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2020 (9) TMI 1247 - AT - Income TaxValidity of Reopening of assessment u/s 147 v/s assessment u/s 153C - reliance on material/information was gathered during the course of search - HELD THAT:- Reopening of the assessment is contrary to the ratio decided in ARUN KUMAR KAPOOR [2012 (6) TMI 403 - ITAT AMRITSAR],M/S. SAURASHTRA COLOR TONES PVT. LTD [2020 (4) TMI 289 - ITAT DELHI] and G. KOTESWARA RAO AND OTHERS [2015 (12) TMI 1280 - ITAT VISAKHAPATNAM] wherein held when incriminating documents were found during the course of search, the same have been used in the case of the assessee-company. The proper course the A.O. should have adopted is to proceed against the assessee-company under section 153C of the I.T. Act instead of recording reasons for reopening of the assessment under section 147/148 Moreover, the Revenue has not brought to my notice any other binding precedents to take a contrary view. Second objection of the assessee that the assessee was not provided cross examination - It is not in dispute that the information was gathered at the premises of the 3rd party addition is based upon the statement of the 3rd party. This fact is not rebutted by the revenue, therefore, in my considered view the assessee ought to have been provided opportunity of cross examination. The Assessing Officer purely based his finding on the statement made by third party and data recovered from third party - not providing opportunity of cross examination is ex-facie contrary to the principles of natural justice, therefore, on this ground also assessment so framed is against settled principles of law. In view of the above, hereby quash the assessment order being contrary to judicial pronouncements. The AO is directed to delete the impugned addition. Appeal filed by the assessee is allowed.
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