2017 (6) TMI 557 - GUJARAT HIGH COURT

Reopening of assessment - proceedings initiated by the AO on the basis of material provided by the Principal Director of Income Tax (Investigation), Ahmedabad - Shri Pravin Kumar Jain is engaged in providing accommodation entries and the present assessee is also one of the beneficiary of such accommodation entry - Held that:- AO received the information from the Principal Director of Income Tax (Investigation), Ahmedabad vide its Confidential Letter stating that a search under Section 132 was conducted in the case of one Shri Pravin Kumar Jain and the search action resulted in collection of the evidence and other findings which conclusively proved that the said Shri Pravin Kumar Jain was engaged in providing accommodation entries and the assessee is one of the beneficiaries of bogus share application from various bogus companies operated by the said Shri Pravin Kumar Jain. Thus, the information received from the Office of Principal Director of Income Tax (Investigation), Ahmedabad along with the evidence collected during the search action in case of said Shri Pravin Kumar Jain, the AO has reopened the assessments for AYs 201112 and 201213. Therefore, it cannot be said that there was no tangible material available with the AO to form an opinion that the income chargeable to tax has escaped assessment for the years under consideration.

As on the basis of the information supplied by / from the office of Principal Director of Income Tax (Investigation), Ahmedabad, the AO has found that the petitioner – assessee is the beneficiary of accommodation entries provided by one Shri Pravin Kumar Jain. The AO was having with him findings of the Investigating Team based on the material recovered during the search conducted of Shri Pravin Kumar Jain Group. Under the circumstances, it cannot be said that there was no tangible material available with the AO to prima facie form an opinion / belief that the income chargeable to tax has escaped assessment. In the facts and circumstances of the case, it cannot be said that the reopening of the assessment is on change of opinion by the subsequent AO. - Decided against assessee.