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Issues Involved:
1. Validity of proceedings under section 17(1)(b) of the Wealth-tax Act, 1957. 2. Definition and scope of "information" under section 17(1)(b). 3. Whether the initial assessment constituted an error apparent on the face of the record. Issue-wise Detailed Analysis: 1. Validity of proceedings under section 17(1)(b) of the Wealth-tax Act, 1957: The primary issue was whether the Tribunal was correct in concluding that no new information had been found which had not been obtained at the stage of the original assessment, thereby rendering the proceedings under section 17(1)(b) of the Wealth-tax Act invalid. The original assessment computed the total net wealth at Rs. 10,66,755 and assessed it in the hands of the beneficiary. The successor Wealth-tax Officer later revised this assessment, believing that the original officer had missed the point by treating the entire trust fund as belonging to the beneficiary. The revised assessment was challenged and ultimately led to the Tribunal's decision, which was then referred to the High Court for opinion. 2. Definition and scope of "information" under section 17(1)(b): The court examined the definition and scope of "information" under section 17(1)(b) of the Wealth-tax Act. The section allows the Wealth-tax Officer to reassess if there is reason to believe that the net wealth chargeable to tax has escaped assessment due to under-assessment or other reasons. The court referenced several precedents, including the Supreme Court's decision in Kalyanji Mavji & Co. v. Commissioner of Income-tax, which held that "information" is of the widest amplitude and can come from external sources or from materials already on record. The court contrasted this with the Gujarat High Court's earlier decision in Kasturbhai Lalbhai v. R. K. Malhotra, which required information to be derived from an external source. 3. Whether the initial assessment constituted an error apparent on the face of the record: The court considered whether the initial assessment made by the Wealth-tax Officer was an error apparent on the face of the record. The original assessment did not fully consider the relevant clauses of the trust deed, particularly clauses (3)(b) and (3)(e), which limited the beneficiary's right to the corpus of the trust. The court found that the original Wealth-tax Officer had missed this critical information, constituting an error apparent on the face of the record. This justified the reopening of the assessment under section 17(1)(b). Conclusion: The court concluded that the Tribunal erred in its decision. The successor Wealth-tax Officer was justified in reopening the assessment under section 17(1)(b) based on the error apparent in the original assessment. The court held that the term "information" includes knowledge derived from materials already on record, and not necessarily from an external source. Therefore, the proceedings under section 17(1)(b) were valid. The court answered the question in the negative and in favor of the department, with costs.
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