Reassessment notice challenge fails where unpleaded grounds and unsupported mala fides cannot displace recorded reasons to believe.

A writ court should not quash a reassessment notice on a factual or jurisdictional ground that was not pleaded or put in issue, because a new case cannot be introduced without foundational averments. The record must support any challenge that the notice lacked the requisite reasons to believe that income had escaped assessment by reason of nondisclosure of material facts; on the materials referred to in the text, that belief was shown and the notice was treated as valid. Allegations of non-recording of reasons and mala fides also fail where they were neither properly pleaded nor supported by the record. The reassessment notice was therefore upheld.

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Issues: (i) Whether the High Court could quash a reassessment notice on a ground not raised in the writ petition; (ii) Whether the notice issued under section 34(1)(a) was without jurisdiction for want of reasons to believe that income had escaped assessment by reason of the assessee's failure to disclose fully and truly all material facts; (iii) Whether the notice was invalid for non-compliance with the requirement of recording reasons or for mala fides.

Issue (i): Whether the High Court could quash a reassessment notice on a ground not raised in the writ petition.

Analysis: The challenge before the High Court was confined to the absence of reasons to believe that income had escaped assessment. No pleading was made that the escapement, if any, was attributable to the assessee's failure to disclose fully and truly all material facts, and the matter was not put in issue by the affidavits. In the absence of foundational averments, the High Court could not introduce and decide a new factual case.

Conclusion: The High Court was not justified in quashing the notice on a ground not pleaded by the respondent.

Issue (ii): Whether the notice issued under section 34(1)(a) was without jurisdiction for want of reasons to believe that income had escaped assessment by reason of the assessee's failure to disclose fully and truly all material facts.

Analysis: The materials placed before the Court, including the departmental report and the request for sanction, showed that the officer had reason to believe that income had been under-assessed on grounds contemplated by section 34(1)(a). The record did not support the contention that the notice was issued without the requisite belief.

Conclusion: The notice under section 34(1)(a) was valid and not liable to be struck down on this ground.

Issue (iii): Whether the notice was invalid for non-compliance with the requirement of recording reasons or for mala fides.

Analysis: The requirement regarding recording of reasons was neither pleaded in the writ petition nor urged before the High Court, and the necessary facts were absent from the record. The allegation of mala fides was also met by the counter-affidavits, and there was no basis to reject the department's explanation or to infer an improper purpose from the earlier proceedings.

Conclusion: The additional grounds of non-recording of reasons and mala fides were rejected.

Final Conclusion: The reassessment notice was upheld and the writ petition failed.

Ratio Decidendi: A writ court should not quash a reassessment notice on a factual or jurisdictional ground not properly pleaded, and a notice under section 34(1)(a) of the Income-tax Act, 1922 will stand where the record discloses the requisite reasons to believe and no established mala fides are shown.

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