2017 (5) TMI 349

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....ucts and has filed its return of income declaring total income of NIL. The same was accepted u/s. 143(1) of the Income Tax Act [Act] on 05-07-2007. Subsequently, Assessing Officer (AO) has received communication from DIT(Investigation)-II, New Delhi that Shri Virender Kumar Jain and Surender Kumar Jain and Kiran Kumar Jain, who were searched as a part of Jain Group of companies have provided accommodation entries from various paper and dummy companies of Jain Group in lieu of cash. Since assessee-company received share capital from the said Group, they are to be considered in the hands of assessee. The AO accordingly recorded the satisfaction and reopened the assessment by issuance of notices u/s. 148 in March, 2013. Assessee replied to the....

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....ness, AO was of the opinion that these entries shown by assessee are not genuine and accordingly the entire amount of Rs. 45 Lakhs was brought to tax. 3. Before the Ld.CIT(A), assessee contested the reopening of assessment, including the objection that AO did not follow the procedure u/s. 151 in taking approvals. Ld.CIT(A) however, gave a finding that on examination of record, it was noticed that AO has followed proper procedure and accordingly the said ground was rejected. With reference to reopening, since the information has been received from Investigation Unit in Delhi, and since no scrutiny assessment was completed earlier in the assessee's case for this assessment year, invoking the principles laid down by the Hon'ble Supreme ....

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....at Ld.CIT(A) did not examine the merits but decided the issue on legal principles only. He has no objection if matter is sent back to the AO for examination of the facts. 7. Ld.DR while supporting the orders of the AO and CIT(A) submitted that reopening is proper and on merits, AO did not receive any confirmation by the time assessment was completed, inspite of due opportunity given. 8. I have considered the issue and perused the documents placed on record. As far as reopening is concerned, there is no assessment u/s. 143(3) therefore, the proviso to Section 147 that there should be failure on the part of assessee in furnishing necessary information does not apply. As perused from the assessment order and also from the order of the CI....