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2021 (2) TMI 734 - AT - Income TaxValidity of reopening of assessment - unexplained bank deposits - reasons recorded for reopening of the assessment are reproduced above in which A.O. has mentioned that as per information received from REIC through Income Tax Officer, Ward-43(4), New Delhi, assessee has involved in smuggling of various banned items - HELD THAT:- As assessee has explained that assessee-firm is engaged in business of trading and exporting various products. A.O. did not dispute the explanation of assessee that assessee is an exporter. Therefore, whatever sale proceeds were received by assessee in assessment year under appeal from foreign buyer, have been deposited into the impugned bank accounts of the assessee. The details of the same are noted in the assessment order. A.O. ultimately did not make any addition against the assessee of the impugned amounts as have been mentioned in the reasons recorded for reopening of the assessment. A.O. has also not made any addition against the assessee on account of any income earned by assessee through smuggling activities. The A.O, thus, recorded wrong, incorrect and non-existing reasons in the reasons recorded for reopening of the assessment. It would also show that A.O. did not apply his mind to the information received from REIC through ITO, Ward-43(4), New Delhi. The A.O. without any basis has recorded wrong, incorrect and non-existing reasons for reopening of the assessment. The A.O. also did not mention in the reasons that as to how much amount, the income chargeable to tax has escaped assessment in the case for assessee for assessment year under appeal. All these facts clearly support the explanation of assessee that A.O. without any cause or justification recorded wrong, incorrect and non-existing reasons for reopening of the assessment. As relying on SHRI NATRAJAN MONIE VERSUS THE INCOME TAX OFFICER, WARD – 2 (5) , GURGAON. [2020 (12) TMI 345 - ITAT DELHI] it is clear that A.O. has recorded incorrect, wrong and non-existing reasons in the reasons recorded for reopening of the assessment reproduced above and have also did not apply his mind to the information received from REIC through ITO, Ward-43(4), New Delhi. Therefore, we are of the view that reopening of the assessment is illegal and bad in Law and liable to be quashed. - Decided in favour of assessee.
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