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Judgment
Pendse, J.—The petitioner is a wealth-tax assessee and had filed wealth-tax returns for the assessment years 1967-68 and 1968-69. The WTO, Bombay, completed the wealth-tax assessment for the assessment year 1967-68, by order dated March 18, 1968, and computed the total net wealth at Rs. 20,44,794. The assessment for the assessment year 1968-69 was completed by order dated August 22, 1970, and the net wealth was found to be Rs. 22,22,007. On March 29, 1976, the petitioner was served with a notice under s. 17 of the W.T. Act, 1957, issued by respondent No. 1, inter alia, claiming that there is reason to believe that the petitioner''s net wealth chargeable to tax for the assessment year 1967-68 had escaped assessment. The petitioner was called upon to file a return within thirty five days of the receipt of notice. The petitioner received the notice for reopening the assessment for the assessment year 1968-69 on March 31, 1977. The petitioner filed fresh returns for the relevant assessment years without prejudice to the contention that the WTO had no jurisdiction to reopen the assessment. The petitioner sought reasons from the WTO for reopening the assessment, but the same were not furnished and the petitioner was served with a notice to remain present for hearing before respondent No. 1. At the hearing on February 26, 1980, the petitioner''s authorised representative was orally informed that the reopening of the assessment was initiated because the WTO proposed to revalue the shares held by the petitioner in the company known as Neville Wadia Private Limited. The petitioner thereafter approached this court by filing the present petition under art. 226 of the Constitution of India to challenge the validity of the notice.
Mrs. S. Jagtiani, learned counsel appearing on behalf on the petitioner, submitted that the WTO had issued a notice to the mother of the petitioner for reopening her wealth-tax assessment and one of the reasons furnished for reopening the assessment was that the shares held by the mother of the petitioner in the company known as Neville Wadia Private Limited require to be revalued. The mother of the petitioner filed Miscellaneous Petition No. 1311 of 1973 in this court under art. 226 of the Constitution of India and the petition was allowed and the notice for reopening the assessment was struck down by my judgment dated July 4, 1979. The learned counsel urged, and in my judgment correctly, that the assessment for the relevant assessment years was completed after the petitioner disclosed all the relevant information about the valuation of the shares, and the WTO accepted the said valuation. It was urged that the mere fact that subsequently the WTO is for the opinion that the shares were no properly valued is not sufficient to reopen the assessment. The respondents have not filed any return in answer to the petition, but Shri Joshi, learned counsel appearing for the Revenue, stated that the WTO initiated the proceedings on receipt of certain information that the shares were not properly valued. It is not permissible to exercise jurisdiction under s. 17 of the W.T. Act merely because the WTO changes his opinion about the method of valuation of shares. In my judgment, the proceedings commenced by the WTO under s. 17 of the Act were wholly misconceived and are required to be struck down.
Accordingly, the petition succeeds and the rule is made absolute in terms of prayer (a) of the petition. There will be no order as to costs.