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TMI Blog2017 (1) TMI 1036X X X X Extracts X X X X X X X X Extracts X X X X ..... ingful, which is the rationale for the safeguard of an approval by a higher ranking officer. For these reasons, the Court is satisfied that the findings by the ITAT cannot be disturbed. - Decided in favour of the assessee. - ITA 335/2015 - - - Dated:- 11-1-2017 - S. Ravindra Bhat And Najmi Waziri, JJ. For the Appellant : Mr. Dileep Shivpuri, Mr. Sanjay Kumar and Mr. Vikrant A. Maheshwari, Advocates For the Respondent : Dr. Rakesh Gupta, Mr. Somil Agarwal, Mr. Rohit Kumar Gupta and Ms. Monika Ghai, Advocates ORDER S. Ravindra Bhat (Oral) 1. The following questions of law were framed in this case:- (a) Did the Tribunal fall into error in holding that the Commissioner of Income Tax (CIT) did not in fact record sat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rits. 3. The Revenue appealed against the appellate order on the merits; the assessee s cross appeal was on the question of correctness of reopening of the assessment. 4. The ITAT upheld the assessee s cross-objections and dismissed the Revenue s appeal holding that there was no proper application of mind by the concerned sanctioning authority under Section 151 of the Act as a pre- condition for issuing notice under Sections 147/148 of the Act. The ITAT also concluded that in the given facts of the case, the AO had not conducted adequate and proper inquiry into the materials, while invoking Section 68 of the Act to add the amounts in issue. 5. Counsel for the Revenue urges that the CIT (A) and the Tribunal fell into material error ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reditors were not demonstrated. In the circumstances, the assessee could not be said to have discharged the burden placed upon it in the first instance. 7. Counsel for the assessee argued that the findings of the ITAT on the question of reopening are not perverse and are according to law. He relied upon the noting to say that the CIT (A) merely approved the note put up by the ACIT which cannot be said to have satisfied the pre-condition of satisfaction contemplated under Section 151 of the Act. As to the merits, the learned counsel urged that details of each relevant party i.e. confirmation of the amounts paid towards share application or loan, acknowledgment of the ITRs filed by the concerned party/creditor, copies of bank statements an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertain bank statements which disclosed facially that the amounts were infused in cash at the relevant time before the shares were subscribed to or the credits were given. Those suspicious circumstances at the same time could not have been the conclusive factor in this case. 9. Since the investigation wing had levelled several allegations, the AO should, in our opinion, have carried out a more intensive investigation into the income tax records to actually discern the volume of trade or commerce of the share applicants/creditors and their inability, if any, to invest or advance the amounts in issue. That failure cannot translate into the amount by the assessee to provide basic information which is undoubtedly not done. In these circumstan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the 'Money Laundering Scam leaving the said money at the disposal of the beneficiaries without any associated cost or liability. In the instant case, the assessee is found to be the beneficiary of accommodation entry from such entry operators as per the following specific details of transaction:- Entry Operator Beneficiary s bank Amount- Rs. Instrument No. by which entry taken and date Entry giving bank Account no. From which entry was given Mahesh Garg - 800480 30.11.2000 SBP-DG 4507 Performance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sums from the entry operators as per the above details as per information available with the undersigned. As explained above the identity, creditworthiness and genuineness of transactions with the persons found to be entry operators cannot be established. I therefore have reasons to believe that on account of failure on the part of the assessee to disclose truly and fully all material facts necessary for assessment for above AY the income chargeable to tax to the extent of accommodation entry mentioned above, has escaped assessment within the meaning of S.147 of the Act. Since four years has been expired from the end of the relevant year, and assessment u/s 143(3) of the Act was made in the case of the assessee for the said A ~ the rea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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