Sabyasachi Mukharji, J.
1. The subject-matter of challenge in this application under Article 226 of the Constitution is a notice dated 7th January, 1976. The said notice was issued under Section 148 of the Income-tax Act; 1961 for reopening the assessment for the assessment year 1972-73. The petitioner No. 1 is a limited company. The petitioner No. 1's assessment was completed for the relevant assessment years in accordance with law. The petitioners state that they have complied with all the requirements of the Income-tax Officer for the completion of the assessment of the petitioner No. 1. The petitioner No. 1 showed in his return for the relevant assessment year a loan of Rs. 1,10,000 alleged to have been received from one Manickchand Mohanlal. The petitioner No. 1 produced the confirmation slip of the alleged lender as well as the income-tax file number of the said alleged lender. By the impugned notice the said assessment has been sought to be reopened. The petitioners contend that there were no materials for reopening of the said assessment. In answer to the rule nisi, issued in this case on behalf of the respondents, it has been stated as follows ;
(a) The assessee, petitioner No. 1, is being regularly assessed to income-tax for a number of years. For the assessment year 1972-73, assessment was made by the Income-tax Officer on an income of Rs. 1,86,770 on 31st October, 1972. The aforesaid assessment figure was arrived at after giving effect to certain reliefs allowed by the Appellate Assistant Commissioner of Income-tax, Calcutta.
(b) In the course of the aforesaid assessment proceedings the assessee had shown loan credits in the names of various parties. The assessee also had filed a confirmation letter relating to the loan from M/s. Manickchand Mohanlal from whom a loan of Rs. 1,10,000 in cash was alleged to have been received on 16th September, 1971. The assessment file No. of the money-lender, Manickchand Mohanlal, was also given. The Income-tax Officer duly forwarded the confirmation letter, furnished by the assessee, to the Income-tax Officer, 'D' Ward, Dist. 1(1), Calcutta, who was assessing M/s. Manickchand Mohanlal.
(c) On 17th December, 1975, the Income-tax Officer, 'D' Ward, Dist. 1(1), Calcutta, informed the Income-tax Officer assessing the petitioner-company that he had issued a notice in terms of Section 131 in the name of Manickchand Mohanlal and one Manick Chand Baid had appeared before the Income-tax Officer on 11th December, 1975, and had confessed that the business carried on in the name of Manickchand Mohanlal had indulged in name-lending business only and no money-lending business was carried on by M/s. Manickchand Mohanlal. A copy of the deposition of Shri Manick Chand Baid is annexed herewith and marked 'A'.
(d) Having received and read the aforesaid report from the Income-tax Officer in-charge of assessment of Manickchand Mohanlal, and after going through the various documents produced and statements made by the petitioner-company at the time of the original assessment, I had reason to believe that by reason of failure on the part of the assessee to disclose fully and truly all materials necessary for its assessment income chargeable to tax had escaped assessment and hence a notice under Section 148 of the Income-tax Act, 1961, was issued to the assessee-company after duly recording the reasons for issuing the aforesaid notice.
2. At the hearing of this application the learned counsel for the petitioners drew my attention to the deposition of Manick Chand Baid and contended that from the deposition no reasonable person having the faculty of reasoning could have come to the conclusion that there was non-disclosure or failure to disclose relevant or material facts at the time of the original assessment. He drew my attention to question No. 5, question No. 14 and to other questions. The learned counsel's main contention was that though Manick Chand Baid had stated that his firm, M/s. Manickchand Mohanlal, had only acted as name-lender, Manick Chand Baid himself, in his personal capacity, had occasionally done money-lending business. On the basis of the aforesaid, on behalf of the petitioners, it was contended that there were no materials to show that the income of the assessee had escaped assessment due to the failure or omission on the part of the assessee. The learned counsel drew my attention to the decision of the Kerala High Court in the case of Sujir Ganesh Nayak & Co. v. Income-tax Officer : 104ITR524(Ker) . He also relied on the decisions in the case of B. P. Jain v. Commissioner of Income-tax : 105ITR195(Patna) , Smt. Nirmala Birla v. Wealth-tax Officer : 105ITR483(Cal) [FB] and Lakhmani Mewal Das v. Income-tax Officer : 99ITR296(Cal) [FB]. It is well settled that there must be materials at the time or prior to the issue of a notice for the reopening of an assessment that there has been failure or omission on the part of the assessee to disclose fully or truly all relevant material facts at the time of the reopening of the assessment. If there are some materials for thinking that there has been some non-disclosure then the court is not concerned with the sufficiency of the material's. In the instant case, the genuineness of the transactions of Manickchand Mohanlal is in question. There are some materials for thinking that there was no full disclosure regarding the transaction. The position is corroborated by the subsequent disclosure in the petition made by one of the directors of the assessee-company, Mr. Mahabir Prosad Murarka, a copy of which and the accompanying letter dated 20th January, 1977, written by the petitioner-company was produced before me. The said letter written by the director of the petitioner-company dated 20th January, 1977, states as follows :
' Dear Sir,
Please refer to your above notices and the discussion our authorised representative, Mr. G. L. Kedia, had with your honour on 20-1-77 ; we have to state that Mr. M. P. Murarka, one of the directors of the company, had made a voluntary disclosure under the Voluntary Disclosure of Income Wealth Ordinance. He filed his disclosure petition on 31-12-75. We are given to understand that the disclosure made by the said Mr. M.P. Murarka, inter alia, covers the amount of Rs. 1,10,000 appearing in the books of the company in the name of M/s. Manickchand Mohanlal. It has been admitted by Mr. M. P. Murarka in his disclosure petition that the amount of Rs. 1,10,000 is actually his concealed income, which has been invested with the company in the name of Manickchand Mohanlal (the name-lender).
We are enclosing herewith a photo copy of the certificate issued by the C.I.T., W.B.-XII, accepting the disclosure made by Mr. M. P. Murarka We, therefore, request your honour that the disputed amount is covered by the disclosure petition of Mr. M. P. Murarka, one of the directors of the company.
Hence, in all fairness and justice your honour is requested to accept the genuineness of the loan so far as the company is concerned.
The Murarka Paint & Varnish Works Ltd.,
3. On behalf of the revenue reliance was placed on the aforesaid letter in support of the argument that the genuineness of the transaction was admitted by the assessee-company to be not correct. On the other hand, on behalf of the petitioners, it was contended that the act of a director was not the act of the company and the company was not bound or estopped by the aforesaid letter of the director. Reliance was placed on Buckley on the Companies Acts, 13th edition, page 378, In re Marseilles Extension Railway Company : Ex parte Credit Fonder and Mobilier of England  7 Ch App 161 and In re David Payne & Co. Ltd. : Young v. David Payne & Co. Ltd.  2 Ch 608. I would not go into the question whether the act of the director is an act of the company in determining the controversy in this case. For the present, it must also be noted that the subsequent disclosure will not be any material for issuing the notice dated 7th January, 1976. Whether there were materials for issue of the notice must be judged with reference to the position prior to the issue of the notice. As I have held that there were some materials to think that there was not full disclosure about the loan transaction of M/s. Manickchand Mohanlal with the assessee-company, the subsequent disclosure petition merely corroborates that position. In the aforesaid view of the matter, the challenge to the notice cannot be sustained.
4. In the view that I have taken it is not necessary for me to embark on the question whether the petitioners have any alternative remedy which entitles the petitioners to the reliefs under Article 226 of the Constitution.
5. For the reasons as aforesaid, this application fails and is dismissed.
6. There will, however, be no order as to costs.