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2017 (2) TMI 344 - AT - Income TaxReopening of assessment - advancing loans to son and nephew by assessee - Held that:- Considering the copy of the reasons recorded, it is seen that the AO does not refer to any new material noticed by him for re-opening the assessment as the AO records that on a “perusal of the balance sheets” the opinion is formed. The consistent claim of the assessee that the re-opening is based on a mere change of opinion has not been rebutted by the Revenue by referring to any fact, argument or evidence which came up for consideration. In the absence of any new material in the peculiar facts of the present case justifying change of opinion income cannot be said to have escaped assessment. Re-appreciating the very same material on facts ad-infintum lays the Revenue open to the charge of arbitrariness and abuse of a power vested in the A.O. Consistent claim of the assessee before the tax authorities on facts has wrongly been ignored. It is seen that the assessee in each of these three years though has pleaded commercial expediency for advancing loans to his son and nephew where being a senior citizen i.e. 60 years the presence of his relatives was considered necessary on site to ensure quality and time related compliances in order to avoid penalties and being black listed from Government contract work the son and the nephew are stated to have helped by being present on site and over-seeing the quality and the work. However, if even otherwise the availability of sufficient funds in his own capital account and interest free loans and sundry creditors have not been disputed by the Revenue the occasion to make addition in the peculiar facts of the present case does not arise. The advances have been returned and have not been advanced out of borrowed funds for business purposes. - Decided in favour of assessee
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