TMI Blog2018 (9) TMI 1617X X X X Extracts X X X X X X X X Extracts X X X X ..... to do on his own cannot be done on the basis of the order of the appellate authority in the case of other assessee. The notice issued u/s 148 was only after receiving the letter dated 23rd September, 2011 and, therefore, the reopening is only in compliance of the said letter and not based on the opinion and independent application of mind of the AO. We set aside and quash the reopening of the assessment being not sustainable in law and consequently the reassessment order is set aside. - Decided in favour of assessee - ITA No. 638/JP/2015 - - - Dated:- 12-7-2018 - Shri Vijay Pal Rao, JM And Shri Bhagchand, AM For the Assessee : Shri Dilip Shivpuri (Advocate) For the Revenue : Smt. Seema Meena (JCIT) ORDER PER VIJAY P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ground No. 1 is regarding validity of reopening of the assessment. 2. The assessee company is engaged in the business of trading of sprinkler systems and equipments. The assessee filed its return of income on 28.12.2005 declaring Nil income. The return was processed under section 143(1) on 26.07.2006. Subsequently, as per the out-come of the appellate proceedings in case of M/s. Rasal Builders and Developers Pvt. Ltd. after two rounds of appeal, the AO reopened the assessment by issuing notice under section 148 on 26th March, 2012. The AO proposed to reassess the income on account of loan of ₹ 18,27,583/- given to M/s. Rasal Builders and Developers Pvt. Ltd. as it was given after deposit of cash in the bank account of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act. The AO has to apply his mind to the information, if any collected and must form belief thereon. The reopening based on the directions of the ld. CIT (A) is not sustainable. The ld. A/R has also relied upon the decision in case of Smt. Kaushalya Devi Ors. Vs. Assistant Director, Urban Lands Buildings Tax, Jodhpur Ors., RLR 1988(2) 800. Thus, the ld. A/R has submitted that the reopening in this case is bad in law and, therefore, the same may be quashed. 3.1. On the other hand, the ld. D/R has submitted that though the AO received a communication from the ld. CIT (A) dated 23rd September, 2011, however, the reasons recorded by the AO are independent of the said communication and, therefore, the reopening is based on the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacturing and sale of sprinkler sets during the year. Further there was no corroborative evidences for the cash deposits of ₹ 10,18,358/- out of the total cash receipts of ₹ 18,27,583/- shown in the cash book of M/s. Orbit Polytech (India) Ltd. Further he admitted that no manufacturing activity was carried out during the A.Y. 2005-06 or in subsequent years and finally the factory was sold in F.Y. 2010-11. Further it was seen that the company was claiming depreciation on plants and machinery. Besides, the ld. CIT (A) has deleted the addition in the case of M/s. Rasal Builders and Developers Pvt. Ltd., Jaipur stating that M/s. Orbit Polytech Pvt. Ltd. is a company which has a distinct entity from the appellant company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the AO for taking appropriate action in the case of the assessee before us. It is pertinent to mention that the ITO Ward 3(1), Jaipur is having jurisdiction over the assessee as well as M/s. Rasal Builders and Developers Pvt. Ltd. Hence, this fact of making the addition in the hands of M/s. Rasal Builders and Developers Pvt. Ltd. under section 68 on account of cash credit from assessee was known to the AO at the time of assessment completed under section 143(3) in case of M/s. Rasal Builders and Developers Pvt. Ltd. At the time of making the said addition of cash credit in the hands of M/s. Rasal Builders and Developers Pvt. Ltd. the AO was of the view that it was the money of M/s. Rasal Builders and Developers Pvt. Ltd. and the transacti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he reasons for reopening of the assessment were already known to the AO at the time of framing the assessment in case of M/s. Rasal Builders and Developers Pvt. Ltd. as well as at the time of completing the set aside proceedings by the AO. Hence the subsequent reopening of the assessment in compliance of the letter dated 23.09.2011 of ld. CIT (A) clearly a case of reopening on the basis of the satisfaction of the ld. CIT (A) that the addition should have been made in the hands of the assessee and not in the hands of M/s. Rasal Builders and Developers Pvt. Ltd. The powers to reopen the assessment under section 147 can only be exercised by the AO and cannot be abdicated by any other authority. Hence the AO has no jurisdiction to reopen the as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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