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2017 (11) TMI 1475 - AT - Income TaxReopening of assessment - whether reopening u/s. 147 is correct when the time to issue a notice u/s. 143(2) is open? - Held that:- As seen from the satisfaction recorded, the case was reopened by the AO on the reason that there was a difference of ₹ 3,30,017/- in the gross receipts reflected in the Form No:26AS and in the Computation of income with regard to Gross Receipts received from Commissioner, Tirupati Municipality and therefore the AO was of the opinion that there was reason to believe that income, chargeable to tax has escaped assessment. Once the difference in the gross receipts from Commissioner, Tirupati Municipality was duly reconciled by furnishing the rectified Form No.26AS downloaded from the Income Tax Dept. website, the reason to reopen ceased to exist. Further, the reasons recorded for reopening of assessment laid more stress on reconciliation of gross receipts and but not on escapement of any income and therefore there was no belief that there was any escapement of any income and hence the entire order passed u/s. 143(3) r.w.s 147 of the Act is without jurisdiction. Another contention was that the AO did not dispose off the objections. Without passing a separate order by considering the objections of assessee, the AO has simply mentioned in the assessment order that as per the Explanation 3 of the Provisions of the section 147 of the Act are attracted. AO continued the reassessment proceedings, without of disposing the objections raised by assessee by way of a speaking order. For the reasons stated above, both initiation of proceedings and continuation of assessment proceedings are ab initio void. Consequently, the order of AO/ CIT(A) stands set aside. Ld.CIT(A) should have examined the facts and arguments and should have followed the principles of law on the issue, as interpreted by higher judicial authorities. Appeal of assessee is treated allowed.
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