When “information” is regarded as meaning instruction or knowledge as to law the position is more complex. When we speak of “law,” we ordinarily speak of norms or guiding principles having legal effect and legal consequences.
6. In cases falling under S. 147 (b), the expression “information” prescribes one of the conditions upon which a concluded assessment may be reopened under that provision. It is an indispensable ingredient which must exist before the section can be availed of. What does “information” in S. 147 (b) connote? In Kamal Singh v. Commr. of Income-tax (1959) 35 ITR 1 (SC) this Court, construing the corresponding S. 34 (1) (b) of the Indian Income Tax Act, 1922 held the word “information” to mean not only facts or factual material but to include also information as to the true and correct state of the law and, therefore, information as to relevant judicial decisions. Thereafter, in Commr. of Income-tax v. Raman and Co., (1968) 67 ITR 11 (SC) the Court defined the expression “information” in S. 147 (b) of the Income-tax Act 1961 as “instruction or knowledge derived from an external source concerning facts or particulars, or as to law, relating to a matter bearing on the assessment.” That definition has been reaffirmed in subsequent cases, and with it as the point of departure we shall now proceed.
7. In so far as the word “information” means instruction or knowledge concerning facts or particulars, there is little difficulty. By its inherent nature, a fact has concrete existence. It influences the determination of an issue by the mere circumstance of its relevance. It requires no further authority to make it significant. Its quintessential value lies in its definitive vitality.
8. But when “information” is regarded as meaning instruction or knowledge as to law the position is more complex. When we speak of “law,” we ordinarily speak of norms or guiding principles having legal effect and legal consequences. To possess legal significance for that purpose, it must be enacted or declared by competent authority. The legal sanction vivifying it imparts to it its force and validity and binding nature. Law may be statutory law or, what is popularly described as, judge-made law. In the former case, it proceeds from enactment having its source in competent legislative authority. Judge-made law emanates from a declaration or exposition of the content of a legal principle or the interpretation of a statute, and may in particular cases extend to a definition of the status of a party or the legal relationship between parties, the declaration being rendered by a competent judicial or quasi-judicial authority empowered to decide questions of law between contending parties. The declaration or exposition is ordinarily set forth in the judgment of a court or the order of a tribunal. Such declaration or exposition in itself bears the character of law. In every case, therefore, to be law it must be a creation by a formal source, either legislative or judicial authority. A statement by a person or body not competent to create or define the law cannot be regarded as law. The suggested interpretation of enacted legislation and the elaboration of legal principles in text books and journals do not enjoy the status of law. They are merely opinions and, at best, evidence in regard to the state of the law and in themselves possess no binding effect as law. The forensic sub-missions of professional lawyers and the seminal activities of legal academics enjoy no higher status. Perhaps the only exception is provided by the writing of publicists in international law, for in the law of nations the distinction between formal and material sources is difficult to maintain.
9. In that view, therefore, when Section 147 (b) of the Income-tax, Act is read as referring to “information” as to law, what is contemplated is information as to the law created by a formal source. It is law, we must remember, which because it issues from a competent legislature or a competent judicial or quasijudicial authority, influences the course of the assessment any decides and one or more of those matters which determine the assessee’s tax liability.