AO reopened assessment based on information received from Investigation Wing and treated share capital received by assessee as unexplained credit and accordingly made addition under section 68.Held: AO did not carry out independent enquiry pursuant to receipt of information from investigation wing. Accordingly, there was clear non-application of mind on AO's part and hence, reopening of assessment based on mere borrowed satisfaction could not be sustained in the absence of valid reason to believe.
IN THE ITAT, DELHI BENCH
AMIT SHUKLA, J.M. & L.P. SAHU, A.M.
ITO v. Randeep Investment (P) Ltd.
ITA No. 4365/Del/2015 & ITA No. 4000/Del/2015
26 March, 2019
Appeal Allowed.
Department by: Surender Pal, Sr. DR
Asessee by: Sandeep Sapra, Advocate
Amit Shukla, J.M.
The aforesaid cross appeals filed by the assessee as well as by the revenue against impugned Order, dated 21-4-2015, passed by learned CIT (Appeals)-10, New Delhi for the quantum of assessment under section 147/143(3).
2. We will first take up the assessee's appeal, wherein the assessee has challenged, firstly, the validity of proceedings under section 148 and reopening of assessment under section 147 on the ground that 'reasons recorded' are not in accordance with law; secondly, the approval granted by the learned CIT in terms of section 151 is purely mechanical; thirdly, the addition of Rs. 28 lacs as sustained by Commissioner (Appeals) out of total addition of Rs. 1,53,50,000 under section 68; and lastly, addition of Rs. 28,000 made under section 69C on account of commission/premium allegedly paid by the assessee for getting the share capital.
3. The facts in brief are that assessee has filed its return of income on 29-3-2007 which was duly processed under section 143(1). Thereafter a notice under section 148 was issued on 16-3-2013. Before issuing of notice, assessing officer has recorded following reasons: --