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2018 (4) TMI 252 - AT - Income TaxReopening of assessment - proceedings to assess the capital gains in the hands of the assessee, in his individual capacity and not in the hands of the “seller firm” - Held that:- Notice u/s 148 of the Act was issued to the purchaser firm M/s. Hotel Sea Weed on 31.07.2012. Notice was also issued on 31.07.2012u/s 148 to Shri Girish Chandra Rout, who is the respondent before me and a partner of the seller firm The AO had taken the cost of the asset as the WDV in the books of the seller partnership firm. Thus it is clear that the AO, prior to framing assessments on the purchaser firm and prior to framing assessments on the individual assessees, who are respondents in these appeals was fully aware that the asset in question belong to the seller partnership firm and not the individual assessee. It was the WDV of the asset in the Balance Sheet of the Seller Firm that the AO has taken for the purpose of computation of Capital Gains. Thus the argument of the ld. DR that the AO was misled as to whether the asset belonged to the firm or the individual in view of the recitals in the sale deed is devoid of merit. The notices u/s 148 of the Act were wrongly given as the reasons recorded were against the fact that, the asset belong to the firm which were in the knowledge of the A.O. No infirmity in the order of the First Appellate Authority wherein he held that u/s 189 of the Act, the assessments have to be made on the firm only, even if the business of the firm is discontinued. He rightly held that the capital gain in question could be brought to tax u/s 189 of the Act only in the hands of the seller firm with PAN AADFH 9221R. - Decided against revenue.
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