Goodluck Commercials Ltd., Delhi V. ITO, New Delhi

ITA 915/DEL/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4769 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 12-06-2017
• Assessment Year: 2000-2001
• Appeal Filed On: 16-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T VASANTHAN
• Assessee Lawyers: O P MODY
• Keywords: Reopening of assessment; Gift; Income from undisclosed sources; Tangible material; Accommodation entries; Reason to believe; Borrowed satisfaction
• Section: 131; 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES SMC : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA.NO.915/DEL./2017 ASSESSMENT YEAR 2000-2001 GOO DLUCK COMMERCIALS LTD., KH NO.882, GROUND FLOOR, LAL DORA, VILLAGE BURARI, NEAR CHHAKU FACTORY, DELHI 110 084. PAN AAACG4081C VS. THE INCOME TAX OFFICER WARD NO.12(2) NEW DELHI. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI O.P. MODY , ADVOCATE. FOR REVENUE : SHRI T. VASANTHAN , SR.D.R DATE OF HEARING : 06 .0 9 .2017 DATE OF PRONOUNCEMENT : 13 .0 9 .2017 ORDER THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-15, DELHI, DATED 04 TH DECEMBER, 2015 FOR THE A.Y. 2000-2001, CHALLENGING THE REOPENING OF THE AS SESSMENT UNDER SECTION 147/148 OF THE I.T. ACT, 1961 AND ADDITIONS OF RS.34,50,200 UNDER SECTION 68 OF THE I.T. ACT, 1961 AND RS.3,450 ON ACCOUNT OF COMMISSION UNDER SECTION 69A OF THE I.T. ACT, 1961. 2 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT RETURN O F INCOME DECLARING INCOME OF RS.34,510 WAS FILED BY ASSESSEE -COMPANY ON 19 TH SEPTEMBER, 2000. THE RETURN WAS PROCESSED UNDER SEC TION 143(1) OF THE I.T. ACT. AN INFORMATION WAS RECEIVED FROM O/O. DIT (INVESTIGATION), NEW DELHI, VIDE LETTER DATED 31 ST JANUARY, 2007 AND DATED 05 TH FEBRUARY, 2007 THAT ASSESSEE HAD TAKEN ACCOMMODATI ON ENTRY OF RS.34,50,200 FROM VARIOUS ENTITIES CREDITE D IN ASSESSEES BANK ACCOUNT MAINTAINED WITH STATE BANK OF INDIA. T HE ABOVE INFORMATION AND ENQUIRIES MADE BY THE INVESTIGATION WING LED TO THE BELIEF THAT THE TRANSACTION IS CLEARLY AN ACCOMMODA TION ENTRY AND BELIEF WAS FORMED THAT ASSESSEE HAD TAKEN ACCOMMODA TION ENTRY OF RS.34,50,200 IN LIEU OF UNACCOUNTED INCOME OF THE A SSESSEE. THE A.O. ACCORDINGLY, RECODED REASONS UNDER SECTION 148 OF T HE I.T. ACT AND ISSUED NOTICE UPON ASSESSEE WHICH WAS SERVED. THE A SSESSEE STATED THAT RETURN ALREADY FILED MAY BE TREATED AS RETURN HAVING BEEN FILED IN RESPONSE TO NOTICE UNDER SECTION 148 OF THE I.T. ACT. WHILE CARRYING OUT THE ENQUIRIES IN THE CASE OF ENTRY OPERATIONS, THE INVESTIGATION WING, NEW DELHI, HAD RECORDED STATEMENT OF SHRI PRA DEEP KUMAR JINDAL UNDER SECTION 131 OF THE I.T. ACT ON 15 TH APRIL, 2004, IN WHICH, 3 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. HE HAD ADMITTED THAT THROUGH THE VARIOUS COMPANIES FLOATED BY HIM, HE HAD CARRIED OUT THE BUSINESS ACTIVITIES OF PROVI DING BOGUS ACCOMMODATION ENTRIES. THE A.O. AFTER GIVING AN OPP ORTUNITY OF BEING HEARD TO THE ASSESSEE, MADE ADDITION OF RS.34,50,20 0 UNDER SECTION 68 OF THE I.T. ACT AND ALSO MADE ADDITION OF RS.3,4 50 ON ACCOUNT OF COMMISSION FOR PROVIDING SUCH ACCOMMODATION ENTRIES . THE TOTAL ADDITION WAS MADE AT RS.34,53,650. THE LD. CIT(A) C ONFIRMED BOTH THE ISSUES AND DISMISSED THE APPEAL OF ASSESSEE. 3. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND R EFERRED TO PAGE- 1 OF THE PAPER BOOK WHICH IS REASONS RECORDED UNDER SECTION 148 OF THE I.T. ACT. HE HAS SUBMITTED THAT ALL ENTRIES ARE TAKEN IN THE BANK ACCOUNT OF THE ASSESSEE. HE HAS SUBMITTED THAT IN C ASE OF IKA PROCESSORS & DISTRIBUTORS PVT. LTD., AN ENTRY OF RS .2,20,000 IS REPAYMENT OF THE DEBT OF EARLIER YEARS. IN CASE OF RIYA INVESTMENT RS.2 LAKHS WAS PAID ON BEHALF OF M/S. JAGAN INSTITUTE OF MANAGEMENT OF SOCIETY BEING THE AMOUNT DUE TO THE ASSESSEE FROM T HEM UNDER THEIR INSTRUCTIONS. COPIES OF THEIR LEDGER ACCOUNT IS FIL ED AT PAGE 9 OF THE PAPER BOOK. PAGE-10 IS THE LETTER OF M/S. RIYA INVE STMENTS IN WHICH 4 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. THEY HAVE CONFIRMED REPAYMENT OF THE ABOVE AMOUNT. COPY OF THE ACCOUNT AND LETTER OF M/S. JAGAN INSTITUTE OF MANAG EMENT ARE FILED AT PAGE 12 AND 11 OF THE PAPER BOOK. PB-13 AND 14 I S LEDGER ACCOUNT OF M/S. DUPAS LEASING & FINANCING CO. LTD. PB-15 IS LETTER OF LORD SHIV INVESTMENT & TRADING COMPANY PVT. LTD., WHO HA VE PAID RS.5 LAKHS TO THE ASSESSEE ON BEHALF OF M/S. DUPAS LEASI NG & FINANCING CO. LTD., BEING AMOUNT DUE TO THE ASSESSEE. PB-16 I S LETTER OF M/S. HARE KRISHAN INVESTMENT & TRADING COMPANY PVT. LTD. , IN WHICH THEY HAVE MADE PAYMENT OF RS.5 LAKHS TO ASSESSEE ON BEHA LF OF M/S. DUPAS LEASING & FINANCING CO. LTD., AS DUE TO THE A SSESSEE. LEARNED COUNSEL FOR THE ASSESSEE, THEREFORE, SUBMITTED THAT ALL AMOUNTS WERE OUTSTANDING FOR EARLIER YEARS WHICH HAVE BEEN REPAI D IN THE ASSESSMENT YEAR UNDER APPEAL. THEREFORE, A.O. HAS M ERELY COPIED THE REPORT OF THE INVESTIGATION WING IN THE REASONS AND WITHOUT APPLYING THE MIND, REOPENED THE ASSESSMENT. IN SUPPORT OF HI S CONTENTION, HE HAS RELIED UPON THE DECISION OF THE HONBLE DELHI H IGH COURT IN THE CASE OF PR. CIT VS. G AND G PHARMA INDIA LTD., (201 6) 384 ITR 147 (DEL.) AND DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF PR. CIT VS. MEENAKSHI OVERSEAS PVT. LTD., 395 ITR 677. HE H AS, THEREFORE, 5 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. SUBMITTED THAT REOPENING OF THE ASSESSMENT IS BAD I N LAW IN THIS CASE. HE HAS ALSO SUBMITTED THAT FOR REPAYMENT OF LOAN OF EARLIER YEAR, SECTION 68 WILL NOT APPLY. 4. ON THE OTHER HAND, LD. D.R. RELIED UPON THE ORD ERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT AT THE STAGE O F REOPENING OF THE ASSESSMENT, ONLY PRIMA FACIE CASE IS TO BE SEEN. HE HAS RELIED UPON THE DECISION OF HONBLE SUPREME COURT IN THE CASE O F RAYMOND WOOLLEN MILLS LTD., VS. ITO (1999) 236 ITR 34 (SC) IN SUPPORT OF THE PROPOSITION THAT AT THE STAGE OF REOPENING OF THE A SSESSMENT, PRIMA FACIE SOME MATERIAL IS TO BE SEEN WHICH IS THE BASIS FOR REOPENING OF THE ASSESSMENT BUT SUFFICIENCY OR CORRECTNESS OF SU CH MATERIAL COULD NOT BE CONSIDERED. HE HAS ALSO RELIED UPON THE DECI SION OF HONBLE SUPREME COURT IN THE CASE OF YOGENDRA KUMAR GUPTA V S. ITO (2014) 227 TAXMAN 374 (SC) IN WHICH IT WAS HELD AS UNDER : WHERE SUBSEQUENT TO COMPLETION OF ORIGINAL ASSESSM ENT, ASSESSING OFFICER, ON BASIS OF SEARCH CARRIED OUT I N CASE OF ANOTHER PERSON, CAME TO KNOW THAT LOAN TRANSACTIONS OF ASSESSEE WITH A FINANCE COMPANY WERE BOGUS AS SAID COMPANY W AS ENGAGED IN PROVIDING ACCOMMODATION ENTRIES, IT BEIN G A FRESH INFORMATION, HE WAS JUSTIFIED IN INITIATING REASSES SMENT PROCEEDING IN CASE OF ASSESSEE. 6 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. 4.1. LD. D.R. FURTHER SUBMITTED THAT UNDER SECTION 68, THE CREDITS IN THE BOOKS OF ACCOUNT HAVE TO BE SEEN, MA Y BE WHICH IS THE REPAYMENT OF THE LOAN. 5. I HAVE CONSIDERED THE RIVAL CONTENTIONS AND PER USED THE MATERIAL ON RECORD. IT IS WELL SETTLED LAW THAT VAL IDITY OF RE-ASSESSMENT PROCEEDINGS, HAVE TO BE JUDGED ON THE BASIS OF THE REASONS RECORDED BY A.O. FOR REOPENING OF THE ASSESSMENT. THE ASSESS EE HAS FILED COPY OF THE REASONS RECORDED UNDER SECTION 148 OF THE I. T. ACT FOR THE PURPOSE OF REOPENING OF THE ASSESSMENT AT PAGE-1 OF THE PAPER BOOK AND THE SAME IS REPRODUCED AS UNDER : ANNEX.A M/S. GOODLUCK COMMERCIALS LTD. (AAACG4081C) ASSESSMENT YEAR 2000-01 THE ASSESSEE FILED ITS RETURN OF INCOME FOR THE YEA R UNDER CONSIDERATION VIDE RECEIPT NO.63 DATED 19.09.2000 D ECLARING INCOME OF RS.34,510/-. AS PER INFORMATION RECEIVED FROM THE OFFICE OF THE DIT (INV.), NEW DELHI VIDE LETTER NO.DIT(INV.)-I/2006-07/AE/132 2 DATED 31.01.2007 AND NO.1536 DATED 05.02.2007, THE ASSESS EE COMPANY HAS TAKEN FOLLOWING ACCOMMODATION ENTRIES T OTALING TO RS.34,50,200/-. 7 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. VALUE OF ENTRY TAKEN DT. OF ENTRY FROM WHOM TAKEN RS.2,20,000 19.01.2000 IKA PROCESSORS & DISTRIBUTOR S PVT. LTD., (A/C NO.19041 WITH UBI, AZADPUR). RS.2,00,200 15.01.2000 RIYA INVESTMENT (A/C NO.28265 WITH UBI, AZADPUR) RS.1,00,000 20.12.1999 PRECISION AGENCIES PVT. LTD. , (A/C.NO.43145 WITH SBI, SHAKTI NAGAR) RS.5,30,000 21.12.1999 PRECISION AGENCIES PVT. LTD. , (A/C.NO.43145 WITH SBI, SHAKTI NAGAR) RS.7,00,000 04.01.2000 PRECISION AGENCIES PVT. LTD. , (A/C.NO.43145 WITH SBI, SHAKTI NAGAR) RS.5,00,000 01.10.1999 HARE KRISHAN INVESTMENT & TR ADING CO. PVT. LTD., (A/C. NO.610CA WITH VAISH COOP NEW BANK, KAMLA NAGAR) RS.5,00,000 01.10.1999 LORD SHIV INVESTMENT & TRADI NG CO. PVT. LTD., (A/C.NO.611CA WITH VAISH COOP NEW BANK KAMLA NAGAR. RS.7,00,000 20.09.1999 PRECISION AGENCIES PVT. LTD. , (A/C.NO.43145 WITH SBI, SHAKTI NAGAR) THE SAID AMOUNTS ARE STATED TO BE CREDITED IN ASSES SEES BANK ACCOUNTS MAINTAINED WITH STATE BANK OF INDIA, SHAKTI NAGAR, UCO BANK, MODEL TOWN AND BANK OF BARODA, SHA LIMAR BAGH, NEW DELHI. RETURN OF INCOME FILED ALSO SHOWS THAT ASSESSEE HAS BANK ACCOUNT WITH BANK OF BARODA, SHALIMAR BAGH AND UCO BANK. ON INVESTIGATION MADE BY THE INVESTIGATION WI NG IT HAS BEEN FOUND THAT ASSESSEE IS A BENEFICIARY OF TAKING THE AFORESAID ACCOMMODATION ENTRIES OF RS.34,50,200/-. IN VIEW OF THE ABOVE INFORMATION, IT IS EVIDENT THAT THE ASSESSEE COMPAN Y HAS INTRODUCED ITS OWN UNACCOUNTED MONEY IN ITS BANK BY WAY OF ACCOMMODATION ENTRY. 8 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. PRIMA FACIE, THE INVESTIGATIONS AND ENQUIRIES MADE BY THE INVESTIGATION WING INDICATE THAT THE ABOVE TRANSACT ION IS SHAM TRANSACTION OF ACCOMMODATION ENTRY TAKEN BY THE ASS ESSEE IN ORDER TO REDUCE ITS TAXABLE INCOME. IN VIEW OF THE ABOVE FACTS, I AM OF THE CONSIDERED OPINION THAT THE ABOVE TRANSAC TION REFLECTS THE UNDISCLOSED INCOME OF THE ASSESSEE INTRODUCED I N THE GARB OF SUCH SHAM TRANSACTION. CONSIDERING THE FACTS OF THE CASE, I HAVE REASON TO BELIEVE THAT INCOME TO THE EXTENT OF ATLE AST RS.34,50,200/- HAS ESCAPED ASSESSMENT AND THIS IS A FIT CASE FOR INITIATION OF PROCEEDINGS UNDER SECTION 147 OF THE INCOME TAX ACT, 1961. SUBMITTED FOR KIND PERUSAL AND APPROVAL AS PER PROV ISIONS OF SECTION 151(2) OF THE ACT. SD/-ARUN KUMAR DT.28.03.07 5.1. LEARNED COUNSEL FOR THE ASSESSEE HAS FILED CO PIES OF THE LEDGER ACCOUNT AND LETTERS OF VARIOUS PARTIES WHO A RE MENTIONED IN THE REASONS RECORDED ABOVE WHO HAVE ALLEGEDLY PROVI DED ACCOMMODATION ENTRY TO ASSESSEE TO SHOW THAT EITHER THE AMOUNTS WERE OPENING BALANCE OR THE AMOUNTS HAVE BEEN REPAI D TO THE ASSESSEE IN THE ASSESSMENT YEAR UNDER APPEAL, WHICH WERE DUE TO THE ASSESSEE ON BEHALF OF THE DIFFERENT PARTIES. THE HO NBLE DELHI HIGH COURT IN THE CASE OF PR. CIT VS. MEENAKSHI OVERSEAS PVT. LTD., (SUPRA) IN PARAS 19 TO 38 HELD AS UNDER : 9 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. 19. A PERUSAL OF THE REASONS AS RECORDED BY THE AO REVEALS THAT THERE ARE THREE PARTS TO IT. IN THE FI RST PART, THE AO HAS REPRODUCED THE PRECISE INFORMATION HE HAS RECEI VED FROM THE INVESTIGATION WING OF THE REVENUE. THIS INFORMATION IS IN THE FORM OF DETAILS OF THE AMOUNT OF CREDIT RECEIVED, THE PA YER, THE PAYEE, THEIR RESPECTIVE BANKS, AND THE CHEQUE NUMBER. THIS INFORMATION BY ITSELF CANNOT BE SAID TO BE TANGIBLE MATERIAL. 20. COMING TO THE SECOND PART, THIS TELLS US WHAT THE AO DID WITH THE INFORMATION SO RECEIVED. HE SAYS: 'THE INFORMATION SO RECEIVED HAS BEEN GONE THROUGH.' ONE WOULD HAVE EXPECTED HIM TO POINT OUT WHAT HE FOUND WHEN HE WENT THROUGH THE INFORMATION. IN OTHER WORDS, WHAT IN SUCH INFORMATI ON LED HIM TO FORM THE BELIEF THAT INCOME ESCAPED ASSESSMENT. BUT THIS IS ABSENT. HE STRAIGHTAWAY RECORDS THE CONCLUSION THAT 'THE ABOVE SAID INSTRUMENTS ARE IN THE NATURE OF ACCOMMODATION ENTRY WHICH THE ASSESSEE HAD TAKEN AFTER PAYING UNACCOUNTED CAS H TO THE ACCOMMODATION ENTRY GIVEN (SIC GIVER)'. THE AO ADDS THAT THE SAID ACCOMMODATION WAS 'A KNOWN ENTRY OPERATOR' THE SOUR CE BEING 'THE REPORT OF THE INVESTIGATION WING'. 10 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. 21. THE THIRD AND LAST PART CONTAINS THE CONCLUSI ON DRAWN BY THE AO THAT IN VIEW OF THESE FACTS, 'THE ALLEGED TRANSACTION IS NOT THE BONAFIDE ONE. THEREFORE, I HAVE REASON TO B E BELIEVE THAT AN INCOME OF RS.5,00,000 HAS ESCAPED ASSESSMENT IN THE AY 2004-05 DUE TO THE FAILURE ON THE PART OF THE ASSES SEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS NECESSARY FOR IT S ASSESSMENT... ' 22. AS RIGHTLY POINTED OUT BY THE ITAT, THE 'REAS ONS TO BELIEVE' ARE NOT IN FACT REASONS BUT ONLY CONCLUSIO NS, ONE AFTER THE OTHER. THE EXPRESSION 'ACCOMMODATION ENTRY' IS USED TO DESCRIBE THE INFORMATION SET OUT WITHOUT EXPLAINING THE BASI S FOR ARRIVING AT SUCH A CONCLUSION. THE STATEMENT THAT THE SAID E NTRY WAS GIVEN TO THE ASSESSEE ON HIS PAYING 'UNACCOUNTED CASH' IS ANOTHER CONCLUSION THE BASIS FOR WHICH IS NOT DISCLOSED. WH O IS THE ACCOMMODATION ENTRY GIVER IS NOT MENTIONED. HOW HE CAN BE SAID TO BE 'A KNOWN ENTRY OPERATOR' IS EVEN MORE MYSTERI OUS. CLEARLY THE SOURCE FOR ALL THESE CONCLUSIONS, ONE AFTER THE OTHER, IS THE INVESTIGATION REPORT OF THE DIT. NOTHING FROM THAT REPORT IS SET OUT TO ENABLE THE READER TO APPRECIATE HOW THE CONCLUSI ONS FLOW THEREFROM. 11 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. 23. THUS, THE CRUCIAL LINK BETWEEN THE INFORMATIO N MADE AVAILABLE TO THE AO AND THE FORMATION OF BELIEF IS ABSENT. THE REASONS MUST BE SELF EVIDENT, THEY MUST SPEAK FOR T HEMSELVES. THE TANGIBLE MATERIAL WHICH FORMS THE BASIS FOR THE BELIEF THAT INCOME HAS ESCAPED ASSESSMENT MUST BE EVIDENT FROM A READING OF THE REASONS. THE ENTIRE MATERIAL NEED NOT BE SET OUT. HOWEVER, SOMETHING THEREIN WHICH IS CRITICAL TO THE FORMATIO N OF THE BELIEF MUST BE REFERRED TO. OTHERWISE THE LINK GOES MISSIN G. 24. THE REOPENING OF ASSESSMENT UNDER SECTION 147 IS A POTENT POWER NOT TO BE LIGHTLY EXERCISED. IT CERTAI NLY CANNOT BE INVOKED CASUALLY OR MECHANICALLY. THE HEART OF THE PROVISION IS THE FORMATION OF BELIEF BY THE AO THAT INCOME HAS E SCAPED ASSESSMENT. THE REASONS SO RECORDED HAVE TO BE BASE D ON SOME TANGIBLE MATERIAL AND THAT SHOULD BE EVIDENT FROM R EADING THE REASONS. IT CANNOT BE SUPPLIED SUBSEQUENTLY EITHER DURING THE PROCEEDINGS WHEN OBJECTIONS TO THE REOPENING ARE CO NSIDERED OR EVEN DURING THE ASSESSMENT PROCEEDINGS THAT FOLLOW. THIS IS THE BARE MINIMUM MANDATORY REQUIREMENT OF THE FIRST PAR T OF SECTION 147 (1) OF THE ACT. 12 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. 25. AT THIS STAGE IT REQUIRES TO BE NOTED THAT SI NCE THE ORIGINAL ASSESSMENT WAS PROCESSED UNDER SECTION 143 (1) OF THE ACT, AND NOT SECTION 143 (3) OF THE ACT, THE PROVISO TO SECTION 147 WILL NOT APPLY. IN OTHER WORDS, EVEN THOUGH THE REO PENING IN THE PRESENT CASE WAS AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT AY, IT WAS NOT NECESSARY FOR THE AO TO SHOW THAT THERE WAS ANY FAILURE TO DISCLOSE FULLY OR TRULY AL L MATERIAL FACTS NECESSARY FOR THE ASSESSMENT. 26. THE FIRST PART OF SECTION 147 (1) OF THE ACT REQUIRES THE AO TO HAVE 'REASONS TO BELIEVE' THAT ANY INCOME CHA RGEABLE TO TAX HAS ESCAPED ASSESSMENT. IT IS THUS FORMATION OF REA SON TO BELIEVE THAT IS SUBJECT MATTER OF EXAMINATION. THE AO BEING A QUASI JUDICIAL AUTHORITY IS EXPECTED TO ARRIVE AT A SUBJE CTIVE SATISFACTION INDEPENDENTLY ON AN OBJECTIVE CRITERIA. WHILE THE R EPORT OF THE INVESTIGATION WING MIGHT CONSTITUTE THE MATERIAL ON THE BASIS OF WHICH HE FORMS THE REASONS TO BELIEVE THE PROCESS O F ARRIVING AT SUCH SATISFACTION CANNOT BE A MERE REPETITION OF TH E REPORT OF INVESTIGATION. THE RECORDING OF REASONS TO BELIEVE AND NOT REASONS TO SUSPECT IS THE PRE- CONDITION TO THE ASSUMPTION OF JURISDICTION 13 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. UNDER SECTION 147 OF THE ACT. THE REASONS TO BELIEVE MUST DEMONSTRATE LINK BETWEEN THE TANGIBLE MATERIAL AND THE FORMATION OF THE BELIEF OR THE REASON TO BELIEVE TH AT INCOME HAS ESCAPED ASSESSMENT. 27. EACH CASE OBVIOUSLY TURNS ON ITS OWN FACTS AN D NO TWO CASES ARE IDENTICAL. HOWEVER, THERE HAVE BEEN A LAR GE NUMBER OF CASES EXPLAINING THE LEGAL REQUIREMENT THAT REQUIRE S TO BE SATISFIED BY THE AO FOR A VALID ASSUMPTION OF JURIS DICTION UNDER SECTION 147 OF THE ACT TO REOPEN A PAST ASSESSMENT. 28.1. IN SIGNATURE HOTELS PVT. LTD. V. INCOME TAX OFFICER (SUPRA), THE REASONS FOR REOPENING AS RECORDED BY THE AO IN A PROFORMA AND PLACED BEFORE THE CIT FOR APPROVA L READ THUS: '11. REASONS FOR THE BELIEF THAT INCOME HAS ESCAP ED ASSESSMENT.- INFORMATION IS RECEIVED FROM THE DIT ( INV.-1), NEW DELHI THAT THE ASSESSEE HAS INTRODUCED MONEY AMOUNT ING TO RS. 5 LAKH DURING THE F.Y. 2002-03 RELATING TO A.Y. 200 3-04. DETAILS ARE CONTAINED IN ANNEXURE. AS PER INFORMATION AMOUN T RECEIVED IS NOTHING BUT ACCOMMODATION ENTRY AND ASSESSEE IS A BENEFICIARY.' 14 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. 28.2. THE ANNEXURE TO THE SAID PROFORMA GAVE THE NAME OF THE BENEFICIARY, THE VALUE OF ENTRY TAKEN, THE NUMB ER OF THE INSTRUMENT BY WHICH ENTRY WAS TAKEN, THE DATE ON WH ICH THE ENTRY WAS TAKEN, NAME OF THE ACCOUNT HOLDER OF THE BANK FROM WHICH THE CHEQUE WAS ISSUED, THE ACCOUNT NUMBER AND SO ON. 28.3. ANALYSING THE ABOVE REASONS TOGETHER WITH T HE ANNEXURE, THE COURT OBSERVED: '14. THE FIRST SENTENCE OF THE REASONS STATES THAT INFORMATION HAD BEEN RECEIVED FROM DIRECTOR OF INCOME-TAX (INVESTIG ATION) THAT THE PETITIONER HAD INTRODUCED MONEY AMOUNTING TO RS . 5 LACS DURING FINANCIAL YEAR 2002-03 AS PER THE DETAILS GI VEN IN ANNEXURE. THE SAID ANNEXURE, REPRODUCED ABOVE, RELA TES TO A CHEQUE RECEIVED BY THE PETITIONER ON 9TH OCTOBER, 2 002 FROM SWETU STONE PV FROM THE BANK AND THE ACCOUNT NUMBER MENTIONED THEREIN. THE LAST SENTENCE RECORDS THAT A S PER THE INFORMATION, THE AMOUNT RECEIVED WAS NOTHING BUT AN ACCOMMODATION ENTRY AND THE ASSESSEE WAS THE BENEFI CIARY. 15. THE AFORESAID REASONS DO NOT SATISFY THE REQUIR EMENTS OF SECTION 147 OF THE ACT. THE REASONS AND THE INFORMATION REFERRED TO IS EXTREMELY SCANTY AND VAGUE. THERE IS NO REFERENCE TO ANY DOCUMENT OR STATEMENT, EXCEPT ANNEXURE, WHIC H HAS BEEN QUOTED ABOVE. ANNEXURE CANNOT BE REGARDED AS A MATE RIAL OR 15 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. EVIDENCE THAT PRIMA FACIE SHOWS OR ESTABLISHES NEXU S OR LINK WHICH DISCLOSES ESCAPEMENT OF INCOME. ANNEXURE IS N OT A POINTER AND DOES NOT INDICATE ESCAPEMENT OF INCOME. FURTHER , IT IS APPARENT THAT THE ASSESSING OFFICER DID NOT APPLY H IS OWN MIND TO THE INFORMATION AND EXAMINE THE BASIS AND MATERI AL OF THE INFORMATION. THE ASSESSING OFFICER ACCEPTED THE PLE A ON THE BASIS OF VAGUE INFORMATION IN A MECHANICAL MANNER. THE COMMISSIONER ALSO ACTED ON THE SAME BASIS BY MECHAN ICALLY GIVING HIS APPROVAL. THE REASONS RECORDED REFLECT T HAT THE ASSESSING OFFICER DID NOT INDEPENDENTLY APPLY HIS M IND TO THE INFORMATION RECEIVED FROM THE DIRECTOR OF INCOME-TA X (INVESTIGATION) AND ARRIVE AT A BELIEF WHETHER OR N OT ANY INCOME HAD ESCAPED ASSESSMENT.' 28.4. THE COURT IN SIGNATURE HOTELS PVT. LTD. V. INCOME TAX OFFICER (SUPRA) QUASHED THE PROCEEDINGS UNDER SECTION 148 OF THE ACT. THE FACTS IN THE PRESENT CASE ARE MORE OR LESS SIMILAR. THE PRESENT CASE IS THEREFORE COVERED AGAI NST THE REVENUE BY THE AFOREMENTIONED DECISION. 29.1. THE ABOVE DECISION CAN BE CONTRASTED WITH TH E DECISION IN AGR INVESTMENT V. ADDITIONAL COMMISSIONER OF INCOME TAX (SUPRA), WHERE THE 'REASONS TO BELIEVE' READ AS UNDER: 16 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. 'CERTAIN INVESTIGATIONS WERE CARRIED OUT BY THE DIR ECTORATE OF INVESTIGATION, JHANDEWALAN, NEW DELHI IN RESPECT OF THE BOGUS/ACCOMMODATION ENTRIES PROVIDED BY CERTAIN INDIVIDUALS/COMPANIES. THE NAME OF THE ASSESSEE FIG URES AS ONE OF THE BENEFICIARIES OF THESE ALLEGED BOGUS TRANSACTIO NS GIVEN BY THE DIRECTORATE AFTER MAKING THE NECESSARY ENQUIRIES. I N THE SAID INFORMATION, IT HAS BEEN INTER-ALIA REPORTED AS UND ER: 'ENTRIES ARE BROADLY TAKEN FOR TWO PURPOSES: 1. TO PLOUGH BACK UNACCOUNTED BLACK MONEY FOR THE P URPOSE OF BUSINESS OR FOR PERSONAL NEEDS SUCH AS PURCHASE OF ASSETS ETC., IN THE FORM OF GIFTS, SHARE APPLICATION MONEY, LOANS E TC. 2. TO INFLATE EXPENSE IN THE TRADING AND PROFIT AND LOSS ACCOUNT SO AS TO REDUCE THE REAL PROFITS AND THEREBY PAY LE SS TAXES. IT HAS BEEN REVEALED THAT THE FOLLOWING ENTRIES HAV E BEEN RECEIVED BY THE ASSESSEE:....' 29.2. THE DETAILS OF SIX ENTRIES WERE THEN SET OU T IN THE ABOVE 'REASONS'. THESE INCLUDED NAME OF THE BENEFICIARY, THE BENEFICIARY'S BANK, VALUE OF THE ENTRY TAKEN, INSTR UMENT NUMBER, DATE, NAME OF THE ACCOUNT IN WHICH ENTRY WAS TAKEN AND THE ACCOUNT FROM WHERE THE ENTRY WAS GIVEN THE DETAILS OF THOSE BANKS. THE REASONS THEN RECORDED: 17 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. 'THE TRANSACTIONS INVOLVING RS. 27,00,000/-, MENTIO NED IN THE MANNER ABOVE, CONSTITUTES FRESH INFORMATION IN RESP ECT OF THE ASSESSEE AS A BENEFICIARY OF BOGUS ACCOMMODATION EN TRIES PROVIDED TO IT AND REPRESENTS THE UNDISCLOSED INCOM E/INCOME FROM OTHER SOURCES OF THE ASSESSEE COMPANY, WHICH H AS NOT BEEN OFFERED TO TAX BY THE ASSESSEE TILL ITS RETURN FILE D. ON THE BASIS OF THIS NEW INFORMATION, I HAVE REASON TO BELIEVE THAT THE INCOME OF RS.27,00,000/- HAS ESCAPED ASSESSMENT AS DEFINED BY SECTION 147 OF THE INCOME TAX ACT. THEREFORE, THIS IS A FIT CA SE FOR THE ISSUANCE OF THE NOTICE UNDER SECTION 148 .' 29.3. THE COURT WAS NOT INCLINED TO INTERFERE IN T HE ABOVE CIRCUMSTANCES IN EXERCISE OF ITS WRIT JURISDICTION TO QUASH THE PROCEEDINGS. A CAREFUL PERUSAL OF THE ABOVE REASONS REVEALS THAT THE AO DOES NOT MERELY REPRODUCE THE INFORMATION BU T TAKES THE EFFORT OF REVEALING WHAT IS CONTAINED IN THE INVEST IGATION REPORT SPECIFIC TO THE ASSESSEE. IMPORTANTLY HE NOTES THAT THE INFORMATION OBTAINED WAS 'FRESH' AND HAD NOT BEEN O FFERED BY THE ASSESSEE TILL ITS RETURN PURSUANT TO THE NOTICE ISS UED TO IT WAS FILED. THIS IS A CRUCIAL FACTOR THAT WENT INTO THE FORMATION OF THE BELIEF. IN THE PRESENT CASE, HOWEVER, THE AO HAS MA DE NO EFFORT TO SET OUT THE PORTION OF THE INVESTIGATION REPORT WHICH CONTAINS 18 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. THE INFORMATION SPECIFIC TO THE ASSESSEE. HE DOES N OT ALSO EXAMINE THE RETURN ALREADY FILED TO ASCERTAIN IF TH E ENTRY HAS BEEN DISCLOSED THEREIN. 30.1. IN COMMISSIONER OF INCOME TAX, NEW DELHI V. HIGHGAI N FINVEST (P) LIMITED (2007) 164 TAXMAN 142 (DEL) RELIED UPON BY MR. CHAUDHARY, THE REASONS TO BELIEVE READ AS UNDER : 'IT HAS BEEN INFORMED BY THE ADDITIONAL DIRECTOR OF INCOME TAX (INVESTIGATION), UNIT VII, NEW DELHI VIDE LETTER NO . 138 DATED 8 TH APRIL 2003 THAT THIS COMPANY WAS INVOLVED IN THE GIVING A ND TAKING BOGUS ENTRIES/ TRANSACTIONS DURING THE FINANCIAL YEAR 199 6-97, AS PER THE DEPOSITION MADE BEFORE THEM BY SHRI SANJAY RASTOGI, CA DURING A SURVEY OPERATION CONDUCTED AT HIS OFFICE PREMISES B Y THE INVESTIGATION WING. THE PARTICULARS OF SOME OF THE TRANSACTION OF THIS NATURE ARE AS UNDER: DATE PARTICULARS OF CHEQUE DEBIT AMT. CREDIT AMT 18.11.96 305002 5,00,000 THROUGH THE BANK ACCOUNT NO. CA 4266 OF M/S. MEHRAM EXPORTS PVT. LTD. IN THE PNB, NEW ROHTAK ROAD, NEW DELHI. NOTE: IT IS NOTED THAT THERE MIGHT BE MORE SUCH ENT RIES APART FROM THE ABOVE. 19 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 1997-9 8 WAS FILED BY THE ASSESSEE ON 4TH MARCH 1998 WHICH WAS ACCEPTED UNDER SECTION 143 (1) AT THE DECLARED INCOME OF RS. 4,200. IN VIEW OF THE SE FACTS, I HAVE REASON TO BELIEVE THAT THE AMOUNT OF SUCH TRANSACTIONS PAR TICULARLY THAT OF RS. 5,00,000 (AS MENTIONED ABOVE) HAS ESCAPED THE ASSES SMENT WITHIN THE MEANING OF THE PROVISO TO SECTION 147 AND CLAUSE (B) TO THE EXPLANATION 2 OF THIS SECTION. SUBMITTED TO THE ADDITIONAL CIT, RANGE -12, NEW DEL HI FOR APPROVAL TO ISSUE NOTICE UNDER SECTION 148 FOR THE ASSESSMENT YEAR 1997-98, IF APPROVED.' 30.2. THE AO WAS NOT MERELY REPRODUCING THE INFOR MATION RECEIVED FROM THE INVESTIGATION BUT TOOK THE EFFORT OF REFERRING TO THE DEPOSITION MADE DURING THE SURVEY BY THE CHARTE RED ACCOUNTANT THAT THE ASSESSEE COMPANY WAS INVOLVED I N THE GIVING AND TAKING OF BOGUS ENTRIES. THE AO THUS IND ICATED WHAT THE TANGIBLE MATERIAL WAS WHICH ENABLED HIM TO FORM THE REASONS TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT. IT W AS IN THOSE CIRCUMSTANCES THAT IN THE CASE, THE COURT CAME TO T HE CONCLUSION 20 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. THAT THERE WAS PRIMA FACIE MATERIAL FOR THE AO TO C OME TO THE CONCLUSION THAT THE ASSESSEE HAD NOT MADE A FULL AN D TRUE DISCLOSURE OF ALL THE MATERIAL FACTS RELEVANT FOR T HE ASSESSMENT. 31. IN COMMISSIONER OF INCOME TAX V. G&G PHARMA (SUPRA) THERE WAS A SIMILAR INSTANCE OF REOPENING OF ASSESSMENT BY THE AO BASED ON THE INFORMATION RECEI VED FROM THE DIT (I). THERE AGAIN THE DETAILS OF THE ENTRY P ROVIDED WERE SET OUT IN THE 'REASONS TO BELIEVE'. HOWEVER, THE COURT FOUND THAT THE AO HAD NOT MADE ANY EFFORT TO DISCUSS THE MATERIAL ON THE BASIS OF WHICH HE FORMED PRIMA FACIE VIEW THAT INCOME HAD ESCAPED ASSESSMENT. THE COURT HELD THAT THE BASIC REQUIREME NT OF SECTION 147 OF THE ACT THAT THE AO SHOULD APPLY HIS MIND IN OR DER TO FORM REASONS TO BELIEVE THAT INCOME HAD ESCAPED ASSESSME NT HAD NOT BEEN FULFILLED. LIKEWISE IN CIT-4 V. INDEPENDENT MEDIA P. LIMITED (SUPRA) THE COURT IN SIMILAR CIRCUMSTANCES INVALID ATED THE INITIATION OF THE PROCEEDINGS TO REOPEN THE ASSESSM ENT UNDER SECTION 147 OF THE ACT. 32. IN ORIENTAL INSURANCE COMPANY LIMITED V. COMMISSIONER OF INCOME TAX 378 ITR 421 (DEL) IT WAS HELD THAT 21 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. 'THEREFORE, EVEN IF IT IS ASSUMED THAT, IN FACT, TH E ASSESSEES INCOME HAS ESCAPED ASSESSMENT, THE AO WOULD HAVE NO JURISDICTION TO ASSESS THE SAME IF HIS REASONS TO B ELIEVE WERE NOT BASED ON ANY COGENT MATERIAL. IN ABSENCE OF THE JUR ISDICTIONAL PRE- CONDITION BEING MET TO REOPEN THE ASSESSMENT, THE Q UESTION OF ASSESSING OR REASSESSING INCOME UNDER SECTION 147 OF THE ACT WOULD NOT ARISE.' 33. IN RUSTAGI ENGINEERING UDYOG (P) LIMITED (SUP RA), IT WAS HELD THAT '...THE IMPUGNED NOTICES MUST ALSO BE SET ASIDE AS THE AO HAD NO REASON TO BELIEVE THAT THE INCOME OF THE ASSESSEE FOR THE RELEVANT ASSESSMENT YEARS HAD ESCAPED ASSES SMENT. CONCEDEDLY, THE AO HAD NO TANGIBLE MATERIAL IN REGA RD TO ANY OF THE TRANSACTIONS PERTAINING TO THE RELEVANT ASSESSM ENT YEARS. ALTHOUGH THE AO MAY HAVE ENTERTAINED A SUSPICION TH AT THE ASSESSEES INCOME HAS ESCAPED ASSESSMENT, SUCH SUSP ICION COULD NOT FORM THE BASIS OF INITIATING PROCEEDINGS UNDER SECTION 147 OF THE ACT. A REASON TO BELIEVE - NOT REASON TO SU SPECT - IS THE PRECONDITION FOR EXERCISE OF JURISDICTION UNDER SECTION 147 OF THE ACT. ' 22 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. 34. RECENTLY IN AGYA RAM V. CIT (SUPRA), IT WAS EMPHASIZED THAT THE REASONS TO BELIEVE 'SHOULD HAVE A LINK WITH AN OBJECTIVE FACT IN THE FORM OF INFORMATION OR MAT ERIALS ON RECORD...' IT WAS FURTHER EMPHASIZED THAT 'MERE ALL EGATION IN REASONS CANNOT BE TREATED EQUIVALENT TO MATERIAL IN EYES OF LAW. MERE RECEIPT OF INFORMATION FROM ANY SOURCE WOULD N OT BY ITSELF TANTAMOUNT TO REASON TO BELIEVE THAT INCOME CHARGEA BLE TO TAX HAS ESCAPED ASSESSMENTS.' 35. IN THE DECISION OF THIS COURT DATED 16TH MARC H 2016 IN W.P. (C) NO. 9659 OF 2015 ( RAJIV AGARWAL V. CIT ) IT WAS EMPHASIZED THAT 'EVEN IN CASES WHERE THE AO COMES A CROSS CERTAIN UNVERIFIED INFORMATION, IT IS NECESSARY FOR HIM TO TAKE FURTHER STEPS, MAKE INQUIRIES AND GARNER FURTHER MA TERIAL AND IF SUCH MATERIAL INDICATES THAT INCOME OF AN ASSESSEE HAS ESCAPED ASSESSMENT, FORM A BELIEF THAT INCOME OF THE ASSESS EE HAS ESCAPED ASSESSMENT.' 36. IN THE PRESENT CASE, AS ALREADY NOTICED, THE REASONS TO BELIEVE CONTAIN NOT THE REASONS BUT THE CONCLUSIONS OF THE AO ONE AFTER THE OTHER. THERE IS NO INDEPENDENT APPLICATIO N OF MIND BY 23 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. THE AO TO THE TANGIBLE MATERIAL WHICH FORMS THE BAS IS OF THE REASONS TO BELIEVE THAT INCOME HAS ESCAPED ASSESSME NT. THE CONCLUSIONS OF THE AO ARE AT BEST A REPRODUCTION OF THE CONCLUSION IN THE INVESTIGATION REPORT. INDEED IT IS A 'BORROW ED SATISFACTION'. THE REASONS FAIL TO DEMONSTRATE THE LINK BETWEEN TH E TANGIBLE MATERIAL AND THE FORMATION OF THE REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT. 37. 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 CONC LUDING THAT THE INITIATION OF THE PROCEEDINGS UNDER SECTION 147 / 148 OF THE ACT TO REOPEN THE ASSESSMENTS FOR THE AYS IN QUESTION D OES NOT SATISFY THE REQUIREMENT OF LAW. 38. THE QUESTION FRAMED IS ANSWERED IN THE NEGATI VE, I.E., IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. THE APPEAL IS, ACCORDINGLY, DISMISSED BUT WITH NO ORDERS AS TO COSTS. 5.2. THE REPORT OF THE INVESTIGATION WING MIGHT H AVE CONSTITUTED MATERIAL ON THE BASIS OF WHICH THE A.O. FORMED THE 24 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. REASONS TO BELIEVE, THE PROCESS OF ARRIVING AT SUCH SATISFACTION, WOULD NOT BE A MERE REPETITION OF THE REPORT OF INVESTIGA TION WING. IN THE ASSESSEES CASE, THE CRUCIAL LINK BETWEEN THE INFOR MATION MADE AVAILABLE TO THE A.O. AND THE FORMATION OF THE BELI EF WAS ABSENT. THE REASONS TO BELIEVE RECORDED WERE NOT REASONS BUT ONLY CONCLUSIONS AND THE REPRODUCTION OF THE CONCLUSION IN THE INVES TIGATION REPORT RECEIVED FROM THE DIRECTOR OF INVESTIGATION. IT WAS A BORROWED SATISFACTION. THE EXPRESSION ACCOMMODATION ENTRY WAS USED TO DESCRIBE THE INFORMATION SET-OUT WITHOUT EXPLAINING THE BASIS FOR ARRIVING AT SUCH CONCLUSION. THE BASIS FOR THE STAT EMENT THAT ENTRY WAS GIVEN TO THE ASSESSEE TO INTRODUCE ITS UNACCOUN TED MONEY, WAS NOT DISCLOSED. WHO WAS THE ACCOMMODATION ENTRY GIVE R AND HOW HE COULD BE SAID TO BE AN ENTRY OPERATOR WERE NOT MENT IONED. THE SOURCE FOR ALL THE CONCLUSION WAS THE INVESTIGATION REPORT . THE TANGIBLE MATERIAL WHICH FORMED THE BASIS, FOR THE BELIEF THA T INCOME HAD ESCAPED THE ASSESSMENT MUST BE EVIDENT FROM READIN G OF THE REASONS. LEARNED COUNSEL FOR THE ASSESSEE FILED COPY OF THE LEDGER ACCOUNT AND LETTERS OF THE PARTIES WHO ARE NAMED IN THE REASONS RECORDED UNDER SECTION 148 OF THE I.T. ACT, TO SHOW THAT THE AMOUN TS WERE DUE TO THE 25 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. ASSESSEE FROM EARLIER YEARS AND THE AMOUNTS IN QUES TION ARE REPAYMENT OF THE DEBTS IN ASSESSMENT YEAR UNDER APP EAL. THE A.O. RECORDED INCORRECT FACTS IN REASONS FOR REOPENING O F ASSESSMENT. THE REASONS FAILED TO DEMONSTRATE THAT THE LINK BETWEEN THE TANGIBLE MATERIAL AND THE FORMATION OF THE REASONS TO BELIEV E THAT INCOME HAS ESCAPED ASSESSMENT. THE A.O. HAD NOT INDEPENDENTLY CONSIDERED THE TANGIBLE MATERIAL WHICH FORMED THE BASIS FOR THE RE ASONS TO BELIEVE THAT INCOME HAD ESCAPED ASSESSMENT. THE A.O. MERELY REPRODUCED INFORMATION RECEIVED FROM INVESTIGATION WING AND EN QUIRIES CONDUCTED BY THEM AND THEN, STRAIGHTAWAY CAME TO TH E CONCLUSION THAT INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSME NT. IN THE PRESENT CASE, AS ALREADY NOTICED, THE REASONS TO BE LIEVE CONTAINED NOT THE REASONS BUT THE CONCLUSION OF THE A.O. THERE IS NO INDEPENDENT APPLICATION OF MIND BY THE A.O. TO THE TANGIBLE MAT ERIAL WHICH FORM THE BASIS OF THE REASONS TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT. THE CONCLUSION OF THE A.O, AT BEST, ARE REPRODUCTION OF THE CONCLUSION OF THE INVESTIGATION REPORT. THUS, I T IS CLEARLY A BORROWED SATISFACTION. THE ISSUE IS, THEREFORE, COV ERED IN FAVOUR OF THE ASSESSEE BY JUDGMENT OF THE HONBLE DELHI HIGH COUR T IN THE CASE OF 26 ITA.NO.915/DEL./2017 GOODLUCK COMMERCIALS LTD., DELHI. PR. CIT VS. G AND G PHARMA INDIA LTD., (SUPRA) AND MEENAKSHI OVESEAS PVT. LTD., (SUPRA). THE REOPENING OF THE AS SESSMENT, THUS, IS BAD IN LAW AND CANNOT BE SUSTAINED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. I, ACCORDINGLY, SET ASIDE THE ORDERS O F THE AUTHORITIES BELOW AND QUASH THE REOPENING OF THE ASSESSMENT UND ER SECTION 147/148 OF THE I.T. ACT. RESULTANTLY, ALL ADDITIONS MADE IN THE RE- ASSESSMENT ORDER STANDS DELETED. IN VIEW OF THESE F INDINGS, THERE IS NO NEED TO DECIDE THE APPEAL OF ASSESSEE ON MERITS. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DELHI, DATED 13 TH SEPTEMBER, 2017 VBP/- COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT SMC BENCH, DELHI 6. GUARD FILE. // BY ORDER // ASST. REGISTRAR : ITAT DELHI BENCHES : DELHI.