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2016 (6) TMI 839 - ITAT DELHI

2016 (6) TMI 839 - ITAT DELHI - TMI - Reopening of assessment - accommodation entry received - information received from the DIT (Inv.) - Held that:- Notice u/s 148 has been issued in a mechanical manner on the basis of vague information from Directorate of Inspection (Inv.). The AO did not dwell upon the veracity and the basis of information received. He has not mentioned any material which has led him to believe that the amount deposited in the bank account represented accommodation entry whic .....

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plea on the basis of vague information in a mechanical manner. The reasons recorded reflect that the AO did not independently apply his mind to the information received from the DIT (Inv.) and arrive at a belief whether or not any income had escaped assessment. - Decided in favour of assessee - I.T.A. No. 3793/DEL/2014 - Dated:- 15-6-2016 - Shri H. S. Sidhu, Judicial Member For the Assessee : Shri Udaibir Singh Kochar, Adv For the Department : Shri KK Jaiswal, Sr. DR ORDER Per H. S. Sidhu, JM T .....

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w in upholding the validity of initiation of proceedings u/s. 147 of the Income Tax Act, 1961 (hereinafter referred to as the Act') as the reasons recorded by the AO did not lead to any belief that the assessee's income had escaped assessment. 3. That the learned CIT(A) erred in upholding the validity of a vague and stereotyped notice u/s. 148 of the Act, which manifestly showed non application of mind. 4. That the learned CIT(A) erred in law in confirming the addition made By the AO to .....

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for being granted leave to urge and be heard on the following legal ground which requires no investigation of facts and can be decided on the basis of material already on record: "6. That the assessment order dt. 14.11.2008 is void ab initio, having been passed in pursuance of an invalid notice dt. 14.10.2008 issued u/s 143(2) of the Act." 3. The brief facts of the case are that the assessee was not assessed to tax and no return of income was filed for the relevant assessment year. The .....

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ar. 4. Aggrieved by the order dated 14.11.2008, Assessee filed an Appeal before the Ld. CIT(A), who vide impugned order dated 31.10.2012 dismissed the appeal of the assessee. 4.1 Aggrieved by the impugned order dated 31.10.2012, assessee filed the Appeal before the Tribunal. 5. Ld. Counsel of the assessee has submitted that notice u/s. 148 has been issued in a mechanical manner on the basis of vague information received from DIT (Inv.) and also stated that the reasons recorded by the AO did not .....

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TO & Anr. (2011) 338 ITR 51 (Del.) and stated that the present case is covered by the aforesaid decision of the Hon ble Delhi High Court, hence, the reopening is required to be quashed. 6. On the other hand, Ld. DR controverted the contentions raised by the Ld. Counsel of the assessee and stated that the lower authorities have passed the well reasoned order which does not need any interference on the part of the Tribunal, therefore, the orders of the revenue authorities may be upheld. 7. I h .....

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s been credited in his / her bank account no. 15863 with Punjab & Singh bank, Janakpurei, Delhi. Hence, I have reason to believe that an income of ₹ 2,00,000/- chargeable to tax for the asstt. Year 2003-04 relevant to FY 2002-03 has escaped assessment within the meaning of Section 147 of the I.T. Act, 1961. 7.1 On perusal of the aforesaid reasons indicates that notice uls 148 has been issued in a mechanical manner on the basis of vague information from Directorate of Inspection (Inv.). .....

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e Hotels (P) Ltd. vs. ITO & Anr. (2011) 338 ITR 51 (Del.) decided by the Hon ble Delhi High Court. In the said case during the assessment proceedings similar reasons were recorded by the AO which reads as under:- "7. In the present case the undated reasons recorded by the AO for initiation of proceedings; read as under: Information received from the office of the Director of IT (Inv.)- VI, New Delhi revealed that Mls Signature Hotels (P) Ltd. has introduced unaccounted money in its book .....

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no reference to any document or statement. Further, it is apparent that the AO did not apply his own mind to the information and examine the basis and material of the information. The AO accepted the plea on the basis of vague information in a mechanical manner. The reasons recorded reflect that the AO did not independently apply his mind to the information received from the DIT (Inv.) and arrive at a belief whether or not any income had escaped assessment. I further find considerable cogency in .....

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