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Issues:
1. Barred by time assessment for the year 1950-51. 2. Justification of Tribunal's decision on concealment of income. Analysis: The judgment delivered by the High Court pertains to two questions referred by the Income-tax Appellate Tribunal. The first issue revolves around whether the assessment for the year 1950-51, conducted on February 28, 1959, was time-barred. The second question concerns the Tribunal's decision on the concealment of income in the case under consideration. The assessee, an individual earning income through salary and commission, had a complex history of assessment proceedings. The Income-tax Officer initially sought sanction for proceedings under section 34 of the Income-tax Act, 1922. However, before receiving the sanction, the assessee filed a return of income in January 1955. Subsequently, the assessment was completed in September 1955, including an amount of Rs. 1 lakh received by the assessee. Appeals followed, leading to a final decision by the Tribunal upholding the taxability of the said amount. Regarding the first issue of time-barred assessment, the High Court analyzed the sequence of events and the legal provisions. The Income-tax Officer proceeded to make an assessment under section 23(4) in February 1959 due to non-compliance with a notice under section 23(2). However, the assessment was annulled on appeal as it was passed after a period of 4 years. The Tribunal concurred with this view, emphasizing that the assessment was time-barred. The Court further noted that penalty proceedings initiated were dropped by the Income-tax Officer, and the Tribunal found no concealment by the assessee. This finding was crucial as it impacted the extension of the assessment period under section 34(3) of the Act. Regarding the second issue of concealment of income, the Tribunal's decision was pivotal. The Tribunal held that the assessee had disclosed all material facts for assessment and that any suppression was minimal, involving an amount of only Rs. 12. Additionally, the Tribunal determined that the Rs. 1 lakh amount was not concealed income, considering its uncertain nature and the possibility of differing opinions on its classification as a gift or income. The Court upheld the Tribunal's findings, emphasizing that relevant materials were considered, and no irrelevant factors were identified to invalidate the decision. In conclusion, the High Court ruled in favor of the assessee on both issues, affirming that the assessment was time-barred and that there was no concealment of income. The Court awarded costs to the assessee and assessed counsel's fee at Rs. 200.
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