Reassessment based on alleged concealed sales requires proper examination of objections and relied-upon material before tax liability is fixed.

Reassessment based on alleged concealed sales could not be sustained where the assessee's objections, including non-supply of the relied-upon material and the contention that broker-routed transactions did not conclusively establish sales, were not properly examined. The assessing authority was required to address those objections and the supporting material before fixing tax liability. As the same factual basis had already led to the penalty being set aside, the reassessment order was set aside and the matter remanded for fresh determination, with liberty to consider any request for document supply in accordance with law.

---

---

Issues: Whether the reassessment of tax could be sustained when the assessee's objection that the relied-upon material was not supplied and the assessing authority had not adverted to the objections was not properly examined, warranting remand.

Analysis: The reopening and reassessment were founded on an alleged concealment of sales. The assessee challenged the reassessment on the ground that the transactions were routed through brokers, that the Tamil Nadu dealers' material did not conclusively establish sales to the assessee, and that the documents relied upon by the department had not been made available. The penalty had already been set aside on the basis of the same factual plea. The assessing authority, however, had not dealt with these objections in the manner required for a proper determination of tax liability. In these circumstances, the reassessment order could not be sustained without a fresh consideration of the objections and the material.

Conclusion: The reassessment of tax was set aside and the matter was remanded to the assessing authority for fresh determination of tax liability, with liberty to deal with any request for supply of documents in accordance with law.

Ratio Decidendi: Where reassessment is based on alleged concealed transactions, the assessing authority must consider the assessee's objections and the material relied upon, including any grievance as to non-supply of documents, before sustaining the tax demand.

---