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Assessment under Wealth tax Act for the year 1971-72, reopening of assessment under section 17(1)(a) of the Act, justification of reopening assessment based on failure to file return, interpretation of provisions of section 17(1)(a) of the Act, disclosure of primary facts by the assessee, duty of assessing authority to make proper inquiry before reopening assessment. Analysis: The judgment pertains to an assessment under the Wealth tax Act for the year 1971-72, where the assessee failed to file a return in response to the notice under section 14(2) of the Act. Consequently, the assessment was completed ex parte by the Wealth-tax Officer under section 16(5) of the Act, estimating the net wealth of the assessee at Rs. 3,00,000. Subsequently, the assessment was reopened under section 17(1)(a) of the Act on the grounds that the wealth chargeable to tax had escaped assessment due to the assessee's failure to file the return. The Tribunal held that the reopening of the assessment was not justified solely based on the failure to furnish the return, as the primary facts were already disclosed by the assessee in previous assessments for the years 1969-70 and 1970-71. The Tribunal emphasized that the duty of the assessee is to disclose primary facts, and it is the assessing authority's responsibility to draw correct inferences from those facts. The Tribunal found that the assessing officer did not conduct a proper investigation before reopening the assessment, as all primary facts required for assessment were already provided by the assessee. The issue at hand revolved around the interpretation of section 17(1)(a) of the Act, which allows the assessing officer to reopen assessments if there is a failure on the part of the assessee to disclose fully and truly all material facts necessary for assessment. The Tribunal's decision was based on the principle that the duty of the assessee is limited to disclosing primary facts, and it is the assessing authority's duty to make proper inquiries and draw correct inferences from those facts. The Tribunal cited relevant case laws to support its decision, emphasizing that the obligation of the assessee is to disclose primary facts, not inferential facts. The Tribunal held that the assessing officer cannot justify reopening an assessment solely based on the failure to file a return, especially when all primary facts necessary for assessment were already disclosed by the assessee in previous returns. In conclusion, the Tribunal found in favor of the assessee, stating that the duty of the assessee to make a full and true disclosure of all material facts does not absolve the assessing authority from conducting a proper inquiry before reopening an assessment. The Tribunal emphasized that in this case, the underestimation of property value was not solely due to the assessee's failure to file a return, as all primary facts were already disclosed. Therefore, the Tribunal held that the reopening of the assessment under section 17(1)(a) of the Act was not justified solely based on the failure to file a return, and ruled in favor of the assessee against the Revenue.
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