Case: Assistant Controller of Estate-Duty, Hyderabad Vs. Nawab Sir Mir Osman Ali Khan Bahadur, H. E. H. The Nizam of Hyderabad, and Others

According to him any matter of fact or law which may come to the notice of the appellant after the making of assessment including a finding by a higher authority would be " information " for the purpose and within the meaning of section 59. It is urged that the appellant bad not taken action on mere change of his opinion. The predecessor in office of the appellant had adopted a wrong mode of valuation and the opinion expressed by the Central Board of Revenue about the correct mode was " information " which led to the appellant entertaining a reasonable belief that the property assessed to estate duty had been undervalued. Reliance has been placed on a number of decisions in which the meaning of the word " information " in parallel provisions in the Income-tax Act, 1922, and other enactments came up for consideration. In Maharaj Kumar Kamal Singh v. Commissioner of Income-tax, it was held that the word " information " in section 34(1)(b) included information as to the true and correct state of law, and so would cover information as to relevant judicial decisions. The following observation may be reproduced with advantage:" If the word information used in any other provision of the Act denotes information as to facts or particulars, that would not necessarily determine the meaning of the said word in section 34(1)(b). The denotation of the said word would naturally depend on the context of the particular provisions in which it is used. It is then contended that sections 33B and 35 confer ample powers on the specified authorities to revise the Income-tax Officers orders and to rectify mistakes respectively and so it would be legitimate to construe the word information in section 34(1)(b) strictly and to confine it to information in regard to facts or particulars. This argument also is not valid. If the word information in its plain grammatical meaning includes information as to facts as well as information as to the state of the law, it would be unreasonable to limit to information as to the facts on the extraneous consideration that some cases of assessment which need to be revised or rectified on the ground of mistake of law may conceivably be covered by sections 33B and 35In Commissioner of Income-tax v. A. Raman & Co., it was said that the expression " information " in the context of section 147(b) of the Income-tax Act, 1961, must mean instruction or knowledge derived from extraneous sources concerning facts or particulars or as to law relating to a matter bearing on the assessment. The Bombay High Court, in a recent decision, commissioner of Income-tax v. A. J. Zaveri, after a discussion of the relevant case law, came to the conclusion that " information " within the meaning of section 34(1)(b) of the Income-tax Act, 1922, may consist of a different view taken of the facts on the record by a higher Tribunal on appeal from the Income-tax Officers decision. In that case it was held that the decision of the Income-tax Appellate Tribunal constituted " information " to the Income-tax Officer as to which of the assessable parties was chargeable for a particular item of income. In the latest decision of this court in R. B. Bansilal Abirchand Firm v. Commissioner of Income-tax, when the first assessment of the assessees income was made by the Income-tax Officer the latters information was that the assessee was a partner in another concern known as Bisesar House and that the interest had been received from that concern in the capacity of a partner. It was only after the Tribunal and the High Court gave their decision in the proceedings for assessment to tax of Bisesar House that the Income-tax Officer came to know that the interest was not being received by the assessee-firm in the capacity of a partner but in its capacity of a financier advancing monies to Bisesar House as a banker. It was held that the Income-tax Officer had not acted on his own initiative or on the change of his own opinion when he took proceedings under section 34(1)(b). The correct position had been brought to his notice by the decision of the Tribunal and the High Court and that must be held to be " information " as a consequence of which he came to believe that the provisions of section 34(1)(b) were attractedThe learned counsel for the respondents in the presence of the above state of law, as settled by this court, sought to contend that the question of valuation of the securities was neither purely one of fact nor of law and was a mixed question of law and fact and, therefore, it could not fall within the rule laid down in the aforesaid decisions.3. We are unable to agree. When the expression " information " is understood in the sense of instruction or knowledge derived from an external source concerning facts or particulars or as to law relating to a matter bearing on the assessment, it is difficult to see how determination of valuation for the purpose of assessment of estate duty would not squarely fall within the meaning of the expression " information " in the context in which it occurs in section 59 of the Act. It has not been disputed, and can indeed not be disputed, that the provisions of section 59 are in pari materia with section 34 of the Income-tax Act, 1922, and section 147 of the Income-tax Act, 1961. The opinion expressed by the Board of Revenue, in the present case, as to valuation, was clearly " information " in the sense in which that expres. sion has been held to have been used in these enactments. The view of the High Court on this point cannot be sustained for the aforesaid reasons4. The Division Bench did not decide the first point which related to the applicability of section 59 to assessments completed before the amendment Act came into force.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]s then contended that sections 33B and 35 confer ample powers on the specified authorities to revise thes orders and to rectify mistakes respectively and so it would be legitimate to construe the word  information  in section 34(1)(b) strictly and to confine it to information in regard to facts or particulars.This argument also is not valid. If the word  information  in its plain grammatical meaning includes information as to facts as well as information as to the state of the law, it would be unreasonable to limit to information as to the facts on the extraneous consideration that some cases of assessment which need to be revised or rectified on the ground of mistake of law may conceivably be covered by sections 33B andthe latest decision of this court in R. B. Bansilal Abirchand Firm v. Commissioner ofwhen the first assessment of the assessees income was made by theOfficer the latters information was that the assessee was a partner in another concern known as Bisesar House and that the interest had been received from that concern in the capacity of a partner. It was only after the Tribunal and the High Court gave their decision in the proceedings for assessment to tax of Bisesar House that theOfficer came to know that the interest was not being received by thein the capacity of a partner but in its capacity of a financier advancing monies to Bisesar House as a banker. It was held that theOfficer had not acted on his own initiative or on the change of his own opinion when he took proceedings under section 34(1)(b). The correct position had been brought to his notice by the decision of the Tribunal and the High Court and that must be held to be " information " as a consequence of which he came to believe that the provisions of section 34(1)(b) wereWe are unable to agree. When the expression " information " is understood in the sense of instruction or knowledge derived from an external source concerning facts or particulars or as to law relating to a matter bearing on the assessment, it is difficult to see how determination of valuation for the purpose of assessment of estate duty would not squarely fall within the meaning of the expression " information " in the context in which it occurs in section 59 of the Act. It has not been disputed, and can indeed not be disputed, that the provisions of section 59 are in pari materia with section 34 of theAct, 1922, and section 147 of theAct, 1961. The opinion expressed by the Board of Revenue, in the present case, as to valuation, was clearly " information " in the sense in which that expres. sion has been held to have been used in these enactments. The view of the High Court on this point cannot be sustained for the aforesaid reasons4. The Division Bench did not decide the first point which related to the applicability of section 59 to assessments completed before the amendment Act came into force.