Reassessment notice invalid where escapement grounds were missing and new reasons were added later in the process.

A reassessment notice under section 148A(b) must disclose material showing escapement of income, and a later section 148A(d) order cannot be sustained on new grounds not stated in the original notice. Mere reference to disclosed receipts or an exemption claim is insufficient to establish escapement, and the Assessing Officer cannot supplement the recorded basis by introducing a different theory, such as permanent establishment or treaty taxability, at the objections stage. The section 148A(b) notice, the section 148A(d) order, and the consequent section 148 notice were therefore invalid and set aside.

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Issues: Whether the reassessment notice and consequential order were valid when the show-cause notice under section 148A(b) did not disclose material showing escapement of income and the later order under section 148A(d) was founded on new grounds.

Analysis: Reassessment can be initiated only where the Assessing Officer has material indicating that income has escaped assessment. A notice under section 148A(b) must disclose the basis for forming that view; a mere reference to disclosed receipts or to an assessee's claim of exemption does not by itself establish escapement. The later order under section 148A(d) introduced a different basis, namely alleged permanent establishment and treaty taxability, which was not contained in the original notice. A reassessment decision cannot be sustained by supplying new grounds at the stage of disposal of objections or by supplementing the original reasons.

Conclusion: The notice under section 148A(b), the order under section 148A(d), and the notice under section 148 were invalid and were set aside.

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