Audit objection cannot justify reassessment; reopening notice under estate duty law was held invalid and quashed.

A reassessment notice under section 59 of the Estate Duty Act, issued on the basis of an audit objection about property valuation, was held invalid. The Court treated section 59 as pari materia with the pre-1989 reassessment provision in section 147 of the Income-tax Act and applied the settled rule that an audit report is not information sufficient to reopen a concluded assessment. On that basis, the impugned notice could not lawfully sustain reopening and was quashed in favour of the assessee.

---

---

Issues: Whether the notice reopening the estate duty assessment under section 59 of the Estate Duty Act, based on an audit objection relating to valuation of property, was valid.

Analysis: The reopening was shown on the materials before the Court to have been initiated on the basis of observations made by the audit authority. Section 59 of the Estate Duty Act was treated as being in pari materia with section 147 of the Income-tax Act as it stood before the 1989 amendment. On that basis, the Court applied the settled principle that an audit report cannot constitute information sufficient to found reassessment proceedings.

Conclusion: The reopening notice was invalid and was quashed, in favour of the assessee.

Final Conclusion: The writ petition succeeded because reassessment could not be founded on an audit report, and the impugned notice was set aside.

Ratio Decidendi: An audit objection does not amount to information that can lawfully justify reopening of a concluded assessment under a reassessment provision in pari materia with section 147 of the Income-tax Act.

---