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TMI Blog2020 (2) TMI 1267X X X X Extracts X X X X X X X X Extracts X X X X ..... red in confirming the addition of Rs. 20,000/- made by Ld. Assessing Officer as unexplained expenditure. 4. On the facts and in the circumstances of the case as well as in law the Ld. Commissioner of Income Tax (Appeals) grossly erred in confirming the action of Ld. Assessing Officer using the adverse material gathered at back and behind the appellant without providing the copy for rebut of the claim. 5. The appellant crave leave to amend, alter, add/modify any or all grounds of appeal. These action of Hon'ble Commissioner of Income Tax (Appeals) - XXVIII, New DeIhL, and Ld. Assessing officer being Arbitrary, unjust, illegal and invalid in law are liable to quashed and it is prayed to Your Honor that they please be quashed and/or any other relief just deem fit and proper please be directed. 2. The facts in brief are that assessee filed its return of income at Rs. 7,670/- on 25.9.2008. The return of the assessee was processed u/s. 143(1) of the Income Tax Act, 1961 (in short "Act"). Subsequently, an information was received by Assessing Officer from the Investigation Wing of the Department that the assessee is beneficiary of taking accommodation entry in the garb of share ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate as to who AO reached to the conclusion that the assessee received accommodation entry and escaped assessment. AO jumped on the conclusion the money is unaccounted money of the assessee without any basis. It was further submitted that AO has never alleged the failure of the assessee to disclose true and correct facts. To support his aforesaid contention, he relied the case law of Hon'ble Supreme Court of India in the case of ACIT vs. Dhariya Construction Co. (2011) 197 Taxman 202 (SC); Delhi High Court in the case of Pr. CIT vs. RMG Polyvinyls (I) Ltd. (2017) 83 taxmann.com 348 (Delhi); Pr. CIT vs. Meenakshi Overseas () Ltd. vs. ITO 395 ITR 677 (Del.); Signature Hotels Pvt. Ltd. vs. ITO (2012) 20 taxmann.com 797 (Del.); Pr. CIT vs. G&G Pharma India Ltd. 384 ITR 147 (Del.) and CIT vs. Sfil Stock Broking Ltd. 2010) 435 ITR 285 (Delhi). In view of above, he requested to quash the re-assessment. 4. On the contrary, Ld. DR relied upon the orders of the authorities below and the case laws referred therein and stated that Assessing Officer issued the notice u/s. 148 after due application of mind. He further stated that the AO has followed due procedure before issuing the notice u/s 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which was passed on to revenue authorities was 'tangible material outside record' to initiate valid reassessment proceedings. 6. 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 valid reassessment proceedings. 7. Amit Polyprints (P.) Ltd. Vs PCIT Gujarat High Court [2018] 94 taxmann.com 393 (Gujarat) Where reassessment proceedings were initiated on basis of information received from Investigation wing that assessee had received certain amount from shell companies working as an accommodation entry provider, reassessment could not be held unjustified. 8. Aaspas Multimedia Ltd. Vs PCIT Gujarat High Court [2017] 83 taxmann.com 82 (Gujarat) Where reassessment was made on basis of information received from Principal DIT (Investigation) that assessee was beneficiary of accommodation entries by way of share application provided by a third party, same was justified. 9. Murlibhai Fatandas Sawlani Vs ITO Gujarat High Court 2016-TIQL-370-HC- AHM-IT It is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Investigation Wing has informed that assessee company has received accommodation entry of Rs. 10 lacs in the garb of share application money which is said to be as per inquiry made by the Directorate of Investigation (DI) on the persons said to be involved providing accommodation entries/ bogus share application. Based on inquiries made, DI is said to have provided details of persons who are beneficiaries of such accommodation entries and one such beneficiary is said to be the assessee. In this case notice u/s. 148 of the Act was issued merely on the basis of information from D.I. that the assessee has received accommodation entry of Rs. 10 laks. There is no mention of any application of mind or any independent inquiry or any link between any tangible material and formation of reasons to believe that income chargeable to tax has escaped assessment. It is also noted that in the reasons recorded, the AO has made vague remarks that assessee has income chargeable to tax which has escaped assessment. The AO has not even specified as to what is the amount of alleged income escaping assessment, which shows that AO has merely recorded certain unsubstantiated allegations on the basis of so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ries. 12. Recently, in its decision dated 26th May, 2017 in ITA NO.692/20l6 (Principal Commissioner of Income Tax-6 v. Meenakshi Overseas Pvt. Ltd.), this Court discussed the legal position regarding reopening of assessments where the return filed at the initial stage was processed under Section 143(1) of the Act awl not under Section 143(3) of the Act. The reasons for the reopening of the assessment in that case were more or less similar to the reasons in the present case, viz., information was received from the Investigation Wing regarding accommodation entries provided by a 'known' accommodation entry provider. There, on facts, the Court came to the conclusion that the reasons were, in fact, in the form of conclusions "one after the other" and that the satisfaction arrived at by the AO was a "borrowed satisfaction" and at best "a reproduction of the conclusion in the investigation report." 13. As in the above case, even in the present case, the Court is unable to discern the link between the tangible material and the formation of the reasons to believe that income had escaped assessment. In the present case too, the information received from the Investigation Wing ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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