TMI Blog1983 (7) TMI 46X X X X Extracts X X X X X X X X Extracts X X X X ..... d to be too low when compared with the value of the property, which was admitted to be two lakhs of rupees in 1975-76 by the assessee, the assessing authority, by invoking his powers under s. 147(b), reopened the assessment for the assessment year 1971-72 and determined the annual letting value of the property at Rs. 12,000 under s. 23(1) of the I.T. Act, 1961. On appeal by the assessee, the AAC held that the rent receipts as returned by the assessee and the value of the building were already on record at the time of the ITO making the original assessment and, as such, there was no fresh material which subsequently came into his possession so as to enable him to reopen the assessment under s. 147(b). In this view, the AAC set aside the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 1975-76 and that will not justify the ITO to reopen the assessment for 1971-72 under s. 147(b). The Tribunal upheld the contention put forward on behalf of the assessee and held that the reopening of the assessment in this case made under s. 147(b) cannot legally be sustained. Aggrieved by the decision of the Tribunal, the Revenue has sought and obtained a reference on the following question of law : " Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that the assessment made under section 147(b) cannot be legally sustained ? " In this case, as will be clear from the facts set out above, at the time of the completion of the income-tax as well as wealth-tax assessments for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erty. Therefore, the reopening of the assessment in this case cannot be taken to be based on new information or material, but it was made only on the change of opinion on the part of the ITO that the rental income was too low in relation to the value of the property. The learned counsel for the Revenue contends that it is not necessary for reopening an assessment under s. 147(b) to have any new or fresh material from which the ITO must come to the conclusion that there had been an underassessment, and that the reopening of the assessment could be made under s. 147 if the ITO informs himself from the materials already on his file that there had been an underassessment. The learned counsel also refers to the provisions under s. 23 of the I. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which the ITO should have reason to believe that the income chargeable to tax had escaped assessment as contemplated by Expln. I to s. 147. In this case, the Tribunal has specifically found, and it is not disputed before us, that excepting the fresh valuation of the property for the assessment year 1975-76 for wealth-tax assessment, there was no other fresh information or material from which the ITO could have entertained the belief that income had escaped assessment. Even assuming that the learned counsel is right in her submissions that there is no necessity for any fresh material or information and the ITO can inform himself from the materials already on record before him for purposes of reopening the assessment, in this case the reopen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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