2014 (5) TMI 963

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....there was no reason to believe that income has escaped assessment; 2. Treating the share application money received in a sum of Rs. 5 lacs as unexplained and making an addition of the amount to the returned income." 2. Apropos first ground, ld. Counsel for the assessee contends that for invoking jurisdiction u/s 147 the AO ought to have specific information and valid reasons to believe that the income has escaped assessment. Thus, the belief is to be made on the basis of correct information and not on hearsay and wrong information. In the assessee's case ld. AO issued notice u/s 148 on the basis that the assessee had given an amount of Rs. 5 lacs in cash to the alleged entry operator M/s VPS Valves Tubes & Tubes Pvt. Ltd., which was g....

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....vt. Ltd and not the assessee. Thus, there being no valid information against the assessee, the assessing officer could not have recorded these reasons to believe that income had escaped assessment in assessee's case. It is vehemently argued that on both the counts the reasons recorded by the assessing officer are baseless, hearsay and are not backed by any valid information. Therefore, the proceedings are bad in law. Ld. CIT(A) without addressing to this issue has summarily upheld the impugned reopening of assessment. 2.4. On merits it is pleaded that the assessee has filed all the relevant information qua this share application amount of Rs. 5 lacs in the form of confirmation, bank a/cs. The statement of Mr. Rajan Jassal does not say th....