2020 (10) TMI 251

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....d its return of income declaring NIL income on 26.11.2006 against which the assessment u/s. 143(3) of the I.T. Act, 1961 was completed on 21.11.2008 at NIL income. Subsequently, information was received from the office of Director of Income Tax, (Inv.), New Delhi that the assessee had received accommodation entries amounting to Rs. 75 lacs from various parties. The case of the assessee was reopened u/s. 147/148 of the Act and notice u/s. 148 of the Act was issued on 22.3.2013 with the prior approval of the CIT, Delhi-5, New Delhi, after recording the reasons. In view of the report received from the DIT (Inv.), New Delhi, the AO initiated the proceedings u/s. 147 of the Act and issued notice u/s. 148 of the Act dated 22.3.2013. In response t....

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....principle of natural justice, perverse and void ab initio. In support of his contention, Ld. Counsel for the assessee has given his written submissions challenging the notice u/s. 148 of the Act on various grounds. He has also argued and made the averments in the written submissions on merits also, but specifically he draw our attention towards the reasons recorded dated 20.3.2013 as well as the approval given by the Ld. CIT, Delhi-5, New Delhi dated 22.3.2013 and stated that Ld. CIT-5, New Delhi has not applied his mind and gave approval in a mechanical manner, which is not sustainable in the eyes of law and therefore, the notice u/s. 148 is not in accordance law. He requested that the notice u/s. 148 of the Act is invalid and accordingly ....

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....of the Income Tax Act, 1961 by mentioning as under:- "I am satisfied with the reasons." 5.1 After perusing the aforesaid remarks of the Ld. CIT-5, New Delhi, we find that the approval granted by the Ld. CIT-5, New Delhi is a mechanical and without application of mind, which is not valid for initiating the reassessment proceedings, because from the aforesaid remarks, it is not coming out as to which material; information; documents and which other aspects have been gone through and examined by the Ld. CIT-5, New Delhi for reaching to the satisfaction for granting approval. Thereafter, the AO has mechanically issued notice u/s. 148 of the Act. Keeping in view of the facts and circumstances of the present case and the case laws applicable i....

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....read with section 148 of Income Tax Act, 1961 - Income escaping assessment - Sanction for issue of notice (Recording of satisfaction) - High Court by impugned order held that where Joint Commissioner recorded satisfaction in mechanical manner and without application of mind to accord sanction for issuing notice under section 148, reopening of assessment was invalid - Whether Special Leave Petition filed against impugned order was to be dismissed - Held, Yes (in favour of the Assessee)." 6. In the background of the aforesaid discussions and respectfully following the precedents, as aforesaid, we are of the considered view that approval granted by the Ld. CIT-5, New Delhi is a mechanical and without application of mind, which is not valid f....