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2014 (1) TMI 336 - AT - Income TaxValidity of reassessment u/s 147 - Held that - The Investigation Wing has prepared the list of beneficiaries who have taken accommodation entries from person/firm engaged in the racket of providing accommodation entries which includes the name of Bimla Devi - The present assessee is Maya Gupta and not Bimla Devi - In the chart, only the value of entry taken is mentioned but the nature of entry whether it is a bogus gift, loan or share capital money is not mentioned - No reference is made to any statement given by any accommodation entry provider or any documentary evidence found from their premises which indicated any accommodation entry being taken by the assessee Following Signature Hotels P. Ltd. 2011 (7) TMI 361 - Delhi High Court - The information on the basis of which the Assessing Officer had initiated proceedings under Section 147 was vague and uncertain - The learned CIT(A) rightly held that the reopening of assessment was not valid Decided against Revenue.
Issues:
1. Validity of reopening of assessment under Section 147/148 of the IT Act 2. Addition of income from unexplained sources under Section 68 of the Income Tax Act Issue 1: Validity of reopening of assessment under Section 147/148 of the IT Act The appeal was against the order of the learned CIT(A)-XXIV, New Delhi for the AY 2003-04. The Revenue challenged the invalidation of the reopening of assessment by the CIT(A). The reasons for reopening were related to accommodation entry providers involved in giving entries in the form of gifts/loans/share capital money, which led to the belief that the assessee had obtained accommodation entries worth Rs. 2,50,000. The CIT(A) held the reopening invalid based on a previous decision of the Jurisdictional High Court. The Revenue cited a different decision to support their case. The Tribunal analyzed various High Court decisions and concluded that the reasons for reopening were vague and uncertain, lacking specific details to establish the escapement of income. As a result, the Tribunal upheld the CIT(A)'s decision that the reopening was not valid. Issue 2: Addition of income from unexplained sources under Section 68 of the Income Tax Act The second ground of appeal by the Revenue was related to quashing the assessment order that added Rs. 35,77,293 as income from unexplained sources under Section 68 of the Income Tax Act. However, the Tribunal's decision on the first issue rendered this ground of appeal moot, as the reopening of assessment was deemed invalid. The Tribunal did not delve into the merits of the addition under Section 68 due to the primary issue of the reopening being dismissed. Therefore, the Tribunal dismissed the Revenue's appeal, and the decision was pronounced on December 13, 2013. This judgment addressed the validity of the reopening of assessment under Section 147/148 of the IT Act and the addition of income from unexplained sources under Section 68 of the Income Tax Act. The Tribunal found the reasons for reopening to be vague and uncertain, lacking specific details to establish income escapement. Consequently, the Tribunal upheld the CIT(A)'s decision that the reopening was not valid. As a result, the appeal was dismissed, and the issue of the addition under Section 68 was not addressed due to the primary issue being resolved in favor of the assessee.
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