Reasoned sanction is mandatory for reassessment; an unreasoned reopening approval cannot sustain the consequential notice.

Reopening assessment under section 21(2) of the U.P. Trade Tax Act requires a sanction order showing recorded reasons and application of mind to the material and the dealer's objections. An unreasoned approval that merely grants permission, without addressing escaped turnover or the reply submitted, is not a valid exercise of statutory power and is liable to be quashed. A notice issued solely on the basis of such invalid sanction also cannot survive as an independent proceeding. The authority may, however, proceed afresh by first taking a valid decision on sanction in accordance with law.

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Issues: (i) Whether the sanction or authorisation for reopening assessment under section 21(2) of the U.P. Trade Tax Act, 1948 was valid when no reasons were recorded and the dealer's reply was not considered; (ii) whether the notice issued in pursuance of such sanction could survive once the authorisation was held unsustainable.

Issue (i): Whether the sanction or authorisation for reopening assessment under section 21(2) of the U.P. Trade Tax Act, 1948 was valid when no reasons were recorded and the dealer's reply was not considered.

Analysis: The legality of reopening depended upon a reasoned application of mind by the authority granting sanction. Where the order merely granted approval without referring to the material showing escaped assessment and without dealing with the objections raised, it lacked the necessary reasons. Such an order could not be sustained as a proper exercise of the statutory power.

Conclusion: The sanction or authorisation was invalid and was rightly quashed in favour of the petitioner.

Issue (ii): Whether the notice issued in pursuance of such sanction could survive once the authorisation was held unsustainable.

Analysis: The notice was wholly consequential to the invalid sanction. Once the foundational authorisation fell, the notice issued on its basis could not independently stand. At the same time, the authority retained the liberty to proceed afresh in accordance with law after a fresh decision on sanction.

Conclusion: The notice was quashed in favour of the petitioner, with liberty to issue a fresh notice after a valid decision on sanction.

Final Conclusion: The challenge succeeded on the ground that reopening proceedings cannot rest on an unreasoned sanction order, and the consequential notice issued on its basis also failed, while leaving the authority free to proceed afresh according to law.

Ratio Decidendi: A sanction for reassessment under section 21(2) of the U.P. Trade Tax Act, 1948 must be supported by recorded reasons showing application of mind; if the sanction is invalid, consequential proceedings founded on it cannot survive.

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