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TMI Blog2001 (8) TMI 27X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment years 1981-82 to 1988-89. The facts of these appeals are that the Department on the basis of the information/material in the possession of the Department, which pointed to the fact that the assessee was in possession of wealth of a certain value, which had escaped assessment, a notice under section 17 of the Wealth-tax Act, 1957 (hereinafter referred to as "the Act"), was issued in the name of the legal heirs of the assessee on September 12, 1990. No reply was filed in its response. For completing the proceedings initiated under section 17 of the Act, a notice under section 16(2) of the Act was issued which was responded to by the authorised representative of the assessee. The Assessing Officer que ried and sought reply from the authorised representative as to why on the basis of the material on record, the assessment should not be completed since no return of wealth was filed by the assessee. The assessee did not comply with the requirement and accordingly the assessment was completed ex parte under section 16(4) of the Act. The Assessing Officer issued notice under section 17 of the Act on the basis of major audit objections in respect of the assessment years 1981 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice under section 17 of the Act. He would further add that the learned Tribunal without properly appreciating the provisions of law decided the appeals against the appellant-Revenue. It is further submitted that the proviso to section 17(1) of the Act which requires that the Assessing Officer shall, before issuing any notice under this sub-section, record his reasons for doing so was added with effect from April 1, 1989, and prior to it similar provision was not there. The matters pertains to the years 1981-82 to 1988-89 in which there was no mandatory requirement of recording reasons before issuance of notice. According to learned counsel, the law applicable in the relevant assessment year is to be applied and thus the Commissioner of Income-tax (Appeals) and the learned Tribunal have seriously erred in setting aside the assessment orders. It is then submitted that the Assessing Officer had reasons to believe on the basis of the material on record consisting of serious audit objections that wealth of the assessee had escaped assessment. The assessee was required to furnish its wealth-tax returns by issuance of notice under section 17 of the Act and again by the notice issued u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quired by the notice, and may proceed to assess or reassess such net wealth and also any other net wealth chargeable to tax in respect of which such person is assessable, which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under this section for the assessment year concerned (hereafter in this section referred to as the relevant assessment year), and the provisions of this Act shall, so far as may be, apply as if the return were a return required to be furnished under section 14:... Provided that ... for that assessment year: Provided further that the Assessing Officer shall, before issuing any notice under this sub-section, record his reasons for doing so." We have also perused the assessment orders (annexure 1). As already noticed, the legal objection taken by learned counsel for the assessee was with reference to the validity of the notice issued under section 17 of the Act and the assessment completed thereof. It is seen from the order of the Tribunal that the assessments were forwarded to the Assessing Officer for his comments. The Assessing Officer, presently holding additional charge of Circle 3(1), Jaipur, submitted h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "shall" in the second proviso to section 17(1) makes "recording of reasons" before issuance of notice under section 17, certain and mandatory. However, as per the law up to March 31, 1989, recording of reasons was not mandatory under the Wealth-tax Act. In the cases on hand, notices under section 17 of the Act for all the eight assessment years were issued on September 12, 1990. Since the assessment years involved are assessment years 1981-82 to 1988-89, the question would arise whether the issue of notice under section 17 will be covered under the provisions of law existing up to March 31, 1989, or the provisions of substituted section 17 with effect from April 1, 1989? While considering this issue, the Commissioner of Income-tax (Appeals) has held that the provisions of section 17 of the Act are not pari meteria with those of section 147 of the Incometax Act, but they are similar and synonymous. Thus, issuance of notices under section 17 of the Act on September 12, 1990, would be governed and covered by the substituted provisions of section 17 of the Act, which came into force with effect from April 1, 1989. When the matter was taken on appeal before the Tribunal, the same vi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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