TMI Blog2013 (1) TMI 235X X X X Extracts X X X X X X X X Extracts X X X X ..... reopened u/s 148 in A.Y.1996-97. Even after detailed investigation, the A.O. has not been able to find out that the appellant has purchased or sold the shares within short span of time or that shares have been purchased at a rate higher than the market rate as has been found in the A.Y.1996-97. In fact in the order of the A.Y.1996-97 there is only vague reference of A.Y.1995-96. From the perusal of the order it is absolutely clear that there is no reference to any transaction for the assessment year 1995-96. CIT was, therefore, perfectly justified in holding that the reasons recorded by the AO were not honest reason and there is nothing to show from this reason that income has escaped assessment and assessment has been primarily reopene ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... follows. The appeal relates for the Assessment Year 1995-96. In the proceedings arising out of Sections 147 and 148 of the Act,. The respondent assessee derives income from running of a flour mill for production of Maida, Suji, Atta in the name and style of M/s. Kanodia Flour Mills at Dulhipur, Varanasi and has head office at Kanpur. For the Assessment Year 1995-96 the original return of income was filed on 31.10.1995 declaring total income of a sum of Rs. 7,73,880/- which was processed under Section 143(1)(a) of the Act, on 24.1.1996 resulting a refund of Rs. 45,361/- , which was rectified under Section 154 of the Act and further refund of Rs. 2216/- was allowed. While making assessment for the assessment year 1996-97, the Assessing Off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... preferred by the Revenue before the Tribunal has been dismissed by the impugned order. 4. We have heard Sri Ashok Kumar, learned Senior Standing Counsel for the Revenue and Sri S.K. Garg, learned counsel for the respondent-assessee. 5. Sri Ashok Kumar submitted that the CIT (Appeal), as also the Tribunal was not justified in setting aside the reassessment order and also in quashing the order for issuing notice under Section 148 on the ground that no proper reasons were recorded and on the reason recorded the proceedings under Section 148 could not have been initiated. He further submitted that in the assessment proceeding for the assessment year 1996-97 bogus share transactions were detected as the modus operendi was the same as in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, it is very surprising as to why was he doing business of shares on behalf of the firm and that too for incurring heavy losses. It appeared that whole of the exercise of transactions in shares has been manipulated by the assessee just to reduce the taxable income as the profit from the Flour Mills were at Rs. 37 Lakhs but returned income has only been shown at Rs. 882,000/-. From the records of the previous years, it appears that the assessee has done transactions of shares only in 1995-96 and 1996-97. No such transactions have been done in the earlier year or in AY 97-98. It is very interesting to note that the assessee had done these transactions of shares during the F.Y. 1994-95 and 95-96 when the share market was going in a very low ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tax was, therefore, perfectly justified in holding that the reasons recorded by the Assessing Officer were not honest reason and there is nothing to show from this reason that income has escaped assessment and assessment has been primarily reopened with a view to make enquiries and conduct examination of various expenses debited to profit and loss account. This order has been affirmed by the Tribunal. 8. We are of the considered opinion that the order passed by the Commissioner Income Tax (Appeals) as upheld by the Tribunal does not suffer from any legal infirmity. The reasons recorded by the Assessing Officer do not show that they are relevant to reopen the assessment proceedings. 9. We do not find any legal infirmity in the impugned ..... X X X X Extracts X X X X X X X X Extracts X X X X
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