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Income Tax Appellate Tribunal, DELHI BENCHES “SMC”: DELHI
Before: SHRI BHAVNESH SAINI
ORDER This appeal by assessee has been directed against the Order of the Ld. CIT(A)-12, New Delhi, Dated 19.01.2018, for the A.Y. 2012-2013, challenging the reopening of the assessment under section 147/148 of the I.T. Act, 1961 and addition of Rs.21,28,020/- as deemed income under section 69A of the I.T. Act, 1961.
2 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi.
Briefly the facts of the case are that an information was received from ACIT, Inv. Unit-III (3), New Delhi vide letter dated 03.05.2012 wherein it was stated that during search operation carried out on AEZ group of cases (part of Aerens Group) on 17.08.2011 and subsequent post search enquiries and operation under section 133A conducted on 10.02.2012 on certain investors groups comprising of 23 investors, it was gathered that the investors had made substantial amount of cash payment other than the payment made through banking channel. The amount of cash paid tallied with the printout from Annexure A-27 seized from Corporate Office at Bakshi House, Nehru Place, New Delhi. It was further noticed that the cash received was coded as incentive to sale. Apart from this Annexure A-32, file DP correction sheet was also seized.
2.1. The assessee was found one of the investors in booking of FF-117, Ground Floor Commercial, Indirapuram Habitat Centre Project, Ghaziabad Project of AEZ Group. As per information received, assessee had made a total payment of Rs.1,20,50,000/- for booking/purchase of this 3 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. property. The cash payment as recorded in the seized record amounted to Rs.88,50,000/- and payment through banking channel amounted to Rs.32 lakhs. On perusal of the documents, it was crystal clear that the assessee had made cash payment amounting to Rs.88,50,000/- apart from payment of Rs.32 lakhs through banking channel. During the assessment proceeding, assessee regarding payment made by her to M/s AEZ Grop in connection with booking/purchase of property, the assessee has only admitted of having paid Rs.32 lakhs out of her saving bank account maintained with Canara Bank in two installments of (i) Rs. 11,37,000/- on 21.04.2006 and (ii) Rs.20,63,000/- on 21.06.2011. The assessee denied any cash payment. The A.O. noted that numbers of investors, during post search enquiries admitted having made cash payment. The circumstantial evidences as gathered during post search enquiries revealed that assessee had made cash payment of Rs.88,50,000/- apart from payment made by cheque to the tune of Rs. 32 lakhs. There is general practice in real estate business that cash component is on a higher side as 4 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. compared to payments by cheque and this is an admitted fact in this trade. Considering all aspect of the case, reasons under section 147 were recorded and a belief was formed that the assessee had made cash payment of Rs.88,50,000/- from undisclosed sources and income liable to tax had escaped assessment. The assessee filed return of income of Rs.5,71,479/- and asked that the same may be treated as return filed in response to notice under section 148 of the I.T. Act, 1961.
2.2. The A.O. in this case previously reopened the assessment for A.Y. 2007-2008 and Order under section 147 of the I.T. Act was passed on 28.03.2014. As per reasons recorded for A.Y. 2007-2008, it is observed that the assessee had booked FF-117, Ground Floor Commercial, Indirapuram Habitat Centre Project, Ghaziabad, Project of AEZ Group. As per reason recorded, assessee had made a total payment of Rs.78,58,980/- for booking/purchase of the property FF-117, Ground Floor Commercial, Indirapuram Habitat Centre Project, Ghaziabad, out of which, Rs.11,37,000/- was made by cheque and payment of 5 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. Rs.67,21,980/- was made in cash. The amount paid in cash amounting to Rs.67,21,980/- was treated as unexplained investment in cash and added in A.Y. 2007-08. During the assessment year under appeal i.e., 2012-13, the assessee has submitted that she had invested in this property and assessee had made payment amounting to Rs.11,37,000/- and Rs.20,63,000/- (supra) for the same property and also copies of the bank statement for both the years were enclosed. On perusal of submission made by the assessee, A.O. observed that the amount of Rs.11,37,000/- paid through cheque is the same amount which was shown at the time of assessment proceeding for the A.Y. 2007-08 for the same property. Out of Rs.32 lakhs, Rs.20,63,000/- was paid on 21.06.2011 and, therefore, covered for the assessment proceeding for the A.Y. 2012-13 under appeal. Regarding cash payment, out of Rs.88,50,000/-, an amount of Rs.67,21,980/- was already covered for the assessment proceedings for the A.Y. 2007-08 for which the assessee is in appeal before ITAT, New Delhi. The A.O, therefore, noted that since, as per reasons recorded for A.Y. 2007-08 and 6 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. A.Y. 2012-13 (under appeal), the description of property appears to be same, therefore, the difference amount being Rs.21,28,020/- (i.e., Rs.88,50,000/- - Rs.67,21,980/-) has, escaped for assessment and this amount is covered for assessment year under appeal i.e., 2012-2013. The A.O. accordingly made addition of Rs.21,28,020/- under section 69A of the I.T. Act, 1961.
3. The assessee challenged the addition as well as reopening of the assessment before the Ld. CIT(A). The written submissions of the assessee are reproduced in the appellate order. The Ld. CIT(A), however, dismissed both the grounds.
I have heard the Learned Representative of both the parties and perused the material available on record. It is well settled Law that validity of the re-assessment proceedings shall have to be determined with reference to the reasons recorded for reopening of the assessment. In assessment year under appeal i.e., 2012-2013, the A.O. has recorded the following reasons for reopening of the 7 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. assessment, copy of which is filed at P-8 of the paper book which reads as under: “Annexure Reason for the belief that the income has escaped assessment in the case of Smt. Taruna Verma [PAN - AKFPS195JP] for the Assessment Year 2012-13.
Information in this case was received from ADIT, Investigation), Unit-Ill (3), New Delhi that a search & seizure operation was conducted on AEZ Group (Part of Aerens Group) on 17.08.2011. On the basis of material seized/impounded during the course of search/survey operation and post survey conducted on even investors groups comprising of 23 investors to verify payment of such unaccounted money on booking. During the course of search/survey, operation it has been accepted by the investors that they have made cash payment for booking/purchase of property in the above said project. The amount accepted by them to have been paid exactly matched with the amounts mentioned in the extracted
8 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. sheets of the Hard Disk seized from the Corporate Office of the AEZ Group.
2. Ms. Taruna Verma is one of the investors of the AEZ Group, who has booked/purchase Unit No. FF-117, Ground Floor Commercial, Indirapuram Habitat Centre Project, Ghaziabad Project of AEZ Group. As per information received Ms. Taruna Verma has made a total payment of Rs.1,20,50,000/- for booking/ purchase of this property, Rs.32,00,000/- was 'made by cheque on 01.04.2011 and payment of Rs.88,50,000/- was made in cash.
Letter was issued to Ms. Taruna Verma regarding payments made by her to M/s AEZ Group in connection with booking/purchase of property. The assessee has only admitted of having paid Rs.32,00,000/-, out of her savings Bank account maintained with Canara Bank, Shastri Nagar, New Delhi as under : (i) Rs.11,37,000/- on 21.04.2006; and (ii) Rs.20,63,000/- on 21.06.2011 9 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi.
4. Thus, she denied any payment in cash. The case for the Assessment year 2007-08 was taken under scrutiny after recording reasons and the assessment has been completed under scrutiny on 28.03.2014 at an income of Rs.68,30,980/- as against the return income at Rs.1,08,256/-. As information also revealed payment Rs.88,50,000/- paid in cash on 01.04.2011 (FY 2011-12). The assessee failed explain the source of cash payment of Rs.88,50,000/-, thus, paid from undisclosed sources which is to be added to the income of the assessee. Hence, the case also need be opened for the assessment year 2012-13.
In view of the facts and circumstances, I have reason to believe that income to the extent of Rs.88,50,000/- paid by Ms. Taruna Verma in cash for booking/purchase of property with AEZ Group in the FY 2011-12 is chargeable to tax for the assessment year 2012-13 and has escaped assessment.”
10 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. 4.1. Since in this case similar reasons were also recorded for A.Y. 2007-2008 and the matter was pending before the Tribunal, Learned Counsel for the Assessee filed copy of the same reasons for reopening of the assessment for A.Y. 2007-2008 at page-7 of the paper which which reads as under :
“Ms. Taruna Verma – PAN AKFPV1950P – Assessment Year 2007-08.
Information has been received front ADIT, (Investigation), Unit - III (3), New Delhi that a search & seizure operation was conducted on 17/08/2011 on AEZ Group (Part of Aerens Group). On the basis of material seized/impounded during the course of search/survey operation and post survey conducted on seven investors groups ; comprising of 23 investors to verify payment of such unaccounted money on 'booking.
During the course of search/survey operation it has been accepted by the investors that they have made cash payment for booking/purchase of property in the 11 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. above said project. The amount accepted by them to have been paid exactly matched with the amounts mentioned in the extracted sheets of the Hard Disk seized from the Corporate Office of the AEZ Group.
Ms. Taruna Verma is one of the investors of the AEZ. Group, who has booked/purchase Unit No. FF-117, Ground Floor Commercial, Indirapuram Habitat Centre Project, Gaziabad Project of AEZ Group. As per information received, M/s Taruna Verma has made a total payment of Rs.78,58,980/- for booking/purchase of this property. Rs.11,37,000/- was made by cheque on 19/04/2006 and payment of Rs.67,21,980/- was made in cash.
Letter was issued to Ms. Taruna Verma regarding payments made by her to M/s AEZ Group in connection with booking/purchase of property. The assessee has only admitted of having paid Rs.11,37,000/- out of her saving bank account maintained with Canara Bank, Shastri Nagar, New Delhi.
12 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. In view of the facts and circumstances, I have reason to believe that income to the extent of Rs.67,21,980/- paid, by M/s. Taruna Verma in cash for booking/ purchase of property with AEZ Group in the F. Y. 2006- 07 is chargeable to tax for the assessment year 2007- 08 and has escaped assessment.
Approval is sought u/s 151(2) of the 1. T. Act.
Sd/-Sunil Kumar, Income Tax Officer, Ward-19(3), New Delhi.
4.2. Learned Counsel for the Assessee submitted that appeal of assessee for A.Y. 2007-2008 have been decided by ITAT, Division Bench, New Delhi in ITA.No.2833/Del./2016 vide Order Dated 19.09.2017 and re-assessment proceedings have been quashed. The Order of the Tribunal in paras 8 to 15 are reproduced as under :
“8. We have carefully considered the rival contentions. The issue before us is twin fold: one with respect to the reopening of the assessment challenged by 13 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. the assessee vide ground No. 1 to 6 of the appeal of the assessee and ground No. 7 and 8 are related to the merits of the case of the assessee. In the present case the original reasons recorded by the ld Assessing Officer on 22.04.2013 shows that information was received that assessee has made total payment of Rs.78,58,980/- and out of this sum of Rs.11,37,000/- was paid by cheque and balance amount of Rs.67,21,980/- was paid in cash. It was stated in the reason that the assessee has accepted it during the course of post search enquiries conducted by the Investigation Wing. The reasons also stated that AO had issued a query letter on 05.02.2013, which was replied by the assessee on 27.02.2013, wherein the assessee has accepted investment of Rs.11.37 lacs only. Therefore, the ld AO had reason to believe that sum of Rs.67,21,980/- is paid by the assessee in cash.
14 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi.
In response to above reasons assessee submitted that it has paid on 21.04.2006 Rs.11,37,000/- vide cheque No.874025 of Canara Bank and Rs.20.63 lakhs on 21.06.2011, therefore, assessee has paid a sum of Rs.32 lakhs by cheque. Therefore, the reason recorded by the Assessing Officer of payment Rs.11.37 lacs by cheque is incorrect. Furthermore, the assessee was never examined during the post search enquiries and hence, it is an incorrect statement. The Assessing Officer has given the statement of two different persons vide letter dated 18.02.2014 but nowhere the statement of the assessee was given. Apparently, assessee was not examined. The Revenue also could not produce any such communication which are also referred to in letter dated 22.04.2013.
Further suddenly on 20/03/2014 the Ld. assessing officer wrote a letter to the assessee stating that by sending the letter dated 15 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. 22/04/2013 wherein the original reasons recorded were communicated, some typographical mistake have crept in. Therefore, the said letter dated 22/04/2013 is withdrawn. It was further stated that 22/03/2013 under section 147 of even date is enclosed. Suddenly the new reasons, which are placed at page No. 56 of the paper book, were supplied to the assessee. As per the new reasons the total payment of Rs.78,58,980/-, the sum paid by cheque of Rs.11.37 Lacs, and the balance amount of Rs.67,21,980/-paid in cash also remains unchanged. This was provided to the assessee when only 10 days time was left with the assessing officer for completion of the assessment. The assessee filed objection to this new reasons on 24/03/2014, which was disposed of on the same date without adverting to the any of the objection of the assessee. In the present case the figure stated by the Ld. assessing officer in reasons recorded as well as the actual fact of 16 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. details of payment made by the assessee to the builder did not match. Assessee has already paid a sum of Rs.32 Lacs whereas the reasons mentioned by the assessing officer states that assessee has only paid Rs.11.37 Lacs. Therefore, it is apparent that Ld. assessing officer has initiated reassessment proceedings without application of mind to the facts of the case to the information supplied by the investigation wing. The issue is squarely covered by the decision of the Hon'ble Delhi High Court in case of principle Commissioner of income tax versus G & G Pharma Ltd 384 ITR 147 (Delhi) wherein it has been held that :-
10. In Asst. CIT v. Dhariya Construction Co. [2010] 328 ITR 515 (SC), the Supreme Court in a short order held as under :
Having examined the record, we find that in this case, the Department sought reopening of the assessment based on 17 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. the opinion given by the District Valuation Officer, the opinion of the District Valuation Officer per se is not an information for the purposes of reopening assessment under section 147 of the Income-tax Act, 1961. The Assessing Officer has to apply his mind to the information, if any, collected and must form a belief thereon. In the circumstances, there is no merit in the civil appeal. The Department was not entitled to reopen the assessment.
11. The above basic requirement of sections 147/148 has been reiterated in numerous decisions of the Supreme Court and this court. Recently, this court rendered a decision dated September 22, 2015 in I. T. A. No. 356 of 2013 (CIT v. Multiplex Trading and Industrial Co. Ltd. [2015] 378 ITR 351 (Delhi)) where the assessment was sought to be 18 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. reopened beyond the period of four years. This court considered the decision of the Supreme Page No : 0152 Court in Phool Chand Bajrang Lal v. ITO (supra) as well as the decision of this court in Haryana Acrylic Manufacturing Co. (P.) Ltd. v. CIT [2009] 308 ITR 38 (Delhi) The court noted that a material change had been brought about to section 147 of the Act with effect from April 1, 1989 and observed (page 368 of 378 ITR) :
It is at once seen that the amendment in section 147 of the Act brought about a material change in law with effect from April 1, 1989. Section 147(a) as it stood prior to April 1, 1989, required the Assess ing Officer to have a reason to believe that (a) the income of the assessee has escaped assessment and 19 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. (b) that such escapement is by reason of omission or failure on the part of the assessee to file a return or to disclose fully and truly all material facts necessary for his assessment for that year. After the amendment, only one singular requirement is to be fulfilled under section 147(a) and that is, that the Assessing Officer has reason to believe that income of an assessee has escaped assessment. However, the proviso to section 147 of the Act provides a complete bar for reopening an assessment, which has been made under section 143(3) of the Act, after the expiry of four years. However, this proscription is not applicable where the income of an assessee has escaped assessment on account of failure on the part of the assessee to make a return or to disclose fully and truly all material facts necessary for his assessment. Thus, in order 20 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. to reopen an 16 | P a g e Tarun Verma Vs. ITO, (Assessment Year: 2007-08) assessment which is beyond the period of four years from the end of the relevant assessment year, the condition that there has been a failure on the part of the assessee to truly and fully disclose all material facts must be concluded with certain level of certainty. It is in the aforesaid context that this court in Haryana Acrylic Manufacturing Co. (P.) Ltd. (supra) explained that the ratio of the decision in Phool Chand Bajrang Lal (supra) may not be entirely applicable since the same was in respect of section 147(a) as it existed prior to the amendment.
In the present case, after setting out four entries, stated to have been received by the assessee on a single date, i.e., February 10, 2003, from four entities which were 21 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. termed as accommodation entries, which information was given to him by the Directorate of Investigation, the Assessing Officer stated : "I have also perused various materials and report from Investigation Wing and on that basis it is evident that the assessee company has introduced its own unaccounted money in its bank account by way of above accommodation entries". The above conclusion is unhelpful in understanding whether the Assessing Officer applied his mind to the materials that he talks about particularly since he did not describe what Page No : 0153 those materials were. Once the date on which the so called accommodation entries were provided is known, it would not have been difficult for the Assessing Officer, if he had in 22 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. fact undertaken the exercise, to make a reference to the manner in which those very entries were provided in the accounts of the assessee, which must have been tendered along with the return, which was filed on November 14, 2004, and was processed under section 143(3) of the Act. Without forming a prima facie opinion, on the basis of such material, it was not possible for the Assessing Officer to have simply concluded : "it is evident that the assessee company has introduced its own unaccounted money in its bank by way of accommodation entries". In the considered view of the court, in light of the law explained with sufficient clarity by the Supreme Court in the decisions discussed hereinbefore, the basic requirement that the Assessing Officer must apply his mind to the materials in order to have reasons to believe 23 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. that the income of the assessee escaped assessment is missing in the present case.
13. Mr. Sawhney took the court through the order of the Commissioner of Income-tax (Appeals) to show how the Commissioner of Income-tax (Appeals) discussed the materials produced during the hearing of the appeal. The court would like to observe that this is in the nature of a post mortem exercise after the event of reopening of the assessment has taken place. While the Commissioner of Income-tax may have proceeded on the basis that the reopening of the assessment was valid, this does not satisfy the requirement of law that prior to the reopening of the assessment, the Assessing Officer has to, applying his mind to the materials, conclude that he has reason to believe that income of the assessee has escaped assessment. Unless that basic jurisdictional requirement is 24 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. satisfied a post mortem exercise of analysing materials produced subsequent to the reopening will not rescue an inherently defective reopening order from invalidity.
14. In the circumstances, the conclusion reached by the Income-tax Appellate Tribunal cannot be said to be erroneous. No substantial question of law arises."
In the present case, it is apparent that Ld. assessing officer has not applied his mind to the information provided by the investigation wing to the extent that even the amount of payment made by the assessee to the builder was not even verified. Furthermore it was also not verified that were the investors purchasing the property were examined. The Ld. assessing officer even did not care to provide the correct reasons recorded by the revenue instead of that he provided the reasons incorporating them in the letter dated 22/04/2013. In view of this on the solitary 25 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. ground itself, the appeal of the assessee deserves to be allowed.
12. In fact, in this present case the Ld. assessing officer has grossly ignored the direction of the Hon'ble Supreme Court in case of GKN driveshaft India Ltd versus ITO. 259 ITR 19 wherein it has been held that:-
"We see no justifiable reason to interfere with the order under challenge. However, we clarify that when a notice under section 148 of the Income-tax Act is issued, the proper course of action for the noticee is to file a return and if he so desires, to seek reasons for issuing notices. The Assessing Officer is bound to furnish reasons within a reasonable time. On receipt of reasons, the noticee is entitled to file objections to issuance of notice and the Assessing Officer is bound to dispose of the same by passing a speaking order. In the instant case, as the reasons have been 26 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. disclosed in these proceedings, the Assessing Officer has to dispose of the objections, if filed, by passing a speaking order, before proceeding with the assessment in respect of the above said five assessment years.
In so far as the appeals filed against the order of assessment before the Commissioner (Appeals), we direct the appellate authority to dispose of the same, expeditiously."
In the present case the assessee has filed the return of income on 18/04/2013 in response to the notice under section 148 of the income tax act dated 22/03/2013. On the date of filing of the return of income, the assessee requested for the reasons recorded. However, the correct reasons recorded were provided to the assessee only on 20/03/2014 i.e. Just before 10 days of the completion of the assessment. The Hon'ble Supreme Court has provided guidelines that reasons must be provided within reasonable time. We 27 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. are of the opinion that Ld. assessing officer has not provided the reasons to the assessee within reasonable time but only at the fag end of the 18 | P a g e Tarun Verma Vs. ITO, (Assessment Year: 2007-08) assessment proceedings. Furthermore, the Hon'ble Supreme Court has further guided that only after disposing of the objections of the assessee with respect to the reopening of the assessment, the assessing officer shall proceed for reassessment. In the present case, the assessment proceedings were already completed before providing the correct reasons to the assessee. In view of this, we do not have any hesitation in holding that reassessment proceedings are invalid.
In view of this without going into the merits of the addition made by the Ld. assessing officer we quash the reassessment proceedings and allow ground No. 1 to 6 of the appeal of the assessee.
In the result appeal of the assessee is allowed.”
28 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi.
5. Considering the above, it is clear that the ITAT, Delhi Bench for A.Y. 2007-2008 did not approve the reasons sufficient for reopening of the assessment. It was also clearly held that A.O. has not applied his mind to the information provided by Investigation Wing. therefore, reopening of the assessment was quashed. In the present case, the assessee has submitted before the Ld. CIT(A) that reasons to believe are factually incorrect, inconsistent with the reasons recorded for A.Y. 2007-2008. It was stated that case for A.Y. 2007-2008 and impugned assessment order i.e., A.Y. 2012-2013 have been reopened in respect of the same property of Indirapuram Habitat Centre Project, Ghaziabad and on the basis of information of investigation report and seized material collected during the course of search on Aerens Group. The basis for reopening of the assessment for assessment year is as under :
(i) Report of Investigation Wing (ii) Material seized during the course of search conducted on AEZ Group on 17.08.2011.
29 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. (iii) Statement of certain investors recorded under section 133A of the I.T. Act.
5.1. The assessee submitted that in para-2 of the reasons recorded for assessment year under appeal, it has been alleged that assessee made total payment of Rs.1,20,50,000/- for booking/purchase of property, out of which, Rs.32 lakhs was made by cheque on 01.04.2011 and payment of Rs.88,50,000/- was made in cash. Whereas, as per the reasons recorded for A.Y. 2007-2008, on the similar issue it was alleged that assessee made total payment of Rs.78,58,980/- for booking of the same property, out of which, Rs.11,37,000/- was paid by cheque on 19.04.2006 and Rs.67,21,980/- was paid in cash. It was further submitted that after perusing both the reasons to believe, it becomes clear that neither the amount nor date of payment of alleged investment in property in question are proper. The reasons to believe for impugned assessment year also shows several contradictory facts/inconsistencies which are as under :
30 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. (i) In para-2, it is mentioned that Rs.32 lakhs was paid by cheque on 01.04.2011. Whereas in the next para-3 it is mentioned that Rs.32 lakhs was paid in two installments of Rs.11,37,000/- on 21.04.2006 and Rs.20,63,000/- on 21.06.2011.
(ii) In para-4 of the reason, A.O. stated that case for A.Y. 2007-2008 have been reopened under section 148 after recording reasons and income was assessed at Rs.68,30,980/-. However, in the very next line, it is stated that Rs.88,50,000/- was paid in cash on 01.04.2011. If A.O. had believed that total cash portion of Rs.88,50,000/- was paid in F.Y. 2011-2012, then, why A.O. allowed cash investment in A.Y. 2007-2008.
5.2. The aforesaid facts clearly establish reason to believe are incorrect, inconsistent, contradictory and vague which shows non-application of mind by the A.O. while recording reasons. Reopening of the assessment is, therefore, bad in law.
31 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. 5.3. Considering the totality of the facts and circumstances of the case and comparing the reasons for reopening of the assessment for A.Y. 2007-2008 and 2012- 2013 (under appeal), it is clear that A.O. has recorded incorrect facts in the reasons for reopening of the assessment which are factually incorrect, contradictory and vague. The A.O. did not verify the report received from Investigation Wing and did not apply his mind to the information as well as facts of the case. In A.Y. 2007-2008 on the identical reasons, the Division Bench of the Tribunal did not approve the reopening of the assessment in the matter and quashed the same vide Order Dated 19.09.2017 (supra). The issue is, therefore, covered in favour of the assessee by the Order of the Tribunal in the case of same assessee for A.Y. 2007-2008 (supra). There isno link between material and formation of opinion that income escaped assessment. There is no independent application of mind to the information received from Investigation Wing and no prima facie opinion have been formed, therefore, re- assessment is invalid. I rely upon Judgments of Hon’ble 32 ITA.No.2496/Del./2018 Smt. Taruna Verma, Delhi. Delhi High Court in the case of Pr. CIT vs., G and G Pharma India Ltd., [2016] 384 ITR 147 (Del.), Pr. CIT vs., Meenakshi Overseas Pvt. Ltd., [2017] 395 ITR 677 (Del.) and Pr. CIT vs., RMG Polyvinyl (I) Ltd., [2017] 396 ITR 5 (Del.). Considering the totality of the facts and circumstances of the case, I am of the view that reopening of the assessment is invalid and bad in law and is liable to be quashed. I, accordingly, set aside the Orders of the authorities below and quash the reopening of the assessment in the matter. Resultantly, all the additions stand deleted. Appeal of the assessee allowed.
In the result, appeal of the Assessee allowed.
Order pronounced in the open Court.