TaxTMI 
TaxTMI 
2017 (8) TMI 961
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....9. To issue such notice, the Assessing Officer had recorded the following reasons : "In this case assessment for 200809 was finalized u/s.143(3) of the I.T. Act of Rs. 2,49,57,447/as against returned income Rs. 2,45,62,500/. Total purchase sales shown by the assessee amounting to Rs. 31,29,45,78,609,60/and Rs. 31,34,42,28,043/respectively. The Dy. Director of Income tax (Inv.), Unit2( 3), Mumbai;400 038 vide his letter No. DDIT(Inv.)/U2( 3)/ IntimationAO/ 20l415 dated 23.03.2015 supplied the information that during the course of investigation carried out by the Dy. Director of Income tax (Inv), Unit2( 3), Mumbai400 038 in the case of Shri Chandrakant Prahladbhai Patel (PAN : AOZPP 4246 C) it was found from the Bank statements. that Sh....
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....tax to the tune of Rs. 3,15,10,29,852/for A.Y. 200809 has escaped assessment. Therefore this is the fit case for reopening the assessment u/s. 147 for the A.Ys. 200809. Issue notice u/s. 148 of the I.T. Act." 2. The assessee raised objections to the notice of reopening under communication dated 5.6.2015. Such objections were rejected by the Assessing Officer by an order dated 9.6.2015. The petitioner has therefore, filed this petition. 3. Appearing for the petitioner, learned counsel Shri J.P. Shah vehemently contended that the original assessment was framed after scrutiny. The Assessing Officer during such scrutiny assessment had examined all aspects. He thereafter, framed the scrutiny assessment making no additions or disallowances.....
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....ai, it was revealed that during the course of investigation carried out in case of Shri Chandrakant Prahladbhai Patel, it was found from his bank statement that he had indulged in providing accommodation entries and bogus bills without actual supply of any goods or services. Most of these cheques were issued from the current account maintained by him and issuance of these cheques preceded by substantial cash deposits in such account. The account was maintained in the name of M/s. Shiyon Enterprises in Union Bank of India, Zaveri Bazar branch. There was strong prima facie material suggesting that said Shri Chandrakant Patel was providing accommodation entries. It was found that the assessee company was also availing the accommodation entries....
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....ssment. The expression cannot be read to mean that the Assessing Officer should have finally ascertained the fact by legal evidence or conclusion. What is required is reason to believe but not the established fact of escapement of income. At the stage of issuance of notice, the only question is whether there was relevant material on which a reasonable person could have formed the requisite belief. Whether material would conclusively prove escapement of income was not the concern at that stage. This is so because the formation of the belief is within the realm of the subjective satisfaction of the Assessing Officer. At this stage therefore, what we have on record and emerging from the reasons recorded is that there is strong prima facie mate....
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.... and nonspecific information. To that limited extent, the Court may look at the view taken by the Incometax Officer and can examine whether any material is available on record from which the requisite belief could be formed by the Assessing Officer and whether that material has any rational connection or a live link with the formation of the requisite belief. It is also immaterial that at the time of making original assessment, the Assessing Officer could have found by further inquiry or investigation as to whether the transactions were genuine or not. If on the basis of subsequent valid information, the Assessing Officer forms a reason to believe on satisfying twin conditions prescribed under section 147 of the Act that no full and true di....
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....ficer to a limited extent to inquiry as to whether there was sufficient material available on record for the Assessing Officer to form a requisite belief whether there was a live link existing of the material and the income chargeable to tax that escaped assessment. This does not appear to be the case where the Assessing Officer on vague or unspecific information initiated the proceedings of reassessment, without bothering to form his own belief in respect of such material. We need to notice that the Joint Director, CBI, Mumbai, intimated to the DIT (Investigation), Mumbai. A case is registered against Mr.Arun Dalmia, Harsh Dalmia and during the search at their residence and office premises, the substantial material indicated that 20 dummy ....