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TMI Blog2019 (10) TMI 735X X X X Extracts X X X X X X X X Extracts X X X X ..... Code (CCM) by the assessee. 3.1 That without prejudice, the disallowance of Rs. 20,04,714/- made without fully confronting the alleged adverse material and without providing for the cross examination of required persons, is unwarranted. 4. That there is no legality, no justification and no basis for addition of Rs. 60,125/- by estimating and assuming alleged unexplained expenditure for obtaining alleged bogus F&O loss, at the rate of 3 percent of Rs. 20,04,174/-. 5. That the AO exceeded his jurisdiction in examining the issue of disallowance u/s. 14A/Rule8-D as the issue is outside the scope of these 147 proceedings and also not a part of reason and also since no such material available on record on the basis of which it can be said that it is an escaped income which has come to the notice of AO subsequently in the course of proceedings u/s. 147. 6. That there is absolutely no legality and justification for disallowing Rs. 3,981/- u/s. 14A r/w 8D, further more without recording any satisfaction for not accepting the claim of appellant of not incurring any such expenditure. 2. The facts in brief are that the assessee filed its return of income at Rs. NIL on 16.09.2010. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly the page no. 15- 16 which is a copy of performa for recording the reasons for initiating proceedings u/s. 148 and for obtaining approval of Pr. CIT, Delhi-3, New Delhi in which Pr. CIT, Delhi-3, New Delhi has granted the approval in a mechanical manner, for issuing of notice u/s. 148 of the Income Tax Act, 1961, hence, he stated that the approval for issue of notice us. 148 of the Act is not within the meaning of section 151 of the I.T. Act, 1961 and therefore, the reassessment needs to be quashed. In view of above, he requested to quash the reassessment. To support his contention, Ld. Counsel of the assessee has relied upon the decision of the Hon'ble Delhi High Court in the case of United Electrical Company (P) Ltd. Vs. CIT & Ors. 258 ITR 317 (Del.) and the judgment of the Hon'ble Supreme Court of India in the case of CIT vs. S. Goyanka Lime & Chemical Ltd. (2015) 64 taxmann.com 313 (SC) by which the ground no. 2 raised by the assessee in the present appeal is squarely covered. 4. On the contrary, Ld. DR relied upon the orders of the authorities below and stated that the reasons recorded and satisfaction/approval accorded is within the meaning of section 151 of the Act and n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sactions entered into by it, in view of proviso to section 147, Assessing Officer was justified in initiating reassessment proceedings even after expiry of four years from end of relevant assessment year. 7. Acorus Unitech Wireless (P.) Ltd. Vs ACIT Delhi High Court T20141 43 taxmann.com 62 (Delhi)/r20141 223 Taxman 181 (Delhi)(MAG)/r20141 362 ITR 417 (Delhi) In terms of section 148, law only requires that information or material on which Assessing Officer records his or her satisfaction has to be communicated to assessee, without mandating disclosure of any specific document. 8. PCIT, Vs Paramount Communication (P.) Ltd. Delhi High Court [20171 79 taxmann.com 409 (Delhi)/r20171 392 ITR 444 (Delhi) Information regarding bogus purchase by assessee received by DRI from CCE which was passed on to revenue authorities was 'tangible material outside record' to initiate valid reassessment proceedings. 9. Paramount Communication (P.) Ltd. Vs PCIT Supreme Court 2017-TIQL-253- SC-IT SLP of assessee dismissed. Information regarding bogus purchase by assessee received by DRI from CCE which was passed on to revenue authorities was 'tangible material outside record' to initiate v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by passing a speaking order, would not make reassessment order void ab initio. 17. Baldevbahi Bhikhabhai Patel vs. DCIT (Gujarat High Court) (2018) 94 Taxmann.co, 428(Gujarat) Where revenue produced bunch of documents to suggest that entire proposal of reopening of assessment alongwith reasons recorded by the Assessing Officer for same were placed before Additional Commissioner who, upon perusal of same, recorded his satisfaction that it was a fit case for issuance of notice for reopening assessment, reassessment notice issued against assessee was justified. 5. I have heard both the parties and carefully considered the case laws and the relevant documents available on record especially the assessment order, impugned order, reasons/satisfaction/approval recorded for issue of notice u/s. 148 of the Act as well as the Paper Book filed by the Assessee containing pages 1 to 72 in which he has attached the copy of reasons; assessee's objection letter dated 11.5.2017; assessee's objection letter dated 15.5.2017; AO's objection disposal order dated 6.11.2017; copy of approval u/s. 151; contract notes issued by NSE broker Integrated Master Securities (P) Ltd.; ledger a/c for F&O share ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned to observe that in the present case, there has been no application of mind by the Addl. CIT before granting the approval. (Para 19). (B) Hon'ble Supreme Court of India in the case of CIT vs. S. Goyanka Lime & Chemical Ltd. reported in (2015) 64 taxmann.com 313 (SC) arising out of order of Hon'ble High Court of Madhya Pradesh in CIT vs. S. Goyanka Lime & Chemicals Ltd. (2015) 56 taxmann.com 390 (MP). "Section 151, read with section 148 of Income Tax Act, 1961 - Income escaping assessment - Sanction for issue of notice (Recording of satisfaction) - High Court by impugned order held that where Joint Commissioner recorded satisfaction in mechanical manner and without application of mind to accord sanction for issuing notice under section 148, reopening of assessment was invalid - Whether Special Leave Petition filed against impugned order was to be dismissed - Held, Yes (in favour of the Assessee)." 5.2 In the background of the aforesaid discussions and respectfully following the precedents, as aforesaid, I am of the considered view that approval granted by the Ld. Pr. CIT-3, Delhi, New Delhi is a mechanical and without application of mind, which is not valid for initiating th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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