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TMI Blog2021 (1) TMI 949X X X X Extracts X X X X X X X X Extracts X X X X ..... cases (hereinafter known as Entry Operator) and after enquiry and examination of documents seized during course of search, it has been noticed that the said group is involved in providing accommodation entries to the persons which were named in the Report. The assessee company also figures in the list as one of the beneficiaries of the accommodation entries. On the basis of this information, AO recorded the reasons in writing and issued notice u/s. 148 of the Act to the assessee on 26.3.2015, after obtaining the approval from the JCIT, Range-24, New Delhi. Thereafter, a notice u/s. 143(2) of the Act was issued to the assessee and in response to the same, the AR of the assessee appeared from to time and submitted the requisite details. 2.1. Assessee vide letter dated 03.8.2015 submitted that return of income filed u/s. 139 of the Act on 30.9.2008 may be treated as return of income filed in response to the notice u/s. 148 of the Act and also requested for supply of copy of reasons for reopening of assessment which was provided by the AO. Assessee has also raised objections against the said reopening of the assessment which was disposed of by the AO vide letter dated 29.01.2016. 2. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate etc. The entire reasons to believe recorded by the AO is reproduction of conclusions drawn by the Investigation Wing. Ld. Counsel for the assessee further stated that it is perquisite that the AO should first apply his mind on the material/statement etc. supplied by the Investigation Wing. Keeping in view of the facts and circumstances of the present case, the AO recorded the reasons merely on the basis of some letters of Investigation Wing issued in the year 2013 and there was no material etc. in the possession of the AO which he examined independently at the time of recording the reasons on 25.2.2015. He draw our attention towards the reasons recorded by the AO. He requested that in view of the various decisions rendered by the Hon'ble Supreme Court of India and the Hon'ble High Courts in which the Hon'ble Courts has held that reopening of assessment based on the opinion and information wherein the AO has not investigated/enquired the matter independently, then the Department is not entitled to reopen the assessment. In support of his contention he relied upon the following cases laws:- - ACIT vs. Dhariya Construction Co. (2010) 328 ITR 515 (SC) - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DR relied upon the orders authorities below and stated that the AO has made the addition in dispute on the basis of various documentary evidences especially the information given by the Investigation Wing. As regards the approval obtained u/s. 151 of the Act from the Competent Authority, by the Assessing Officer, the addition in dispute has been made on the basis of after making detailed enquiry and on the basis of documentary evidences. Hence, he requested that the addition in dispute may be upheld by dismissing the appeal of the assessee. 5. We have heard both the parties and perused the orders passed by the revenue authorities, the reasons recorded by the AO and the approval granted by the Ld. JCIT u/s. 151 of the Act. For the sake of convenience, we are reproducing the reasons recorded by the AO as under:- 5.1. After perusing the aforesaid reasons recorded for reopening of assessment and approval of issue of notice u/s. 148 of the Act, we are of the view that the reasons to believe in the present case, are mechanical, without independent application of mind by the Investigation Wing of the Department without prima facie reaching to the conclusions himself by showing nexus wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... primary facts - Whether opinion of District Valuation Officer (DVO) per se is not an information for purposes of reopening of an assessment under section 147; Assessing Officer has to apply his mind to information, if any, collected and must form a belief thereon - Held, yes." ii) Pr CIT v. RMG Plyvinyl (I) Ltd. (2017) 83 taxmann.com 348 (Hon'ble Delhi High Court has observed as under:- 11. There can be no manner of doubt that in the instant there was a failure of application of mind by the AO to the facts. In fact he proceeded on two wrong premises - one regarding alleged non-filing of the return and the other regarding the extent of the so-called accommodation entries. 12. Recently, in its decision dated 26th May, 2017 in ITA No. 692/2016 (Principal Commissioner of Income Tax-6 v. Meenakshi Overseas Pvt. Ltd.), this Court discussed the legal position regarding reopening of assessments where the return filed at the initial stage was processed under Section 143(1) of the Act not under Section 143(3) of the Act. The reasons for the reopening of the assessment in that case were more or less similar to the reasons in the present case, viz., information was received from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ement of law. 38. The question framed is answered in the negative, i.e., in favour of the Assessee and against the Revenue. The appeal is, accordingly, dismissed but with no orders as to costs. 5.2. Even otherwise, we find that Ld. Joint CIT, Range-24, New Delhi has granted the approval in a mechanical manner by mentioning only "Yes, I am satisfied that this is a fit case for issue of notice u/s. 148 of the I.T. Act." which is not valid for initiating the reassessment proceedings. Thereafter, the AO has mechanically issued notice u/s. 148 of the Act. This view is supported by the following decision:- "Hon'ble Supreme Court of India in the case of CIT vs. S. Goyanka Lime & Chemical Ltd. reported in (2015) 64 taxmann.com 313 (SC) arising out of order of Hon'ble High Court of Madhya Pradesh in CIT vs. S. Goyanka Lime & Chemicals Ltd. (2015) 56 taxmann.com 390 (MP). "Section 151, 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 fo ..... 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