TaxTMI 
TaxTMI 
1990 (2) TMI 87
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....ppeals) has erred on facts and in law in setting aside the assessment back to the file of the Deputy Commissioner to be reframed as per his suggestions is contrary to facts and bad in law. 4. Because the authorities below have erred on facts and in law in ignoring and the provisions of Section 4(1)(b), and the Rules prescribed therein which are the proper and correct provisions and should have been strictly followed. 5. Because in any case and in all circumstances of the case, the valuation arrived at by the Deputy Commissioner is arbitrary and is highly excessive, without being based on proper materials and facts. " 3. The assessee was a partner in the firm M/s Bhagwandas Shobha Lal Jain, Sagar, having 1/9th share in the profits of the firm. In his return of wealth, the assessee had declared the value of his interest in the said firm at Rs. 18,42,924, which was the assessee's capital balance in the firm. Net wealth was shown at Rs. 20,91,900, and the assessment was completed on 8th February, 1984 on the figure as disclosed by the assessee. Thereafter, the IAC (Asst.), Jabalpur, vide his letter dated 10th July 1985, had made a reference to the District Valuation Officer, J....
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....any particular asset should be picked up from the balance sheet of the assessee firm. (v) That the valuation report may be given to the assessee and he should be allowed to cross examine the District Valuation Officer. " 5. The assessing officer rejected the contentions raised by the assessee and completed the assessment on 18th March, 1988. 6. The assessee appealed before the Commissioner (Appeals). It was contended on behalf of the assessee that during the original assessment proceedings, the assessee had disclosed fully and truly all material facts necessary for assessment of net wealth and hence Section 17(1)(a) of the Wealth-tax Act could not be invoked, it was also contended that the proceedings initiated under section 17(1)(a) of the Act cannot be converted into the proceedings under section 17(1)(b). It was also the case of the assessee that the assessing officer did not have any material to believe that the wealth had escaped assessment. It was also contended that no valid reference could be made to a Valuation Officer after completion of the assessment. Violation of the principles of natural justice was also alleged inasmuch as it was pointed out that the assessi....
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.... material facts and at the same time hold the belief that even if there was no omission or failure to disclose, wealth has escaped assessment. Belief under clause (a), according to him, excludes the belief under clause (b). Shri Garg has argued that the Wealth-tax Officer can proceed only on one belief at a time and two beliefs cannot operate at one point of time inasmuch as the clauses (a) and (b) of section 17 contemplate two separate and mutually exclusive jurisdictions. 8. Opposing the above submissions of the assessee, the learned Departmental Representative, supporting the order of the Commissioner (Appeals), has argued that it is open to the assessing officer to have alternative beliefs on the same set of facts. He has pointed out that in the instant case, the assessing officer had initiated action under both the clauses and the law does not prohibit such an action. He has further pointed out that the Commissioner (Appeals) had approved of the action only under section 17(1)(b) of the Act, and in the present appeal only it is to be adjudicated upon whether the action under clause (b) is sustainable. He has further pointed out that in the notice issued under section 17 of ....
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....ions were cited in support of this submission. The argument is undoubtedly sound but the same does not improve the assessee's case, because in the instant case, no such reference was made by the assessing officer after completion of the assessment. It was the IAC (Assessment), Jabalpur, who had made the reference and that reference was made in a case other than that of the assessee. In view of these facts, this argument also is not available to the assessee. 11. It was then argued that valuation report obtained in the case of the firm is the basis for action under section 17(1)(b) of the Act and no reference was made in the assessee's case. According to the learned Advocate for the assessee, no reason or inter-linking of the material was available to the assessing officer to proceed under the said section. According to him, the action has been initiated only on the basis of suspicion and surmises. As per his submissions, it is not open to an assessing officer to make fishing and roving enquiry and review his previous order. It was also argued that for initiating action under section 17 there must be a direct nexus or live link between the material coming to the notice of the ass....