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2015 (10) TMI 816 - AT - Income TaxValidity of reopening of assessment - Held that:- Information in the shape of communication made by DCIT, Central Circle 2(1) is specific and clear demonstrating the modus operandi of L.T. Shroff and Group. The name of B D Ashokbhai is available in the list resemble with the assessee and, therefore, Assessing Officer can reasonably harbour a belief that income belonging to the assessee has escaped from taxation. Therefore, he has rightly reopened the assessment and issued notice to both the assessees u/s. 148 of the income tax act. We do not find any merit in this fold of contention. Addition in the case of Ashokbhailal Chokshi, Assessment Year 1995-96, and in the case of M/s. Chokshi Bhailal Dahyabhai and Co. for Assessment Year 1995-96 and 1996-97 - Held that:- Hon’ble Supreme Court way back 1980 in the case of Kishanchand Chellaram vs. Commissioner of Income Tax reported in [1980 (9) TMI 3 - SUPREME Court] dealing with an assessment year 1947-48 has observed that, if the opportunity to cross-examine the witness upon whose statement reliance is being placed was not granted, then, that statement recorded behind the back of assessee cannot be used in evidence. According to the department, it is possessing a diary which contains names of different individual/office/firms who had either deposited the money with LT Shroff or availed loan facility. Now, the evidence which we have extracted above nowhere gave a pointer towards the assessee in clinching way. We have reproduced the explanation of Kalpesh Takkar given in his assessment proceedings. We find that as far as assessee is concerned, it only say B.D. Abdullal Dhujibhai Manek Chowk. Against all the other concerns, their office telephone no. residence phone no. were being mentioned. There is no corroborative evidence apart from this explanation of L.T. Shroff. This is a diary written by a third person found at the premises of the third person. It was not written by assessee. The assessee repeatedly asked to bring the author and give him an opportunity to cross-examine. If that man is not traceable, then it does not mean that assessee would be deprived of his right to verify how his name has been mentioned in the alleged diary. When he has no alleged connection with L.T Shroff, the department ought to have collected some other corroborative evidences which can establish the nexus or link between the assessee and L. T Shroff. The evidence collected by the department is not worthy of credence, more particularly in view of the judgment of Hon’ble Supreme Court in the case of CBI vs. V.C. Shukla & others reported in [1998 (3) TMI 675 - SUPREME COURT ]. There is no independent evidence on the record, therefore, we are of the view that addition with the help of this much information can not be made. We allow all the three appeals and delete the additions. - Decided in favour of assessee. Penalty u/s 271(1)(c) - Held that:- Perusal of sub-clause III would indicate that in case it is proved that assessee has concealed particulars of income or furnished inaccurate particulars then, in addition to taxes, if any, payable by him, a sum which shall not be less than but which shall not exceed the three times of the amount of taxes sought to be evaded by reason of concealment of particulars of income will be payable by the assessee. In the present case, we have deleted the quantum addition, therefore, the charge against the assessee of evading the taxes on the addition no more survive. There cannot be any penalty which can be computed in the present case. As a result, this appeal is also allowed and penalty is deleted. - Decided in favour of assessee.
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