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2017 (4) TMI 64 - DELHI HIGH COURTReopening of assessment - reasons to believe - whether statement made by Mr. Sanjay Rastogi that he and his associates provided bogus entries to various entities, could not have been the basis for valid reassessment notice? - Held that:- The entire basis for the reassessment notice impugned by the petitioner is Sanjay Rastogi’s statement. His questioning and his answers nowhere implicate the petitioner. He specifically names 2-3 concerns as the beneficiaries of the bogus entry business / activity that he was carrying on. However, the statement nowhere mentions the petitioner. The second aspect - and more crucially in this case-is that the issue with respect to the commission expenditure claimed by the petitioner had undergone a further fresh inquiry – albeit in one previous AY 1996-97. The Assessing Officer, on that occasion too felt that the expenditure needed more scrutiny or inquiry. The assessee / petitioner was able to show that M/s Hallmarks Healthcare Ltd. was an existing company which had filed returns and was assessed to income tax. The statement of Sanjay Rastogi may have been the starting point for some kind of an inquiry but in the circumstances of this case, to hold or assume that the individual concern had some association and every transaction of that concern needed scrutiny, was too far at a distance to tread as to sustain as ‘reasons to believe’, under Sections 147/148 of the Act.
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