https://www.taxtmi.com/caselaws?id=772120 The ITAT Mumbai set aside the AO's reopening of assessment under section 147 for penny stock transactions. The tribunal held that the AO failed to establish the necessary nexus between investigation information and belief that income escaped assessment. Since the assessee neither claimed exemption under section 10(38) nor short-term capital loss, the AO could not demonstrate how income escaped assessment. The AO also failed to specify what material facts were not disclosed by the assessee. The tribunal ruled that without proper reasoning showing prima facie belief of escaped income, the jurisdictional assumption under section 147 was defective and unsustainable. en-us Tue, 27 May 2025 00:00:00 +0530 Wed, 04 Jun 2025 08:40:39 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=772120 The ITAT Mumbai set aside the AO's reopening of assessment under section 147 for penny stock transactions. The tribunal held that the AO failed to establish the necessary nexus between investigation information and belief that income escaped assessment. Since the assessee neither claimed exemption under section 10(38) nor short-term capital loss, the AO could not demonstrate how income escaped assessment. The AO also failed to specify what material facts were not disclosed by the assessee. The tribunal ruled that without proper reasoning showing prima facie belief of escaped income, the jurisdictional assumption under section 147 was defective and unsustainable. Case-Laws Income Tax Tue, 27 May 2025 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=772120