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2022 (2) TMI 873 - AT - Income TaxValidity of Reopening of assessment u/s 147 - Unexplained cash credit u/s.68 - share application money received in cash - HELD THAT:- As per section 147, the AO has reasons to believe that any income liable to tax has escaped assessment for any assessment year, then he can issue notice under section 148 after satisfying section 149 which prescribed time limit for issuance of notice and quantum of escaped income. But in the present case, the AO has made an observation that no accrued income is offered to tax against bank deposits by the assessee. Further, the AO has not quantified what extent of income has escaped from taxation relevant to the assessment year 2008-09, whereas addition made by the AO are on account of share application money received and unsecured loan availed by the assessee, which are not formed in the reasons recorded by the AO. Hence, the reasons recorded does not satisfy provisions of section 148 which says AO has reasons to believe that there is escapement of income. Thus reopening of assessment is bad in law and therefore we quash reassessment order made by the AO. Consequently, grounds of appeal of the assessee are allowed on the preliminary issue.
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