1970 (3) TMI 35 - HC - Income Tax

Estate Duty Act, 1953 - Notice for Reassessment -property chargeable to duty as escaped assessment - whether the notice should contain details of property that had escaped assessment

Summary

Issues Involved:
1. Validity of the notice under Section 59 of the Estate Duty Act.
2. Jurisdiction of the assessing authority to reopen the matter.
3. Limitation period for reassessment under Section 73A of the Estate Duty Act.

Issue-wise Detailed Analysis:

1. Validity of the Notice under Section 59 of the Estate Duty Act:
The petitioners contended that the notice dated January 31, 1967, was vague and did not comply with the requirements of Section 59 of the Estate Duty Act. Section 59 empowers the Controller to reassess the property that has escaped assessment. The court held that under Section 59, the Controller merely needs to require the accountable person to submit an account as required under Section 53. It is not mandatory for the notice to specify the property that has allegedly escaped assessment. The court emphasized that the statute does not cast a responsibility on the Controller to detail the property in the notice. The court concluded that the notice under Section 59 was valid, and the contention raised by the petitioners had no force.

2. Jurisdiction of the Assessing Authority to Reopen the Matter:
The petitioners argued that the assessing authority had no jurisdiction to reopen the matter, especially when all material facts were before it during the initial assessment. The court clarified that under Section 59(b), the Controller can reassess if he has some information in his possession that leads him to believe that any property chargeable to estate duty has escaped assessment. The court examined the note by which the Controller commenced the reassessment proceedings, which relied on additional information that came to light during the appeal stage. The court found that the information from the appellate order and the deposition of the deceased were valid grounds for the Controller to reopen the assessment. The court held that the Controller had jurisdiction to commence reassessment proceedings under Section 59(b) as the basic requirements for assuming jurisdiction were satisfied.

3. Limitation Period for Reassessment under Section 73A of the Estate Duty Act:
The petitioners contended that if the notice dated January 31, 1967, was ignored and the letter dated February 19, 1969, was treated as the notice under Section 59, the reassessment proceedings would be barred by limitation under Section 73A. The court rejected this argument, stating that the notice dated January 31, 1967, was a valid notice under Section 59, and the letter dated February 19, 1969, was not a notice under Section 59 but merely a request for further information. The court concluded that the reassessment proceedings were not barred by limitation, as the notice issued on January 31, 1967, was within the permissible period.

Conclusion:
The court dismissed the writ petition, holding that the notice under Section 59 was valid, the Controller had jurisdiction to reopen the assessment based on new information, and the reassessment proceedings were not barred by limitation. The petitioners were directed to raise any further objections before the Controller during the reassessment proceedings. The writ petition was dismissed with costs.