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TMI Blog2021 (4) TMI 376X X X X Extracts X X X X X X X X Extracts X X X X ..... of deposit need not necessarily be income of the assessee. We further notice that in the present case, the Ld. Pr. CIT has accorded sanction for issuing notice u/s 148 of the Act, without ensuring that the AO has recorded the reasons after due application of mind. In our considered view, the Ld. CIT(A) has sustained the addition in question ignoring that the impugned order suffers from the legal infirmities discussed in the forgoing paras. In the light of the facts of the case and the cases relied upon by the Ld. Counsel, we are of the opinion that the impugned order is not sustainable in law as the ld. CIT(A) has passed the impugned order ignoring the ratio laid down by the hon ble High Court of Delhi and Madhya Pradesh and also the decision of the Delhi Bench of the Tribunal discussed above. We accordingly allow the legal grounds raised by the assessee and set aside the impugned order passed by the. ld. CIT(A). - SHRI N.K. SAINI, VICE PRESIDENT AND SHRI R.L NEGI, JUDICIAL MEMBER Assessee by: Shri Sudhir Sehgal, Advocate Revenue by: Smt. Meenakshi Vohra, Addl. CIT ORDER Per R.L. Negi, Judicial Member: The assessee has filed the present appeal against the order dated 12.12.2019 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer. 4. That the Ld. CIT(A) has failed to consider the documentary evidences with regard to availability of funds and ignoring the documentary evidences. 5. That the confirmation part addition is against the facts and circumstances of the case. 6. That the detailed submission as filed during the course of proceeding has not been considered properly. 7. That the appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed of. 4. The assessee further challenged the impugned order by raising an additional ground that since the notice u/s 148 of the Act was not served upon the assessee either by post or by affixture, the proceedings u/s 147 r/w section 148 of the Act is void ab initio, therefore, liable to be quashed. 5. At the outset, the Ld. Counsel submitted before us that since, the additional ground raised by the assessee is legal in nature and no fresh enquiry is required, the same may be admitted and the assessee may be allowed to argue on the said ground as well. The ld. Counsel relied on the judgment of the Hon ble Supreme court in the case of National Thermal Power Plant Co. Ltd. vs. CIT 229 ITR 383 to substantiate his argum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at notice u/s 148 of the Act was not served upon the assessee. The Revenue is not in a position to rebut the contention of the assessee. The Hon ble Delhi High Court in the case of CIT vs. Chetan Gupta (supra) has held that in order to initiate reassessment proceedings, notice u/s 148 of the Act has to be served mandatorily served upon assessee in accordance with section 282(1) of the Act read with Order V, Rule 12 and Order III Rule 6 of the Civil Procedure Code. Hence, in our considered view, the reassessment proceedings initiated by the AO in this case is contrary to the judgment of the Hon ble High Court of Delhi and decisions of the various Benches of the Tribunal, relied upon by the Ld. counsel for the assessee, therefore liable to be quashed. 11. The assessee has further challenged the action of the Ld. CIT(A) by raising another legal ground that the Ld. CIT(A) has eared in confirming the action of AO in initiating reassessment proceedings on the basis of approval granted by the Principal Commissioner of Income Tax (Pr. CIT) in a mechanical manner. The Ld. Counsel submitted before us that in this case there was no application of mind by the AO to come to the conclusion that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in mechanical manner and without application of mind to accord sanction for issuing notice u/s 148 of the Act, the reopening of the assessment was invalid. The observations of the Hon ble Court are as under: 7. We have considered the rival contentions and we find that while according sanction, the Joint Commissioner, Income Tax only recorded so Yes, I am satisfied which indicates as if he was to sign only on the dotted line. Even otherwise also, the exercise is shown to have been performed in less than 24 hours of time which also goes to indicate that the Commissioner did not apply his mind at all while granting sanction. The satisfaction has to be with objectivity on objective material. 8. If the case in hand is analysed on the basis of the aforesaid principle, the mechanical way of recording satisfaction by the Joint Commissioner, which accords sanction for issuing notice under 148, is clearly unsustainable and we find that on such consideration both the appellate authorities have interfered into the matter. In doing so, no error has been committed warranting reconsideration. 15. In the present case, the Pr. CIT has recorded his satisfaction by writing yes, satisfied, it is a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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