JUDGMENT JUDGMENT judgment of court was delivered by G. G. SOHANI J.-By this reference under section 256(1) of Incometax Act, 1961 (hereinafter referred to as " Act "), Income-tax Appellate Tribunal, Indore Bench, has referred following questions of law to this court for its opinion: " (1) Whether, on facts and in circumstances of case, Appellate Tribunal was right in holding that reassessment proceedings were validly initiated under section 147(b) of Income-tax Act, 1961? (2) Whether, on facts and in circumstances of case, Appellate Tribunal was right in holding that rental income of exempted palace did not fall within ambit of provision of sub-section (19A) of section 10 of Income-tax Act, 1961? " material facts giving rise to this reference, briefly, are as follows: assessee is erstwhile ruler of Ratlam. While framing assessment of assessee for assessment years 1973-74 and 1974-75, Income-tax Officer held that rental income from " Ranjit Vilas Palace " owned by assessee was exempt from tax under Act. Thereafter, in view of objections taken by audit party that as part of palace had been let out by assessee, rental income therefrom was not exempt from tax, assessments were reopened and fresh assessment orders were passed. On appeal, Commissioner of Income-tax (Appeals) overruled objection taken by assessee to jurisdiction of Income-tax Officer to reopen assessment on basis of report of audit party. second appeal preferred by assessee before Tribunal was also dismissed. Hence, at instance of assessee, Tribunal has referred aforesaid questions of law to this court for its opinion. When matter came up for hearing before Division Bench of this court, Division Bench, by its order dated January 29, 1982, directed Tribunal to furnish supplementary statement of case stating reasons on basis of which Income-tax Officer had reopened assessment. In pursuance of that direction, Tribunal has sent copy of original assessment order and copy of letter sent by Income-tax Officer to assessee intimating that as portion of palace was let out, income from that property would not qualify for exemption under section 10(19A) of Act. That is how case has now come up before us for consideration. first contention advanced by Shri Chapheker, learned counsel for assessee, was that Income-tax Officer had reopened assessment on basis of opinion of audit party that as palace was partly let out, rental income therefrom was not exempt from tax and that opinion of audit party did not constitute " information " within meaning of section 147(b) of Act, conferring jurisdiction on Income-tax Officer to reopen assessment. In reply, Shri Mukati, learned counsel for Revenue, contended that audit party had merely brought to notice of Income-tax Officer relevant provision of law under which income in question could not be held to be exempt from tax and that Tribunal was justified in holding that Income- tax Officer had jurisdiction to reopen assessments. Now, it is significant to note that at relevant time, when income of palace was not held to be chargeable to tax by Income-tax Officer, only relevant provision of Act which had bearing on that question was clause (19A) of section 10 of Act. opinion of audit party that provisions of clause ( 19A) of section 10 of Act were not attracted because palace of assessee was partly let out, cannot, as laid down by Supreme Court in Indian and Eastern Newspaper Society v. CIT [1979] 119 ITR 996, constitute " information " within meaning of section 147(b) of Act, conferring jurisdiction on Incometax Officer to reopen assessment. contention urged on behalf of Revenue that audit party had merely drawn attention of Income-tax Officer to relevant provision of law which had escaped notice of Income-tax Officer and that note of audit party constituted "information" within meaning of section 147(b) of Act cannot be upheld. opinion of audit party that provisions of section 110(19A) of Act were not attracted in view of fact that palace of assessee was partly let out, cannot be held to be merely communication of law. following observations of Supreme Court in Indian and Eastern Newspaper Society [1979] 119 ITR 996 are pertinent (at p. 1004): "In present case, internal audit party of income-tax department expressed view that receipts from occupation of conference hall and rooms did not attract section 10 of Act and that assessment should have been made under section 9. While sections 9 and 10 can be described as law, opinion of audit party in regard to their application is not law. It is not declaration by body authorised to declare law. That part alone of note of audit party which mentions law which escaped notice of Income-tax Officer constitutes'information' within meaning of section 147(b); part which embodies opinion of audit party in regard to application or interpretation of law cannot be taken into account by Incometax Officer. In every case, Income-tax Officer must determine for himself what is effect and consequence of law mentioned in audit note and whether in consequence of law which has now come to his notice, he can reasonably believe that income has escaped assessment. basis of his belief must be law of which he has now become aware. opinion rendered by audit party in regard to law cannot, for purpose of such belief, add to or colour significance of such law. In short, true evaluation of law in its bearing on assessment must be made directly and solely by Income-tax Officer." Now, in case before us, only provision enabling Income-tax Officer to hold that income from palace of assessee was not chargeable to tax was section 10(19A) of Act. Any different view taken by him afterwards on applicability of that provision would amount to change of opinion on material already considered by him. As held by Supreme Court in Indian and Eastern Newspaper Society's case [1979] 119 ITR 996, error discovered, on reconsideration of same material and no more, does not give power to Income-tax Officer to reopen assessment under section 147(b) of Act. Under circumstances, it must be held that Tribunal was not justified in holding that reassessment proceedings were validly initiated under section 147(b) of Act. Learned counsel for parties conceded that if our answer to first question referred to this court was in negative, it was not necessary to answer second question. For all these reasons, our answer to first question referred to this court is in negative and against Revenue. In this view of matter, it is not necessary to answer second question. Reference answered accordingly. In circumstances of case, parties shall bear their own costs of this reference. *** H.H. MAHARAJA SHRI LOKENDRA SINGHJI v. COMMISSIONER OF INCOME TAX