The only thing behind my reopening notice is the Valuation Officer's report. Is that enough?
No. The Supreme Court held that the opinion of the Valuation Officer is not by itself information on which an assessment can be reopened. The officer has to apply his mind to whatever material he has collected and form his own belief; adopting the valuer's figure is not that.
Decided by the Supreme Court (Supreme Court of India — S.H. Kapadia and Aftab Alam, JJ) on 2010-02-16, reported as (2010) 328 ITR 515 (SC); [2011] 197 Taxman 202 (SC); [2010] 236 CTR 226 (SC) — Civil Appeal No. 9468 of 2003. It bears on section 147, section 148 of the Income Tax Act 1961, in Reassessment & Reopening, Assessment & Scrutiny and Evidence & Burden of Proof matters.
Valuation-driven reopenings are common - a stamp duty value, a DVO report obtained in someone else's proceeding, a report obtained after the assessment was over. This is the short answer to all of them at the threshold stage, and it is a Supreme Court answer, so it does not have to be argued through a line of High Court cases. The department's counter is that the report is not the only material, so the reply has to force the officer to identify what else he had.
Binding on every court and authority in India.
Read aloud by your device. Press again to stop.
The Assessing Officer reopened a completed assessment on the strength of the opinion of the District Valuation Officer. The pages fetched do not give the assessment year, the amount in dispute or the course the matter took in the High Court; they record only that the reopening rested on the valuation report and that the Revenue's appeal came to the Supreme Court as Civil Appeal No. 9468 of 2003.
The Department's appeal was dismissed with no order as to costs. Having examined the record, the Court found that the Department had sought to reopen the assessment on the opinion of the District Valuation Officer, held that such an opinion is not by itself information for the purposes of reopening under s.147, and held that the Assessing Officer has to apply his mind to the information, if any, collected and must form a belief on it. On that footing the Department was not entitled to reopen the assessment.
The order gives its reasoning in three sentences and no more. Section 147 requires the officer to form his own belief that income has escaped assessment. A valuation is an opinion, and an opinion of the Valuation Officer is not, by itself, information for that purpose. What the section requires is that the officer apply his mind to whatever information has been collected and form a belief on it, which the Department had not done here. The order cites no authority and states no wider principle.
The opinion of the DVO per se is not an information for the purposes of reopening assessment under section 147 of the Income-tax Act, 1961. The Assessing Officer has to apply his mind to the information, if any, collected and must form a belief thereon.
Upload it and we will read it, work out your deadline and draft the reply. A CA reviews before anything is filed.
Handle my notice → Ask a CA on WhatsAppNo. The Supreme Court held that the opinion of the Valuation Officer is not by itself information on which an assessment can be reopened. The officer has to apply his mind to whatever material he has collected and form his own belief; adopting the valuer's figure is not that. This was decided by the Supreme Court (Supreme Court of India — S.H. Kapadia and Aftab Alam, JJ) and bears on section 147, section 148 of the Income Tax Act 1961. It is reported as (2010) 328 ITR 515 (SC); [2011] 197 Taxman 202 (SC); [2010] 236 CTR 226 (SC) — Civil Appeal No. 9468 of 2003. Valuation-driven reopenings are common - a stamp duty value, a DVO report obtained in someone else's proceeding, a report obtained after the assessment was over. This is the short answer to all of them at the threshold stage, and it is a Supreme Court answer, so it does not have to be argued through a line of High Court cases. The department's counter is that the report is not the only material, so the reply has to force the officer to identify what else he had. If it applies to you, the first step is this: Ask for the recorded reasons or the s.148A material and check whether anything other than the valuation report is identified in them.
The Assessing Officer reopened a completed assessment on the strength of the opinion of the District Valuation Officer. The pages fetched do not give the assessment year, the amount in dispute or the course the matter took in the High Court; they record only that the reopening rested on the valuation report and that the Revenue's appeal came to the Supreme Court as Civil Appeal No. 9468 of 2003. The matter was decided on 2010-02-16 by the Supreme Court (Supreme Court of India — S.H. Kapadia and Aftab Alam, JJ). On those facts the Supreme Court held as follows. The Department's appeal was dismissed with no order as to costs. Having examined the record, the Court found that the Department had sought to reopen the assessment on the opinion of the District Valuation Officer, held that such an opinion is not by itself information for the purposes of reopening under s.147, and held that the Assessing Officer has to apply his mind to the information, if any, collected and must form a belief on it. On that footing the Department was not entitled to reopen the assessment.
The order gives its reasoning in three sentences and no more. Section 147 requires the officer to form his own belief that income has escaped assessment. A valuation is an opinion, and an opinion of the Valuation Officer is not, by itself, information for that purpose. What the section requires is that the officer apply his mind to whatever information has been collected and form a belief on it, which the Department had not done here. The order cites no authority and states no wider principle. In the words reproduced by the source cited on this page: "The opinion of the DVO per se is not an information for the purposes of reopening assessment under section 147 of the Income-tax Act, 1961. The Assessing Officer has to apply his mind to the information, if any, collected and must form a belief thereon."
It was decided by the Supreme Court on 2010-02-16 and is reported as (2010) 328 ITR 515 (SC); [2011] 197 Taxman 202 (SC); [2010] 236 CTR 226 (SC) — Civil Appeal No. 9468 of 2003. Binding on every court and authority in India. A Supreme Court decision binds every assessing officer, every Commissioner (Appeals), every bench of the Income Tax Appellate Tribunal and every High Court in India. An officer who declines to follow it is acting contrary to law, and that refusal is itself a ground of appeal. On section 147, section 148, the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the taxpayer. The Department's appeal was dismissed with no order as to costs. Having examined the record, the Court found that the Department had sought to reopen the assessment on the opinion of the District Valuation Officer, held that such an opinion is not by itself information for the purposes of reopening under s.147, and held that the Assessing Officer has to apply his mind to the information, if any, collected and must form a belief on it. On that footing the Department was not entitled to reopen the assessment. It arises in Reassessment & Reopening, Assessment & Scrutiny and Evidence & Burden of Proof matters, on section 147, section 148 of the Income Tax Act 1961, and was decided by Supreme Court of India — S.H. Kapadia and Aftab Alam, JJ. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. If the report is the whole of the material, say so in terms in the reply and cite this decision - the objection is that no belief has been formed, not that the valuation is wrong. Keep the valuation dispute itself for the merits; do not let it displace the threshold point. Check separately whether the reference to the Valuation Officer was itself competent, which is a different question from whether his opinion is information.
Still good law. Followed by the Gujarat High Court in Akshar Infrastructure (P.) Ltd. v. Income-tax Officer, Ward 1(1) [2017] 79 taxmann.com 239 / [2017] 393 ITR 658 / [2017] 246 Taxman 353 (Guj.), decided 2 March 2017, which quashed a reopening founded solely on a District Valuation Officer's report — the report there having already been rejected by the Commissioner (Appeals) as a ground for enhancement — and which records this decision as followed at its para 5. That judgment also notes a Division Bench of the same Court taking the same view in Dr. Rajivraj Ranbirsingh Choudhary v. ACIT, Special Civil Application No. 21470 of 2016. What has changed is the statutory setting rather than the principle: since 1 April 2021 the officer acts on 'information which suggests' escapement, drawn from a defined list, and from 1 September 2024 that list sits in s.148(3), so the argument today is that the officer formed no satisfaction of his own, not that a valuation cannot be information at all. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
The order runs to two paragraphs and was read in full. It sets out no facts beyond the fact that the Department sought reopening on the strength of the District Valuation Officer's opinion; it gives no assessment year, no figures, no account of what the High Court below had decided, and it cites no authority. It refers only to s.147 — s.148, under which the notice would have issued, is not mentioned. The decision is from the 'reason to believe' era: from 1 April 2021 the trigger is 'information which suggests' escapement, defined by a closed statutory list, so the decision now bites on the officer's satisfaction rather than on the meaning of 'information'. It does not tell you whether a valuation report can be part of a larger body of material that does justify reopening — the decision is about the report standing alone, and the Gujarat High Court in Akshar Infrastructure applied it on a finding that nothing except the report was on record. It says nothing about whether the reference to the Valuation Officer was competent in the first place. And because the order records no facts, it does not tell you what happens where the report is obtained after the notice has issued, or where the report was called for during an assessment that was completed before it arrived — a situation on which the Delhi High Court in ACC Ltd. v. District Valuation Officer and the Allahabad High Court in Sunder Carpet Industries v. ITO were distinguished in Akshar Infrastructure rather than followed. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The Department's appeal was dismissed with no order as to costs. Having examined the record, the Court found that the Department had sought to reopen the assessment on the opinion of the District Valuation Officer, held that such an opinion is not by itself information for the purposes of reopening under s.147, and held that the Assessing Officer has to apply his mind to the information, if any, collected and must form a belief on it. On that footing the Department was not entitled to reopen the assessment.
Every entry in this library links to where it was found, so you can check it yourself rather than take our word for it.
My return was only processed under 143(1). Does that stop the department reopening it later?
How much am I actually required to disclose — and can they reopen because the officer drew the wrong conclusion?
The sanctioning authority just wrote 'yes' and signed. Is that a sanction?
A reassessment was done in between. Does the two-year clock for s.263 restart from it?