original assessment in this case was completed on 11th March, 1975 on loss of Rs. 2,878. Later on ITO got information from ITO, survey Circle, Bombay that assessee had allegedly paid "on money" of Rs. 1,19,048 to Madhav Co-op. Housing Society Ltd. for purchase of two flats No. H 4 in "Helio Polio" and P 6 in "Petro Polio" from them through agent. Thereupon, ITO reopened assessment under s. 147(b) r/w s. 148 of IT Act, 1961. In response to notice under s. 148, assessee again declared loss of Rs. 2,878 and submitted as under in its explanation dt. 6th Aug., 1978: (i) That assessee did not remember whether any "on money" was paid to Madhav Co-op. Housing Society Ltd. as matter was very old. (ii) That while making disclosure under Voluntary Disclosure Scheme 1975, it was agreed between assessee and CIT that if company made disclosure for Rs. 3,75,000 for asst. yr. 1973-74, no inquiry would be made regarding any outgoing by way of "on money." ITO rejected explanation of assessee and added sum of Rs. 1,19,048 to its income as income from undisclosed sources. On appeal, CIT(A) held as follows: (i) That record of case did not indicate that ITO had recorded his reasons for reopening assessment as required under s. 148(2) and that ITO despite specific opportunity to him, could not refer to or produce any material to show that he had recorded his "reasons" for reopening assessment and so reassessment was void. (ii) That there was no information on basis of which it could be said that ITO could come to reasonable conclusion that income of assessee had escaped assessment so as to justify action under s. 147(b). (iii) That in view of settlement made by assessee with CIT on 30th Dec., 1975 under Voluntary Disclosure Scheme, 1975, amount considered in reassessment proceedings was covered by settlement and so no further addition could be made in this behalf. CIT(A) accordingly, cancelled reassessment order. Aggrieved by order of CIT(A), Department has filed present appeal. We have gone through record and heard ld. representatives of parties. In our opinion, assessee deserves to succeed on short ground that provisions of sub-s. (2) of s. 148 have not been complied with. This sub- section clearly lays down that ITO shall, before issuing notice under s. 148(1), record his reasons for doing so. Now, in present case, there is no material on record to prove that ITO in fact, recorded his reasons before issuing notice under s. 148(1) for reopening assessment. CIT(A) has clearly observed in his order that he went through record of ITO but did not find any entry in order sheet, showing reasons recorded by ITO before issuing notice under s. 148(1). It is also stated by CIT(A) that he gave specific opportunity to ITO in writing to produce relevant order sheet or other material which could show that he had recorded his reasons for reopening assessment, but ITO failed to do so. These findings of CIT(A) stand uncontroverted. In order to exclude every possibility of doubt, we also directed ld. departmental representative to bring on record any material to show that ITO had in fact recorded his reasons before reopening of assessment, but he expressed his inability to do so. In such situation, we have no alternative but to cancel reassessment order for want of compliance with provisions of s. 148(2). It has been held by Allahabad High Court in case of Jamnalal Kabra vs. ITO & Ors. (1968) 69 ITR 461 (All) that recording of reasons before issuing notice under s. 148 is mandatory and pre-requisite to assumption of jurisdiction by ITO for initiating proceeding for assessing or reassessing income which has escaped assessment. To same effect is decision of Calcutta High Court in case of East Coast Commercial Co. Ltd. vs. ITO & Ors. (1981) 128 ITR 326 (Cal). According to this authority, recording of reasons under s. 148 of IT Act, 1961 is not idle formality but mandatory requirement of statute casting duty and obligation on ITO to record his reasons for issuing notice for reassessment. In view of these authorities, we are of opinion that CIT(A) has rightly cancelled reassessment order for want of compliance with mandatory provisions of s. 148(2). We, therefore, confirm his order on this point. In view of our finding given above, it is not necessary to go into merits of case. In result, appeal is dismissed. *** INCOME TAX OFFICER v. JOLLY MAKER P. LTD.