1994 (4) TMI 3

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..... ssessment year 1986-87 saying that he had reason to believe that income chargeable to tax for the assessed period had escaped assessment within the meaning of section 147 of the Act and demanding delivery of the return in the prescribed form within 30 days from the date of service of this notice. The petitioners replied on November 8, 1993 (annexure " C "), indicating that the return already filed be treated as return in response to this notice. On November 10, 1993, the petitioners demanded, vide annexure " D ", that the reasons recorded for proceedings under section 148 of the Act be communicated. Respondent No. 2 declined to do so and took the stand in reply dated November 10, 1993 (annexure " E "), that there was no provision under the .....

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..... s, merits to be mortalised. (b) Reasons are now furnished during the course of this petition. These are to a large extent irrelevant and inadequate. Irrelevance and irrationality are recognised grounds of judicial review and affect the very jurisdiction of the authority. The notice is thus without jurisdictional competence and deserves to be quashed. Counsel for the respondents has dubbed both the grounds meritless and prayed for dismissal of the petition on the fulcrum of remedy available under the Act itself. It is contended that communication or disclosure is not essential and that existence is not disputed. Shri Bagadia has placed reliance on Thanthi Trust v. ITO [1973] 91 ITR 261 (Mad) ; British Electrical and Pumps P. Ltd. v. IT .....

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..... behalf. The assessee is entitled to contest the issue effectively. This is possible only on obtaining the reasons. It cannot be gainsaid that the satisfaction of the conditions, being sine qua non, can be judged only on the basis of the reasons. Refusal is, thus, arbitrary and prejudicial. However, for this lapse, this point now pales into insignificance because the reasons have since been furnished. As such, the debate centred round the necessity of declaration of the position of law. In his dissenting judgment in Breen v. Amalgamated Engineering Union [1971] 2 QB 175 (CA), Lord Denning MR., has observed that : " The giving of reasons is one of the fundamentals of good administration. " And in Alexander Machinery (Dudley) Ltd. v. Cr .....

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