Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2021 (12) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (12) TMI 1140 - HC - Income TaxReopening of assessment u/s 147 - Whether the reasons to believe has rational connection with the formation of the belief? - live link between the material connecting the notice of the Assessing Officer and the formation of belief regarding escapement of income - HELD THAT:- The reasons as made available to Petitioner merely indicates information received from the DDIT (Investigation), about certain entity entering into suspicious / questionable transactions. The entire information received has been reproduced in the reasons. In the information so reproduced, there is no mention or even a cursory reference to Petitioner. There is no link between the information received from the DDIT and Petitioner. The information / material received is not further linked by any reason to come to the conclusion that Petitioner has indulged in any activity which could give rise to reason to believe on the part of the Assessing Officer that income chargeable to tax has escaped assessment. Recorded reasons even does not indicate the amount which according to the Assessing Officer has escaped assessment. In our view, this is evidence of a fishing enquiry and not a reasonable belief that income chargeable to tax has escaped assessment. Moreover, AO alleges that substantial income (specified as above) chargeable to tax has escaped assessment for AY 2014-15 and accordingly notice under Section 148 of the Act for AY 2014-15 has been issued for the purpose of re-assessment. This shows non-application of mind not only by the Assessing Officer but also the sanctioning authority. If both these persons had read the reasons before putting their signatures, they would have found the error in the assessment year. There is nothing new in the reasons provided on 23/10/2019 save and except the assessment year has been corrected to reflect the correct assessment year in the last paragraph; but at the same time, our view expressed earlier that if only the sanctioning authority has read the reasons and applied his mind to the same, it would have indicated the error in the assessment year and that there is absolutely no link or nexus between the information received from DDIT and Petitioner. Therefore, in our view, the notice u/s 148 issued is set aside - Decided in favour of assessee.
|