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2008] 303 ITR 82 [2007] 163 Taxman 537 (Patna) HIGH COURT OF PATNA M.K. Jha v. Income-tax Appellate Tribunal BARIN GHOSH AND NAVANITI PRASAD SINGH, JJ. CIVIL REVIEW NOS. 102 TO 104 OF 2006 APRIL 23, 2007 Section 64, read with section 147, of the Income-tax Act, 1961 - Transfer of assets - For benefit of spouse, etc. - Assessment years 1989-90 to 1994-95 - Whether it is impermissible to club disclosed income of an assessee, as accepted by department, in income of another assessee without reopening assessment of that assessee, whose income was sought to be clubbed with income of other assessee - Held, yes FACTS After the completion of the assessment proceedings, the Assessing Officer received an information that the assessee had concealed the fact of having made investment in two immovable properties and found that the income arising out of said properties was not disclosed by the assessee in his returns. Accordingly, he issued notices under section 148 seeking to reopen the assessment. The assessee replied, stating that his wife owned the said properties, source of funds for acquisition whereof and the income derived therefrom had been accounted for by her in her separate returns filed during the relevant assessment years and the same had been accepted by the department. Rejecting the contentions of the assessee, the Assessing Officer treated the subject immovable properties as that of the assessee and held that profits earned by those properties were incomes of the assessee. The Commissioner (Appeals), not agreeing with the views of the Assessing Officer, held in favour of the assessee. The Tribunal, however, restored the order of the Assessing Officer on the reasoning that the assessee had failed to prove the source of funds for acquisition of the properties by wife. Thereafter, the Tribunal clubbed the entire income of the wife with the income of the assessee treating it as income of the assessee and levied additional tax on the additional income less tax paid by the wife. On further appeal, the High Court upheld the order of the Tribunal. In the review petition, the assessee contended that while deciding the appeal, the High Court failed to take into account…

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