M/S. PRINTERS HOUSE PVT. LTD. vs M/S. COLD STORAGE & FOOD PRODUCTS .

The Supreme Court held that Section 147(a) of the Income Tax Act requires two conditions for the Income-Tax Officer to exercise jurisdiction: (1) satisfaction that the income is exigible to tax and (2) reason to believe that income has escaped assessment due to the assessee's failure to disclose material facts. The Court found that while the notice did not prima facie disclose satisfaction of these conditions, the Income-Tax Officer's counter affidavit provided the necessary material facts, thus not rendering the notice illegal. The Court also noted that the Division Bench erred in prematurely concluding that Rs. 15,00,000 was received for the sale of goodwill without proper assessment of the facts.