Reassessment must track the recorded reason for reopening; unrelated additions cannot sustain proceedings when the basis income is not taxed.

Reassessment based on cash deposits in a bank account failed where the Assessing Officer did not tax that very income and instead made additions on different balance sheet and profit and loss account items. The applied jurisdictional principle was that, once the recorded reason for reopening is either explained or not brought to tax, the Assessing Officer cannot assess other items in the same reassessment proceedings. On that ground, the reassessment was held unsustainable and the assessee succeeded.

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Issues: Whether the reassessment could be sustained when the additions ultimately made did not relate to the recorded reason for reopening and the Assessing Officer had not taxed the income that formed the basis of the notice.

Analysis: The notice for reassessment was founded on cash deposits in a bank account. In the assessment, however, no addition was made on that very basis; instead, additions were made on different items arising from the balance sheet and profit and loss account. The binding jurisdictional principle applied was that once the income for which reassessment was initiated is found to be explained or is not brought to tax, the Assessing Officer cannot continue to assess other items of income in the same reassessment proceedings.

Conclusion: The reassessment on the challenged jurisdictional ground was unsustainable and the assessee succeeded.

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