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2018 (2) TMI 1471 - HC - Income TaxReopening of assessment - reasons to believe - Held that:- AO in the reasons recorded, proceeded on the erroneous footing that the assessee had not filed return at all. The first premise for issuing the notice was thus factually incorrect. It is now not disputed by the Revenue that the assessee did file return of income for the year under consideration which was duly acknowledged by the Department. The entire reasoning thus proceeded on the wrong premise that the assessee had never filed the return. This itself would be sufficient to annul the notice of reopening the assessment. The assessee had from the outset been contending that the assessee’s accounts are duly audited and such audited accounts are presented alongwith the return. This has been so asserted in the objections before the Assessing Officer as well as in the petition before us. Both times, the response of AO in the order disposing of the objections and the affidavit-in-reply filed in this petition is that the assessee’s cash deposits can only be verified through assessment proceedings. AO does not even contended that the said cash deposits were not duly reflected in the return filed, but that he wishes to verify the validity of such deposits and the assessee’s claim of exemption, being a Trust. Re-assessment, even in a case where the return was not scrutinized before acceptance originally, cannot be resorted to unless AO had a reason to believe that the income chargeable to tax has escaped assessment. For mere verification or for a fishing inquiry, reopening of the assessment is not permissible. - Decided in favour of assessee.
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