TaxTMI 
TaxTMI 
TaxTMI 
2019 (3) TMI 1063
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....me at nil. Subsequently, information was received by the department vide letter dated 20.3.2013 from the Investigation Wing of the department that the assessee had raised share capital and share premium totalling to Rs. 1,25,00,000/- during the year under consideration but had not filed any return of income. Further, the Assessing Officer received another information from the Investigation Wing that the assessee had received accommodation entries of Rs. 19,00,500/- from one Shri S.K. Jain who had been found to be providing accommodation entries. Accordingly, the Assessing Officer issued notice u/s 148 of the Income Tax Act, 1961 (hereinafter called 'the Act') after recording reasons that income to the extent of Rs. 1,44,00,500/- had....
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....s and nature of transactions and, thus, the reasons had been recorded in a mechanical manner without independent application of mind. The Ld. Commissioner of Income Tax (Appeals) went on to hold that the initiation of reassessment proceedings and issuance of notice u/s 148 of the Act was bad in law and was not sustainable. The Ld. Commissioner of Income Tax (Appeals) proceeded to quash the notice issued u/s 148 as well as the consequent assessment order. The department is now in appeal before the ITAT against the quashing of this reassessment order and has raised the following grounds of appeal:- "1. The Ld. CIT (A) erred in quashing the assessment and issue of notice u/s 148 of the Act. 2. The Ld. CIT(A) erred in observing that the ret....
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....sessee company was one of the beneficiary companies of Shri S.K. Jain and had received accommodation entries and, therefore, the Assessing Officer had reason to believe that the income of the assessee had escaped assessment and, therefore, the Assessing Officer was justified in issuing notice u/s 148 of the Act. The ld. Sr. DR also placed reliance on numerous case laws in support of his contention that the quashing of re-assessment was bad in law. 4.0 In response, the Ld. AR submitted that the Ld. Sr. DR was factually incorrect in alleging that the assessee had filed return with the wrong Assessing Officer. It was submitted that the assessee had filed the return with the jurisdictional Assessing Officer only but it was the Assessing Office....
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.... assessing officer has to comply with the provisions of sections 148 to 153 of the Act. Under the scheme of the Act, the assessing officer can initiate proceedings under section 147 of the Act only if he has "reasons to believe" that any income of the assessee has escaped assessment. In terms of section 148 of the Act, the assessing officer is required to record the reasons on the basis of which proceedings under section 147 of the Act are initiated. The reasons recorded must show application of mind by the assessing officer to come to the belief that any income of the assessee had escaped assessment, and thus the reasons act as the stepping stone in initiation of proceedings under section 147 of the Act. The validity or otherwise of the pr....
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....is case, the assessee had filed the return of income declaring a certain income and the Assessing Officer subsequently had issued notice u/s 147 of the Act on the ground that information had been received from the Investigation Wing that the assessee was a beneficiary of accommodation entries received from certain established entry operators identified by the Investigation Wing. As per the information received from the Investigation Wing, the accommodation provider had given accommodation entries in the garb of share application money etc. Notice was issued by the Assessing Officer to reopen the assessment on the basis that income chargeable to tax to the extent of accommodation entry had escaped assessment. The Assessing Officer also noted....