New Portman Ltd. v. Jayawardena and Two Others – sllr 1989 volume 1 page 307

In the case between New Portman Ltd. (and its substituted petitioner, the widow of E.D. Gunaratne) and Jayawardena and Two Others (Department of Inland Revenue officials), the court addressed the adequacy of reasons given by the tax assessor for rejecting a company’s income tax return. The court held that mere conclusory statements do not satisfy the statutory requirement to provide adequate and intelligible reasons under Section 115(3) of the Inland Revenue Act No. 28 of 1979, and that failure to sufficiently confront the assessee with pertinent grounds constitutes a breach of natural justice. The principle reaffirmed was that a tax authority must grant sufficient notice of the basis for rejecting a return to enable the taxpayer to respond, as supported by relevant case law. The decision