Invalid reassessment for lack of cogent reasons to believe; reopening failed without details of alleged accommodation entry.

Reassessment under section 147 was held invalid where the recorded reasons failed to disclose the nature of the alleged accommodation entry, the transaction details, the counterparty identity, or the basis for the quantified escapement. The ITAT noted that mere reliance on survey or search material, without independent application of mind and cogent reasons to believe income had escaped assessment, could not sustain reopening. The reassessment was quashed, and the remaining grounds were left academic.

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Issues: Whether the reassessment initiated under section 147 of the Income-tax Act, 1961 was valid where the recorded reasons did not disclose the nature of the alleged accommodation entry, the date of the transaction, the identity of the counterparty, or the basis for the quantified amount.

Analysis: The recorded reasons relied on information from survey/search material indicating that an accommodation-entry provider had been found to be engaged in such business and that the assessee was one of the beneficiaries. However, the reasons did not specify the form of the alleged accommodation entry, the entity through which it was allegedly taken, or the factual basis for the exact figure attributed to the assessee. The absence of these particulars meant that the Assessing Officer had not demonstrated an independent application of mind to the information before assuming jurisdiction for reopening. On this footing, the reopening was held to be vitiated for want of valid and cogent reasons to believe that income had escaped assessment.

Conclusion: The reassessment was invalid and was quashed. The appeal was allowed in favour of the assessee, and the remaining grounds were left unadjudicated as academic.

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