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TMI Blog1974 (2) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... in the matter a return in the prescribed form in which the taxable gift was valued at Rs. 1,34,667. This figure was arrived at by computing the value of the two-third interest on the basis of the value of the entire property as shown in the gift deed and by deducting from the said amount a sum of Rs. 10,000 in view of the statutory exemption given under section 5(2) of the Gift-tax Act, 1958 (hereinafter referred to as " the Act " ). It appears that the Gift-tax Officer was not satisfied with the return and he, therefore, issued a notice under section 15(2) on the assessee directing her to produce evidence in support of the return. The assessee accordingly produced before the Gift-tax Officer the report dated July 11, 1968, of a Government approved valuer valuing the entire property in question as on March 31, 1968. The approved valuer valued the super-structures and the land upon which they were constructed together at Rs. 4,69,476. It may be stated that 60 per cent. of the open land comprised in the property in question which was not built upon was not taken into consideration by the approved valuer while evaluating the property since, in his opinion, it had "no value as it is us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... valuation report 60 per cent. of the open land comprised in the property in question was treated as bearing no value at all and that it could not be believed that land situated in the locality in which the land in question was situated could have no value at all. He has further stated : " I say that from the report of the Inspecting Assistant Commissioner, Audit Circle, dated 7th December, 1970, this irregularity was pointed out and in pursuance of the said report my predecessor in office had reason to believe that the gift made by the petitioner for the assessment year 1968-69 had escaped assessment within the meaning of section 16 of the Gift-tax Act. In pursuance of the aforesaid, a notice dated February 18, 1972, being annexure 'F' to the petition, was issued to the petitioner calling upon him to submit within 30 days of the receipt of the said notice the return of gift or gifts made by the petitioner assessable for the assessment year 1968-69." In the submission of the Gift-tax Officer, the information gathered from the audit report amounted to "information" within the meaning of section 16(1)(b) of the Act giving jurisdiction to the Gift-tax Officer to assess or reasse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iginal assessments ; and (2) in consequence of such "information", he should reasonably believe that taxable gift has escaped assessment. This provision is, in all material respects, similar to the provision of section 147(b) of the Income-tax Act, 1961, and the decisions given in the context of section 147(b) would, therefore, be helpful in construing the provisions of section 16(1)(b). Now, so far as section 147(1)(b) of the Income-tax Act, 1961, is concerned, it is well-settled as a result of the decision of the Supreme Court in Commissioner of Income-tax v. A. Raman Company that, "information" in the context in which it occurs in the said provision must mean "instruction or knowledge derived from an external source concerning facts or particulars, or as to law relating to a matter bearing on the assessment". Mere change of opinion on the part of the Income-tax Officer does not constitute "information" so as to entitle the Income-tax Officer to initiate proceedings under section 147(6). On a parity of reasoning, for initiating action under section 16(1)(b), mere change of opinion on the part of the Gift-tax Officer would not be sufficient and it would not constitute "inform ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Any way-side gossip, any inference or surmise drawn by a person from certain facts which are assumed to exist and not supported by any data or any general opinion expressed by a person not qualified, experienced or acquainted with the subject-matter, cannot amount to "information" on which the Gift-tax Officer might act for reopening a completed assessment. It must be remembered that section 16(1) empowers the Git-tax Officer to disturb the finality of an assessment already made and to assess or reassess the taxable gift made by an assessee. Such an action is bound to result in considerable anxiety and harassment to the assessee and the legislature has, therefore, imposed certain conditions, subject to which alone, the Gift-tax Officer can reopen an assessment which is already concluded. These safeguards would be rendered illusory unless the word "information" is given the aforesaid meaning in the context of section 16(1)(b). Let us now proceed to consider whether the abovementioned test is satisfied in the present case so far as the letter of the Inspecting Assistant Commissioner on the basis of which proceedings under section 16(1)(b) have been taken is concerned. The Inspecti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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