Kadir Ahmed Vs ITO (ITAT Delhi)
ITAT Delhi held that reopening of the assessment u/s 147 of the Income Tax Act based on the approval granted in a routine and casual manner is unsustainable in the eye of law.
Facts-
The Department has received Non PAN AIR information regarding cash deposit of Rs.21,55,000/- in the saving bank account of the assessee during F.Y. 2009-10. Therefore, the case of the assessee was reopened u/s. 147 of the I.T. Act, 1961 by issuing notice u/s. 148 of the I.T. Act, 1961.
It was explained that the assessee has sold a property which is located near Surajpur, Greater Noida and the cash sale proceed was deposited in the bank account. On perusal of the sale deed the A.O. noted that the assessee has sold plot for a consideration of Rs.6,00,000/-. The AO issued notice u/s. 142(1) and asked the assessee to furnish the complete source of cash deposit. AO made addition u/s. 68 on account of unexplained cash deposit. AO also initiated penalty proceedings u/s. 271(1)(c).
Aggrieved by the order of the A.O, the assessee carried the matter in appeal before CIT(A) which was dismissed. Being aggrieved, the present appeal is preferred by the appellant.
Conclusion-
AO has not applied his independent mind while reopening the assessment u/s. 147 and simply relied on the Non PAN AIR information. The Commissioner is required to apply his independent mind to the proposal put up to him for approval in the light of material relied upon by the A.O. That power by the Commissioner cannot be exercised casually and in a routine manner.
Since, the authorities below has granted approval for reopening of the assessment in a routine and casual manner, based on such approval, reopening of assessment by the A.O. is not at all sustained in the eye of law.
FULL TEXT OF THE ORDER OF ITAT DELHI
