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TMI Blog2017 (6) TMI 491X X X X Extracts X X X X X X X X Extracts X X X X ..... Bhavnesh Saini, Judicial Member Assessee by : Dr. Rakesh Gupta Shri Somil Aggarwal, Advocate Department by: Ms. Bedobani, Sr. DR ORDER Per Bhavnesh Saini, Judicial Member Both the appeals by the same assessee are directed against different orders of Ld. CIT(A) dated 3rd November, 2016 for asstt. year 2011-12 and dated 16th November, 2016 for asstt. year 2012-13. Ld. Representatives of both the parties mainly argued in asstt. year 2011-12 and have submitted that issues are same in both the appeals. Therefore for purpose of disposal of both the appeals I decide the appeal of assessee for asstt. year 2011-12 as under :- ITA No. 970/DEL/2017 Assessment Year : 2011-12 2. I have heard Ld. Representatives of both the parties and perused the material on record. 3. In this appeal assessee challenged the assumption of jurisdiction u/s 147 to 151 of the I.T. Act and additions of ₹ 13,91,657/-. 4. Briefly the facts of the case are that assessee filed return of income declaring income at ₹ 2,37,940/- on 29th March, 2013. The AO noticed that there were total cash deposits of ₹ 63,27,996/- in assessee s saving bank account with Punjab Nationa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... L a/c as the case may be. (v) You are required to furnish the details within one week of receipt of this letter. Please note that non-compliance of this letter may attract the penal action as per the provision of the Income Tax Act, 1961. It is to be mentioned in the verification letter itself that non-furnishing of information may constitute the reasons for initiating the proceedings to tax these transaction in the hand of the assessee by presuming that these are not disclosed to Income Tax Department. The assessee even after receiving the letter himself, did not tendered any reply till date and till now. This is sufficient fact to establish that these transaction/deposits are not disclosed in the regular return of income of assessee. Therefore, it is clear that amount of ₹ 63,27,996/- has not been brought to tax by the assessee. Accordingly, I have reason to believe that income to that tune of ₹ 63,27,996/- has been escaped assessment. Accordingly notice u/s148 is being issued for initiating the proceeding of the I.T. Act, 1961. 7. Ld. Counsel for assessee submitted that no proceedings were pending before AO when AO issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not analysed the information in right perspective and he sought to reopen by conceiving a fact that the assessee failed to respond to the query raised about this investment. As noticed in the submissions of Ld. Counsel for the assessee, I am of the view that there was no proceedings pending before the AO when he sought the clarification of the assessee vide alleged query notice dated 23rd January, 2012. The ITAT Amritsar Bench has dealt with this issue elaborately and recorded a finding that under the income tax Act, there is no such procedure to conduct an enquiry for collecting the information without pendency of assessment proceedings. If this reasoning is being excluded from the copy of the reasons given by the AO, then, nothing will remain with the AO except the information transmitted by AIR Wing. Apart from the above, it is to be seen that in the reasons the AO has nowhere alleged escapement of income. The thrust of the reasoning would show that he want to make an enquiry about the investment. No doubt, for reopening of an assessment, he has to just form a prima facie opinion and not to arrive at a firm conclusion, but, the formation of a prima facie opinion should also de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s found that assessee deposited cash of ₹ 63,27,996/- in his bank accounts. However the assessee contended before Ld. CIT(A) that the total aggregate deposits in bank accounts were only 41.15 lacs and not ₹ 63,27,996/-. The contention of the assessee was found correct by the Ld. CIT(A). It is therefore clear that the AO while recording the reasons for reopening of the assessment recorded incorrect facts in the reasons for reopening of assessment. Therefore reopening of the assessment u/s 147 is clearly invalid and bad in law. I rely decision of Hon ble Punjab Haryana High Court in the case of CIT vs. Atlas Cycle Industries 180 ITR 319. Further the AO after obtaining the AIR information wanted to verify the same and issued a letter of enquiry to the assessee. The AO thus did not apply in his independent mind to the information received from AIR. Since no proceedings were pending before AO when he issued the letter of enquiry to the assessee, therefore such enquiry letter was not valid in eyes of law. The assessee was not required to respond to this invalid and non est letter of inquiry issued by the AO. The AO in the absence of reply from the assessee presumed that inc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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