Section 148(2)

Section 148(2) — the law in short

What the courts have decided on section 148(2), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.

• Signature Hotels (P) Ltd v ITO High CourtHelps taxpayer
  The only material behind my reopening notice is a one-line entry in an Investigation Wing annexure naming me as the beneficiary of an accommodation entry. Is that enough?
  No. The Delhi High Court quashed the section 148 proceedings. The reasons referred to nothing but an annexure listing a Rs.5 lakh cheque received on 9 October 2002 from Swetu Stone PV, with a bank and account number. That annexure is not material or evidence establishing a nexus with escapement of income and is not even a pointer to it. The Assessing Officer had not applied his own mind to the information or examined its basis, and the Commissioner had given approval mechanically. The share applicant was an existing incorporated company with a permanent account number, and the entry operators' statements did not name the petitioner.
• Ranbaxy Laboratories Ltd v CIT High CourtHelps taxpayerValidity unconfirmed
  Same point, in Delhi: if the recorded grounds fail, can the officer still tax an unrelated item?
  No. Once the officer accepts that the recorded items did not escape assessment, it means he had no reason to believe, and the notice becomes invalid. Every new issue needs a fresh s.148 notice.

Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.