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Reassessment proceedings under section 17(1)(a) of the Wealth-tax Act, 1957 for consecutive assessment years 1971-72 to 1975-76. Validity of the initiation of reassessment proceedings. Disclosure of material facts by the assessee. Acceptance of family settlement regarding Mardana Mahal. Reopening of assessment based on unregistered document. Justification for reassessment on the ground of nondisclosure of compensation received. Analysis: The judgment pertains to reassessment proceedings initiated under section 17(1)(a) of the Wealth-tax Act, 1957 for the assessment years 1971-72 to 1975-76 concerning the assessment of wealth tax of the assessee. The Wealth-tax Officer initiated reassessment proceedings based on the opinion that certain values had escaped assessment. However, both the Appellate Assistant Commissioner and the Income-tax Appellate Tribunal held that the proceedings were not validly initiated as all material facts necessary for assessment were disclosed by the assessee during the original assessment, and there was no omission or failure on the part of the assessee in disclosing relevant information. Regarding the addition of the value of Mardana Mahal, the assessee argued that a family settlement had taken place, and the document supporting this settlement was produced before the assessing authority during the original assessment. The Wealth-tax Officer's change of opinion regarding the validity of the family settlement, based on an unregistered document, was deemed unjustified by the Appellate Tribunal. The Tribunal emphasized that the mere change of opinion does not warrant reassessment under section 17(1)(a) of the Act. Citing the Indian and Eastern Newspaper Society case, the Tribunal highlighted that reassessment based on an internal audit party report does not constitute valid grounds for reassessment if all material facts were disclosed during the original assessment. The Tribunal also noted that the assessee had already disclosed the compensation received under the voluntary disclosure scheme, and the assessments were completed before the reassessment notices were issued. Consequently, there was no valid reason for the reassessment based on the alleged nondisclosure of compensation received. In conclusion, the Income-tax Appellate Tribunal found no legal question arising from the order setting aside the reassessment proceedings for the assessment years in question. Therefore, all applications were dismissed, emphasizing that there was no justification for reassessment based on the disclosed facts and no order was issued regarding costs.
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