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2016 (4) TMI 158 - AT - Income TaxReopening of assessment - unexplained gifts - reasons to believe - Held that:- AO merely mentioned that the name of the assessee appear in the list of beneficiaries having channelized her undisclosed income in the garb of gift. Admittedly. In the present case gift was from her paternal aunt, a close relative and the donor Smt. Sita Devi cann't be alleged as bogus or accommodation entry provider in absence of any substantial evidence, specially when the assessee has established her identity, capacity and genuineness of the transaction of gift by furnishing bank statement of the donor, affidavit of the done (assessee) and the donor (Smt. Sita Devi) gift deed dated 23.1.2004, copy of acknowledgement and Balance sheet of Smt Sita Devi showing her capital and assets, copy of PAN card etc. The AO has not mentioned in the reasons recorded that he either examined the information or verified it from the relevant assessment record of the assessee for AY 2004-05 which clearly shows not application of mind and issuance of notice u/s 148 of the Act in a mechanical manner. Because had the AO examined the details and the alleged information, he would have certainly known that information and allegation of accommodation entry is factually incorrect and baseless. Thus we are inclined to hold that the AO proceeded to initiate reassessment proceedings and to issue notice u/s 147/148 of the Act on the vague information without verifying and examining the same and without application of mind in a mechanical manner and hence, the AO did not assume valid jurisdiction to issue notice u/s 148 of the Act and thus notice u/s 148 of the Act and impugned necessary order passed in pursuant thereto u/s 143(3) r.w.s. 147 of the Act is not sustainable and we quashed. - Decided in favour of assessee
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