Judgment

PATHAK, J.:- Can the view expressed by an internal audit party of the Income Tax Department on a point of law be regarded as "information" for the purpose of initiating proceedings under S. 147 (b) of the Income-tax act, Opinion on the question has been divided among the High courts and accordingly the present cases have been referred by the Income-tax Appellate Tribunal under S. 257 of the Act.

2. The assessee, Messrs. Indian and Eastern Newspaper Society, is a society registered under the Indian Companies Act. It is a professional association of newspapers established with the principal object of promoting the welfare and interest of all newspapers. The assessee owns a building in which a conference hall and rooms are lesst out on rent to its members as well as to outsiders. Certain other services are also provided to the members. The income from that source was assessed to tax all along as income from business. It was so assessed for the years 1960-61, 1961-62, 1962-63 and 1963-64 also.

3. The Income-tax Department includes an internal audit organisation whose function it is to examine income-tax records and check mistakes made therein with a view ultimately to improve th