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2017 (8) TMI 1303 - AT - Income TaxValidity of Reopening of assessment - validity of reasons to believe - Held that:- Assessee was supplied with the reasons recorded and opportunity to raise objections thereto was given to him. It was availed as the assessee raised the objections against the validity of initiation of reopening proceedings and the Assessing Officer duly disposed off the said objections. The reason to believe was based on search operation in Bhushan Steel Group and survey at the assessee. We thus do not find substance in the contention of the ld. AR that initiation of reopening proceedings against the assessee was not valid. It is well established position of law that for initiation of reopening proceedings formation of reasons to belief is required to be based upon a prima facie view that taxable income has escaped assessment. Sufficiency of such belief cannot be questioned before the court of law. We thus do not find reason to interfere with the first appellate order in this regard, as in our view, the ld. CIT (Appeals) under the facts and circumstances of the case as discussed above has rightly upheld the validity of initiation of reopening proceedings and the assessment framed in furtherance thereto. - Decided against assessee Addition on unexplained share capital including share premium - Held that:- The sources of capital introduced in these companies were established during the respective assessment proceedings. It is also pertinent to mention over here that out of total 6 investor companies, notices could not be served in case of 2 companies as they were not available on the given addresses and in case of 1 company notice could not be served as the premises was found locked on various days. The remaining 4 companies had responded and had filed their submissions. However, there is no dispute that in case of all the 6 investor companies, the assessee had filed primary documents and had accordingly discharged its initial onus to establish identity and creditworthiness of the investor companies and genuineness of the transaction as there is no dispute that all the transactions have been done through banking channels i.e. through account payee cheques and demand drafts. We thus find that the Assessing Officer has failed to discharge its onus to prove that the documents filed by the assessee, as discussed above, were false or fabricated as the Assessing Officer has not made any efforts to verify those documents especially when there is no dispute that all the investor companies were filing their returns of income and were being assessed by the Department. The Assessing Officer on the contrary remained suspicious on the claimed receipt from the investor companies on some other factors like some of them were not found on their given addresses, some of them had furnished their submissions through posts and some of them were not having sufficient income etc. as discussed above. Under these circumstances, we are of the view that the ld. CIT (Appeals) was justified in deleting the addition of ₹ 5,15,00,000./- made under section 68 of the Act on account of unexplained share capital and share premium - Decided against revenue
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