TMI Blog2020 (12) TMI 1378X X X X Extracts X X X X X X X X Extracts X X X X ..... ication of Mind and Borrowed satisfaction because the initiation is on the basis of report of Inv. wing only; No prime facie enquiry done by A.O. before initiating proceedings; Hence, it is a case of initiation on wrong facts and on borrowed satisfaction without application of mind which makes the proceedings un-sustainable. Our view is fortified by the decision of Sarthak Securities Co. (P) Ltd. [ 2010 (10) TMI 92 - DELHI HIGH COURT] wherein it has been held that no independent application of mind by the AO by acting under information from Inv. Wing. Notice u/s. 147 to be quashed. Limitation Period - As we have perused the documentary evidences filed by the assessee especially the notice u/s. 148 of the Act prepared by the AO and sent to post office and delivered to the assessee as stated by the Ld. Counsel for the assessee. As in the case of Kanubahi M. Patel (HUF) vs. Hiren Bhattr [ 2010 (7) TMI 704 - GUJARAT HIGH COURT] the assessment is barred by limitation and hence, null and void. Thus reopening of assessment orders quashed - Decided in favour of assessee. - ITA No. 3504/DEL/2019 - - - Dated:- 23-12-2020 - Shri H.S. Sidhu, Judicial Member And Shri Anil Chatu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 11.10.2010. The case of the assessee company was assessed u/s. 143(3) of the I.T. Act, 1961 (in short Act ) at a total income of Rs.90,33,560/- on 20.11.2012. The case of the assessee was reopened and notice u/s. 148 of the Act was issued to the assessee company on 31.3.2017 after receiving the reasons for initiating the proceedings u/s. 147 of the Act and obtaining approval from the Ld. CIT(A)-2, New Delhi. In response to the notice u/s. 148 of the Act assessee filed its reply dated 26.5.2017 wherein a copy of return of income was filed on 26.4.2017 in response to notice under section 148 had been submitted. A Notice u/s. 143(2) of the Act was issued on 7.9.2017. A notice u/s. 142(1) of the Act alongwith questionnaire was also issued on 7.9.2017. In response to the statutory notices, the AR of the assessee filed the details which was placed on record by the AO. After considering all the documentary evidences filed by the assessee as well as the written submission, the AO completed the assessment on 28.12.2017 u/s. 147 of the Act and added the unexplained credit u/s. 68 of the Act amounting to Rs. 2,47,50,000/- and commission of Rs. 6,18,750/- totaling to Rs. 3,44,02,310/-. Aggr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee stated that the lower authorities wrongly upheld the addition in dispute to the extent of Rs. 1,10,00,000/- u/s. 68 of the Act for the share capital and share premium. He finally stated that the AO has made the addition of Rs. 2,47,50,000/- u/s. 68 of the Act alongwith the commission of Rs. 6,18,750/-, but the Ld. CIT(A) has deleted the addition of Rs. 1,37,50,000/- and balance amount of Rs. 1,10,00,000/- received by the applicant has been upheld u/s. 68 of the Act. Ld. Counsel for the assessee further stated that Ld. CIT(A) after considering the documentary evidences filed by the assessee which was already filed by the assessee before the AO, deleted the addition of Rs. 1,37,50,000/- out of Rs. 2,47,50,000/- and upheld the addition of Rs. 1,10,00,000/- meaning thereby while recording the reasons in issuing the notice u/s. 148 of the Act, AO has not applied his mind, therefore, on this ground the addition in dispute deserve to be cancelled. 4. On the contrary, Ld. DR relied upon the order of the Ld. CIT(A) and stated that AO has issued notice u/s. 148 of the Act after recording the reasons and on the basis of the evidences which was brought to the notice of the assessee by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... diction u/s. 147. 5.1 We further find that in this case initiation of reopening proceedings is mechanical and Non-application of Mind and Borrowed satisfaction because the initiation is on the basis of report of Inv. wing only; No prime facie enquiry done by A.O. before initiating proceedings; Hence, it is a case of initiation on wrong facts and on borrowed satisfaction without application of mind which makes the proceedings un-sustainable. Our view is fortified by the decision of the Hon ble High Court of Delhi in the case of Sarthak Securities Co. (P) Ltd. 329 ITR 110 (Del) wherein it has been held that no independent application of mind by the AO by acting under information from Inv. Wing. Notice u/s. 147 to be quashed. 5.2 As regards the limitation issue is concerned, we have perused the documentary evidences filed by the assessee especially the notice u/s. 148 of the Act prepared by the AO and sent to post office and delivered to the assessee as stated by the Ld. Counsel for the assessee. We are of the view that keeping in view of the judgment of the Hon ble Hon ble Gujarat High Court in the case of Kanubahi M. Patel (HUF) vs. Hiren Bhattr or His Successors to office ..... X X X X Extracts X X X X X X X X Extracts X X X X
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