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2007 (12) TMI 477 - AT - Income TaxValidity of reopening of assessment u/s 147 - escaped assessment - Income from undisclosed sources - bogus transactions of purchase and sale of shares. Validity of reopening of assessment u/s 147 - escaped assessment - HELD THAT:- Assessee found to have received cheques issued from the said bank account. Thus, the information was not vague or too general but specific and concerning the assessee herself. We, therefore, hold that the AO had valid reason to believe that income chargeable to tax has escaped assessment. It may be noted that under similar circumstances, Hon'ble Delhi High Court in the case of CIT vs. Vipin Batra [2007 (5) TMI 51 - HIGH COURT,NEW DELHI] has upheld the validity of reassessment and directed the Tribunal to deal with the case on merits. When the original assessment was completed under s. 143(1)(a), the AO has no occasion to form an opinion in such original assessment which can be said to have changed while reopening the assessment. This view is fortified by the decision of Hon'ble Supreme Court in the case of Asstt. CIT vs. Rajesh Jhaveri Stock Brokers (P) Ltd.[2007 (5) TMI 197 - SUPREME COURT]. We, therefore, uphold the action of AO in assuming jurisdiction for framing reassessment under s. 147. Accordingly, the cross-objection raised by assessee is to be dismissed. Bogus transactions - We find that after the assessee having furnished proof for purchase, sale, registration of shares in her name duly supported by market quotations etc., the AO ignored the same on the basis of statement of the share broker, namely, Shri Satish Goel through whom the assessee has sold the shares. The purchase of shares were in the earlier years and the same transaction is not found to be bogus. Thus, the assessee has proved the purchase of shares at least. The transfer of shares were held to be bogus on the basis of statement of chartered accountant/company law consultant of Globe Commercial Ltd. Similarly, the statement of Shri Satish Goel as recorded by Dy. Director of IT, Gurgaon, though made available to the assessee but the objection raised thereagainst has not been considered. The statement of a person may give rise to conduct further enquiry but that cannot be held as a sacrosanct particularly when a person challenges the contention of such statement in view of specific proof. In view of the above principles laid down in the case of SMC Share Brokers Ltd. [2006 (8) TMI 110 - DELHI HIGH COURT] and Kishinchand Chellaram [1980 (9) TMI 3 - SUPREME COURT], it is seen that unless the principles of natural justice are followed by allowing assessee to cross-examine a person whose statement is said to be relied upon, such statement cannot be admitted in evidence. If such statement is discarded, there is no material with the AO to hold that the transaction of sale of shares is bogus. Since the assessee has specifically requested for an opportunity to cross-examine, which was denied, we find it difficult to admit the evidence in the form of statement of Shri Satish Goel to hold the transaction as bogus. Consequently, the transaction is to be treated as genuine and the claim of the assessee is allowable. We, therefore, sustain the deletion of addition by learned CIT(A). We, therefore, do not find any justification to sustain the addition as made by the AO - In the result, the appeal and cross-objection are dismissed.
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