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2019 (3) TMI 986 - AT - Income TaxReopening of assessment - reopening after the end of four years from the end of relevant assessment year - Assessment was originally completed u/s 143(3) - conversion from investment to stock in trade merely because the investment was treated as inventory for considering the diminution in its value in books of account - assessee has followed the accounting standard issued by ICAI - HELD THAT:- AO has called for the information relating to investment in shares and valuation of the same. He has applied his mind and formed an opinion, but, he has not discussed elaborately in his order. It is settled precedent that AO cannot reopen the assessment merely on change of his opinion. Further, we notice that AO recorded the reasons for reopening, in which, he has not recorded anywhere that there is failure on the part of the assessee. Since, the assessment was reopened after four years, it is the duty of the AO to bring on record the failure on the part of the assessee, as held in the case of Tecumseh Products India Pvt. Ltd. Vs. ACIT and Anr.[2014 (4) TMI 239 - ANDHRA PRADESH HIGH COURT]. We notice that AO has not recorded any reasons of failure on the part of the assessee. Hence, the reopening itself is illegal. Therefore, in our considered view, the reopening was bad in law and therefore, the same is hereby quashed. Accordingly, we allow the grounds raised by the assessee in this regard. Penalty u/s 271(1) - HELD THAT:- As the reopening of assessments made by the AO u/s 147 of the Act were quashed by us in these appeals, penalty levied u/s 271(1) on such assessments were null and avoid
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