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2020 (10) TMI 744 - AT - Income TaxAssessment concluded based on a news article - Concealment of material facts relevant for both disclosure as per Income-tax Act and the Accounting Standards as well as during the course of assessment proceedings - A.O. had alleged that the assessee has received an amount of USD 30 million as proceeds for sale of urbantouch.com The shareholders of the assessee had sold their shares in the Company in the month of August 2012 and the domain name was sold by the assessee in March 2013 - HELD THAT:- In the instant case as well, the article printed may have been to provide information with respect to the fact that the shareholders of the assessee are selling the shares held by them. However, the same has been misunderstood by the A.O. and an adjustment to that effect has been made in the subject assessment order. It would also be pertinent to note that the copy of the article which was relied upon by the A.O. was not provided to the assessee during the course of assessment proceedings. Accordingly, the information contained in the news article was not ratified by the assessee. Additionally a letter was written by assessee company objecting to the material published in the article which was the basis, on which the A.O. has passed the assessment order. In this letter to the Editor of Economic Times, the assessee states that the article per se did not speak about any amount being received by the assessee and only speaks of consideration received by the shareholders. Given the same, no specific action was taken by the assessee or any of its Directors at the time the news article was published. Transaction of sale of shares by the investors is distinct and separate from the sale of shares undertaken in August, 2012. Neither the assessee nor the investors have received the said amount of USD 30 million. The amount has been reported in the news articles relied upon by the A.O. without carrying out adequate due diligence and without being ratified by the assessee or the investors. We are of the view that the assessment in the instant case has been concluded based on a news article which does not in any case constitute adequate material on record. Accordingly, addition made by the A.O., has been rightly deleted by the CIT(A). - Decided in favour of assessee.
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