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TMI Blog1990 (7) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... casion, his return was supported by the report of an approved valuer and the valuation placed upon the plot in question was accepted by the Wealth-tax Officer and assessments made. While so, the petitioner entered into an agreement with a third party, agreeing to sell the said plot of land for a consideration of twenty-five lakhs of rupees. The agreement was entered into in the year 1986. With view to enable him to execute a sale deed, he applied to the Income-tax Department for an income-tax clearance certificate from the contents of the application for the clearance certificate, the Wealth-tax Officer came to know that the said plot was being sold for rupees twenty-five lakhs. Thereupon he issued the impugned notices proposing to value the plot in question on the basis of the said consideration amount for all the assessment years 1979-80 to 1986-87. The petitioner's contention is that there was no concealment or failure to disclose this asset or its value on his part in any of the said assessment years and, therefore, the notice issued proposing to revise the assessment in respect of the previous eight years in incompetent and beyond the jurisdiction of the Wealth-tax Officer. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the omission or failure on the part of any person to make a return under section 14 of his net wealthy or the net wealth of any other person in respect of which he is assessable under this Act for any assessment year or to disclose fully and truly all material facts necessary for assessment of his net wealth or the net wealth of such other person for that year, the net wealth chargeable to tax has escaped assessment for that year, whether by reason of underassessment or assessment at too low a rate or otherwise ; or (b) has, in consequence of any information in his possession, reason to believe, notwithstanding that there has been no such omission or failure as is referred to in clause (a), that the net wealth chargeable to tax has escaped assessment for any year, whether by reason of underassessment or assessment at too low a rate or otherwise; he may, in cases falling under clause (a) at any time within eight years and in cases falling under clause (b) at any time within four years of the end of that assessment year, serve on such person a notice containing all or any of the requirements which may be included in a notice under sub-section (2) of section 14, and may procee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xtent of the previous four years. We are in respectful agreement with the said decision of the Bench of the Delhi High Court. Sri Vikram Gulati, learned counsel for the assessee, however, contended that the course adopted by the Delhi High Court cannot be adopted in this case for two reasons: (i) Though the impugned notices did not specify whether they are issued under clause (a) or clause (b) of section 17(1) of the Act, it is clear from the record as well as from the fact that assessments of previous eight years were sought to be reopened that the notices were under clause (a) of section 17(1). Thus, there is no ambiguity about the clause under which the impugned notices were issued. (ii) In Raghubar Dayal Ram Kishan's case [1967] 63 ITR 572, this court held that a notice under clause (a) of section 34(1) of the Indian Income-tax Act, 1922, could not be converted into a notice under clause (b) thereof inasmuch as both the clauses contemplated two distinct and mutually independent jurisdictions. This decision is binding on this Bench and, therefore, the impugned notices must be quashed in full. In Raghubar Dayal Ram Kishan's case [1967] 63 ITR 572 (All), there arose a differen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made under clause (a) to one under clause (b)." In the case before us, we are not concerned with the Tribunal's power, nor with the situation considered in the said decision of this court. We are at the stage of issue of notice itself. The question is whether the notice should be quashed in full on the ground that it appears relatable to section 17(1)(a) of the Act. In this context, it must be remembered that the impugned notice does not say whether it is issued under clause (a) or clause (b). It, no doubt, proposes to reopen the assessments of the previous eight years. But, a reading of the " reasons recorded" (which have been extracted hereinbefore) does show that the Wealth-tax Officer was treating the contents of the application made by the assessee for the income-tax clearance certificate as an information and, on that basis, seeking to reopen the assessments. It is not the clause which he mentions that Since the "reasons recorded" are relatable to section 17(1)(b), it would be appropriate to sustain the notices under that clause, notwithstanding the fact that the Wealth-tax Officer has expressed an opinion that the case attracted his power under section 17(1)(a). Learned co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the assessment was reopened under section 17(1)(a) and not under section 17(l)(b). The Tribunal had not considered the question of applicability of section 17(1)(b). In those circumstances, it was held by the court that, at the stage of reference, it could not consider the applicability of section 17(1)(b). So far as the Calcutta decision is concerned, the facts and the principle of that case are wholly unrelated to the facts and controversy in the case before us. We do not, therefore, think it necessary to deal with the same at any length. We must make it clear that we are not dealing with a situation where valuation of an asset for previous assessment years was being made under rule 1BB of the Wealth-tax Rules, that is, on the basis of rental valuation. Probably, such a case will stand on a different footing. We need express no opinion in that behalf. For the above reasons, the writ petitions are allowed in part. The impugned notices shall be construed as having been issued under clause (b) of section 17(1) and not under clause (a) thereof. Accordingly, the notices shall be confined to the assessment years 1983-84, 1984-85, 1985-86 and 1986-87. They are quashed in so far ..... X X X X Extracts X X X X X X X X Extracts X X X X
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