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Issues involved: Reopening of assessment u/s 147 and addition of share application money u/s 68.
Reopening of assessment u/s 147: The revenue appealed against the Ld. CIT(A)'s order regarding the reopening of assessment for the assessment year 2002-03. The AO issued a notice u/s 148 based on information indicating that certain companies provided accommodation entries to the assessee. The Ld. CIT(A) held that there was no material with the AO to conclude that income had escaped assessment. The Tribunal noted that the AO is required to form a prima facie opinion before issuing a notice u/s 148, and in this case, the information from the investigation wing provided sufficient grounds for reopening. The Tribunal set aside the Ld. CIT(A)'s finding and upheld the reopening of assessment. Addition of share application money u/s 68: The revenue contested the deletion of the addition of &8377; 9 lakh by the Ld. CIT(A). The assessee received share application money from 12 entities, out of which the AO disbelieved the contribution of three companies. The Tribunal, after considering the details submitted by the assessee and relevant case law, found that the assessee had proven the identity of the share application money and had discharged its onus. It was noted that the AO did not conduct a proper inquiry and relied solely on information from the DIT Investigation. The Tribunal, following the decision of the Hon'ble Delhi High Court, upheld the Ld. CIT(A)'s deletion of the addition, as the assessee had provided sufficient evidence to support the legitimacy of the transactions.
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