Reassessment beyond four years needs recorded reasons showing full and true disclosure failure before reopening can stand.

Reassessment initiated beyond four years from the end of the relevant assessment year requires the recorded reasons to specifically show that income escaped assessment because the assessee failed to disclose fully and truly all material facts necessary for assessment. General information from the investigation wing, without a clear nexus to the assessee and without that jurisdictional assertion, does not satisfy the first proviso to Section 147 of the Income-tax Act, 1961. On these facts, the reopening lacked jurisdiction, the reassessment notice was quashed, and the assessment order based on that reopening could not stand.

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Issues: Whether reassessment proceedings initiated beyond four years were valid in the absence of a recorded finding that the assessee had failed to disclose fully and truly all material facts necessary for assessment.

Analysis: Since the reassessment was initiated after expiry of four years from the end of the relevant assessment year, the first proviso to Section 147 of the Income-tax Act, 1961 applied. In such a case, the reopening must be supported by a specific and recorded allegation that the escapement of income resulted from the assessee's failure to disclose fully and truly all material facts. The reasons supplied did not contain any such clear assertion, and the information from the investigation wing was found to be general and not sufficiently linked to the assessee. On these facts, the recorded material did not establish the jurisdictional precondition for reopening.

Conclusion: The reassessment notice was without jurisdiction and was liable to be quashed; the assessment order based on such reopening also could not stand.

Final Conclusion: The reassessment proceedings having been invalidly initiated, the assessment was set aside and the assessee obtained full relief.

Ratio Decidendi: Where reassessment is initiated beyond four years, the reopening is invalid unless the recorded reasons specifically demonstrate the assessee's failure to disclose fully and truly all material facts necessary for assessment.

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