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Mere production before the AO of the account books, or other evidence, from which material evidence could, with due diligence, have been discovered by the AO, would not necessarily amount to disclosure within the meaning of the first proviso to s. 147. The AO, while framing the assessment for the asst. yr. 2012-13 took the assessee SIPL for its word–when it claimed that the transactions undertaken by it with Moral were genuine sale transactions. However, that fundamental premise is now shaken, since Moral has been found to be a completely tainted entity embroiled in very large scale dubious transactions of providing accommodation entries. If the transactions undertaken by SIPL with Moral are indeed not genuine, as now reasonably believed by the AO, it would not be correct to say that SIPL had disclosed fully and truly all the material facts for its assessment for the relevant assessment year.

Shanti Prime Publication Pvt. Ltd.

Sec. 147 of Income-tax Act, 1961 — Reassessment — Sanctity of concluded assessment proceedings needs to be protected, and an assessee should be protected against undue harassment by the taxation authorities by resort to reopening of the concluded assessment. however, when subsequently, it comes to light that the assessee has had financial/monetary dealings with dubious entities/persons-such as bogus accommodation entry providers giving rise to a serious and well founded doubt about the creditworthiness of the investor and genuineness of the transaction, the endeavour of the AO to reopen the assessment in terms of s. 147/148 should normally not be thwarted by the Court, if the same is done within the limitation period, and the same is not merely a case of change of opinion on the same set of facts. A serious and well founded doubt about the genuineness of the transaction would justify formation of the reasonable belief that taxable income has escaped assessment in the light of the scheme of s. 68 which provides that cash credits which, in the opinion of the AO are not satisfactorily explained, would be charged to income-tax as the income of the assessee and the subsequent acquisition of knowledge that the monetary transaction undertaken by the assessee was with a bogus entity/person-such as an accommodation entry provider-which knowledge was not available to the AO at the time of completion of the scrutiny assessment, would be a material change of circumstances, and the formation of belief that taxable income has escaped assessment would not suffer from the taint of simplicitor change of opinion as the live-link between the said material information, and the formation of the belief that taxable income has escaped assessment is the fact that the assessee admittedly, received Rs. 4.10 crores from M/s Shail Investments (P) Ltd. and M/s New Delhi Credits (P) Ltd each and this live-link is actionable as it was found and acted upon within the period of limitation under the proviso to s. 147 — Vedanta Ltd. vs. Asstt. CIT [2020] 312 CTR 481 (DEL)