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2020 (1) TMI 728 - AT - Income TaxReopening of assessment u/s 147 - ‘reason to believe’ that the income of the assessee has escaped assessment - Bogus accommodation entries - HELD THAT:- The reason to believe does not spell out any connection of assessee’s with M/s. Avenue Dealers and what wrongful conduct of assessee has been detected by the Investigation Wing or FMC is discerned from the reasons recorded. Moreover, note from the said reasons recorded by AO that no where it is stated as to how the assessee got profit which he has derived from the commodity trading with M/s. Avenue Dealers Pvt. Ltd. and what is the connection of assessee with its director Shri Devesh Upadhyay. Though it was stated that Shri Devesh Upadhyay’s statement was recorded there is no whisper as to whether the assessee has been named by Shri Devesh Upadhyay to be a beneficiary. The reasons recorded has not provided the details of the transaction alleged to be bogus such as nature of the commodity, dates and about the contracts as well as the number of contractee the assessee have entered into for taking the alleged bogus entries. The details of the bank transactions also are found absent. The reasons recorded by the AO is totally silent with regard to the amount and nature of bogus entries and transactions and the persons with whom the transactions had taken place. Requirement under the law has not been made in the reasons recorded in the instant case to reopen the assessment and, therefore, the reopening and consequent reassessment is not valid in the eyes of law and, therefore, all the consequent proceedings are null in the eyes of law. No adverse view could have been taken against the assessee. The allegation of attributing illegal conspiracy/activities etc. is hurled without any basis and therefore, on merits as well as on the legal issue the assessee succeeds and, therefore, since the assessee succeeds in respect of the legal issues itself, since the AO did not satisfy the condition precedent for assuming jurisdiction to reopen the assessment, the notice issued u/s. 148 itself is null in the eyes of law and, therefore, all the subsequent proceedings are null in the eyes of law and therefore, the reassessment order is quashed and resultantly all the three appeals of assessee are allowed.
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