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Grounds Nos. 1 to 3:

4. The Ld. Counsel for the assessee has submitted that, in this case, the assessment was reopened by the AO on the basis of the information circulated on Insight Portal of Department, wherein, it was mentioned that a search & seizure action u/s 132 of the Act was carried out on 19/12/2019 in the case of one "Dishman Group" of companies during which the digital data found and seized from Dishman Group revealed that the said Dishman Group was involved in providing accommodation entries to various beneficiaries against ITA Nos.424, 425, 426 and 427/Ahd/2024 Arcoy Industries (India) P. Ltd.

AYs : 2013-14, 2014-15, 2015-16 & 2017-18 Director of Dishman Group on whose instruction Chirag used to obtain such entries. From perusal of information, it is found that the assessee M/s ARCOY INDUSTRIES (INDIA) PRIVATE LIMITEDIS a company which has done transaction Dishman Carbogen Amics Limited during the F.Y.2012-13 relevant to AY. 2013-14. From the verification of excel sheet uploaded on insight portal, it is found that the assessee has done transactions with Dishman Carbogen Amics Limited. The total amount of transactions done by the assessee company with Dishman Carbogen Amics Limited is Rs. 40,02,325/-. The transaction done through the Dishman Group is nothing but the unaccounted income of the assessee company of the A.Y. 2013-14.

AYs : 2013-14, 2014-15, 2015-16 & 2017-18 formed the belief of escapement of income of the assessee alleging that the assessee had booked bogus commission expenses of Rs. 4002325/-, however, in the assessment proceedings he had made the impugned addition holding that the same was on account of bogus loan taken by the assessee from Dishman Group. The Ld. Counsel has submitted that had the AO cross verified the aforesaid information with the assessment records of the assessee, he would have got to know that the assessee had not claimed any such commission expenses in its computation of income. However, the AO without verifying the correctness of the information available on insight portal, straightaway, reopened the assessment u/s 147 of the Act, which is totally on the basis of borrowed satisfaction obtained from inside portal. The Ld. AR has submitted that the AO has failed to establish any live nexus between information received from Insight Portal with facts of assessee's case. He has further submitted that as per the scheme of the Act, an Assessing Officer can reopen the case of an assessee within the prescribed time limit provided that he has "reason to believe" that some income chargeable to tax has escaped assessment. That such "reason to believe" must be based on some tangible material and must prima- facie establish that there is escapement of any income chargeable to tax. The Ld. Counsel has further referred to the copy of the reply dated 14/03/2022 filed before AO, placed at paper book page No. 168 to 193, and demonstrated that the assessee had specifically asked to the AO to provide information as to whether out of the alleged total amount of advanced by DCAL of Rs. 795,00,36,904/-. whether the alleged amount include amount of loan given to Assessee and whether any evidence was found showing that any cash was paid by the Assessee in lieu of unsecured loan received from Dishman Group. The assessee also requested for cross examination of Chirag Thakkar and Shri Bharat Padia. However, the AO neither provided any such information to the ITA Nos.424, 425, 426 and 427/Ahd/2024 Arcoy Industries (India) P. Ltd.

AYs : 2013-14, 2014-15, 2015-16 & 2017-18 expenses of Rs.40,02,325/- in form of commission expense. Therefore, I have reasons to believe that there is an escapement of income from tax of Rs.40,02,325/- and it is a fit case for issuing notice u/s. 148 of the Act."

8.1. It is nowhere stated in any part of the lengthy reasons recorded as to how the AO came to the conclusion that the aforesaid alleged transaction of Rs. 4002325 was non-genuine transaction of commission expenses. A perusal of the reasons recorded for reopening of the assessment would reveal that the assessment in this case has been reopened on the basis of vague and general information available on insight portal that assessee has done some non- genuine transaction of Rs.4002325/- with the Dishman Group. There was no mention of the nature of alleged non-genuine transaction. As discussed above, the AO though, has recorded lengthy reasons under different heads, yet, failed to point out about the nature of the alleged transaction done by the assessee with Dishman Group. It is only at one point that he has mentioned that the said transaction was relating to bogus commission expenditure claimed by the assessee. However, the said observation was factually incorrect. The AO in this case, reopened the assessment in a mechanical manner, without corelating and cross verifying the general information available on the insight portal with the accounts/assessment records of the assessee. This is a case where the AO has reopened the assessment on the basis of borrowed satisfaction and without application of mind and the reasons recorded by the AO do not constitute sufficient and valid reasons for forming belief by the AO of escapement of income of the assessee for the year under consideration. The reasons recorded by the AO, in this case, were factually incorrect and there was no effort made by the AO to verify or corelate the alleged information available to the AO with the assessment records, therefore, it cannot be said that the AO was having ITA Nos.424, 425, 426 and 427/Ahd/2024 Arcoy Industries (India) P. Ltd.