9911796707
TMI Blog2002 (12) TMI 638X X X X Extracts X X X X X X X X Extracts X X X X ..... ompleted by the appellants on 27-1-1988. Subsequently, a letter was issued to the assessee in which it was said that on the basis of a statement made by the Chief Executive of the respondent Company in the course of the hearing of the assessee's case for Assessment Year 1986-1987, the assessing officer has reasons to believe that the assessee had "suppressed stock" in respect of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the show-cause notices on the ground that the assessee had disclosed all material particulars before the authorities concerned and that, therefore, there was no basis for the assessing authority to initiate proceedings under Section 148 of the Act. The view of the learned Single Judge was upheld in appeal by the Division Bench of the High Court. ( 2. ) In our view, the High Court has proceeded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ility of ₹ 31,58,700 on account of the advance in respect of which no supply had been made. The outstanding advance should have represented the amount of stock remaining with the assessee out of the actual stock verified at the time of making of the advance. At least this appears to be the basis upon which the assessing authority noted that instead of the aforesaid, in the return of the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tive of the assessee had not at all been adverted to by the learned Single Judge or by the Division Bench of the High Court. It is well settled that at the time of considering whether the show-cause notice should be quashed or not, if it is not a question of e jurisdiction, the facts as stated in the show-cause notice, must be taken as correct. ( 4. ) Apart from the factual aspect it also appears ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the basis of Section 147(a). The show-cause notice must be restored. We make it clear that the assessee's contention that the statement of its Chief Executive was incorrect or in any event has been misunderstood is left open for being decided in the proceedings under Section 148 of the Act as may be commenced on the basis of the impugned notice. ( 7. ) The appeal is allowed. The order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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