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2021 (3) TMI 682 - AT - Income TaxReassessment of proceedings u/s 147 - as argued reassessment proceedings and consequential reassessment order on the ground that impugned reassessment order has been passed without providing copy of reasons recorded along with satisfaction note of approving authority u/s 151 - Whether AO has supplied copy of the reasons recorded u/s 148 of the I.T. Act? - HELD THAT:- AO merely mentioned in the remand report that assessee attended the assessment proceedings on various dates but never mentioned anything that he was not provided the copy of the reasons. AO therefore, of the view that it is apparent that copy of the reasons were provided by the earlier AO. AO did not bring any evidence on record or to refer any evidence in the remand report as to when copy of the reasons for reopening of the assessment and satisfaction have been provided to the assessee.CIT(A) also in his findings on going through the remand report merely mention that since assessee was in possession of the information received from the Investigation Wing would mean that reasons were disclosed to the assessee during reassessment proceedings. CIT(A) in his findings did not mention anything specifically whether copy of the reason and satisfaction has been provided to the assessee by any of the Assessing Officer. Thus, the impugned order is silent as to when copy of the reasons and satisfaction were supplied to the assessee on making a demand by the assessee in writing. In order to verify this fact, Ld. DR was directed to file copy of the order sheet or any other document from record to show that actually copy of the reasons recorded for reassessment and satisfaction u/s 151 have been supplied to the assessee at reassessment proceedings. However, till date Ld. DR did not produce any evidence in this regard. Therefore, considering the totality of the facts and circumstances, it is clear that assessee was not provided copy of the reasons recorded for reopening of the assessment and satisfaction u/s 151 of the Act despite demand is made by the assessee in writing before AO. The assessee is thus, precluded from raising objection against reopening of the assessment at assessment proceedings. The valuable right of the assessee has been denied by the authorities below in this regard. The entire reassessment proceedings are nullity, invalid and bad in law. The entire reassessment proceedings are vitiated and, as such, liable to be quashed. Whether AO recorded wrong, incorrect and non-existing reasons in the reasons recorded for reopening of the assessment and, as such, did not apply his mind? - It is well settled law that if wrong facts and wrong reasons are recorded for reopening of the assessment, such assessment is bad in law. In the present case, the AO recorded wrong facts on many count in the reasons recorded for reopening of the assessment i.e. AO recorded incorrect amount of ₹ 58,40,171/- credited in HSBC account, Noida despite he has admitted in the assessment order that it was ₹ 30,74,006/-. AO in the reasons also recorded incorrect fact that no assessment has been completed in this case u/s 143(3) but in the reason itself AO recorded that earlier reassessment has been done u/s 147/148 read with section 143(3). AO also incorrectly recorded that sanction for reopening of assessment is required under proviso to section 151(1) of the Act despite such proviso does not exist in the statute as it was amended in 2015. The AO, therefore, recorded wrong, incorrect and non-existing reasons for reopening of the assessment. It makes clear that there is a total non-application of mind on the part of the AO while recording the reasons for reopening of the assessment. AO has recorded incorrect amount which escaped assessment. The reasons failed to demonstrate the live link between the alleged tangible material and the formation of belief that income chargeable to tax has escaped assessment. We are of the view that reopening of the assessment is invalid and bad in law and that sanction/approval granted is also without any application of mind. Therefore, the reopening of the assessment cannot be sustained in law. We, accordingly, set aside the orders of the authorities below and quash the reopening of the assessment. Resultantly all the additions stand deleted. - Decided in favour of assessee.
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