much cash was deposited in the bank account. Therefore, find merit in the arguments of the Ld. Counsel for the assessee that the reopening of the assessment on wrong and incorrect facts makes the reopening null and void. In the case of PCIT vs. Meenakshi Overseas (P) Ltd. [2017 (5) TMI 1428 - DELHI HIGH COURT] has held that where reassessment was resorted to on basis of information from DIT (Investigation) that assessee had received accommodation entry but there was no independent application of mind by Assessing Officer to tangible material and reasons failed to demonstrate link between tangible material and formation of reason to believe that income had escaped assessment, reassessment was not justified. As reopening of the assessment has been made on the basis of AIR information which is not based on correct facts and the AO has not made independent application of his mind before recording reasons for reopening of the assessment and has simply proceeded on the basis of AIR information, therefore, the reassessment proceedings initiated by the AO being not in accordance with law has to be quashed - Decided in favour of assessee.
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