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TMI Blog1998 (2) TMI 73X X X X Extracts X X X X X X X X Extracts X X X X ..... elled ?" The reassessment for those years came to be made on the basis of a report given by the audit party to the Assessing Officer, and in the order of reassessment made on October 30, 1976, the Wealth-tax Officer has stated, inter alia, in the assessment order, that "at the time of the audit of the record, the Revenue audit pointed out the resultant inadequacy in the intrinsic value of the unquoted shares due to excess deduction of liability over and above what is contemplated under Explanation II(ii)(e) of rule 1D of the Wealth-tax Rules, 1957". The inadequacy in the intrinsic value was stated by the Wealth-tax Officer to have been the result of an omission in the original order of assessment to apply rule 1D, Explanation (II)(ii)(e) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uence of the law which has now come to his notice, he can reasonably believe that income has escaped assessment. The opinion rendered by the audit party in regard to the law cannot, for the purpose of belief of the Assessing Officer "add to or colour the significance of such law. The true evaluation of the law in its hearing on the assessment must be made directly and solely by the income-tax Officer". The Tribunal was of the view that the reliance placed by the Assessing Officer on the report of the audit party which had not merely drawn the attention of the Assessing Officer to the law, but had Coloured his view of the law did not constitute "information" on the basis of which, the concluded assessment could be reopened and a fresh assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing Officer to the contents of the rule, and that it had not coloured his view of the rule. The view that he had adopted was the one which was found to be the one which the High Court had regarded as correct, though subsequently, the Supreme Court held otherwise. In this background, it is clear that the Wealth-tax Officer had at the time of the original assessment, kept in mind the requirements of rule 1D of the Rules, had interpreted the same in a certain manner, and, thereafter determined the value of the shares. The fact that he changed his view after the audit party pointed out the possibility of reading rule 1D in a different manner would not provide sufficient basis in law for reopening the assessment which was otherwise validly ..... X X X X Extracts X X X X X X X X Extracts X X X X
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