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2016 (10) TMI 971 - AT - Income TaxReopening of assessment - unexplained investment - Held that:- There was no material with the Revenue to say that unexplained investment was made by the assessee in his individual cases. The ADIT who has investigated the assessee has suggested for obtaining DVO’s report. The ld.AO ought to have first obtained report, then visualize in the light of that report. Thus, at the time when he has recorded reasons for reopening of the assessment he was not possessing any material in the individual cases of the assessee. The DVO has submitted his report on 5.12.2011 and valued the land at ₹ 19.12 lakhs for Block No.559/B at the time of purchases and ₹ 22.31 lakhs at the time of sale i.e. on 18.10.2005. In the case of HUF, the assessee has already shown value of investment at ₹ 55 lakhs. He has already paid tax of ₹ 4.70 lakhs in instalments. He has shown this land in HUF much prior to investigation started by the DDIT. He has paid taxes on account of alleged unexplained investment by way of revised computation. All these steps were taken by the assessee three years prior to the recording of reasons by the AO. Once the alleged land was shown in the balance sheet of HUF, taxes were paid in the hands of HUF, and then how that very alleged unexplained investment can be considered in the hands of the individual ? The AO has not verified any facts from the record, and he simply reproduced information came from the ADIT and issued notice under section 147. As observed earlier, even the ADIT was not sure about the quantum of alleged unexplained investment as well as in the status of the assessee in whose hand it is to be assessed. Quantum was apprehended at ₹ 7 crores, but was subject to verification from the DVO and a suggestion was made to this effect by the ADIT. In spite of that, ld.AO did not bother to collect information for harbouring a belief that income chargeable to tax has escaped assessment. On overall evaluation of the material available on record, we are of the view that a live link is totally missing between the material available with the AO for formation of a belief that income chargeable to tax has escaped. Therefore, we allow this ground of appeal in both the years and quash re-assessment orders. - Decided in favour of assessee
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