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2022 (5) TMI 950 - AT - Income TaxReopening of assessment u/s 147 - recording of satisfaction in mechanical manner - unexplained money u/s 69 A - reopening based on AIR/CIB Information that the assessee had deposited cash in his Bank account - Independent application of mind by AO or not? - HELD THAT:- It is pertinent to mention that the AO has not analyzed the information in right perspective and sought to reopen by conceiving a wrong fact that the assessee did not file return of income and, as such, the bank deposit represents unexplained investment. The mere information from annual information returns which is made as the basis for reopening without describing the contents of information i.e. when was the statement received, the bank account details and most importantly copy of bank account which is made as the basis of reopening was never gone through by the AO while recording the reasons. This is very much clear from the reassessment order that the AO recorded a finding that during the course of assessment proceedings information u/s 133(6) of the Act were called from HDFC Bank Ltd. and ICICI Bank and there was no compliance made by both the banks till date. Therefore, the AO never had with him any copy of bank statement before recording of reasons for reopening of assessment and issue of notice u/s 148. Therefore, without going to the contents of the entries in the bank accounts merely deposits cannot be treated as income escaping assessment. There is no nexus between the prima facie inferences arrived in the reasons recorded and the information. The information was restricted to cash deposit in bank account but there was no material much less tangible, cogent, credible and relevant material to form a reason to believe that cash deposits represented income of the assessee. The reasons recorded in the present case at best can be treated to be reasons to suspect which is not sufficient for reopening the assessment u/s 148 of the Act. The requirement of application of mind is missing in the present case on the face of it in the reasons recorded. PCIT also mechanically issued permission to reopen the assessment without going into the facts available on record. Even in the Form for seeking approval, in Column 8, the AO records that no return has been filed by the assessee even though factually incorrect and the PCIT did not apply his mind while granting approval as he has simply gone by what is recorded by the AO which is factually wrong. The satisfaction recorded by the PCIT is in mechanical manner and without application of mind. Thus reassessment made u/s 144 r.w.s. 147 by the AO is bad in law - Decided in favour of assessee.
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