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Issues:
1. Validity of initiating proceedings for reopening of assessment under section 147(a) for the assessment year 1949-50. Detailed Analysis: The judgment by the High Court of Allahabad involved a case where the Income-tax Appellate Tribunal referred a question regarding the validity of initiating proceedings for reopening the assessment under section 147(a) for the assessment year 1949-50. The original assessments for the years 1949-50 and 1950-51 were completed based on a settlement between the assessee and the Department covering the years 1944-45 to 1952-53. The settlement included consideration of fixed deposits made in various names. Disputes and compromises between family members led to transfers of shares and cash amounts. A discrepancy arose when the assessee disclosed receiving a certain sum at different times in two statements. This led to the Income-tax Officer reopening the assessment under section 147(a) due to alleged failure to disclose material facts. The Income-tax Officer, after reopening the assessment, concluded that the assessee had not received the alleged "on money" and that the source of fixed deposits remained unexplained. Subsequently, the Appellate Assistant Commissioner allowed the appeal, stating that all material facts were disclosed during the original assessment. However, the Tribunal had a difference of opinion, with the Vice President justifying the initiation of proceedings under section 147(a. The case was then referred to a third Member who agreed with the Vice President, leading to the Department's appeal being allowed. The High Court held that the initiation of proceedings for reopening the assessment was valid and justified. The discrepancy in the statements made by the assessee in 1954 and 1962 provided relevant material for reopening the assessment. The Court emphasized that the question was limited to whether the Income-tax Officer had reasons to believe that material facts were not fully disclosed. The Court agreed with the third Member that the initiation of reassessment proceedings was legitimate based on the discrepancy in statements. The Court noted that the correctness of the statement made by the assessee in 1962 was not the current concern, as it would be examined during reassessment on merits. The case was to be sent back to the Appellate Assistant Commissioner for a decision on the appeal's merits. The Court answered the question in favor of the Revenue, allowing costs to the Revenue. The judgment highlighted the importance of the discrepancy in statements as a valid basis for reopening the assessment under section 147(a).
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