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TMI Blog2022 (4) TMI 229X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the case on the basis of AIR information observed that the Assessee has deposited cash in his S.B. Account during the F.Y. 2008-09 and therefore issued a verification letter dated 30.10.2015 to the Assessee who failed to respond the same, therefore inference was drawn by the AO that the source of deposit in saving bank account remained unexplained as the Assessee has not filed return of income for the A.Y. 2009-10. As the AO except issuing verification letter to the Assessee, has not made proper efforts to find out the veracity and authenticity of information and any corroborative evidence/material thereto and without connecting tangible material and the formation of the reasons to believe for escapement of income but only acted on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The case of the Assessee was re-opened by the AO by recording the reasons u/s 147 of the Act, on the basis of AIR information to the effect that the Assessee has deposited cash of ₹ 44,00,500/- in his Saving Bank Account during the FY 2008-09. Though the AO issued a letter dated 30.10.2015 to the Assessee however, the Assessee did not make any compliance to the same. Therefore, the opinion was formed by the AO that source of deposit in saving bank account of the Assessee remained unexplained. The AO further observed that the Assessee has not filed return of income for the Assessment Year 2009-10, therefore, the amount of ₹ 4400500/- chargeable to tax escaped assessment within the meaning of section 147 of the Act. Consequently, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the income for any assessment year has escaped assessment and has duly recorded the reasons, however it well settled that the reasons to believe must be bona fide and based upon some relevant material, on which a reasonable person could have form the requisite belief. 6.1 Let us peruse the reasons recorded by the AO, which are as under: "On the basis of AIR information that the Assessee has deposited cash of ₹ 44,00,500/- in his S.B. Account during the F.Y. 2008-09, verification letter dated 30.10.2015 was issued, but the Assessee did not make any compliance to this letter. Hence, the source of deposit in saving bank account remained unexplained. The Assessee has not filed return of income for the A.Y. 2009-10. I have, there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re is no independent application of mind by the AO to the tangible material which forms the basis of the reasons to believe that income has escaped assessment. The conclusions of the AO are at best a reproduction of the conclusion in the investigation report. Indeed it is a 'borrowed satisfaction'. The reasons fail to demonstrate the link between the tangible material and the formation of the reason to believe that income has escaped assessment. For the aforementioned reasons, the Court is satisfied that in the facts and circumstances of the case, no error has been committed by the ITAT in the impugned order in concluding that the initiation of the proceedings under Section 147/148 of the Act to reopen the assessments for the AYs in q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ondition is that the satisfaction recorded should be "independent" and not "borrowed" or "dictated‟ satisfaction. 6.8 From the judgments referred above, inference can also be drawn that demonstration of link between the tangible material and the formation of the reasons to believe that income had escaped assessment is necessary for reopening the case u/s 147/ 148 of the Act and the information received from the Investigations Wing or AIR cannot be said to be a tangible material per se without further inquiry being undertaken by the AO. The conclusion of the AO, based on the Investigation Report or AIR information indeed is a borrowed satisfaction. 6.9 Admittedly in this case, the AO while recording reasons for selection of the case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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