Reopening on post-assessment information valid when supported by an appellate order, not a mere change of opinion.

For reopening a gift-tax assessment, section 16(1)(b) requires both a belief that taxable gift has escaped assessment and post-assessment information supporting that belief. The text states that "information" can include an external quasi-judicial determination, including an appellate order on the same property for the immediately preceding year. On that basis, the appellate order in the wealth-tax proceedings was treated as valid information, so reopening was upheld. Because the reassessment was founded on that fresh information and not on a mere change of opinion, the Tribunal's order quashing the reassessment was held to be incorrect.

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Issues: (i) Whether the appellate order in the wealth-tax proceedings constituted "information" for reopening the gift-tax assessment under section 16(1)(b) of the Gift-tax Act, 1958. (ii) Whether the Tribunal was correct in quashing the reassessment made under section 16(1)(b).

Issue (i): Whether the appellate order in the wealth-tax proceedings constituted "information" for reopening the gift-tax assessment under section 16(1)(b) of the Gift-tax Act, 1958.

Analysis: The power to reopen under section 16(1)(b) depends on two conditions: the officer must have reason to believe that taxable gift has escaped assessment, and that belief must arise in consequence of information received after the original assessment. The term "information" includes knowledge derived from an external source, including information as to law created or declared by a competent judicial or quasi-judicial authority. The appellate order in the wealth-tax proceedings, relating to the same property and the immediately preceding year, was such an external, quasi-judicial source of information.

Conclusion: Yes. The appellate order in the wealth-tax proceedings constituted information for the purpose of section 16(1)(b), and reopening was valid.

Issue (ii): Whether the Tribunal was correct in quashing the reassessment made under section 16(1)(b).

Analysis: Since the appellate order in the wealth-tax matter supplied valid information and the reopening was not a mere change of opinion, the Tribunal's view that no fresh material existed was incorrect. The reassessment was founded on legally relevant information and satisfied the statutory conditions for reassessment.

Conclusion: No. The Tribunal erred in quashing the reassessment.

Final Conclusion: The reopening of the gift-tax assessment for the relevant year was upheld, and the reassessment survived challenge.

Ratio Decidendi: Information for reopening an assessment may include an appellate or other quasi-judicial determination concerning the same subject matter, and reassessment is valid where the statutory belief is founded on such post-assessment information rather than on a mere change of opinion.

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