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2015 (12) TMI 1738 - AT - Income TaxReopening of assessment - AO failed to provide it with a copy of the reasons recorded before completion of the order of assessment - Held that:- Formation of belief by the AO was a condition precedent as regards the escapement of tax pertaining to the relevant assessment year. Before proceeding to issue the notice under section 147 of the Act, the AO was required to form an opinion, the validity of which are supposed to sustain the formation of an opinion, which can be challenged. Though conclusive evidence is not requisite at the stage of formation of belief, it must be based on application of mind which a reasonable person would apply. In our view, the reasons recorded, as communicated to the assessee by letter dated 04.10.2012, does not remotely evidence independent application of mind as there is clearly no nexus, whatsoever, between the reasons recorded and the factual findings in the order of assessment. In these circumstances we hold that initiation of proceedings under section 147 of the Act is bad in law Variance in the reasons recorded by the AO as provided to the assessee vide letter dated 04.10.2012 and that recorded in the order of assessment, in our view, prevented the assessee from putting up any defence in respect of the reopening of assessment under section 147 of the Act. This has clearly violated the principles of natural justice as the AO proceeded on a different premise while finalizing the order of assessment dated 25.03.2013. - Decided in favour of assessee.
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