Sh. Nav Ratan Singh, Agra V. I.T.O.-1(3), Agra

ITA 242/AGR/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 89198 (ITAT-AGRA)
• Duration Of Justice: 1 year(s) 11 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 04-08-2014
• Assessment Year: 2001-2002
• Appeal Filed On: 08-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMIT SHUK LA
• Assessee Lawyers: ANURAG SINHA
• Keywords: Reopening of assessment; Gift; Depreciation; Income from undisclosed sources; Accommodation entries; Assessment record; Reason to believe; Reassessment proceedings
• Section: 148; 139; 143(3); 142(1)

Judgement Text

I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 1 OF 14 IN THE INCOME TAX APPELLATE TRIBUNAL AGRA (SMC) BENCH, AGRA [CORAM:PRAMOD KUMAR AM ] I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR: 2001-02 SHRI NAV RATAN SINGH ..APPELLANT 37/300-A, NAGLA PADI, NEW AGRA, AGRA [PAN: ABXPK 6598 D ] VS. INCOME-TAX OFFICER, .RESPONDENT 1(3), AGRA. APPEARANCES BY: ANURAG SINHA FOR THE APPELLANT AMIT SHUKLA FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : JUNE 17 , 2015 DATE OF PRONOUNCING THE ORDER : JUNE 24 , 2015 O R D E R 1. BY WAY OF THIS APPEAL, THE ASSESSEE APPELLANT HA S CHALLENGED THE CORRECTNESS OF ORDER DATED 27 TH FEBRUARY, 2013, PASSED BY THE LEARNED CIT(A) IN TH E MATTER OF ASSESSMENT U/S. 143(3) R.W.S. 147 OF THE INCOME-TAX ACT FOR THE ASSESSMENT YEAR 2001-02. THE GRIEVANCES RAISED BY THE ASSESSEE IN S UBSTANCE ARE THAT THE LEARNED CIT(A) WAS NOT LEGALLY JUSTIFIED IN CONFIRMING THE REOPENING OF ASSESSMENT AND SUSTAINING THE ADDITIONS MADE U/S. 68. 2. TO ADJUDICATE ON THIS APPEAL CERTAIN MATERIAL FA CTS NEED TO BE TAKEN NOTE OF. IN THIS CASE REASSESSMENT PROCEEDINGS WERE INITIATE D BY ASSESSING OFFICER AGAINST THE ASSESSEE U/S. 147 AFTER RECEIPT OF INFORMATION FROM THE CIT-I AGRA THROUGH JT. I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 2 OF 14 CIT, RANGE-1, AGRA ABOUT BOGUS ENTRIES OF LONG TERM /SHORT TERM CAPITAL GAINS BEING RECEIVED BY CERTAIN BENEFICIARIES. THIS INFORMATION WAS BASED ON THE ENQUIRIES MADE BY INVESTIGATION WING FINDING THAT CERTAIN STOCK BR OKERS ARE INDULGED IN PROVIDING SUCH ENTRIES SHOWING BOGUS TRANSACTIONS OF PURCHASE AND SALE OF SHARES OF VARIOUS COMPANIES. THE ASSESSEE WAS ALSO INCLUDED IN THE LI ST OF SUCH BENEFICIARIES. DURING THE COURSE OF THESE PROCEEDINGS, THE AO NOTED THAT A SUM OF RS.3,33,983/- WAS REMITTED TO HIM FROM A BROKER M/S. AGARWAL & CO. AS A RESULT OF SUCH ACCOMMODATION ENTRIES. IT WAS IN THIS BACKDROP, THE ASSESSING OFF ICER INITIATED REASSESSMENT PROCEEDINGS U/S. 147 AND AFTER CONSIDERING THE EXPL ANATIONS OF ASSESSEE UNSATISFACTORY, MADE ADDITION OF RS.3,33,938 AS INC OME FROM UNDISCLOSED SOURCES U/S. 68 AND RS.3,000/- AS COMMISSION PAID FOR OBTAI NING SUCH ACCOMMODATION ENTRIES. THE AO RECORDED THE REASONS AS FOLLOWS : AN INFORMATION HAS BEEN RECEIVED FROM THE COMMISSI ONER OF INCOME-TAX-1, AGRA VIDE HIS LETTER F. NO. CIT-1/TECH/CAPITAL GAIN /AGRA/04-05/528 DATED 12.05.05 FORWARDED BY THE JOINT COMMISSIONER OF INC OME-TAX, RANGE-1, AGRA VIDE HER LETTER F. NO. MISC/ITI/02-1/2005-06 DATED 18.05.2005 REGARDING BOGUS ENTRIES OF LONG TERM/SHORT TERM CAPITAL GAIN HAS BEEN FOUND BOGUS AS A RESULT OF ENQUIRIES MADE BY DDI WING. ON ENQUI RIES IT HAS BEEN FOUND THAT THE BANK ACCOUNTS FROM WHICH MONEY HAS BEEN TR ANSFERRED TO VARIOUS BENEFICIARIES HAVE BEEN OPERATED BY CERTAIN STOCK B ROKERS, WHO HAVE BEEN PROVIDING ENTRIES TO THE BENEFICIARIES BY SHOWING T HEM TRANSACTION MADE BY THEM IN PURCHASE AND SALE OF SHARES OF CERTAIN COMP ANIES FROM CERTAIN PERSONS, WHICH IN FACT NEVER TOOK PLACE. THE ASSESSEE IS ALSO ONE OF THE BENEFICIARIES FIGUR ING IN THE LIST SUPPLIED BY THE DDIT (INV), AGRA AND AN AMOUNT OFRS.3,33,983/- HAS BEEN REMITTED TO THE ASSESSEE FROM IOB, PREET VIHAR, DELHI IN THE NAME O F M/S. AGARWAL & CO., DELHI. THE SAID AMOUNT IS FOUND CREDITED IN THE BAN K ACCOUNT NO. 40693 OF CANARA BANK, MG ROAD, AGRA ON 06.09.2000.SINCE THE TRANSACTION OF PURCHASE CLAIMED TO HAVE BEEN RECEIVED BY THE ASSES SEE BY BANK DRAFT IS THE ASSESSEES INCOME FROM UNDISCLOSED SOURCES, WHICH H AS BEEN ESCAPED ASSESSMENT WITHIN THE MEANING OF SECTION 147 OF THE IT ACT, 1961. I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 3 OF 14 THEREFORE, I HAVE REASON TO BELIEVE THAT RS.3,33,98 3/- CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR THE ASSESSMENT YEAR 2001-02. ISSUE NOTICE U/S. 148 OF THE I.T. ACT, 1961. 3. AGGRIEVED, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LEARNED CIT(A), WHERE HE ASSAILED THE VALIDITY OF REASSESSMENT ORDE R AS WELL AS THE ADDITIONS SO MADE, ON MERITS, BUT WITHOUT ANY SUCCESS. 4. I HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE AP PLICABLE LEGAL POSITION. 5. DURING THE COURSE OF HEARING, THE LEARNED AUTHOR IZED REPRESENTATIVE OF THE ASSESSEE VEHEMENTLY CONTENDED THAT THE ISSUE WITH R ESPECT TO VALIDITY OF REASSESSMENT PROCEEDINGS IN THIS CASE IS COVERED IN FAVOUR OF THE ASSESSEE BY A DECISION OF CO-ORDINATE BENCH OF ITAT, AGRA IN ITA NO. 98/AGRA/2013 (A.Y. 2002-03)- SMT. RAJNI SAGAR VS. DCIT IN GROUP CASES, WHEREIN T HE REASONS RECORDED ARE VERBATIM TO THE REASONS RECORDED IN THE INSTANT CA SE. IN THAT CASE, THE TRIBUNAL, INTER ALIA, OBSERVED AS FOLLOWS : 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND TH E MATERIAL AVAILABLE ON RECORD. THE REASONS FOR REOPENING OF ASSESSMENT ARE FILED AT PAGE 13 OF THE PAPER BOOK AND THE SAME ARE REPRODUCED AS UNDER : REASONS FOR ISSUE OF NOTICE U/S 148 OF THE I.T. ACT , 1961 AN INFORMATION HAS BEEN RECEIVED FROM THE ADDL. CI T, RANGE- 2, AGRA VIDE HIS LETTER F.NO. LTCG/ADDL.CIT/RANGE-2/AGRA/2008-09 DATED 03.12.2008 REGARDING BOGUS ENTRIES OF LONG TERM/SHORT TERM CAP ITAL GAIN WHICH HAS BEEN FOUND BOGUS AS A RESULT OF ENQUIRIES MADE BY THE IN VESTIGATION WING. ON ENQUIRIES IT HAS BEEN FOUND THAT THE BANK ACCOUNTS FROM WHICH MONEY HAS BEEN TRANSFERRED TO VARIOUS BENEFICIARIES HAVE BEEN OPERATED BY CERTAIN STOCK BROKERS WHO HAVE BEEN PROVIDING ENTRIES TO THE BENE FICIARIES BY SHOWING THEM I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 4 OF 14 TRANSACTION MADE BY THEM IN PURCHASE AND SALE OF SH ARES OF CERTAIN COMPANIES, WHICH IN FACT NEVER TOOK PLACE. THE ASSESSEE IS ALSO ONE OF THE BENEFICIARIES FIGUR ING IN THE LIST SUPPLIED AS STATED ABOVE AND AN AMOUNT OF RS.8,00,000/- AND RS. 1,33,912/- HAS BEEN REMITTED TO THE ASSESSEE THROUGH JAI LAXMI COOPERAT IVE BANK, INSTRUMENT NO. 370889 & 371198 DATED 26.7.01 & 02.08.01 FROM BROKE R M/S. SINGHMAN FINANCIAL SERVICES LTD. SINCE THE TRANSACTION OF SH ARE TRADING FOUND TO BE BOGUS AND THE ENTIRE AMOUNT OF THE SAME CLAIMED TO HAVE BEEN RECEIVED BY THE ASSESSEE BY BANK DRAFT IS THE ASSESSEES INCOME FROM UNDISCLOSED SOURCES, WHICH HAS ESCAPED ASSESSMENT WITHIN THE ME ANING OF SECTION 147 OF THE IT ACT, 1961. HENCE, I HAVE REASON TO BELIEVE T HAT THE ABOVE INCOME OF RS.8,00,000/- + 1,33,912/- = RS.9,33,912/- HAS ESCA PED ASSESSMENT WITHIN THE MEANING OF SECTION 147 OF THE IT ACT, 1961 FOR A.Y. 2002- 03. 6.1. ITAT, AGRA BENCH IN THE GROUP CASES OF ACIT V S. LATE SHRI SATISH PRAKASH MITTAL (SUPRA), ON IDENTICAL ISSUE IN PARAS 5 TO 8.4 HELD AS UNDER : 5. WE HAVE HEARD THE LD. REPRESENTATIVES OF BOTH T HE PARTIES, PERUSED THE FINDINGS OF AUTHORITIES BELOW AND CONSIDERED TH E MATERIAL AVAILABLE ON RECORD. 6. BEFORE CONSIDERING THE ISSUE ON MERIT, IT WOULD BE APPROPRIATE TO TAKE UP THE LEGAL ISSUE FIRST REGARDING VALIDITY OF INIT IATION OF PROCEEDINGS U/S. 148 OF THE IT ACT, WHICH IS RAISED IN THE CROSSOBJE CTION OF THE ASSESSEE. 6.1. AFTER HEARING THE ARGUMENTS OF LD. REPRESENTAT IVES OF BOTH THE PARTIES, WE FIND THAT FOUR POINTS HAVE ARISEN FOR C ONSIDERATION AND ADJUDICATION WITH REGARD TO VALIDITY OF THE REASSES SMENT PROCEEDINGS U/S. 147/148 OF THE IT ACT, WHICH WE DEAL WITH THEM AS UNDER : (1). WHETHER THE AO HAS VALIDLY INITIATED THE RE-A SSESSMENT PROCEEDINGS U/S. 147/148 OF THE IT ACT. (2). WHETHER THE CASE OF THE ASSESSEE WOULD FALL I N PROVISO TO SECTION 147 OF THE IT ACT. (3). WHETHER NOTICE U/S. 148 DATED 30.03.2007 WAS ISSUED WITHIN SIX YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR AS PER SECTION 149 OF THE IT ACT. (4). WHETHER THERE WAS ANY VALID SERVICE OF NOTICE U/S. 148 OF THE IT ACT UPON THE ASSESSEE. 7. IT WOULD BE RELEVANT TO REPRODUCE THE RELEVANT P ROVISIONS OF LAW DEALING WITH THE ABOVE LEGAL ISSUE OF VALIDITY OF INITIATION OF REASSESSMENT PROCEEDINGS U/S. 147/148 OF THE IT ACT. 7.1. SECTION 147 OF THE IT ACT PROVIDES AS UNDER : 147. IF THE ASSESSING OFFICER, 1523[HAS REASON TO B ELIEVE] THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR ANY I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 5 OF 14 ASSESSMENT YEAR, HE MAY, SUBJECT TO THE PROVISIONS OF SECTIONS 148 TO 153, ASSESS OR REASSESS SUCH INCOME AND ALSO ANY OT HER INCOME CHARGEABLE TO TAX WHICH HAS ESCAPED ASSESSMENT AND WHICH COMES TO HIS NOTICE SUBSEQUENTLY IN THE COURSE OF THE PROCEE DINGS UNDER THIS SECTION, OR RECOMPUTE THE LOSS OR THE DEPRECIATION ALLOWANCE OR ANY OTHER ALLOWANCE, AS THE CASE MAY BE, FOR THE ASSESS MENT YEAR CONCERNED (HEREAFTER IN THIS SECTION AND IN SECTION S 148 TO 153 REFERRED TO AS THE RELEVANT ASSESSMENT YEAR: PROVIDED THAT WHERE AN ASSESSMENT UNDER SUB-SECTION (3) OF SECTION 143 OR THIS SECTION HAS BEEN MADE FOR THE RELEVANT ASSESSMENT YEAR, NO ACTION SHALL BE TAKEN UNDER THIS SECTION AFTER T HE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSMENT YEAR, UNLES S ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FOR SUCH A SSESSMENT YEAR BY REASON OF THE FAILURE ON THE PART OF THE ASSESSE E TO MAKE A RETURN UNDER SECTION 139 OR IN RESPONSE TO A NOTICE ISSUED UNDER SUB-SECTION (1) OF SECTION 142 OR SECTION 148 OR TO DISCLOSE FU LLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR HIS ASSESSMENT FOR THA T ASSESSMENT YEAR: PROVIDED FURTHER THAT THE ASSESSING OFFICER MAY ASS ESS OR REASSESS SUCH INCOME, OTHER THAN THE INCOME INVOLVING MATTER S WHICH ARE THE SUBJECT MATTER OF ANY APPEAL, REFERENCE OR REVISION , WHICH IS CHARGEABLE TO TAX AND HAS ESCAPED ASSESSMENT. EXPLANATION 1 : PRODUCTION BEFORE THE ASSESSING OFF ICER OF ACCOUNT BOOKS OR OTHER EVIDENCE FROM WHICH MATERIAL EVIDENC E COULD WITH DUE DILIGENCE HAVE BEEN DISCOVERED BY THE ASSESSING OFF ICER WILL NOT NECESSARILY AMOUNT TO DISCLOSURE WITHIN THE MEANING OF THE FOREGOING PROVISO. EXPLANATION 2 : FOR THE PURPOSES OF THIS SECTION, T HE FOLLOWING SHALL ALSO BE DEEMED TO BE CASES WHERE INCOME CHARGEABLE TO TA X HAS ESCAPED ASSESSMENT, NAMELY: (A) WHERE NO RETURN OF INCOME HAS BEEN FURNISHED BY THE ASSESSEE ALTHOUGH HIS TOTAL INCOME OR THE TOTAL INCOME OF AN Y OTHER PERSON IN RESPECT OF WHICH HE IS ASSESSABLE UNDER THIS ACT DU RING THE PREVIOUS YEAR EXCEEDED THE MAXIMUM AMOUNT WHICH IS NOT CHARG EABLE TO INCOME TAX. (B) WHERE A RETURN OF INCOME HAS BEEN FURNISHED BY THE ASSESSEE BUT NO ASSESSMENT HAS BEEN MADE AND IT IS NOTICED BY TH E ASSESSING OFFICER THAT THE ASSESSEE HAS UNDERSTATED THE INCOM E OR HAS CLAIMED EXCESSIVE LOSS, DEDUCTION, ALLOWANCE OR RELIEF IN T HE RETURN. (C) WHERE AN ASSESSMENT HAS BEEN MADE, BUT- (I) INCOME CHARGEABLE TO TAX HAS BEEN UNDER ASSESSE D; OR (II) SUCH INCOME HAS BEEN ASSESSED AT TOO LOW A RAT E; OR (III) SUCH INCOME HAS BEEN MADE THE SUBJECT OF EXCE SSIVE RELIEF UNDER THIS ACT; OR I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 6 OF 14 (IV) EXCESSIVE LOSS OR DEPRECIATION ALLOWANCE OR AN Y OTHER ALLOWANCE UNDER THIS ACT HAS BEEN COMPUTED. EXPLANATION 3 : FOR THE PURPOSE OF ASSESSMENT OR RE ASSESSMENT UNDER THIS SECTION, THE ASSESSING OFFICER MAY ASSESS OR R EASSESS THE INCOME IN RESPECT OF ANY ISSUE, WHICH HAS ESCAPED ASSESSME NT, AND SUCH ISSUE COMES TO HIS NOTICE SUBSEQUENTLY IN THE COURS E OF THE PROCEEDINGS UNDER THIS SECTION, NOTWITHSTANDING THA T THE REASONS FOR SUCH ISSUE HAVE NOT BEEN INCLUDED IN THE REASONS RE CORDED UNDER SUB- SECTION (2) OF SECTION 148. EXPLANATION 4.FOR THE REMOVAL OF DOUBTS, IT IS HER EBY CLARIFIED THAT THE PROVISIONS OF THIS SECTION, AS AMENDED BY THE FINAN CE ACT, 2012, SHALL ALSO BE APPLICABLE FOR ANY ASSESSMENT YEAR BEGINNIN G ON OR BEFORE THE 1ST DAY OF APRIL, 2012. 7.2 SECTION 148 OF THE IT ACT PROVIDES AS UNDER : 148 (1). BEFORE MAKING THE ASSESSMENT, REASSESSMENT OR RECOMPUTATION UNDER SECTION 147, THE ASSESSING OFFI CER SHALL SERVE ON THE ASSESSEE A NOTICE REQUIRING HIM TO FURNISH WITH IN SUCH PERIOD, AS MAY BE SPECIFIED IN THE NOTICE, A RETURN OF HIS INC OME OR THE INCOME OF ANY OTHER PERSON IN RESPECT OF WHICH HE IS ASSESSAB LE UNDER THIS ACT DURING THE PREVIOUS YEAR CORRESPONDING TO THE RELEV ANT ASSESSMENT YEAR, IN THE PRESCRIBED FORM AND VERIFIED IN THE PR ESCRIBED MANNER AND SETTING FORTH SUCH OTHER PARTICULARS AS MAY BE PRES CRIBED; AND THE PROVISIONS OF THIS ACT SHALL, SO FAR AS MAY BE, APP LY ACCORDINGLY AS IF SUCH RETURN WERE A RETURN REQUIRED TO BE FURNISHED UNDER SECTION 139: PROVIDED THAT IN A CASE (A) WHERE A RETURN HAS BEEN FURNISHED DURING THE PE RIOD COMMENCING ON THE 1ST DAY OF OCTOBER, 1991 AND ENDING ON THE 3 0TH DAY OF SEPTEMBER, 2005 IN RESPONSE TO A NOTICE SERVED UNDE R THIS SECTION, AND (B) SUBSEQUENTLY A NOTICE HAS BEEN SERVED UNDER SUB -SECTION (2) OF SECTION 143 AFTER THE EXPIRY OF TWELVE MONTHS SPECI FIED IN THE PROVISO TO SUB-SECTION (2) OF SECTION 143, AS IT STOOD IMMEDIA TELY BEFORE THE AMENDMENT OF SAID SUB-SECTION BY THE FINANCE ACT, 2 002 (20 OF 2002) BUT BEFORE THE EXPIRY OF THE TIME LIMIT FOR MAKING THE ASSESSMENT, REASSESSMENT OR RECOMPUTATION AS SPECIFIED IN SUB-S ECTION (2) OF SECTION 153, EVERY SUCH NOTICE REFERRED TO IN THIS CLAUSE SHALL BE DEEMED TO BE A VALID NOTICE: PROVIDED FURTHER THAT IN A CASE (A) WHERE A RETURN HAS BEEN FURNISHED DURING THE P ERIOD COMMENCING ON THE 1ST DAY OF OCTOBER, 1991 AND ENDING ON THE 3 0TH DAY OF SEPTEMBER, 2005, IN RESPONSE TO A NOTICE SERVED UND ER THIS SECTION, AND I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 7 OF 14 (B) SUBSEQUENTLY A NOTICE HAS BEEN SERVED UNDER CLA USE (II) OF SUB- SECTION (2) OF SECTION 143 AFTER THE EXPIRY OF TWEL VE MONTHS SPECIFIED IN THE PROVISO TO CLAUSE (II) OF SUB-SECTION (2) OF SE CTION 143, BUT BEFORE THE EXPIRY OF THE TIME LIMIT FOR MAKING THE ASSESSM ENT, REASSESSMENT OR RECOMPUTATION AS SPECIFIED IN SUB-SECTION (2) OF SE CTION 153, EVERY SUCH NOTICE REFERRED TO IN THIS CLAUSE SHALL BE DEE MED TO BE A VALID NOTICE. EXPLANATION : FOR THE REMOVAL OF DOUBTS, IT IS HERE BY DECLARED THAT NOTHING CONTAINED IN THE FIRST PROVISO OR THE SECON D PROVISO SHALL APPLY TO ANY RETURN WHICH HAS BEEN FURNISHED ON OR AFTER THE 1ST DAY OF OCTOBER, 2005 IN RESPONSE TO A NOTICE SERVED UNDER THIS SECTION. (2) THE ASSESSING OFFICER SHALL, BEFORE ISSUING ANY NOTICE UNDER THIS SECTION, RECORD HIS REASONS FOR DOING SO. 7.3 SECTION 149 OF THE IT ACT PROVIDES AS UNDER : 149. (1) NO NOTICE UNDER SECTION 148 SHALL BE ISSU ED FOR THE RELEVANT ASSESSMENT YEAR, (A) IF FOUR YEARS HAVE ELAPSED FROM THE END OF THE RELEVANT ASSESSMENT YEAR, UNLESS THE CASE FALLS UNDER CLAUSE (B) OR CLA USE (C); (B) IF FOUR YEARS, BUT NOT MORE THAN SIX YEARS, HAV E ELAPSED FROM THE END OF THE RELEVANT ASSESSMENT YEAR UNLESS THE INCO ME CHARGEABLE TO TAX WHICH HAS ESCAPED ASSESSMENT AMOUNTS TO OR IS L IKELY TO AMOUNT TO ONE LAKH RUPEES OR MORE FOR THAT YEAR;] (C) IF FOUR YEARS, BUT NOT MORE THAN SIXTEEN YEARS, HAVE ELAPSED FROM THE END OF THE RELEVANT ASSESSMENT YEAR UNLESS THE INCOME IN RELATION TO ANY ASSET (INCLUDING FINANCIAL INTEREST IN ANY E NTITY) LOCATED OUTSIDE INDIA, CHARGEABLE TO TAX, HAS ESCAPED ASSESSMENT.] EXPLANATION.IN DETERMINING INCOME CHARGEABLE TO TA X WHICH HAS ESCAPED ASSESSMENT FOR THE PURPOSES OF THIS SUB-SEC TION, THE PROVISIONS OF EXPLANATION 2 OF SECTION 147 SHALL AP PLY AS THEY APPLY FOR THE PURPOSES OF THAT SECTION. (2) THE PROVISIONS OF SUB-SECTION (1) AS TO THE ISS UE OF NOTICE SHALL BE SUBJECT TO THE PROVISIONS OF SECTION 151. (3) IF THE PERSON ON WHOM A NOTICE UNDER SECTION 14 8 IS TO BE SERVED IS A PERSON TREATED AS THE AGENT OF A NON-RESIDENT UND ER SECTION 163 AND THE ASSESSMENT, REASSESSMENT OR RECOMPUTATION TO BE MADE IN PURSUANCE OF THE NOTICE IS TO BE MADE ON HIM AS THE AGENT OF SUCH NONRESIDENT, THE NOTICE SHALL NOT BE ISSUED AFTER T HE EXPIRY OF A PERIOD OF SIX YEARS FROM THE END OF THE RELEVANT ASSESSMEN T YEAR. EXPLANATION.FOR THE REMOVAL OF DOUBTS, IT IS HEREB Y CLARIFIED THAT THE PROVISIONS OF SUB-SECTIONS (1) AND (3), AS AMENDED BY THE FINANCE ACT, 2012, SHALL ALSO BE APPLICABLE FOR ANY ASSESSMENT Y EAR BEGINNING ON OR BEFORE THE 1ST DAY OF APRIL, 2012. I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 8 OF 14 POINT NO. 1 : WHETHER THE AO HAS VALIDLY INITIATED THE REASSE SSMENT PROCEEDINGS U/S. 147/148 OF THE IT ACT. 8. ACCORDING TO THE AO, THE ASSESSEE FILED ORIGINAL RETURN OF INCOME ON 28.03.2001 AT INCOME OF RS.3,68,969/-. COPY OF THE ACKNOWLEDGEMENT OF THE RETURN OF INCOME ALONG WITH ANNEXURES ARE FILED IN THE PAPER BOOK AT CPB-119 TO 122, IN WHICH THE ASSESSEE HAS DECLARED ALL THE PARTICULARS AND INFORMATION OF RECEIPT OF GIFT OF RS.15,00,000/-. THE ASSESSMEN T WAS COMPLETED AT INCOME OF RS.8,68,969/- U/S. 143(3)/147 VIDE ORDER DATED 3 0.03.2006 AFTER MAKING ADDITION OF RS.5,00,000/- ON ACCOUNT OF UNEXPLAINED GIFT RECEIVED FROM SH. SANJAY MOHAN AGARWAL. THE SAID ADDITION WAS DELETED BY THE LD. CIT(A)-II, AGRA VIDE ORDER DATED 24.04.2008. IT IS NOTED IN TH IS ASSESSMENT ORDER THAT INFORMATION WAS RECEIVED FROM ADIT (INV.) THAT SHRI SANJAY MOHAN AGARWAL OF NEW DELHI IS INVOLVED IN GIVING BOGUS GIFTS BY CHEQ UES/DDS IN LIEU OF CASH RECEIVED FROM THE INTENDED BENEFICIARIES. IN THE SU BSEQUENT IMPUGNED REASSESSMENT ORDER, UNDER APPEAL, DATED 10.12.2008 THE SAME FACT FINDS MENTION THAT INFORMATION WAS RECEIVED FROM THE INVE STIGATION WING, GHAZIABAD THAT THE ASSESSEE HAS TAKEN GIFT OF RS.10,00,000/- FROM SIMILAR DONOR SHRI SANJAY MOHAN AGARWAL, NEW DELHI IN RESPECT OF THE S AME ASSESSMENT YEAR UNDER APPEAL. THEREFORE, ALL THE FACTS OF DECLARATI ON OF GIFT FROM THE SAME DONOR WERE AVAILABLE TO THE REVENUE DEPARTMENT PRIO R TO INFORMATION RECEIVED FROM THE INVESTIGATION WING, GHAZIABAD. APART FROM THE ABOVE, SINCE, THE ASSESSEE HAS ALREADY DECLARED RECEIPT OF GIFT OF RS .15,00,000/- IN THE ORIGINAL RETURN OF INCOME FROM THE SAME DONOR SHRI SANJAY MO HAN AGARWAL, THEREFORE, ALL THE DETAILS AND RELEVANT FACTS OF RECEIPT OF GI FT AMOUNT OF RS.15,00,000/- WERE DISCLOSED TO THE REVENUE DEPARTMENT EVEN PRIOR TO THE INITIATION OF THE RE-ASSESSMENT PROCEEDINGS. THUS, THE ASSESSEE DISCL OSED ALL THE PRIMARY FACTS OF RECEIPTS OF GIFT FROM THE DONOR. WHEN FIRS T RE-ASSESSMENT ORDER FOR THE SAME ASSESSMENT YEAR UNDER APPEAL DATED 30.03.2006 WAS PASSED, THE INFORMATION OF RECEIPT OF GIFT FROM THE SAME DONOR SHRI SANJAY MOHAN AGARWAL WAS IN ISSUE AND AT THAT TIME THE INFORMATION WAS R ECEIVED OF THE GIFT IN QUESTION FROM ADIT (INV.), AGRA THROUGH JCIT, RANGE -5, FIROZABAD. IT IS, THUS, UNBELIEVABLE THAT THE AO AT THE TIME OF PASSING OF THE FIRST REASSESSMENT ORDER DATED 30.03.2006 WAS NOT AWARE OF THE ENTIRE GIFT A MOUNT OF RS.15,00,000/- RECEIVED BY THE ASSESSEE FROM THE DONOR SHRI SANJAY MOHAN AGARWAL. THE AO THUS EXAMINED ALL THE MATERIAL BEFORE HIM AT THE ORIGINAL RE-ASSESSMENT PROCEEDINGS IN RESPECT OF THE GIFT RECEIVED FROM SH RI SANJAY MOHAN AGARWAL AND THE ISSUE WAS ALSO CONSIDERED IN DETAIL BY THE LD. CIT(A) WHILE DELETING THE IMPUGNED ADDITION OF RS.5,00,000/- ON ACCOUNT OF GI FT RECEIVED FROM THE SAME DONOR VIDE APPELLATE ORDER DATED 24.04.2008. THE AO ON THE BASIS OF INFORMATION RECEIVED FROM INVESTIGATION WING, GHAZI ABAD INTENDED TO AGAIN RE- ASSESS THE INCOME OF ASSESSEE ON ACCOUNT OF PART OF THE GIFT OF RS.10,00,000/- RECEIVED FROM SAME DONOR IN SAME ASSESSMENT YEAR, A ND THE LETTER OF ADIT (INV.), GHAZIABAD WAS RECEIVED ON 21.03.2007. THE A O ASKED THE BRANCH MANAGER, VIJAYA BANK TO GIVE SOME DETAILS AND THERE AFTER ON 30.03.2007 ALLEGEDLY ISSUED NOTICE U/S. 148 OF THE IT ACT AGAI NST THE ASSESSEE. THE AO I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 9 OF 14 RECORDED THE FOLLOWING REASONS FOR RE-OPENING OF TH E ASSESSMENT WHICH ARE REPRODUCED AS UNDER : REASONS THE ADDL. DIRECTOR OF INCOME TAX (INV.),GHAZIABAD VIDE LETTER F. NO. ADDL. DIT (INV.)/GZB/AES/SM/BOGUS GIFTS/1/2006-07/796 DAT ED 16.03.2007 ENDORSED VIDE F.NO. ADDL. CIT/R- 5/FIROZABAD/INFORM ATION/2006-07 DATED 21.03.2007 OF THE ADDL. COMMISSIONER OF INCOME-TAX, RANGE-5, FIROZABAD HAS INFORMED THAT ONE SH.SANJAY MOHAN AGARWAL, 4674 , SHORA KOTHI, PAHAR GANJ, NEW DELHI WAS ENGAGED IN PROVIDING ACCOMMODAT ION ENTRIES BY WAY OF GIFT TO THE NEEDY PERSONS. A LIST OF THE PERSONS WH O HAVE TAKEN ACCOMMODATION ENTRIES FROM HIM WAS ALSO ENCLOSED WI TH THE SAID LETTER OF ADDL. DIT(INV). CONSEQUENTLY, INQUIRIES WERE CONDUC TED FROM VIJAYA BANK, FIROZABAD AND IT WAS GATHERED THAT THE ASSESSEE HAS TAKEN ACCOMMODATION ENTRY OF RS.10,00,000/- BY WAY OF GIFT VIDE D.D. NO .005105 DATED 04.11.99.THE SAID D.D. HAS BEEN CREDITED TO THE SAV ING BANK ACCOUNT OF THE ASSESSEE MAINTAINED WITH ORIENTAL BANK OF COMMERCE, FIROZABAD. THE ASSESSEE HAS THUS INTRODUCED HIS OWN UNACCOUNTED IN COME IN THE GARB OF A GIFT JUST TO GET AWAY FROM PAYMENT OF TAX ON THAT U NACCOUNTED INCOME, WHICH WAS CLEARLY LIABLE TO TAX AS PER PROVISIONS OF I.T. ACT. NO AMOUNT OF DD CREDITED TO THE BANK ACCOUNT OF THE ASSESSEE HAS BEEN ADDED TO THE INCOME OF THE ASSESSEE AS PER ORDER U/S. 143(3) DATED 27.0 3.2006. I HAVE, THEREFORE, IN VIEW OF THE INFORMATION AVAILABLE WITH THIS OFFI CE, REASON TO BELIEVE THAT INCOME TO THE EXTENT OF RS.10,00,000/- HAS ESCAPED ASSESSMENT WITHIN THE MEANING OF SECTION 147 OF THE INCOME-TAX ACT. ACIT, CIRCLE-5, FIROZABAD. 8.1 THE ORDER SHEET RECORDED BY THE AO FROM 21.03.2 007 TO 09.04.2007 IS FILED AT PAGE 53 OF THE PAPER BOOK AND IS REPRODUCE D AS UNDER : 21.3.2007. THE LETTER F.NO. CIT-II/AGRA/ACIT (HQ.) MISC./2006- 07/6660 DATED 19.03.2007 REGARDING ACCOMMODATION ENTRIES TO GETHER WITH COPY OF LETTER DATED 16.03.2007 OF ADDL. DIT ( INV.), GHAZIABAD RECEIVED. 22.03.2007. THE BRANCH MANAGER, VIJAYA BANK, FIROZ ABAD REQUIRED TO FURNISH DETAILS OF D.D. THROUGH WHICH ACCOMMODATION ENTRY W AS TAKEN. 23.03.2007. LETTER REF. NO.- NIL DATED 23.03.2007 ENCLOSING COPY OF D.D. NO.005375 DATED 18.11.1999 RECEIVED FROM VIJAYA BAN K AND PLACED ON FILE. REPORT REGARDING CORRECT NAME OF PERSONS WHO HAVE T AKEN ACCOMMODATION ENTRIES SUBMITTED TO THE ADDL. CIT, R ANGE-5, FIROZABAD. ON VERIFICATION FROM DEMAND AND COLLECTION REGISTER ASSESSMENT IN THIS CASE WAS COMPLETED U/S. 143(3)/147 ON 27.03 .2006. I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 10 OF 14 PROPOSAL U/S. 151 SEEKING APPROVAL FOR ISSUE OF NOT ICE U/S. 148 SENT TO CIT-II AGRA VIDE LETTER F.NO. ACIT/CIR.- 5/ FZD/151/2006- 07/DATED 23.03.2007. 30.03.2007. APPROVAL U/S. 151 OF CIT-II FOR ISSUE OF NOTICE U/S. 148 VIDE LETTER F.NO. PROPOSAL U/S.148/ADDL. CIT/R- 5/FZD/2006-07/8 27 DATED 29.03.2007. NOTICE U/S. 148 ISSUED. THE INSPECTOR OF INCOME-TAX REPORTED THAT ASSESSEE DOES NOT RESIDE AT THE GIVEN ADDRESS I.E., 33, CIRCULAR ROAD , FIROZABAD. HE IS ACCORDINGLY DIRECTED TO EFFECT SERVICE BY AFF IXTURE. 03.04.2007. THE INSPECTOR OF INCOME-TAX RETURNED N OTICE WITH A REPORT THEREON AFTER HAVING AFFIXED COPY OF NOTICE U/S. 14 8. 09.04.2007. ENVELOP CONTAINING NOTICE U/S. 148 REC EIVED BACK AND PLACED ON RECORD. 8.2 THE LD. CIT(A) AT PAGE 40 OF THE APPELLATE ORDE R AFTER GOING THROUGH THE ASSESSMENT RECORD OF ALL THE ABOVE ASSESSEES NOTED THAT AS PER RECORD, LETTER DATED 19.03.2007 WAS RECEIVED BY THE AO ON 21.03.20 07 FORWARDING REPORT OF ADDL. DIT (INV.), GHAZIABAD DATED 16.03.2007 PROVID ING THE DETAILS OF ACCOMMODATION ENTRIES OF BOGUS GIFTS RECEIVED BY AL L EIGHT ASSESSEES. THOUGH NAMES OF SOME OF THESE PERSONS WERE NOT MENT IONED CORRECTLY IN THE SAID REPORT, THESE NAMES WERE GOT VERIFIED BY THE A O FROM THE CONCERNED BANK, IN WHICH THE BANK ACCOUNT OF THESE PERSONS WE RE MAINTAINED AND IT HAS BEEN CONFIRMED BY THE BENCH THAT ALL THE EIGHT ASSE SSEES HAVE RECEIVED GIFT AMOUNTS. FROM THE FINDINGS OF THE LD. CIT(A), IT IS CLEAR THAT ADIT (INV.), GHAZIABAD HAS PROVIDED SOME VAGUE INFORMATION REGAR DING ACCOMMODATION ENTRIES RECEIVED BY THE ASSESSEES. THE ASSESSEE HAS FILED COPY OF THE REMAND REPORT DATED 30.04.2012 ISSUED BY DCIT (INV. ), GHAZIABAD (PB-141), IN WHICH WHILE FILING THE REMAND REPORT REGARDING T HE ASSESSEES, THE DCIT HAS MENTIONED THAT RECORD OF INVESTIGATION WING HAVE BE EN VERIFIED AND NO SUCH RECORDS REGARDING INVESTIGATION IN THE CASE OF S.M. AGARWAL HAVE BEEN FOUND. HE HAS REFERRED TO LETTER OF ADIT (INV.), GHAZIABAD DATED 16.03.2007 ADDRESSED TO CIT(A)-II, AGRA THAT DD/CHEQUES HAVE B EEN ISSUED TO THE BENEFICIARIES THROUGH VIJAYA BANK, ANASARI ROAD, NE W DELHI AND THAT THE ASSESSING OFFICER CAN CALL FOR THE RECORD FROM THE BANK. THE LD. CIT(A) WHILE FINALIZING OF THE APPEALS OF THE ASSESSEE RECORDED THE ORDER SHEET AND THE RELEVANT ORDER SHEET OF DT. 20.06.2012 IS FILED BY THE ASSESSEE AT PAGE 148 OF THE PAPER BOOK AND THE RELEVANT ENTRY CONTAINED IN THE ORDER SHEET DATED 20.06.2012 IS REPRODUCED AS UNDER : AS REGARD TO MERIT OF CASE, THE ASSESSEE HAS FILED PAN CARD AND VOTER IDENTITY CARD TO ESTABLISH THE IDENTITY OF THE DONO R, ASSESSMENT ORDER U/S. 143(3) ASSESSING AT CRORES OF RUPEES TO PROVE THE CREDITWORTHINESS AND GIFT DEED HAS BEEN FILED TO PROVE THE GENUINENE SS OF THE GIFT. AO COULD NOT PRODUCE ANY EVIDENCE TO PROVE THESE DOCUM ENTS FILED BY THE ASSESSEE AS FALSE. EVEN THE MATERIALS CLAIMED TO HA VE BEEN COLLECTED DURING THE INVESTIGATION OF SANJAY MOHAN AGARWAL SH OWING THAT GIFT WAS GIVEN TO THE ASSESSEE OUT OF CASH DEPOSITED BY HIM IN THE ACCOUNT OF SHRI AGARWAL. IT WAS SHOWN THAT IN THE ACCOUNT FROM WHICH GIFT WAS ISSUED , THERE WAS NO CASH DEPOSIT. AO EXPRESSED HI S INABILITY TO I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 11 OF 14 PROVIDE ANY EVIDENCE TO SHOW THAT GIFT WAS GIVEN OU T OF CASH DEPOSIT MADE BY THE ASSESSEE BECAUSE SUCH DETAILS ARE NEITH ER AVAILABLE WITH THE INVESTIGATION WING, GHAZIABAD WHEN ENQUIRY WAS CONDUCTED OR IN OF THE CIT-II, WHERE THE SAID MATERIAL WAS CLAIMED TO HAVE BEEN SENT. 8.3 THE AO AT THE ASSESSMENT STAGE ISSUED LETTER U/ S. 142(1) DATED 07.11.2008 (COPY FILED AT PAGE 44 OF THE PAPER BOOK ) IN WHICH THE AO CALLED FOR INFORMATION OF THE GIFT BY THE DONOR FROM THE A SSESSEE. THESE FACTS, THEREFORE, WOULD CLEARLY SHOW THAT ALL INFORMATION AND DETAILS OF GIFT RECEIVED FROM SHRI SANJAY MOHAN AGARWAL, DONOR WERE FURNISHE D TO THE REVENUE DEPARTMENT NOT ONLY IN THE ORIGINAL RETURN OF INCOM E, BUT IN THE FIRST RE- ASSESSMENT PROCEEDINGS U/S. 148 OF THE IT ACT WHICH CULMINATED INTO ASSESSMENT ORDER DATED 30.03.2006. THUS, INFORMATIO N OF GIFTS WERE VERIFIED AND EXAMINED BY THE AO AND PART ADDITION WAS MADE O F GIFT OF RS.5,00,000/- WHICH WAS ULTIMATELY DELETED BY THE LD. CIT(A). THE AO IN THE REMAND REPORT DATED 30.04.2012 CONFIRMED THAT NO RECORD RELATING TO INVESTIGATION IN THE CASE OF SANJAY MOHAN AGARWAL HAVE BEEN FOUND IN THE OFFI CE OF INVESTIGATION WING, GHAZIABAD. THE LD. CIT(A) IN THE ORDER SHEET DATED 20.06.2012 ON FILING THE EVIDENCE BY THE ASSESSEE FOUND THAT THE ASSESSEE SU ITABLY ESTABLISHED IDENTITY OF THE DONOR, HIS CREDITWORTHINESS AND GEN UINENESS OF THE GIFT IN THE MATTER. IT WAS ALSO FOUND THAT THE AO COULD NOT PRO DUCE ANY EVIDENCE TO PROVE THAT THE EVIDENCE FILED BY THE ASSESSEE WERE FALSE. FROM THE MATERIAL CLAIMED TO BE COLLECTED FROM THE INVESTIGATION OF SHRI SANJ AY MOHAN AGARWAL ALSO MADE IT CLEAR THAT NO CASH WAS DEPOSITED IN HIS ACC OUNT PRIOR TO GIVING OF THE GIFT. THE AO AT THE APPELLATE STAGE EXPRESSED HIS I NABILITY TO PROVIDE ANY EVIDENCE TO SHOW THAT THE GIFT WAS GIVEN OUT OF CAS H DEPOSIT MADE BY THE ASSESSEE BECAUSE NO SUCH DETAILS WERE AVAILABLE WIT H THE INVESTIGATION WING, GHAZIABAD. THESE FACTS WOULD, THEREFORE, CLEARLY SU PPORT THE CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE REASONS FOR R EOPENING OF ASSESSMENT WERE INCORRECT AND WITHOUT ANY BASIS OR MATERIAL. T HE ASSESSEE HAS NOT INTRODUCED ANY UNACCOUNTED INCOME FOR ISSUE OF DD O F GIFT. WHATEVER INFORMATION WAS RECEIVED FROM THE INVESTIGATION WIN G, GHAZIABAD, AS PER REASONS RECORDED BY THE AO, WAS ALSO INCORRECT BECA USE THESE INFORMATION WERE ALREADY ON RECORD OF THE AO AS ON EARLIER OCCA SION, REASSESSMENT PROCEEDINGS WERE FINALIZED VIDE ASSESSMENT ORDER DA TED 30.03.2006. THERE WAS NOTHING NEW WITH THE AO TO SHOW THAT THE ASSESS EE HAS RECEIVED ANY BOGUS ACCOMMODATION ENTRIES OR HAS INTRODUCED ANY U NACCOUNTED MONEY. THUS, THE REASONS RECORDED FOR REOPENING OF THE ASS ESSMENT WERE VAGUE, INCORRECT AND BASED ON NO MATERIAL OR EVIDENCE. WHA TEVER IS RECORDED IN THE REASONS FOR REOPENING OF ASSESSMENT WAS NOT SUPPORT ED BY THE REMAND REPORT DATED 30.04.2012 FILED BY THE INVESTIGATION WING, G HAZIABAD. THE AO WAS THUS, HAVING NO INFORMATION OR MATERIAL TO PROVE TH AT THE GIFT RECEIVED BY THE ASSESSEE WERE MERE ACCOMMODATION ENTRIES BECAUSE AT THE APPELLATE STAGE, THE AO WAS NOT ABLE TO CONTRADICT THE EVIDENCES FIL ED BY THE ASSESSEE FOR RECEIPT OF GENUINE GIFT IN THE MATTER AND HAS EXPRE SSED HIS INABILITY TO PROVIDE ANY EVIDENCE TO CONTRADICT THE CLAIM OF THE ASSESSE E. HONBLE DELHI HIGH COURT IN THE CASE OF SIGNATURE HOTELS P. LTD. VS. I TO, 338 ITR 51 HELD HELD, ALLOWING THE PETITION, THAT THE REASSESSMENT PROCEEDINGS WERE INITIATED ON THE BASIS OF INFORMATION RECEIVED FROM THE DIRECTOR OF I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 12 OF 14 INCOME-TAX (INVESTIGATION) THAT THE PETITIONER HAD INTRODUCED MONEY AMOUNTING TO RS.5 LAKHS DURING FINANCIAL YEAR 2002- 03 AS STATED IN THE ANNEXURE. ACCORDING TO THE INFORMATION, THE AMOUNT RECEIVED FROM A COMPANY, S, WAS NOTHING BUT AN ACCOMMODATION ENTRY AND THE ASSESSEE WAS THE BENEFICIARY. THE REASONS DID NOT S ATISFY THE REQUIREMENTS OF SECTION 147 OF THE IT ACT. THERE WA S NO REFERENCE TO ANY DOCUMENT OR STATEMENT, EXCEPT THE ANNEXURE. THE ANNEXURE COULD NOT BE REGARDED AS A MATERIAL OR EVIDENCE THAT PRIM A FACIE SHOWED OR ESTABLISHES NEXUS OR LINK WHICH DISCLOSED ESCAPEMEN T OF INCOME. THE ANNEXURE WAS NOT A POINTER AND DID NOT INDICATE ESC APEMENT OF INCOME. FURTHER, THE ASSESSING OFFICER DID NOT APPL Y HIS OWN MIND TO THE INFORMATION AND EXAMINE THE BASIS AND MATERIAL OF THE INFORMATION. THERE WAS NO DISPUTE THAT THE COMPANY, S, HAD A PAI D UP CAPITAL OF RS.90 LAKHS AND WAS INCORPORATED ON JANUARY 4, 1989 , AND WAS ALSO ALLOTTED A PERMANENT ACCOUNT NUMBER IN SEPTEMBER, 2 001. THUS, IT COULD NOT BE HELD TO BE A FICTITIOUS PERSON. THE RE ASSESSMENT PROCEEDINGS WERE NOT VALID AND WERE LIABLE TO BE QU ASHED. 8.4 CONSIDERING THE FACTS OF THE CASE IN THE LIGHT OF ABOVE DECISION, IT IS CLEAR THAT THERE WAS NO SPECIFIC OR RELIABLE INFORMATION RECEIVED FROM INVESTIGATION WING, GHAZIABAD ABOUT ESCAPEMENT OF INCOME AND NO R ECORD OF THE DONOR WAS AVAILABLE WITH THE INVESTIGATION WING TO PROVE THAT HE WAS PROVIDING ACCOMMODATION ENTRIES. EVEN ACCORDING TO THE LD. CI T(A), THE NAMES OF SOME OF THE ASSESSEES WERE NOT CORRECTLY MENTIONED IN TH E REPORT OF INVESTIGATION WING, GHAZIABAD. THE AO MERELY CALLED FOR THE NAMES OF THE ASSESSEES FROM VIJAYA BANK. THEREFORE, THE INFORMATION RECEIVED FR OM THE INVESTIGATION WING, GHAZIABAD WAS NOTHING. THE REASONS DID NOT SATISFY THE REQUIREMENT OF SECTION 147 OF THE IT ACT. THERE WAS NO REFERENCE T O ANY DOCUMENT OR MATERIAL WITH THE REPORT OF INVESTIGATION WING, GHAZIABAD. T HUS, THE SAME COULD NOT BE REGARDED AS A MATERIAL OR EVIDENCE THAT PRIMA FACIE SHOWED NEXUS OR LINK WHICH DISCLOSES THE ESCAPEMENT OF INCOME. THE LETTE R OF INVESTIGATION WING, GHAZIABAD DID NOT POINT OUT THE FACT THAT THERE WAS ANY ESCAPEMENT OF INCOME IN THE CASE OF ASSESSEE. THEREFORE, IT IS CLEAR THA T THE AO DID NOT APPLY HIS OWN MIND TO THE VAGUE INFORMATION AND DID NOT EXAMI NE THE BASIS OR MATERIAL, IF ANY, TO SUPPORT SUCH INFORMATION. THE DECISION O F HONBLE DELHI HIGH COURT IN THE CASE OF SIGNATURE HOTELS PVT. LTD. (SUPRA), THUS, SQUARELY APPLY TO THE FACTS AND CIRCUMSTANCES OF THE CASE. THE LD. DR, HO WEVER, RELIED UPON THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF RAJAT EXPORT IMPORT INDIA PVT. LTD. VS. ITO, 18 TAXMAN.COM 311, IN WHICH THE ASSESSEE WAS NOT IN A POSITION TO DENY THAT THE MATERIAL RELIED UPON BY T HE AO AT THE TIME OF RECORDING THE REASONS FOR REOPENING OF ASSESSMENT D ID NOT CONTAIN ENTRY LINKING S. LTD. WITH THE ASSESSEE, ISSUE OF NOTICE U/S. 148 ON PRIMA FACIE BELIEF THAT THE INCOME CHARGEABLE TO TAX HAD ESCAPED ASSES SMENT WAS HELD TO BE VALID. THE DECISION RELIED UPON BY THE LD. DR IS CL EARLY DISTINGUISHABLE ON FACTS OF THE PRESENT CASE AS NOTED ABOVE BECAUSE IN THE R EMAND REPORT OF THE INVESTIGATION WING, THE INVESTIGATION WING, GHAZIAB AD DID NOT FIND ANY RECORD OF INVESTIGATION CONDUCTED IN THE CASE OF DONOR SHR I SANJAY MOHAN AGARWAL OF GIVING BOGUS ACCOMMODATION ENTRY AND THE ORDER SHE ET OF THE LD. CIT(A) DATED 20.12.2012 (SUPRA) SUPPORTS THE CASE OF THE A SSESSEE THAT THERE WAS GENUINE GIFT IN THE MATTER. IN OTHER CASES WHERE 14 3(1) IS DONE ALL INFORMATION I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 13 OF 14 OF GIFT DISCLOSED IN ORIGINAL RETURN. THEREFORE, TH ERE WAS NO PRIMA FACIE BELIEF AVAILABLE TO THE AO TO SAY THAT THERE WAS ANY ESCAP EMENT OF INCOME. THERE IS NO REASON TO BELIEVE AS REQUIRED BY SECTION 147. CO NSIDERING THE ABOVE DISCUSSION, WE ARE OF THE VIEW THAT THERE WAS NO JU STIFICATION FOR THE AO TO HAVE INITIATED THE REASSESSMENT PROCEEDINGS U/S. 14 7/148 OF THE IT ACT. THE RE-ASSESSMENT ORDER IS, THEREFORE, LIABLE TO BE QUA SHED. THIS POINT IS, THEREFORE, DECIDED IN FAVOUR OF THE ASSESSEE AND AG AINST REVENUE. 6.2 ITAT, DELHI BENCH IN THE CASE OF ITO VS. ON EXI M PVT. LTD. (SUPRA) HELD AS UNDER : AO HAVING REOPENED THE ASSESSMENT ON THE BASIS THA T THE ASSESSEE HAS RECEIVED ACCOMMODATION ENTRIES FROM THE COMPANY ASB LTD. PURSUANT TO THE INFORMATION RECEIVED FROM THE INVES TIGATION WING, WITHOUT INDICATING THE NATURE OF TRANSACTIONS MADE BY THE ASSESSEE, MUCH LESS ANYTHING TO ESTABLISH THAT THE SAID TRANS ACTIONS ARE IN THE NATURE OF ACCOMMODATION ENTRIES, THE REASONS FORMIN G THE BASIS OF REOPENING OF ASSESSMENT DO NOT SATISFY THE REQUIREM ENT OF S. 147. 7. CONSIDERING THE FACTS OF THE CASE IN THE LIGHT O F ABOVE DECISIONS, IT IS CLEAR THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY ORDER OF ITAT, AGRA BENCH IN THE CASE OF LATE SHRI SATISH PRAKASH MITTA L (SUPRA). ON 17.10.2013, WHEN THIS MATTER WAS BRIEFLY ARGUED, THE LD. DR WAS DIRECTED TO FILE COPY OF THE INFORMATION RECEIVED FROM INVESTIGATION WING THROUG H ADDL. CIT, RANGE-2, AGRA IN THE MATTER OF ASSESSEE, WHICH FORMED BASIS OF REOPENING OF ASSESSMENT. HOWEVER, NO SUCH MATERIAL IS PRODUCED B EFORE US FOR EXAMINATION. THE LD. DR WAS GIVEN LAST OPPORTUNIT Y TO COMPLY WITH THE ABOVE ORDER ON 27.11.2013 ALSO BUT NO SUCH COMPLIANCE HAS BEEN MADE. IT IS, THEREFORE, CLEAR THAT NO EVIDENCE OR MATERIAL WAS P RODUCED TO JUSTIFY THE REOPENING OF ASSESSMENT IN THE MATTER. HONBLE DELH I HIGH COURT IN THE CASE OF SIGNATURE HOTEL PVT. LTD. VS. ITO, 338 ITR 51 AS IS ALSO CONSIDERED IN THE CASE OF LATE SHRI SATISH PRAKASH MITTAL (SUPRA), HELD TH AT SUCH TYPE OF INFORMATION DID NOT SATISFY THE REQUIREMENT OF SECTION 147. IN THE CASE OF THE ASSESSEE, THERE WAS NO REFERENCE TO ANY DOCUMENT OR STATEMENT EXCEPT SOME INFORMATION, WHICH WAS ALSO NOT PRODUCED BEFORE US. THEREFORE, SUCH INFORMATION COULD NOT BE REGARDED AS MATERIAL OR EV IDENCE TO ESTABLISH THAT IT IS A CASE OF ESCAPEMENT OF INCOME. IT IS, THEREFORE , CLEAR THAT THERE WAS NO SPECIFIC INFORMATION RECEIVED FROM INVESTIGATION WI NG ABOUT THE ESCAPEMENT OF INCOME IN THE CASE OF ASSESSEE OR PROVIDING ANY ACC OMMODATION ENTRY TO THE ASSESSEE. THUS, THERE WAS NO BASIS FOR REOPENING OF ASSESSMENT IN THIS CASE. ON THE OTHER HAND, THE ASSESSEE WAS HAVING SUFFICIE NT MATERIAL TO ESTABLISH THE PURCHASE OF SHARES, SALE THEREOF AND SALE CONSI DERATION RECEIVED THROUGH BANKING CHANNEL. THE LD. COUNSEL FOR THE ASSESSEE, THEREFORE, RIGHTLY CONTENDED THAT THE ISSUE BEING IDENTICAL AS WAS DEC IDED IN THE CASE OF LATE SHRI SATISH PRAKASH MITTAL (SUPRA). WE, FOLLOWING T HE ABOVE DECISION, ARE OF THE VIEW THAT THERE WAS NO JUSTIFICATION FOR THE AO TO HAVE INITIATED REASSESSMENT PROCEEDINGS U/S. 147/148 OF THE IT ACT . THE RE-ASSESSMENT ORDER IS THEREFORE, LIABLE TO BE QUASHED. WE ACCORD INGLY, SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND QUASH THE REASSESSMEN T PROCEEDINGS. IN VIEW OF THE ABOVE FINDING, THERE IS NO NEED TO DECIDE THE A PPEAL ON MERITS. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED. I.T.A. NO. 242/AGR/2013 ASSESSMENT YEAR 2001-02 PAGE 14 OF 14 6. I SEE NO REASON TO TAKE A VIEW DIFFERENT FROM T HAT TAKEN BY CO-ORDINATE BENCH IN THE ABOVE ORDER UNDER IDENTICAL FACTS AND CIRCUM STANCES. I, THEREFORE, UPHOLD THE GRIEVANCE OF ASSESSEE ON VALIDITY OF REASSESSMENT P ROCEEDINGS, REVERSE THE IMPUGNED ORDER AND QUASH THE RE-ASSESSMENT ORDER. 7. IN VIEW OF THE FACT THAT THE REASSESSMENT ITSELF IS QUASHED, I SEE NO NEED TO DEAL WITH OTHER ARGUMENTS SO STRENUOUSLY ADVANCED B Y THE LEARNED COUNSEL ON MERITS OF THE CASE. THE SAME IS RENDERED WHOLLY ACADEMIC. 8. IN THE RESULT, THE APPEAL IS ALLOWED. PRONOUNCED IN THE OPEN COURT TODAY ON THIS 24 TH DAY OF JUNE, 2015. SD/- PRAMOD KUMAR (ACCOUNTANT MEMBER) DATED: THE 24 TH DAY OF JUNE 2015 *AKS/- COPIES TO: (1) THE APPELLANT (2) THE RESPONDE NT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA