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Documents citing Vashist Bhargava vs Income-Tax Officer, Salary Circle on 10 December, 1974

Anil Starch Products Ltd. vs Income-Tax Officer, Companies ... on 19 February, 1980

The facts which we have narrated above show on the contrary that in the case before the Delhi High Court in Vashist Bhargava v. ITO [1975] 99 ITR 148, the ITO, on the prior occasion, at the time of original assessment, had not got information regarding the fact that the payment of interest was to go to the account of the assessee. He got that information subsequently. Consequently, it cannot be said that the ITO in that case was proceeding on a mere change of opinion. The facts of the case before the Delhi High Court were not the same as they exist in the present case. On the contrary, the facts in the present case are squarely covered by the ratio of the decision of the Supreme Court in the case of Indian and Eastern Newspaper Society Ltd. [1979] 119 ITR 996. It is, therefore, clear that the ITO was possessed of all the relevant facts at the time of the original assessment. The directors' report was also before him. But it is only because the audit dept. tried to read the directors' report in a different way that they took a different view and only because the audit dept. had felt that the ITO was not justified in granting deduction of the legal fees that they wanted the ITO to reopen the proceedings. This type of difference of opinion between the ITO and the audit dept. on the question of law can never amount to information within the meaning of s. 147(b) of the Act. Hence it must be held that on the second ground also the ITO had no jurisdiction to reopen the previous proceedings, merely because in the light of the audit objection he felt in retrospect that he had erred earlier in granting deduction pertaining to legal fees of the advocates who had appeared before the Company Law Board and the M.R.T.P. Commission. Whether the concerned expenditure was revenue expenditure or capital expenditure would be a question of law and on that question of law if the ITO had taken one view only because the audit dept. does not agree with that view, there is no ground to enable the ITO to reopen the assessment proceedings under s. 147(b) on the supposition that there was any information received by him from the audit dept. In fact, such information would, at the highest, amount to information regarding opinion on the point of law formed by the audit dept. as it felt that the ITO's view on that legal aspect was not palatable to the audit dept. In any case, such situation can never result in information within the meaning of s. 147(b) so far as the ITO is concerned so as to permit him to issue the impugned notice seeking to reopen the reassessment proceedings. Consequently, even on the second ground which is mentioned in para. 5 of the affidavit-in-reply, the respondent had no jurisdiction to issue the impugned notice.
Gujarat High Court Cites 12 - Cited by 3 - S B Majmudar - Full Document

Indian And Eastern Newspaper Society ... vs Commissioner Of Income Tax, New Delhi on 31 August, 1979

As regards Vashist Bhargava v. Income Tax officer (supra) the "information" consisted in a note of the Revenue Audit 454 and the Ministry of Law that the payment of interest by the assessee was in fact made to his own account in the Provident Fund and, therefore, in law the money paid did not vest in the Government and, consequently, the original assessment was erroneous in so far as it allowed the deduction of the interest as expenditure made by the assessee. The Delhi High Court upheld the reassessment on the finding that the note of the Revenue Audit and the Ministry of Law had to be taken into account by the Income Tax officer, because in his executive capacity he had to be guided by the advice rendered by the Ministry of Law and he had to pay due regard to the note of the Revenue Audit because the officers of the Audit Department were experts empowered to examine and check upon the work of the Income Tax officers. It seems to us that the considerations on which the Delhi High Court rested its judgment are not correct. But the decision of the case can be supported on the ground that the basic information warranting the re- opening of the assessment was the fact that the payment of interest was made to the Provident Fund account of the assesses himself. That the money so paid did not vest in the Government was a conclusion which followed automatically upon that fact, and no controversy in law could possibly arise on that point.
Supreme Court of India Cites 27 - Cited by 571 - R S Pathak - Full Document

Commissioner Of Income-Tax vs Yash Pal Mehra And Co. on 15 December, 1976

7. The very question whether the report of the audit party could be considered to be "information" within the meaning of Section 147(b) was considered in Commissioner of Income-tax v. H. H. Smt. Chand Kanwarji [1972] 84 ITR 584 (Delhi), Muthukrishna Reddiar v. Commissioner of Income-tax [1973] 90 ITR 503 (Ker) and Vashist Bhargava v. Income-tax Officer [1975] 99 ITR 148 (Delhi) and it was held that it did.
Punjab-Haryana High Court Cites 16 - Cited by 8 - Full Document

Raj Kumar Shrawan Kumar vs Central Board Of Direct Taxes And Anr. on 10 November, 1976

The Delhi High Court, in the case of Vashist Bhargava v. Income-tax Officer [1975] 99 ITR 148 (Delhi), after referring to the test laid down by the Gujarat High Court, held that the test laid down by that court was, if narrowly construed, not very appropriate. It held that the information coming from the audit department or the Ministry of Law would amount to "information "within the meaning of Section 147. We are in respectful agreement with that law. There is nothing in the statute which curtails the source of information to the effect that it must come from some person who was authorised to pronounce upon the law. If such a test was applied then it might lead to the result that only judicial decisions would answer the test, We are not prepared to accept this test in view of the phraseology of the Section. All that is required is that the information must come from some external source and must be of such a nature as would lead a prudent man to believe that it is correct. We have already indicated some of the sources of information which could lead the Income-tax Officer to form the belief that the information was prima facie correct and that the income has escaped assessment. The Central Board of Direct Taxes being an authority conversant with the tax laws, would be such a source.
Allahabad High Court Cites 13 - Cited by 3 - R M Sahai - Full Document

Eureka Forbes Ltd. vs State Of Bihar And Ors. on 23 February, 1995

As regards Vashist Bhargava v. Income-tax Officer [1975] 99 ITR 148 (Delhi), the 'information' consisted in a note of the revenue audit and the Ministry of Law that the payment of interest by the assessee was in fact made to his own account in the provident fund and, therefore, in law the money paid did not vest in the Government and, consequently, the original assessment was erroneous in so far as it allowed the deduction of the interest as expenditure made by the assessee. The Delhi High Court upheld the reassessment on the finding that the note of the revenue audit and the Ministry of Law had to be taken into account by the Income-tax Officer, because in his executive capacity he had to be guided by the advice rendered by the Ministry of Law and he had to pay due regard to the note of the revenue audit because the officers of the audit department were experts empowered to examine and check upon the work of the Income-tax Officers. It seems to us that the considerations on which the Delhi High Court rested its judgment are not correct. But the decision of the case can be supported on the ground that the basic information warranting the reopening of the assessment was the fact that the payment of interest was made to the provident fund account of the assessee himself. That the money so paid did not vest in the Government was a conclusion which followed automatically upon that fact, and no controversy in law could possibly arise on that point.
Patna High Court Cites 18 - Cited by 2 - S J Mukhopadhaya - Full Document
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