JUDGMENT
1. Heard counsel for the petitioner.
2. The petitioner seeks to challenge the notice issued under Section 148 of the Income-tax Act, 1961, for the assessment years 1984-85 to 1988-89 on March 7, 1989.
3. The petitioner's case is that there was no omission or failure on the part of the assessee to disclose truly and fully material facts relating to the assessment year inasmuch as there is no information relating to escaped income. Hence, the said notice is liable to be set aside, It is further contended that the notice shows change of opinion and that is for making a fishing inquiry.
4. The respondent in the counter-affidavit has disclosed the reasons. In paragraph 19 of the counter-affidavit, it is stated that the case was reopened after making due inquiries through the Inspectors of Income-tax and their report dated September 12, 1988. Reliance has also been placed on annexures CA-1 to CA-5 for all the years in question.
5. The first ground of attack by learned counsel for the petitioner is that for the year 1988 what is revealed should not be and cannot be utilised for the assessment years and, secondly, there is no material for the year in question, hence the notice issued is illegal and liable to be quashed. The argument is misconceived. If something is revealed on inquiry subsequent to the assessment years, which has been assessed, and on inquiry or on the basis of some material on the record, some income of the assessee has escaped assessment and the material for the year in question is on record, the authority would be within its competence to issue such notice. On behalf of the respondent reliance is placed on the report, where it records, that only part of the building, viz., a verandah and lavatory, is being used for the office purpose and the value of which is recorded as only Rs. 20,000 which was not disclosed and this is the reason that the assessee escaped the tax by not truly disclosing facts. The following reason is further disclosed by the respondent :
"... Scrutiny of the returns and papers annexed thereto reveals that the assessee has paid a sum of Rs. 34,899 as interest. It also reveals that the assessee, Shri Arvind Lal, did not withdraw any amount for the purpose of construction of building which is being utilised by him as residential building. The amount invested in the building is much more than the capital invested by him in the business. The obvious conclusion is that interest paid by the assessee on borrowings, which were utilised for the construction of building, was not utilised for the purpose of business and profession and hence this amount was not allowable. The assessee never disclosed these facts either in his return or at any time during the course of assessment proceedings and instead claimed the said building to be the head office building of the business. "
6. It is on this basis it is urged that the material did exist on the record for initiating proceedings and since reasons for issue of notice have now been, disclosed in the counter-affidavit, it is open to the petitioner to contest the same before the authority concerned.
7. We would not like to go into the merits of the contentions raised by the parties lest it may affect their rights. However, we find, in the present case, that it cannot be said on the facts and in the circumstances of the case that there is any jurisdictional error committed by the respondent in issuing notice under Section 148 of the Income-tax Act. However, the contention raised by the petitioner may be contested before the said authority as raised in this petition and we have no hesitation that the said authority will go into the same and decide in accordance with law after giving opportunity to the petitioner. The material brought by the petitioner by means of the amendment application filed in this case is again such a fact which he can raise before the said authority while contesting the said notice. Accordingly, the present writ petition fails and is dismissed. Costs on parties. The ad interim order dated December 2, 1080, is hereby vacated.