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Section 147(b) of the income-tax act, 1961 - Reassessment - information Original assessment completed after full enquiry assessment reopened on a mere change of opinion by ITO Whether tribunal right in holding reopening as invalid in law Held, yes Facts The assessee was the daughter of ruler of Alwar. Her marriage did not work out and, under a separation agreement dated 15-10-1958, she received an aggregate amount of Rs. 9 lakhs comprising (i ) Rs. 4 lakhs representing lump sum maintenance allowance for her life time, (Rs. 3 lakhs from her father-in-law and Rs. 1 lakh from her husband), in lieu of the monthly maintenance allowance of Rs. 600 discontinued by her in-laws; (ii) Rs. 4 lakhs towards return of Tilak money, etc.; and (iii ) Rs. 1 lakh for Chundri and Badla jewellery. After obtaining all such details and the relevant agreements under which these amounts were paid, the ITO completed on 28-2-1962 the regular assessment for the assessment year 1959-60 on a total income of Rs. 10,947. However, the ITO issued a notice under section 148, read with section 147(6), on 4-3-1964 and completed the reassessment on 29-10-1964, including Rs, 5 lakhs in such reassessment, while the AAC upheld the validity of the reassessment proceedings, he reduced the addition to Rs. 4 lakhs. On further appeal, by a majority decision, the Tribunal held the reassessment proceedings as invalid. On reference: Held After considering the entire matter before completion of assessment, the ITO had taken a decision that no part of the amount received by her under the separation agreement was taxable in her hands. There was nothing to show that he had received any fresh information either in her case or otherwise to provide with any reason to believe that his earlier view was wrong. The ITO had merely reappraised the very same material obtained earlier and, taking a different view, initiated reassessment proceedings. This action was without legal warrant under section 147(b ). The Tribunal was, accordingly, right in holding the reassessment proceedings as invalid. Case Review Indian & Eastern Newspaper Society v. CIT [1979] 2 Taxman 197 (SC) followed. Editor's Note In view of its…

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