Reassessment proceedings could not be declared as null and void where AO was prompted by correct information

Brief of the case:

In the case of ITO Vs. M/S JAGDAMBA OPTICS PVT. LTD. Delhi Bench of ITAT have held that there was existence of correct information which prompted to the AO to proceed to issue notice u/s. 148 of and hence, the reassessment proceedings could not be declared as null and void. After conducting the detailed investigation to prove that the income has escaped assessment in the hands of the assessee, the reassessment proceedings have been initiated by the AO. In an another issue ITAT have held that Once the identity of the shareholders was established it also stands established that the shareholders have invested money in the purchase of shares and hence the onus, on the part of the assessee company, is discharged and there cannot be any addition in the hands of the assessee company on account of share application money.

Facts of the case:

• Assessee filed the return of income declaring loss of Rs. 5,78,075/- on 07.10.2004.

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