TMI Blog2018 (12) TMI 1819X X X X Extracts X X X X X X X X Extracts X X X X ..... where, based on information received in context of a third party, even before issuance of notice u/s 148 has concluded that assessee has obtained accommodation entries and income to that extent has escaped assessment is not a correct approach in the eyes of law. As held in case of M/s Shodiman Investments [ 2018 (4) TMI 1287 - BOMBAY HIGH COURT] the material in possession of the AO has to be further linked by any reason to come to conclusion that the assessee has indulged in any activity which could give rise to reason to believe that income chargeable to tax has escaped assessment - unless the AO carries out the further examination after receipt of initial information from the Investigation wing, how can he conclude that income has es ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld. CIT(A). 3. That the ld. CIT(A) erred on facts in holding that the alleged bogus purchases is through accommodation entries only, without carrying his independent enquiries. 4. That the ld. AO as well as ld. CIT(A) erred on facts and in law in making the above said addition on account of alleged bogus purchases by relying merely on certain informations received from investigation wing of the department and without allowing any opportunity to the appellant to cross examine the witnesses of the department, on account of which the order so passed may kindly be held null and void as had been passed without following the principles of natural justice. 2. Firstly, ground no. 3 was not pressed during the course of hearing. Hence, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct income of the assessee has to be made on the basis of past history of the appellant. However, the ld CIT(A) not fully convinced with the same reduced the disallowance to 15% and granted relief for 10% of such purchases. 3.2 In the above factual background, it was submitted by the ld AR that as per the reasons recorded for reopening, the ld. AO stated that the appellant did not file her original return on the basis of AST system of the department whereas the correct fact is that the appellant had filed her regular return on 31.07.2007. It proves that the ld. AO acted merely on the basis of information passed on by Investigation wing, Mumbai and he did not apply his mind before issuing notice u/s 148 of the Income tax Act, 1961. The app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndicate the amount which according to the Assessing Officer, has escaped Assessment. This is an evidence of a fishing enquiry and not a reasonable belief that income chargeable to tax has escaped assessment. 14 Further, the reasons clearly shows that the Assessing Officer has not applied his mind to the information received by him from the DDIT (Inv.). The Assessing Officer has merely issued a reopening notice on the basis of intimation regarding reopening notice from the DDIT (Inv.) This is clearly in breach of the settled position in law that reopening notice has to be issued by the Assessing Office on his own satisfaction and not on borrowed satisfaction. 15 Therefore, in the above facts, the view taken by the impugned order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... punged assessment year i.e, AY 2007-08. In terms of proviso to section 147 of the Act, an action under the said provisions can be taken by reason of failure on the part of the assessee to file his return of income or to disclose fully and truly all necessary facts necessary for his assessment for the subject assessment year. The contention of the Revenue at the time of recording the reasons was that the assessee had failed to file his return of income for the impunged assessment year and the same was not reflected in the IT system. Per contra, the ld AR has submitted that return of income for the AY 2007-08 was filed by the assessee manually with ITO Ward 6(1) Jaipur vide acknowledgment no. 2611000925 on 21.05.2008. It is relevant to note t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as stated that since the assessee has not filed the return of income as per AST system of the department, he has reasons to believe that income has escaped assessment. To our mind, such an approach of the AO where, based on information received in context of a third party, even before issuance of notice u/s 148 has concluded that assessee has obtained accommodation entries and income to that extent has escaped assessment is not a correct approach in the eyes of law. In the instant case, it is an undisputed fact that the assessee has filed her return of income on 31.07.2007 where she has shown purchases of ₹ 36,64,300 and which are the only purchases during the year and which are alleged to be accommodation entry as per the reasons iss ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
