The reassessment notice was issued on the ground that the loan advanced to its associated enterprise (MMG) amounted to an “International transactions” which was required to be referred to the Transfer Pricing Officer (TPO) and such reference was not made during the original proceedings.  The objection of the assessee was rejected by the Assessing Officer. On writ allowing the petition the Court held that     when the assessee had furnished every detail as required in the prescribed form, and the Assessing Officer in the proceedings under section 143(2) of the Act examined the very transaction, the Department could not dispute that the value of the loans and advances could be within the knowledge of the Assessing Officer. In fact, it was obvious on a perusal of the assessment order that the interest on this very loans and advances was brought to tax with reference to the value of this transaction. Therefore, it would be reasonable to opine that the Assessing Officer, upon examination of the transaction, found no prima facie reason for referring the loan transaction to the Transfer Pricing Officer. The Department did not dispute that both the source of income and the subject investment were mentioned in the books of account, and the Department also did not contend that the assessee did not have the necessary resources to make such investment. The Department had failed to establish that the assessee had either omitted or failed to disclose material circumstances or that there was reason even for a subjective belief that any income had escaped tax. The notice of reassessment and consequent proceedings were held to be invalid. (AY. 2012-13)