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2023 (5) TMI 215 - AT - Income TaxReopening of assessment u/s 147 - assessee was one of the beneficiary of Client Code Modification (CCM) by some broker - ‘reason to suspect’ v/s ‘reason to believe’ - HELD THAT:- We find that the reasons recorded by the ld AO for reopening of the assessment in the instant case are very vague without having any live link to form a reasonable belief that the income of the assessee had escaped assessment. The reasons recorded and the assessment order only talk about modus operandi how the client code modification facility could be misused by some broker. Nowhere, neither the assessee nor its brokers were even impleaded in the said reasons. The reasons recorded only gives way to ‘reason to suspect’ and not ‘reason to believe’. The very same issue was even subject matter of adjudication of this tribunal in the case of Stratagem Portfolio (P) Ltd [2020 (9) TMI 813 - ITAT DELHI] as held there is no material to infer that such client code modification has been done with malafide purpose of shifting of the profit or evasion of the tax. There is no material before the Assessing Officer to form such a belief that income had escaped due to such client code modification and thus there is no live link between the material before the Assessing Officer and inference made. Thus, we have no hesitation in quashing the reassessment proceedings as they are not sustainable in the eyes of law. Decided in favour of assessee.
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