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2016 (3) TMI 923 - AT - Income TaxReopening of assessment - receipt of accomadation enteries - Held that:- It is pertinent to mention that once from the details received from the DIT (Inv.) the dates on which alleged accommodation entries were provided is known to the AO, it would not have been difficult for the AO, if he had infact undertaken the exercise of verification of assessment records of the assessee to make a reference to the manner in which those disputed entries were provided or mentioned in the books of accounts of the assessee, which must have submitted along with respective return of income filed for AY 2004-05. In the event of examination of assessment records the AO could verify the stand of the assessee that the alleged amount received is the sale proceeds of shares which were held as stoke in trade as opening balance in the beginning of the financial period which was also taken into account in the sales and duty reflected and recorded in the P & L a/c. The basic requirement is that the AO must apply his mind to the materials in order to have reason to believe that the income of the assessee has escaped assessment and without forming a prima facie opinion, on the basis of such material that income has escaped assessment the AO can not assume valid jurisdiction to initiate proceedings and to issue notice u/s 147/148 of the Act. - Notice u/s 148 quashed - Decided in favour of assessee
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