1978 (7) TMI 81

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....ce on the ground that as the assessment order in respect of the said year had been passed after being fully satisfied and scrutinising the records, the ITO had no justification in issuing the notice under s. 148 of the I.T. Act. The petitioner claimed that the ITO had no material justifying the issue of the notice under s. 148 of the Act. The petition was contested by the respondents. The respondents contended in the counter-affidavit that as the petitioner had not fully and truly disclosed the income liable to tax, the notice issued under s. 148 was valid. Along with the counter-affidavit, the respondents filed a copy of the reasons for re-opening the case under s. 148. The reasons mentioned in respect of this year were in respect of : ....

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....en our detailed reasons for holding that a case for escapement due to the non-disclosure of the materials was made out, and that the ITO was prima facie justified in starting proceedings on the basis of those grounds. For the reasons given in that writ petition, we find in this case as well that the notice issued under s. 148 of the I.T. Act cannot be said to be without jurisdiction. There remains to be considered only three other items, viz., "exchange loss", "construction of brick-kiln" and "training expenses". In respect of "exchange loss" and "construction of brick-kiln". our definite view is that the escapement was not due to the non-disclosure of the materials on the part of the petitioner-company. It could be only due to the failu....