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TMI Blog2021 (4) TMI 376X X X X Extracts X X X X X X X X Extracts X X X X ..... nt order passed u/s 144 of the Income Tax Act, 1961 (for short 'the Act'). 2. The brief facts of the case are that the AO issued notice u/s 148 of the Act to the assessee on the basis of information that during the year relevant to the assessment year under consideration the assessee deposited cash amounting to Rs. 14.32 lacs in her saving bank account. The AO further issued notice u/s 142(1) of the Act and asked the assessee to comply with the notice u/s 148 and posted the case for hearing. The assessee did not respond the same. Thereafter the AO issued show cause notice and served upon the assessee by affixing at the residence of the assessee. Since the assessee did not appear on the said date, AO passed assessment order u/s 144 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... umentary evidences with regard to availability of funds and ignoring the documentary evidences. 5. That the confirmation part addition is against the facts and circumstances of the case. 6. That the detailed submission as filed during the course of proceeding has not been considered properly. 7. That the appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed of. 4. The assessee further challenged the impugned order by raising an additional ground that since the notice u/s 148 of the Act was not served upon the assessee either by post or by affixture, the proceedings u/s 147 r/w section 148 of the Act is void ab initio, therefore, liable to be quashed. 5. At the outset, the Ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er passed u/s 144 of the Act is void ab initio and liable to be quashed. The Ld. counsel invited our attention to page 3 and 4 of the paper book placed on record, which are the copies of notice issued in the name of the assessee u/s 148 of the Act and the photocopy of envelop on containing endorsement by postal authority, to demonstrate that the notice u/s 148 of the Act was not served upon the assessee either by post of by affixing the same as per the provisions of the CPC. The Ld. Counsel relied on the judgment of the Hon'ble Delhi High Court in the case of CIT vs. Chetan Gupta [2015] 62taxmann.com249(Delhi) and the decisions of the various Benches of the Tribunal to substantiate his contention. 9. On the other hand, the Ld. DR submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent proceedings on the basis of approval granted by the Principal Commissioner of Income Tax (Pr. CIT) in a mechanical manner. The Ld. Counsel submitted before us that in this case there was no application of mind by the AO to come to the conclusion that the income of the assessee has escaped, despite this the Ld. Pr. CIT approved the proposal for issuing notice u/s 148 of the Act in a mechanical manner The Ld. counsel further invited our attention to page 1 and 2 of the paper book containing copy of reasons recorded for reassessment and the permission accorded by the competent authority to demonstrate lack of application by the authorities concerned. The Ld. Counsel placing reliance on the judgment of the Hon'ble Madhya Pradesh High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 000/- in her bank account, which has escaped assessment. We further notice that the Ld. Pr. CIT accorded permission by writing as "yes, satisfied, it is a fit case for issue of notice u/s 148." 14. As pointed out by the Ld. Counsel for the assessee, the Hon'ble Madhya Pradesh High Court has held in the case of CIT vs. S. Goyanka Lime & Chemicals Ltd.(supra) that where Joint Commissioner recorded satisfaction in mechanical manner and without application of mind to accord sanction for issuing notice u/s 148 of the Act, the reopening of the assessment was invalid. The observations of the Hon'ble Court are as under: "7. We have considered the rival contentions and we find that while according sanction, the Joint Commissioner, Income Tax only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the assessee initiated on fallacious assumption that bank deposits constitute undisclosed income of the assessee, overlooking the fact that source of deposit need not necessarily be income of the assessee. We further notice that in the present case, the Ld. Pr. CIT has accorded sanction for issuing notice u/s 148 of the Act, without ensuring that the AO has recorded the reasons after due application of mind. 17. Hence, in our considered view, the Ld. CIT(A) has sustained the addition in question ignoring that the impugned order suffers from the legal infirmities discussed in the forgoing paras. In the light of the facts of the case and the cases relied upon by the Ld. Counsel, we are of the opinion that the impugned order is not sustaina ..... X X X X Extracts X X X X X X X X Extracts X X X X
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