TaxTMI 
TaxTMI 
2016 (4) TMI 995
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.... 1961 in the absence of relevant information with him leading to formation of belief that the income had escaped assessment. (b) Making an addition of Rs. 10,01,045/- in the returned income of the Assessee Company by treating the amount of share application money as accommodation entries amount. (c) Ignoring the fact that shareholder Companies have been struck of the records of Registrar of Companies but still the confirmations of its then directors dated 12.02.2013 is on records. (d) Ignoring the fact the shareholder's existence at the time of remittance of share application money, the allotment of shares and confirmation of the above given by the directors of the defunct shareholder Company on 12.02.2013 has been on records. ....
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....tax Act, 1961 in the present case are based on "borrowed satisfaction" of DIT (Inv), New Delhi, hence, the very initiation of proceedings under sec. 147 of the Act is bad in law. 4.1 The Learned AR contended further that there was no application of his own mind by the Assessing Officer for formation of belief himself that income had escaped assessment as it is very much evident from the reasons recorded that his action was solely based upon the information received from the Investigation Wing. 4.2 In support, the Learned AR referred the contents of the reasons recorded and reproduced at page No.1 of the assessment order. He pointed out that the reasons recorded alleged that an amount of Rs. 6,00,600/- has escaped assessment, whereas the a....
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....d to have been received by the assessee on a single date i.e. 10th February 2003, from four entries which were termed as accommodation entries, which information was given to him by the Directorate of Investigation, the A.O. stated: "I have also perused various materials and report from Investigation Wing and on that basis it is evident that the assessee company has introduced its own unaccounted money in its bank account by way of above accommodation entries." The above conclusion is unhelpful in understanding whether the A.O. applied his mind to the materials that he talks about particularly since he did not describe what those materials were. Once the date on which the so called accommodation entries were provided is known, it would not ....
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....e that he has reason to believe that income of the assessee has escaped assessment. Unless that basic jurisdictional requirement is satisfied, a post mortem exercise of analyzing materials produced subsequent to the reopening will not rescue an inherently defective reopening order from invalidity. 14. In the circumstances, the conclusion reached by the ITAT cannot be said to be erroneous. No substantial question of law arises." 7. Now, we have to examine the reasons recorded in the present case before us in view of the ratios laid down in the above cited decision of the Hon'ble jurisdictional High Court recently pronounced on 08.10.2015 to verify the contention of the Learned AR that while forming the belief that income chargeable ....
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....w Delhi as per section 151(2) of the Income Tax Act, 1961 for issuance of notice u/s 148 of the Income Tax Act." 8. The very perusal of the reasons, it is apparent that these were based on the information received from DIT(Inv), New Delhi after narration of which, the Assessing Officer has simply recorded that he had reason to believe that amount/income of Rs. 6.06 lacs has escaped assessment for the assessment year 2005-06 for failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment within the meaning of sec. 147 of the Income-tax Act, 1961. Notice under sec. 148 of the Act has accordingly been issued by the Assessing Officer. In the above cited decisions of the Hon'ble High Cour....