9911796707
TMI Blog1968 (2) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... ome-tax Appellate Tribunal under section 66(1) of the Indian Income-tax Act, 4922, in respect of the assessment years 1949-50 and 1950-51 the following four questions have been referred to this court. " 1. Whether, on the facts and the circumstances of the case, the finding of the Tribunal that the assessee failed to disclose fully and truly all material facts necessary for his assessments for those years is correct ? 2. Whether, on the facts and circumstances of the case, the finding of the Tribunal that the income had escaped assessment is correct ? 3. Whether, on the facts and in the circumstances of the case, notices under section 34(1) were validly issued ? 4. Whether the assessments in question are invalid at law ? The asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inst it. For the first time, on March 23, 1952, the assessee filed income-tax returns for the assessment years 1947-48 to 1951-52 in the status of an individual. The returns contained a note reading : The assessee holds a share in Messrs. Niranjanlal Ram Chander but since that is taxed in the hands of the Hindu undivided family styled Shiv Charan Bankey Lal, the same is not included here. " The return for the assessment year 1947-48 was " filed " on March 27, 1952, by the Income-tax Officer on the ground that it was incompetent. Proceedings were taken on the remaining four returns, and notices under section 23(2) were issued on July 11, 1952. On the date of hearing all the four cases were adjourned sine die. For the assessment years ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eferred by the assessee were rejected by the Appellate Assistant Commissioner. The assessee proceeded in appeal to the Tribunal. By an order dated September 4, 1961, the Tribunal dismissed both the appeals. It held that the case fell within the terms of section 34(1)(a) and that, although the assessee had voluntarily submitted the returns, he had failed to disclose fully and truly all material facts necessary for his assessment for the relevant assessment years and that, inasmuch as no assessment orders could be made upon the returns filed by the assessee by virtue of the period of limitation of four years having expired, the income must be said to have escaped assessment. The case of the petitioner is that by noting in the returns filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nything else he was liable to tax on that share income. It is true that he also added in the note that, inasmuch as the share income was being taxed in the hands of the Hindu undivided family styled as Shiv Charan Lal Bankey Lal, he was not including the item of income in his returns. That was merely intended to explain the omission of the share income from his returns. By that statement the assessee did not disclaim that he held the share. Nor did he state that he was not liable to tax on the share income. He said that he was the holder of the share and that he was not including the share income in his return merely because it was being treated by the department as taxable in the hands of the family. Regard must be had to the history of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would appear that the assessment proceedings against the Hindu undivided family had not even matured to the point of an assessment order when the returns containing the aforesaid note were filed by the assessee. It could not have been possible for the assessee at the time when he filed his returns to state that the Hindu undivided family was contesting the inclusion of the share income in its assessment. Again, that the Hindu undivided family was challenging the inclusion of that share income or it was not doing so was not a fact determinative of the question whether the share income was liable to be assessed in the hands of the assessee. The Tribunal has relied upon the following circumstances in respect of its finding that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rently viewed with disfavour the omission of the assessee to state that he did not agree with the assessment of the share income in the hands of the family. That circumstance, according to it, " beguiled " the Income-tax Officer into refraining from assessing the share income in his hands. But if the note in the assessee's returns is examined again, it will be clear that the assessee quite positively asserted that he held the share in the firm and the only reason for not including it in the return was that it was taxed in the hands of the family. The assessee, it may be repeated, did not say that the share income was not liable to be taxed in his hands. It is true that he did not enter the specific figure of income in the return, but that w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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