Reassessment notice cannot be issued during pending original assessment when escaped income is not established and reasons are absent

Reassessment under the Income-tax Act could not be initiated while the original assessment proceedings were still pending, because income could not yet be treated as having escaped assessment and the statutory precondition for section 148 was therefore absent. The record also showed no recorded reason for issuing the notice. On that basis, the notice under section 148 was invalid and the reassessment was quashed.

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Issues: Whether notice under section 148 of the Income-tax Act, 1961 could validly be issued during the pendency of the original assessment proceedings and whether the resultant reassessment was liable to be quashed.

Analysis: The assessment proceedings for the relevant assessment year had not culminated in a final assessment when the notice for reassessment was issued. In such a situation, income could not be treated as having escaped assessment, and the precondition for invoking the reassessment jurisdiction was absent. The record also disclosed no reason for issuance of the notice under section 148.

Conclusion: The notice under section 148 was not valid and the assessment was rightly quashed.

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