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2017 (9) TMI 181 - AT - Income TaxValidity of reopening of assessment - addition accommodation entries of bogus purchases - Reasons for the belief that the income has escaped assessment - denial of principle of natural justice - List of accommodation entries received from another CIT - non independent use of mind by AO - Held that:- Addition made by the AO is untenable in the eye of law having been made without providing opportunity to cross examine the person on the basis of whose statement the allegations have been made against the assessee and without following the principle of natural justice. Assessing Officer was having nothing except the list provided by the CIT, Central-2, New Delhi about the list of accommodation entries. Beyond that he was not having the copies of the statement of any of these persons. He was not having copy of the assessment orders and other details or document which would have enabled the Assessing Officer to apply his mind and form a belief that income has escaped assessment. In fact this information was not with the Assessing Officer till fag end of the reassessment proceedings, a fact admitted by the Assessing Officer himself in the assessment order. Initiation of reassessment proceedings as well as issuance of notice u/s 147/148 of the Act was not valid and the same was void ab initio and thus, liable to be quashed along with assessment order passed in pursuance thereto. Also addition of 20% of the purchases sustained by the ld. CIT(A) need to be deleted. - Decided in favour of assessee.
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