JUDGMENT judgment of court was delivered by Badar Durrez Ahmed J.-By way of this writ petition writ of certiorari has been sought for quashing notice dated March 23, 2012, issued by Assistant Commissioner of Income-tax under section 148 of Income-tax Act, 1961 (hereinafter referred to as "the said Act"), as also order dated February 25, 2013, passed by Deputy Commissioner of Income-tax disposing objections raised by petitioner in respect of assessment year 2005-06. Admittedly, issuance of notice under section 148 of said Act is beyond period of four years from end of relevant assessment year, i.e., assessment year 2005-06. Consequently, there is no dispute that first proviso to section 147 of said Act would be relevant. first proviso to section 147 of said Act is reproduced hereinbelow: "147.... Provided that where assessment under sub-section (3) of section 143 or this section has been made for relevant assessment year, no action shall be taken under this section after expiry of four years from end of relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of failure on part of assessee to make return under section 139 or in response to notice issued under sub-section (1) of section 142 or section 148 or to disclose fully and truly all material facts necessary for his assessment, for that assessment year." facts are that petitioner had filed its return of income on October 31, 2005, whereunder it had claimed deduction of Rs. 6,34,90,243 under section 10B of said Act on ground that it is 100 per cent. export oriented unit at Pune which had been set up in assessment year 2000-01 and had earned profit to extent of Rs. 6,34,90,243 which were not exigible to tax on account of fact that it was engaged in manufacturing/production activity in said unit. According to petitioner, it was engaged in business of manufacturing/processing of raw beads into finished imitation pearls. assessment order was passed by Assessing Officer on November 28, 2008, under section 143(3) of said Act after incorporating order passed by Transfer Pricing Officer (TPO) under section 92CA of said Act with regard to computation of arm's length price in relation to international transactions with associated enterprises reported in Form 3CEB. Thereafter, notice under section 154 of said Act was issued on April 21, 2010, whereby it was proposed that deduction of Rs. 6,34,90,243 claimed under section 10B of said Act ought to be disallowed inasmuch as petitioner had undertaken activities on "job work" basis. There was another proposal also that "other income" of Rs. 1,32,97,000 had not been taxed separately and had been included in deduction claimed under section 10B of said Act. petitioner filed detailed submissions in reply to said notice on May 24, 2010. petitioner indicated that it would eligible for deduction under section 10B of said Act for Pune unit inasmuch as petitioner was engaged in manufacturing/production of finished imitation pearls after carrying out processing activities on raw beads. On submission of said reply by petitioner, no further action was taken by Department pursuant to said notice under section 154 of said Act. In meanwhile, notice under section 148 of said Act had been issued on March 19, 2010, within period of four years from end of relevant assessment year (i.e., 2005-06). said notice culminated in reassessment order dated October 26, 2010. Subsequent thereto impugned notice dated March 23, 2012, was issued under section 148 of said Act. purported reasons for issuance of said notice were also furnished to petitioner. Thereafter, petitioner filed its objections dated January 14, 2013, which have been rejected by virtue of order dated February 25, 2013. It is in this background that present writ petition has been filed challenging notice dated March 23, 2012, and order dated February 25, 2013. point urged by Mr Syali, learned senior counsel appearing on behalf of petitioner, was that in case where proviso to section 147 of said Act was applicable, it must be clearly indicated that escapement of income was on account of failure on part of assessee to fully and truly disclose all material facts necessary for assessment. Mr Syali took us through purported reasons behind issuance of notice under section 148 of said Act. purported reasons as indicated by Assistant Commissioner of Income-tax were as under: original assessment under section 143(3) was completed in November 28, 2008, at Rs. 64,36,160 under section 143(3) as against returned loss of Rs. (-) 4,71,20,033. perusal of records revealed that assessee had claimed deduction under section 10B on Pune unit amounting to Rs. 6,34,90,243 as 100 per cent. export oriented undertaking, which undertook Reasons activities on job work basis. This section applies to for belief that any undertaking which manufacturing or produces 1 income has any article on things or computer software. Hence, escaped deduction under section 10B should have been assessment disallowed. This has resulted in incorrect allowance of deduction under section 10B amounting to Rs. 6,34,90,243. Secondly, assessee has not taken income from other sources to tune of Rs. 1,32,97,000 separately and included in deduction which should have been separately considered and taxed. mistake resulted in under assessment of income to tune of Rs. 1,32,97,000 involving potential tax effect. I have, therefore, reason to believe that amount of Rs. 7,67,87,243 has escaped assessment within meaning of section 147(c) of Income-tax Act, 1961. escapement of income has been by reason of failure on part of assessee to disclose fully and truly all material facts necessary for assessment. Since assessment has been completed under section 143(3) of Income-tax Act, 1961, and four years have since elapsed, assessment record is being submitted for kind perusal and approval under section 151(1) of Income-tax Act, 1961, for issuance of notice under section 148 of Income- tax Act, 1961. On going through above reasons, it is evident that while Assessing Officer mentioned that income had escaped assessment because of failure on part of assessee to fully and truly disclose material facts for assessment, he has not indicated as to which material fact had not been fully and truly disclosed by assessee. Presumably material fact could have been fact that assessee was carrying out its activities at its Pune unit on "job work" basis. In this backdrop, point we have to consider in this case is whether petitioner had, in fact, failed to disclose fully and truly all material facts which were necessary for purposes of assessment. learned counsel for petitioner placed reliance on decision of this court in case of Haryana Acrylic Manufacturing Co. v. CIT [2009] 308 ITR 38 (Delhi). While considering provisions of sections 147 and 148 of said Act in particular first proviso thereof, this court observed as under (page 57): "In reasons supplied to petitioner, there is no whisper, what to speak of any allegation, that petitioner had failed to disclose fully and truly all material facts necessary for assessment and that because of this failure there has been escapement of income chargeable to tax. Merely having reason to believe that income had escaped assessment, is not sufficient to reopen assessments beyond four year period indicated above. escapement of income from assessment must also be occasioned by failure on part of assessee to disclose material facts, fully and truly. This is necessary condition for overcoming bar set up by proviso to section 147. If this condition is not satisfied, bar would operate and no action under section 147 could be taken. We have already mentioned above that reasons supplied to petitioner does not contain any such allegation. Consequently, one of conditions precedent for removing bar against taking action after said four year period remains unfulfilled. In our recent decision in Wel Intertrade P. Ltd. [2009] 308 ITR 22 (Delhi) we had agreed with view taken by Punjab and Haryana High Court in case of Duli Chand Singhania [2004] 269 ITR 192 (P&H) that, in absence of allegation in reasons recorded that escapement of income had occurred by reason of failure on part of assessee to disclose fully and truly all material facts necessary for his assessment, any action taken by Assessing Officer under section 147 beyond four year period would be wholly without jurisdiction. Reiterating our view-point, we hold that notice dated March 29, 2004, under section 148 based on recorded reasons as supplied to petitioner as well as consequent order dated March 2, 2005, are without jurisdiction as no action under section 147 could be taken beyond four year period in circumstances narrated above." (underlining added) same view has been expressed in Rural Electrification Corporation Ltd. v. CIT (No. 2) [2013] 355 ITR 356 (Delhi). It may not be out of place here to mention that this court in Microsoft Corporation (I) Pvt. Ltd. v. Deputy CIT W. P. (C.) 284 of 2013 decided on May 23, 2013-since reported in [2013] 357 ITR 50 (Delhi) had observed as under (page 67): "From above, it is evident that merely having reason to believe that income had escaped assessment is not sufficient for reopening assessment beyond four year period referred to above. It is essential that escapement of income from assessment must be occasioned by failure on part of assessee to, inter alia, disclose material facts, fully and truly. If this condition is not satisfied, there would be bar to taking any action under section 147 of said Act." It is clear that escapement of income by itself is not sufficient for reopening assessment in case covered by first proviso to section 147 of said Act unless and until there is failure on part of assessee to disclose fully and truly all material facts necessary for assessment. In present case, it has not been specifically indicated as to which material fact or facts was/were not disclosed by petitioner in course of its original assessment under section 143(3) of said Act. We can, as pointed out above, presume that Assessing Officer had in mind fact that petitioner was carrying out its activities on "job work" basis when he observed that petitioner had failed to disclose fully and truly all material facts. But even on this presumption we find that Assessing Officer was not correct. This is so because in transfer pricing report submitted by assessee it had been clearly indicated that it had processed raw beads to extent of 1,03,213 kgs. into finished imitation pearls in financial year 2004-05 which related to assessment year 2005-2006. entire process had been set out in transfer pricing report as under: "The following are steps of processing carried out by SIPL: 1. Raw beads are examined by SIPL; 2. Raw beads are fixed on frames; 3. Beads are dipped in lacquer based on nitro cellulose (made of nitro cellulose, butyl acetate and ethanol) within DSW developed machinery supplied to EOU. 4. Subsequent to dipping glass beads are subjected to several coating processes, which impart qualities of pearl. 5. Beads are then enameled. 6. After dipping and coating, semi-finished pearls are pre-dried and removed from frames. 7. Thereafter, pearls are baked in ovens to ensure that layers coated on glass beads are permanently stable. 8. next step is to wash pearls in soft water to remove any extraneous material. 9. Process of visual quality control. 10. Quality control is carried out on standard operating procedures of DSW. 11. Pearls are knotted, packed, babeled and sent back to DSW." Apart from this, in course of original assessment proceedings petitioner, in response to notice under section 143(2) and section 143(1) of said Act submitted information on point raised by Assessing Officer with regard to business activity of petitioner. petitioner had submitted letter dated September 9, 2008, which clearly indicated as under: "2. Point 2. Brief note on business activity. Swarovski India Pvt. Ltd. is group company of Swarovski AG, Austria and has two divisions in India, viz., Pune unit and Delhi unit. Pune unit is 100 per cent. export oriented unit (EOU) and is undertaking activities such as coating of raw beads, polishing, stringing and knotting, quality control customs bonded warehousing etc. on job work basis." (underlining added) It is evident from above that petitioner had categorically stated that Pune unit was 100 per cent. export oriented unit and was undertaking activities on raw beads such as coating, polishing, stringing and knotting, etc., on "job work basis". Therefore, it is abundantly clear that petitioner had on specific query raised by Assessing Officer informed Assessing Officer that it was carrying out manufacturing/production activity on "job work basis". It may be further pointed out that even in reassessment order dated October 26, 2010, pursuant to first reassessment notice for this very year, i.e., assessment year 2005-06, Assessing Officer has categorically noted that petitioner was engaged in business of manufacturing/ processing imitation pearls and in business of import and sale of crystal and related items in India. From this, also, it is evident that entire activity and particularly nature of manufacturing/production activity carried out by petitioner "on nature of manufacturing/production activity carried out by petitioner "on job work basis" was clearly revealed before Assessing Officer in original round as well as in round of reassessment. Therefore, statement of Assessing Officer in purported reasons in support of impugned notice dated March 23, 2012, that there had been failure on part of petitioner- assessee to fully and truly disclose material facts, is completely belied by records of case. Consequently, notice dated March 23, 2012, as also order dated February 25, 2013, are liable to be quashed and set aside. It is ordered accordingly. All proceedings pursuant to said notice dated March 23, 2012, also stand quashed. writ petition is allowed. There shall be no order as to costs. *** Swarovski India P. Ltd. v. Deputy Commissioner of Income-tax