Reassessment notice validity turns on statutory basis, not express reasons in the notice, if material exists and is disclosed.

A reopening notice under section 12(8) of the Orissa Sales Tax Act is not invalid merely because it does not expressly state the reasons for issue, since the provision is a machinery mechanism for escaped or under-assessed turnover and does not require reasons to be recited in the notice itself. The statutory basis for reassessment must still exist, and any material relied on against the dealer must be disclosed with a fair opportunity to respond before use in reassessment. Where the record showed clandestine dealings and seizure of documents indicating non-disclosure of turnover, the notice was sustained and the challenge failed.

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Issues: (i) Whether a notice issued under section 12(8) of the Orissa Sales Tax Act, 1947 is invalid merely because it does not expressly state the reasons for issuing the notice. (ii) Whether the existence of material giving rise to the belief of escaped assessment or under-assessment was shown so as to sustain the notice.

Issue (i): Whether a notice issued under section 12(8) of the Orissa Sales Tax Act, 1947 is invalid merely because it does not expressly state the reasons for issuing the notice.

Analysis: Section 12(8) is a machinery provision for reopening assessment where turnover has escaped assessment or has been under-assessed. The provision does not expressly require the reasons for issuing the notice to be set out in the notice itself. The statutory language must be read practically so that the machinery works, and the absence of an express requirement to disclose reasons in the notice cannot be treated as a ground of invalidity. However, if material is proposed to be used against the dealer in reassessment proceedings, it must be disclosed to the dealer with an adequate opportunity to answer it.

Conclusion: The notice is not invalid merely because it omits to state the reasons for issue.

Issue (ii): Whether the existence of material giving rise to the belief of escaped assessment or under-assessment was shown so as to sustain the notice.

Analysis: For a notice under section 12(8), the requisite basis that turnover has escaped assessment or has been under-assessed must exist. On the record, the authorities placed material showing clandestine dealings and seizure of documents that prima facie indicated non-disclosure of the full turnover. The record was sufficient to support the initiation of proceedings.

Conclusion: The existence of the requisite basis for issuing the notice was sustained.

Final Conclusion: The challenge to the reassessment notice failed, and the writ petitions were liable to be dismissed.

Ratio Decidendi: A notice for reopening or reassessment under a machinery provision is not invalid merely because it does not recite the reasons for belief, so long as the statutory basis for action exists and any material relied upon in reassessment is disclosed to the dealer before use.

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