Reassessment threshold under Section 148A(d) fails where bank statement verification was not done before issuing notice.

Under the reassessment procedure, an order under Section 148A(d) and the consequential notice under Section 148 could not stand where the assessing officer failed to verify the bank statement before concluding that escaped income crossed the statutory threshold of not less than Rs. 50,00,000. The recorded need for verification made the conclusion on threshold unsustainable, especially as the bank statement disclosed an arguable case that cash deposits were used to create the fixed deposit. The order and notice were set aside, and the matter was remanded for fresh consideration after giving the assessee a reasonable opportunity.

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Issues: Whether the order under Section 148A(d) of the Income-tax Act, 1961 and the consequential notice under Section 148 of the Income-tax Act, 1961 could be sustained when the assessing officer had not verified the bank statement to determine whether the cash deposits were used to create the fixed deposit and whether the alleged escaped income crossed the statutory threshold.

Analysis: The petitioner had replied to the notice under Section 148A(b) and had furnished the bank statement. The impugned order recorded that the bank statement and other details needed verification, but the assessing officer did not undertake that exercise before concluding that the income represented by assets escaped assessment was not less than Rs. 50,00,000/-. In the absence of verification, the statutory threshold could not be rationally determined. The bank statement disclosed an arguable case that the cash deposits were utilised for the fixed deposit, which required reconsideration.

Conclusion: The impugned order under Section 148A(d) and the notice under Section 148 were set aside and the matter was remanded to the assessing officer for fresh consideration after granting a reasonable opportunity to the petitioner.

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