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2016 (7) TMI 1599 - AT - Income TaxValidity of reopening of assessment u/s 147 - invocation of the jurisdiction u/s 148 on the basis of AIR information - entries relating to investment in Mutual fund etc. - HELD THAT:- Assumption of jurisdiction u/s 147/148 on the basis of AIR information was illegal inasmuch as it was simplify in the domain of suspicion and for verification of the source of investment made in Mutual funds, which is impermissible u/s 148. Section 148 does not permit verification, as rightly contended, as the same falls in the domain of section 143(2), after the return is filed. It is an undisputed fact on the record, that but for the AIR information, there was no other material with the AO to reach the requisite satisfaction u/s 148(2). The above reasons are no reasons in the eyes of law, inasmuch as the source of investment is yet to be verified and explained, and it cannot be held as income escaping assessment for the purposes of section 148. For such a verification, the AO is to assume normal jurisdiction under section 143(2), after the return is filed. It is only during such regular assessment proceedings, that the source can be questioned, and deemed to be income u/s.68/69, in case no satisfactory explanation is offered by assessee. In the absence of verification/explanation of the assessee in the course of assessment proceedings, it is premature to assume the same as 'income', much less for the purposes of section 148. Therefore, the AIR information is no tangible material to empower the AO to reach the requisite satisfaction as envisaged u/s 147/148. - Decided in favour of assessee.
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