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2017 (4) TMI 360 - HC - Income TaxSpecial audit under Section 142 [2A] - Held that:- What is required to be considered while passing an order under Section 142 [2A] of the Act, at the time order under Section 142 [2A] of the Act, any proceedings are pending before the A.O or not ? Notice under Section 148 of the Act ie., reassessment proceedings can be said to be the proceedings pending before the A.O, and therefore, if at that stage of proceedings [in the present case, reassessment proceedings before him], the Assessing Officer, having regard to the multiplicity of transactions in the account or specialized nature of the business activities of the assessee and the interest of the Revenue, is of the opinion that it is necessary to so to do, he may pass an order under Section 142 [2A] of the Act; subject to compliance with the procedure, as required under Section 142 [2A] of the Act. Therefore, in the facts and circumstances of the case, it cannot be said that the impugned order is contrary to Section 142 [2A] of the Act. In the present case, having found that there are complex issues relating to introduction of land by the partners into the firms; revaluation of land; credit of partners in capital account equal to revalued amount of land; conversion of capital account to loan account of shareholders and issues relating to issuance of equity shares against the balances of revaluation credits at an unreasonable premium, and after having been satisfied that considering the specialized nature of business activities of the assessee, the Assessing Officer has passed an order of special audit in exercise of powers under Section 142 [2A] of the Act. Considering the scope and ambit of Section 142 [2A] of the Act, it cannot be said that in the facts and circumstances of the case, the respondent has committed any error and/or any illegality while passing the order under Section 142 [2A] of the Act. Under the circumstances, the present writ petitions deserve to be dismissed and are accordingly dismissed.
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