TMI Blog2021 (2) TMI 722X X X X Extracts X X X X X X X X Extracts X X X X ..... ffect on the aforesaid analyzations, observations and peculiar facts and circumstances, we do not have any hesitation to hold that the proceedings u/s. 147 of the Act itself are vague, consequently the assessment order is liable to be quashed, hence ordered accordingly. Resultantly the order under challenge is set aside. Decided in favour of assessee. - I.T.A. No. 210/VIZ/2020 - - - Dated:- 12-2-2021 - N. K. Choudhry , Member ( J ) And D. S. Sunder Singh , Member ( A ) For the Appellant : C. Subrahmanyam , C. A. For the Respondents : B. Satyanarayana Raju , Sr. DR ORDER N. K. Choudhry , Member ( J ) This appeal has been preferred by the assessee against the order dated 21/09/2020 impugned herein passed by the ld. CIT(A)-1, Visakhapatnam u/sec. 250(6) of the Income Tax Act, 1961 (hereinafter referred to as Act ) for the A.Y. 2011-12. 2. Brief facts of the case are that the Assessee being an individual filed his return of income for the assessment year under consideration by declaring 'NIL' income on 31/07/2018 in pursuance to the notice issued u/sec. 148 of the Act. The AO completed the assessment u/sec. 143(3) r.w.s. 147 and made the addition o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the proceedings u/s. 147 in the instant case have been initiated on the basis of suspicion and there was absolutely no material on record, by which it can be said that there was any reason(s) to believe before the AO qua escapement of income. On the contrary the Ld. Sr. DR refuted the claim of the Assessee and supported the reopening of case as valid. 7. The reasons recorded u/sec. 147 on 27/08/2018 by the AO are reproduced herein (rearranged by Bench for better appreciation) for the sake of brevity and ready reference:- As per the data available in ITS view under CIB data, the assessee has made deposits to the tune of ₹ 24,40,160/- in the Nationalized Bank during the financial year 2010-11 relevant to the assessment year 2011-12 and the assessee has not filed any return of income for the A.Y. 2011-12. In view of the above, it is opined that the sources of income for the deposits made by the assessee during the F.Y. 2010-11 are to be verified. Therefore, I have reason to believe that, income of ₹ 24,40,160/- chargeable to tax has escaped assessment within the meaning of section 147 of the I.T. Act, 1961. In your case the time deposit and draft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e unknown account having PAN number of the Assessee as AUKPK6318B. The Assessee replied the said letter and refuted the claim of the AO. 12. Let us to peruse the relevant provisions of law: 147. If the AO has reason to believe that any income chargeable to tax has escaped assessment for any A.Y., he may, subject to the provisions of sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of proceedings under this section, or recompute the loss or the depreciation allowance or any other allowance, as the case may be, for the a.y. concerned (hereafter in this section and in sections 148 to 153 referred to as the relevant assessment year). Provided that where an assessment under sub-section (3) of section 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... qua deposit of amount, but without verification. From the reasons recorded it further shows that the AO at the initial stage in the reasons recorded narrated that as per the data available in ITS view, the Assessee has made deposits to the tune of ₹ 24,40,160/- in the Nationalised Bank during the F.Y. 2010-11, however in last para it has been mentioned that in Assessee's case, the time deposit and draft deposit of above one lakh in ICICI Bank from April 2010 to September 2010. However, while making the addition the AO came to a conclusion that the Assessee has made deposits in bank without specifying the name of bank. The mind of the AO was not clear as to whether the Assessee has deposited the amount in the Nationalised Bank or ICICI Bank. If one part of the reasons recorded treated as true to the effect that the Assessee has made certain deposits in the Nationalised Bank, then the ICICI or HDFC bank cannot be considered as Nationalised Bank. However, in the last line, the AO has stated that Assessee has made certain deposits in ICICI bank and later on in letter dated 28/12/2018 referred HDFC bank account Nos. 12431000005307 00421020003931. Whereas ultimately in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /or un-corroborative material. The Assessing Officer further failed to establish the nexus with the reasons recorded and alleged material available with the AO before initiation of proceedings and Bank Statements later received and got verified by the AO and/or produced by the Assessee. In our considered view, the competent authority is also required to indicate some link or nexus with the material available, while recording reasons for belief that the amount acquired is chargeable to tax has escaped the assessment, which in this case the AO failed to establish. Even the Ld. CIT(A) was absolutely unjustified in upholding the reopening of the assessment u/s. 147 of the Act, without appreciating the facts of the case, explanation submitted and evidences placed on record judiciously. 17. In cumulative effect on the aforesaid analyzations, observations and peculiar facts and circumstances, we do not have any hesitation to hold that the proceedings u/s. 147 of the Act itself are vague, consequently the assessment order is liable to be quashed, hence ordered accordingly. Resultantly the order under challenge is set aside. 18. As we have already quashed the assessment order and set ..... X X X X Extracts X X X X X X X X Extracts X X X X
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