JUDGMENT - T.D. SUGLA, J.:---By these two petitions under Article 226 of the Constitution of India, the petitioners have challenged the jurisdiction of the Income-tax Officer to issue notices under section 148 read with section 147(a) dated 7-2-1984 for assessment years 1977-78 and 1978-79. 2. The petitioner is a partnership firm. The proceedings relate to assessment years 1977-78 and 1978-79. Returns of income were filed on 24-7-1977 and 19-6-78. The assessments were completed under section 143(3) on 22-6-1978 and 20-6-1971 respectively. On receipt of appraisal report dated 24-10-1983 from the Assistant Director of Inspection (Investigation), Unit III(3), the Income-tax Officer formed reason to believe that the Income of the petitioner chargeable to tax had escaped assessment for the two years by reason of non-disclosure of necessary material fully and truly at the time of original assessment. Accordingly, he issued the impugned notices. 3. The reasons recorded by the I.T.O. for reopening the assessments were furnished to the Court as well as to the Counsel for the petitioner at the time of the hearing. Shri Dalvi, the learned Counsel for the petitioner, referring to the reasons recorded, submitted that the reasons were, to say the least vague and no reasonable person could have formed the belief that the income of the petitioners had escaped assessment on the basis thereof. He referred to the I.T.O.'s own admission that confirmation letters in proof of loans were filed at the time of original assessments. According to him, the petitioners had, thus, furnished primary facts relevant and necessary for completion of assessments and there was no further obligation of the petitioner. In support, Shri Dalvi placed reliance on the Supreme Court decision in the case of (Income-Tax Officer, I Ward, Distt VI, Calcutta and others v. Lakhmani Mewal Das)1, 103 I.T.R. 437 and in the case of (Income-tax Officer, I-Ward, Hundi Circle, Calcutta and others v. Madnani Engineering Works Ltd.)2, 118 I.T.R. 1. 4. Shri Jetly, the learned Counsel for the Department, on the other hand, invited the Court's attention to explanation 2 to section 147. He contended that mere fact that confirmation letters were filed at the time of the original assessments was not and could not amount to a full and true disclosure of necessary and relevant material. For this purpose, he relied on the Supreme Court decision in the case of (Indo-Aden Salt Mfg. Trading Co. He contended that mere fact that confirmation letters were filed at the time of the original assessments was not and could not amount to a full and true disclosure of necessary and relevant material. For this purpose, he relied on the Supreme Court decision in the case of (Indo-Aden Salt Mfg. Trading Co. P. Ltd. v. Commissioner, of Income-tax, Bombay)3, 159 I.T.R. 624. In petitioner he invited my attention to page 628 of the judgment to show that it was the duty of the assessee to bring it to the notice of the assessing authority all material and relevant facts which the assessee knew and the assessing authority might or might not know. According to Shri Dalvi, the latter decision of the Supreme Court was not applicable to the facts of the case. Explanation 2, it was pointed out, was considered by the Supreme Court in one of its earlier decisions in (Commissioner of income -tax, Calcutta v. Burlop Dealers Ltd.)4, 79 I.T.R. 609 and the said decision was followed by the Supreme Court in 103 I.T.R. 437. 5. For proper appreciation of rival contentions, it is desirable to reproduce the reasons recorded by the I.T.O. for reopening the assessment for the year 1978-79 hereunder : "Action against this firm, its partners and other sister concerns was taken on 17-2-1982 under section 132 of the I.T. Act, 1961. Total loans for A.Y. 1978-79 as per balance sheet amounted to Rs. 6.53 lakhs approximately. As the necessary confirmations had been filed, the loans were accepted as genius by the I.T.O. The ADI (Inv.) UNIT-III(3) has intimated in his appraisal report dated 24-10-1983 that a number of persons who are stated to have advanced loans during A.Y. 1977-78 are mere name lenders/Havala loan givers, such loans amount to Rs. 1,95,000/- and further that these and other loans need scrupulous scrutiny. In addition some commission payments have also been found to be of doubtful nature by him. Most of the creditors for loans and persons to whom commission payments are stated to have been made during A.Y. 1978-79 are the same as for A.Y. 1977-78. 1,95,000/- and further that these and other loans need scrupulous scrutiny. In addition some commission payments have also been found to be of doubtful nature by him. Most of the creditors for loans and persons to whom commission payments are stated to have been made during A.Y. 1978-79 are the same as for A.Y. 1977-78. I have thus reason to believe that by reason of the omission of failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for A.Y. 1978-79, income chargeable to tax has escaped assessment for that year." Reasons recorded for reopening the assessment for assessment year 1977-78 are similar and for the sake or brevity are not reproduced. The material information, if any, is in paragraph 3 only and that too upto the figure Rs. 1,95,000/-. Other part of that paragraph, namely, "and further that those and other loans need scrupulous scrutiny. In addition some commission payments have also found to be of doubtful nature by him" can by no stretch of imagination be treated even as information. This piece of observation may, at best, be considered as an advice by a brother officer to the Income-tax Officer to make investigation into certain aspects. Therefore, the only worth while information/material that requires consideration is "a number of persons who are stated to have advanced loans are mere name lenders/havala loan givers and such loans amount to Rs. 1,95,000/-". It is evident that even the ADI in his appraisal report does not indicate as to who are the name lenders and whether they made a general statement before any authority to the effect that they were name lenders or whether they specifically stated that their transactions with the petitioner were not genuine. The information is, thus, very vague and cannot be said to provide a nexus to the formation of belief that the assessee's income had escaped assessment. 6. These facts squarely fall within the ratio of the Supreme Court decision in 103 I.T.R. 437 where it was held that it is not any and every material howsoever vague and indefinite and district, remote and far fetched which would warrant the formation of the belief that income chargeable to tax had escaped assessment. 6. These facts squarely fall within the ratio of the Supreme Court decision in 103 I.T.R. 437 where it was held that it is not any and every material howsoever vague and indefinite and district, remote and far fetched which would warrant the formation of the belief that income chargeable to tax had escaped assessment. In that case also the information was that "one of the creditors has since confessed that he was doing only name in lending." The reopening of assessment under section 147(a) was struck down by the Supreme Court both on the ground that such an information did not warrant the formation of belief that income had escaped assessment also on the ground that the assessee having made true and full disclosure of the primary facts at the time of the original assessment, the escapement if any could not be by reason of failure on his part. It is pertinent to mention that in this case the I.T.O. has himself mention while recording the reasons that confirmation letters were filed at the time of the original assessments. A similar case had come up before the Supreme Court in 118 I.T.R. 1 (supra). It was held that after an assessee had given the particulars of loans with confirmation letters, it was for the I.T.O. to investigate and determine whether these documents were genuine or not. The assessee could not be said to have failed to make a true and full disclosure of material facts by not confessing before the I.T.O. that those documents were bogus. Under the circumstances, even if it is assumed that formation of belief that income chargeable to tax had escaped assessment had some basis, the second condition that the escapement should be by reason of failure on the part of the assessee to disclose truly and fully material facts is certainly absent in this case. 7. As regards the Supreme Court decision in 159 I.T.R. 624 (supra), it is to be noted that the facts in that case are distinguishable. The assessee had both taxable and non-taxable income. There was no dispute that assets used for earning taxable income alone were entitled to depreciation. The assessee had not given the bifurcation of the extent of use of the assets fir earning taxable and non-taxable income. The assessee had both taxable and non-taxable income. There was no dispute that assets used for earning taxable income alone were entitled to depreciation. The assessee had not given the bifurcation of the extent of use of the assets fir earning taxable and non-taxable income. Explanation 2 was considered in this context and it was held that it was the obligation of the assessee to furnish the bifurcation which was necessary for the purpose of assessment. In the present case the petitioner did furnish the loans accounts and filed confirmation letters in support. It was for the I.T.O. to make investigation if advised. The petitioner had no obligation to confess that the loans were not genuine or that the I.T.O. should not accept their genuineness without enquiry. The Supreme Court. in 118 I.T.R.1, in terms stated that it is not the obligation of the assessee. 8. In the above view of the matter, it has to be held that the formation of belief that income chargeable to tax had escaped assessment by reason of the assessee's failure to disclose relevant and necessary material truly and fully is not warranted. The impugned notices were accordingly issued without proper assumption of jurisdiction. In the result, the petition is allowed. The impugned notices are quashed. Rule is made absolute in terms of prayer (a) in both the petitions. No order as to costs. Petition allowed. -----