JUDGMENT :

A.N. GROVER, J.

1. This is an appeal by special leave from a judgment of the High Court of Andhra Pradesh dated July 2, 1964, in Writ Appeal No. 25 of 1963 whereby the judgment of the learned single judge allowing a petition tinder Article 226 of the Constitution was confirmed.

2. The facts briefly are these. H. E. H. the Nizam of Hyderabad had, by a deed of trust dated August 6, 1950, created a trust known as "H.E.H. the Nizam's Miscellaneous Trust" for the benefit of his family and dependants. One of the beneficiaries was Sahebzadi Ghousunnisa Begum, a stepsister of the Nizam, to whom an annuity of Rs. 12,000 had to be given. She died on November 10, 1955. The property passing on her death became liable to estate duty under the Estate Duty Act, 1953 (XXXIV of 1953), hereinafter called "the Act". The trust fund consisted of three items one of which was a loan deposited with the Government of Hyderabad bearing interest at 11/4%. The main dispute before the Assistant Controller of Estate Duty related to the correct valuation of the aforesaid loan. He valued it at Rs. 2,01,30,000 and, after making the other necessary calculations, the net market value of the estate of the deceased was assessed at Rs. 6,61,347 on which demand was created at Rs. 83,519.40. The trustees preferred an appeal before the Central Board of Revenue disputing the correctness of the valuation of the estate of the deceased (Begum) made by the Assistant Controller. The Board of Revenue in its order dated August 6, 1959, expressed the view that the securities in question had not been overvalued but had been undervalued. According to the Board the correct valuation should have been Rs. 3,06,83,760; in other words, its opinion was that the face value of the securities being Rs. 4.5 crores, the market value should have been at the rate of 78% whereas the basis adopted by the Assistant Controller came to 52%. He proceeded to say towards the concluding portion of his order :

"However I find that there is some force in the argument advanced by the appellant's representative against any enhancement being made by the Board in appeal proceedings. I refrain therefore from making the proposed enhancement in the value of the securities and confirm the value adopted by the Assistant Controller. "

3. The Act was amended by the Estate Duty (Amendment) Act, 1958, hereinafter called "the amendment Act." By Section 21 of the amendment Act, Sections 56 to 65 of the principal Act were substituted by the new sections. The new Section 59 for the first time gave power to the Controller of Estate Duty to assess or reassess property escaping assessment. It is common ground that the amendment Act came into force on July 1, 1960. The Assistant Controller issued a notice on August 12, 1960, to the trustees in exercise of the powers conferred by the new Section 59 of the Act. In that notice it was stated that he had reasons to believe that property chargeable under the Act to estate duty had escaped assessment by reason of under valuation and, therefore, a statement of account was called for in respect of the market value of the securities of Rs. 4.5 crores. On September 20, 1960, the present respondents filed a writ petition in the High Court challenging the validity and legality of the notice issued u/s 59 of the Act and praying that it be quashed. In the writ petition two main points were raised : the first was that Section 59 had been introduced by the Amendment Act and it could not be made applicable to assessments which had become final before July 1, 1960, the date on which the amendment Act came into force. Secondly, the conditions laid down in Section 59 had not been fulfilled. It had not been stated what information had been received or was in the possession of the Assistant Controller in consequence of which he had reason to believe that property had been undervalued. It was contended that mere change of opinion would not justify the reopening of assessment. The present