Law:

Section:

Section 147(a) of the Income-tax Act, 1961 Reassessment - Non-disclosure of primary facts During assessment for assessment year 1946-47 assessee claimed that he had certain shares as trustee and produced supporting trust deed in 1947 ITO accordingly Held that income from trust property separately assessable on beneficiaries In 1967, ITO reopened assessment proceedings for assessment years 1946-47 to 1956-57 on grounds, inter alia, that assessee's brothers, who had similarly claimed creation of trust, later admitted them as bogus, relevant trust deed not available on records, and trust accordingly not genuine ACC cancelled notices for want of jurisdiction but tribunal held that reassessments validly made - Whether tribunal justified in law Held, on facts, no Facts The assessee was one of the eight sons of former Prime Minister of Nepal and was a citizen of Nepal. He had investments in India in the form of shares in joint names of himself and certain other persons. In 1947, at the time of assessment for the assessment years 1946-47 and 1947-48, he claimed that he had created a trust and that all the shares and deposits in his name did not belong to him in his individual capacity but some were held only as a trustee on behalf of twenty three beneficiaries. After due scrutiny and after keeping relevant extract from the trust deed oil the file, the ITO accepted the assessee's claim and excluded income from the said shares and deposits from his individual income for being assessed in the hands of beneficiaries. The assessments for the subsequent years up to the assessment year 1956-57 were completed on the same basis. The assessee died in 1960. Subsequently, in 1969, another ITO, to whom the jurisdiction was transferred, did not find any trust dead in the records. He further found and inferred therefrom the following facts: (i) the assessee's father left a will under which his eight sons and widow received their shares of property (which were presumed by the ITO to be their personal property without any encumbrances and without any obligation to any beneficiaries); (ii)the assessee gave away a portion of his assets to his son in 1951; (iii) the assessee's step-mother…

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