Law:

Section:

Section 147(b) of the income-tax act, 1961-Reassessment-Information-ITO completed original assessment by accepting cost of construction of theatre as disclosed by assessee in return supported by registered valuer's report-Whether subsequent report of official valuer estimating cost of construction at higher figure would constitute information within meaning of section 147(b) to confer jurisdiction on ito to reopen assessment-Held, on facts, yes Facts While completing the assessments of the assessee for the relevant assessment years, the ITO accepted the cost of construction of a theatre as disclosed by the assessee in its returns supported by the valuation report of a registered valuer. Subsequently, on a reference made by the ITO, the official valuer estimated the cost of construction of the theatre at a substantially higher figure. Relying on the official valuer's report, the ITO issued notices to the assessee for reopening of the assessments under section 147(b). On writ: Held When an assessment of income is pending, it is open to the ITO to collect all information on the cost of construction furnished by the assessee from all sources including the official valuer under section 55A and complete that assessment in conformity with law. On the point whether the subsequent report furnished by the official valuer after completion of assessment constitutes information as to fact so as to justify the reopening of the assessment, it has been held in K.G. Kemptur v. WTO [W.P. No. 6028 of 1977 and connected cases decided on 30-5-1983], that the subsequent report of the valuation officer, though that was the opinion of that officer, would be a fact within the meaning of that term in section 3 of the Indian Evidence Act and would thus constitute an information as to fact to confer jurisdiction under section 17(1 )(b) of the Wealth-tax Act. Further, the fact that the official valuer's report under the Wealth-tax Act was binding on the WTO and a party has an opportunity to challenge the same hardly make any differences to take a different view in the case of a completed assessment under the Income-tax Act. Therefore, the ITO was justified in reopening the assessment under…

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