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2019 (1) TMI 1483 - BOMBAY HIGH COURTReopening of assessment - accommodation entries dealing - record element of income chargeable to tax having escaped assessment - Held that:- The very premise of Assessing Officer to form a belief that income chargeable had escaped assessment is completely invalid. As per the information received by the Assessing Officer and to which the assessee raised its no dispute, the assessee had as an Asset Reconstruction Company dealt with Avance. Avance was a borrower of Allahabad Bank. The assessee purchased NPA from Allahabad Bank. By way of recovery, Avance paid a sum of ₹ 2.70 crores to the assessee. Whatever be the nature of existence of Avance, its dealings with other individual entities and dealings of said S.C.Shah, we simply fail to appreciate how the AO in the present case asserts that in case of the assessee income chargeable to tax has escaped assessment. Even going by the information at the command of the Assessing Officer, the assessee having purchased the NPA from Allahabad Bank, received the payment of ₹ 2.70 crores from Avance. This has nothing to do with the alleged dubious dealings of Avance at the instance of S.C.Shah. In clear terms, the very formation of the belief by the Assessing Officer that income chargeable to tax in the hands of the assessee had escaped assessment, lacks validity. The department as well as the counsel for the revenue have tried to improve upon the reasons stated by the Assessing Officer by suggesting that it would be necessary to verify whether such income was offered to tax by the assessee or whether the Trustee for whom assessee claims would have received the income had offered the same to tax. None of these elements find place in the reasons recorded by the Assessing Officer. - Decided in favour of assessee.
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