COMMISSIONER OF WEALTH TAX WEST BENGAL CALCUTTA Vs. IMPERIAL TOBACCO CO OF INDIA LIMITED
LAWS(SC)-1966-4-14
SUPREME COURT OF INDIA
Decided on April 15,1966

COMMISSIONER OF WEALTH TAX,WEST BENGAL Appellant
VERSUS
IMPERIAL TOBACCO COMPANT OF INDIA LIMITED Respondents





Cited Judgements :-

RAJ KUMAR SHRAWAN KUMAR VS. CENTRAL BOARD OF DIRECT TAXES [LAWS(ALL)-1976-11-34] [REFERRED TO]
COMMISSIONER OF INCOME TAX VS. CLAGGETT BRACHI AND COMPANY LIMITED [LAWS(APH)-1971-8-20] [REFERRED TO]
COMMISSIONER OF INCOME TAX VS. CALCUTTA STEEL CO LTD [LAWS(CAL)-1980-4-28] [REFERRED TO]
COMMISSIONER OF INCOME TAX VS. MALAYALA MANORAMA COMPANY LIMITED [LAWS(KER)-2001-11-32] [REFERRED TO]
COMMISSIONER OF INCOME TAX VS. SATYA PAUL VIRMANI [LAWS(P&H)-1969-10-6] [REFERRED TO]
COMMISSIONER OF INCOME-TAX CENTRAL VS. SHIV PARSHAD [LAWS(P&H)-1983-2-5] [REFERRED TO]
KALYANJI MAVJI AND COMPANY VS. COMMISSIONER OF INCOME TAX WEST BENGAL II [LAWS(SC)-1975-12-55] [RELIED ON]
COMMISSIONER OF INCOME TAX VS. KERALA STATE INDUSTRIAL DEVELOPMENT CORPORATION LIMITED [LAWS(KER)-1978-6-7] [REFERRED TO]
I K AGENCIES PVT LTD VS. COMMISSIONER OF WEALTH TAX [LAWS(CAL)-2011-3-33] [REFERRED TO]
SIRSA INDUSTRIES VS. COMMISSIONER OF INCOME-TAX [LAWS(P&H)-1983-4-13] [REFERRED TO]
COMMISSIONER OF INCOME TAX VS. MAKHAN SINGH [LAWS(RAJ)-1983-10-1] [REFERRED TO]


JUDGEMENT

Wanchoo, J. - (1.)These two appeals by special more leave arise out of two applications by the appellant to the Income-tax Appellate Tribunal for reference to the High Court of a question of law, which was formulated as follows:-
"Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that the re-assessment proceedings under S. 17 (b) of the Wealth Tax Act were not validly initiated and in setting aside the same."

(2.)The facts which led to the applications for reference are briefly these. The respondent submitted wealth-tax returns for the years 1957-58 and 1958-59. For the year 1957-58 the respondent claimed that an amount of Rs. 51 lakhs and odd being provision for taxation and another amount of Rs. 37 lakhs and odd being provision for contingencies being ascertained liability, should be allowed as deduction from the total wealth. For the year 1958-59, the respondent claimed Rs. 31 lakhs and odd being provision for contingencies as ascertained liability as deduction from the total wealth.
(3.)Assessment for the year 1957-58 was completed on December 30, 1957 and the Wealth-tax Officer accepted the contention of the respondent and allowed the claim for deduction. Subsequently the Commissioner of Wealth-tax by his order dated December 29, 1958 passed under S. 25 (2) of the Wealth Tax Act, No. XXXVII of 1957, (hereinafter referred to as the Act) disallowed the deduction of Rs. 51 lakhs and odd being the provision for taxation for the assessment year 1957-58. The order of the Wealth-tax Officer allowing deduction for contingencies for the assessment year 1957-58 however stood. The assessment for the year 1958-59 was completed on December 9, 1958 and deduction was allowed for contingencies only. It may be added that we are not concerned in the present appeals so far as deduction for provision for taxation is concerned. On March 22, 1960, the Wealth-tax Officer completed the assessment of the respondent for the year 1959-60 and disallowed the claim for deduction of the provision for contingencies. On June 2, 1960, the Wealth-tax Officer issued two notices under S. 17 (b) of the Act for re-assessment of net wealth for the years 1957-58 and 1958-59. On September 24, 2961 orders of re-assessment under C 16 (3) read with S. 17 (b) of the Act were passed in respect of the assessment years 1957-58 and 1958-59 and by these orders the amounts which had been formerly allowed as deduction with respect to contingencies were included in the total wealth of the respondent. The respondent then went in appeal against the two re-assessment orders and the Appellate Assistant Commissioner sustained the decision of the Wealth-tax Officer with respect to the re-assessment in question. The case of the respondent was that the Wealth-tax Officer had no information on the basis of which he could proceed to reassess the net wealth of the respondent mod in this connection reliance was placed on the words "in consequence of any information in his possession' appearing in S. 17 (b) of the Act.


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