TMI Blog1981 (7) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... d returned the market value of the palace at Rs. 3,77,200 on the basis of the valuation report. In view of this valuation made by the valuers, the WTO reopened the wealth-tax assessments for the assessment years 1961-62 to 1967-68 and reassessed the net wealth of the assessee. He completed the wealth-tax assessments for these years after taking into account the enhanced valuation of the palace. The market value of the palace was taken at Rs. 2,25,000 for the assessment year 1961-62 and Rs. 3,77,200 for the assessment year 1967-68. The market value for the remaining assessment years varied between these two amounts. In the appeals preferred by the assessee, the AAC held that there was no justification to reopen the assessment in any of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lea for the assessment years 1966-67 and 1967-68 was concerned, the Tribunal held that the WTO having initiated the proceedings under s. 17(1)(b), it was not open to the revenue to contend that, on the facts on record, the reopening of the assessment was justified under s. 17(1)(b) of the Act. In the result, the Tribunal did not consider the question whether the reopening of assessments was justified under s. 17(1)(b). On the above facts and in the circumstances of the case, the following questions have been referred to us for our opinion under s. 27(1) of the Act: " 1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the Wealth-tax Officer was not justified in reopening the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. Under the circumstances, we agree with the view taken by the Tribunal that the assessee's case does not fall under s. 17(1)(a) of the Act. We, therefore, answer question No. 1 in the affirmative and against the revenue. The Tribunal, however, was not right in holding that it was not open to the revenue to justify the action of the WTO in reopening the assessment for the assessment years 1966-67 and 1967-68 under s. 17(1)(b) of the Act. The notice under which the assessments were reopened did not mention whether the reopening was under s. 17(1)(a) or under s. 17(1)(b). However, in his assessment orders passed after the reopening of the assessments, it was stated that the assessments were made under s. 16(3) read with s. 17(1)(a) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e High Court in Mriganka Mohan Sur v. CIT[1974] 95 ITR 503, rendered in the context of s. 34(1) of the Indian I.T. Act, 1922. In Mriganka Mohan Sur's case, [1974] 95 ITR 503, the Calcutta High Court took the view that where the reassessment made under s. 34(1)(a) of the Indian I.T. Act, 1922, is set aside by the Appellate Tribunal, it is open to the Tribunal to treat the reassessment as one properly, made under s. 34(1)(b) provided that on the materials on record all the necessary conditions under s. 34(1)(b) are satisfied. The Calcutta High Court distinguished the decision of the Supreme Court in Johri Lal v. CIT [1973] 88 ITR 439 rendered in the context of s. 34(1)(a) of the Indian I.T. Act which was in altogether different terms. Therein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... immaterial whether a notice for reopening an assessment was issued under cl. (a) or cl. (b) of sub-s. (1) of s. 17. If, on the facts on record, the requirement of cl. (b) of sub-s. (1) of s. 17 is satisfied, the action of the WTO in reopening the assessment can be justified. If the facts on record constitute information, which call for a reassessment of the assessee's assets and wealth, the action of reopening the assessment can be justified under s. 17(1)(b) of the Act. Similar view has been taken by the Delhi High Court in Avtar Singh Sandhu v. WTO [1981] 129 ITR 531. The Tribunal, in our opinion, therefore, was not right in rejecting the contention of the revenue. Answer to question No. 2 must, therefore, be in the negative and against ..... X X X X Extracts X X X X X X X X Extracts X X X X
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